Theories of norm-dependent utility assume commonly known injunctive norms that rank feasible outcomes by their normative valence, but as yet normative valences have only been measured experimentally. We provide a theoretical foundation that assigns a normative valence to each outcome based on...

Evidence from psychology and marketing suggests that those who make a "precise" first offer in bargaining get a better deal than those who make a "round" first offer. We report on a series of experiments designed to test for and improve our understanding of the "precise first offer" (PFO) effect...

Ethnic and kinship ties have long been viewed as potential catalysts for favoritism, and hence corruption. In experiments conducted in three countries, we recruit siblings, co-ethnics and strangers and vary the relationship(s) between the players of a game to observe how kin and ethnic ties...

It is common for auctions to feature reserve prices that are kept secret. In auctions with independent private values, there is no clear theoretical explanation for why the reserve price should be disclosed publicly or kept secret. Therefore, we conducted laboratory experiments to investigate...

While economists recognize the important role of formal institutions in the promotion of trade, there is increasing agreement that institutions are typically endogenous to culture, making it difficult to disentangle their separate contributions. Lab experiments that assign institutions...

This paper investigates our capacity to attribute preferences to others. This ability is intrinsic to game theory, and is a central component of “Theory of Mind”, perhaps the capstone of social cognition. In particular, this component of theory of mind allows individuals to learn more...

We report an experimental test of alternative rules in innovation contests when success may not be feasible and contestants may learn from each other. Following Halac et al. (forthcoming), the contest designer can vary the prize allocation rule from Winner-Take-All in which the first successful...

This paper introduces a simple application of contest theory that neatly captures how Boulding’s “Loss of Strength Gradient” determines the geographic extent of territory. We focus on the “supply side” of territorial conflict, showing how the costs of initiating and escalating conflict...

Tournaments consisting of iterative matches are a common mechanism for determining how to allocate a prize. For this reason it is important to understand the behavioral as well as the theoretical properties of different tournament structures. Given that laboratory experiments have consistently...

We model competition between two firms selling identical goods to customers who arrive in the market stochastically. Shoppers choose where to purchase based upon both price and the time cost associated with waiting for service. One seller provides two separate queues, each with its own server,...