We study time preferences in a real-effort experiment with a one-month horizon. We report thattwo thirds of choices suggest negative time preferences. Moreover, choice reversal over time iscommon even if temptation plays no role. We propose and measure three distinct concepts ofchoice reversal...

We use a simple, three-item test for cognitive abilities to investigate whether established behavioral biases that play a prominent role in behavioral economics and finance are related to cognitive abilities...

Contrary to the models of deterministic life cycle saving, we take itfor granted that uncertainty of one's future is the essential problem ofsaving decisions. However, unlike the stochastic life cycle models, we capturethis crucial uncertainty by a non-Bayesian scenario-based...

We explain excess volatility, short-term momentum and long-term reversal of asset prices by a repeated game version of Keynes beauty contest. In every period the players can either place a buy or sell order on the asset market. The actual price movement is determined by average market orders and...

How do people make investment decisions when they receive outcome feedback? We examinedhow well the standard mean-variance model and two reinforcement models predict people’sportfolio decisions. The basic reinforcement model predicts a learning process that relies solelyon the portfolio’s...

An apology is a strong and cheap device to restore social or economic relationships thathave been disturbed. In a laboratory experiment we find that harmdoers use apologies inparticular if they fear punishment and when their intentions cannot be easily inferred. Afteroffenses with ambiguous...

In this paper, we analyze a principal's optimal feedback policy in tournaments. We close agap in the literature by assuming the principal to be unable to commit to a certain policy atthe beginning of the tournament...

We replicate three pricing tasks of Gneezy, List and Wu (2006) for which they document the so called uncertainty effect, namely that people value a binary lottery over non-monetary outcomes less than other people value the lottery’s worse outcome. Unlike the authors who implement a verbal...

I examine how financial incentives interact with intrinsic motivation and especially cognitive abilities in explaining heterogeneity in performance. Using a forecasting task with varying cognitive load, I show that the effectiveness of high-powered financial incentives as a stimulator of...

This paper extends existing evidence on the interaction between financial incentives and cognitive capital. I focus on the impact of task-specific cognitive capital, the role of which is central to the capital-labor-production framework of Camerer and Hogarth (1999) and has long been studied in...