Showing 1 - 10 of 12
To explore damage rules’ deterrent effect, we use a public good experiment to tailor allowable punishment to rules used in actual civil litigation. The experimental treatments are analogous to: (1) damages limited to harm to an individual litigant, (2) damages limited to harm to a group...
Persistent link: https://www.econbiz.de/10010541291
Sanctions are often so weak that a money maximizing individual would not be deterred. In this paper I show that they may nonetheless serve a forward looking purpose if sufficiently many individuals are averse against advantageous inequity. Using the Fehr/Schmidt model (QJE 1999) I define three...
Persistent link: https://www.econbiz.de/10010667903
This article shows that it may be socially optimal to grant accident victims less than full compensation. In our framework, firms are liable under product liability but also invest in care to prevent consumers switching to competitors. Affecting the partition of consumers by means of care-taking...
Persistent link: https://www.econbiz.de/10008556294
We study experimentally whether and to what extent impartial decision makers are influenced by stakeholders’ fairness opinions in an allocation decision. The setting allows for different focal fairness rules to be considered. We compare communication treatments, in which one of the...
Persistent link: https://www.econbiz.de/10010751924
The human mind is not a general problem solving machine. Instead of deliberately, consciously and serially processing the available information, men can rely on routines, rules, roles or affect for the purpose. They can bring in technology, experts or groups. For all of these reasons, men have a...
Persistent link: https://www.econbiz.de/10005772782
We study how participation in decision processes shapes people's behavior towards impartial authorities. In an incentivized laboratory experiment, an impartial decision maker at first decides about the allocation of money between two subordinates. Treatments differ in the opportunity for one...
Persistent link: https://www.econbiz.de/10010740227
By its critics, the rational choice model is routinely accused of being unrealistic. One key objection has it that, for all nontrivial problems, calculating the best response is cognitively way too taxing, given the severe cognitive limitations of the human mind. If one confines the analysis to...
Persistent link: https://www.econbiz.de/10005272724
The market for law professors fulfils the conditions for a hog cycle: in the short run, supply cannot be extended or limited; future law professors must be hired soon after they first present themselves, or leave the market; demand is inelastic. Using a comprehensive German dataset, we show that...
Persistent link: https://www.econbiz.de/10010548344
This paper explores potential endowment effects of contractual default rules. For this purpose, we analyze the Hadley liability default clause in a model of bilateral bargaining of lotteries against safe options. The liability default clause determines the right for the safe payoff option. We...
Persistent link: https://www.econbiz.de/10010751925
We report an experiment designed to test the influence of noisy commitments on efficiency in a simple bargaining game. We investigate two different levels of commitment reliability in a variant of the peasant-dictator game. Theoretical analysis suggests that the reliability of commitments in...
Persistent link: https://www.econbiz.de/10008633204