We examine the degree of trust and reciprocity in an experimental trust game with 662 participants from six different age groups, ranging from 8 year old primary school children to retired persons in their late sixties. (...)

We examine experimentally two different types of trust: trust in another party's cooperation and trust in ability. In the cooperation condition, player A sends x {0, X} to player B. The amount x is multiplied by c = 3, and B can return y {0,3x}. (...)

In the experiment two bureaucrats independently can grant a permit with the profit of the private party depending on when the permit is given. Whereas one bureaucrat can only veto the project, the second one has additional discretion in granting the permit earlier or later. (...)

We consider a repeated stochastic coordination game with imperfect publicmonitoring. In the game any pattern of coordinated play is a perfectBayesian Nash equilibrium ...

We present a model for the α-beauty contest that explains common patterns in ex-perimental data of one-shot and iterative games. The approach is based on two basic assumptions. First, players iteratively update their recent guesses. Second, players estimate intervals rather than exact numbers...

Norms play an important role in establishing social order. Thecurrent literature focuses on the emergence, maintenance and impactof norms with regard to coordination and cooperation. However, theissue of norm-related conict deserves more attention. We develop ageneral theory of \normative...

We study ultimatum and dictator experiments where the first moverchooses the amount of money to be distributed between the playerswithin a given interval, knowing that her own share is fixed. Thus, thefirst mover is faced with scarcity, but not with the typical trade-off betweenher own and the...

Recent research has cast some doubt on the general validity of outcome-basedmodels of social preferences. We develop a model based on cognitive dissonance thatfocuses on the importance of self-image. An experiment (a dictator game variant)tests the model.First, we nd that subjects whose choices...

We exploit a controlled frameless laboratory experiment to study settlement negoti-ations and the plainti¤’s decision to raise a lawsuit in case of an impasse. We …nd thatgreater variance in court outcomes increases the litigation rate and lowers the settlementrate. This latter …nding goes...

We present an experiment designed to test the Modigliani-Miller theorem. Applyinga general equilibrium approach and not allowing for arbitrage among firmswith different capital structures, we find that, in accordance with the theorem, participantswell recognize changes in the systematic risk of...