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We study the interplay of inequality and trust in a dynamic game, in which trust increases efficiency and thus allows higher growth of the experimental economy in the future. We find that trust is initially high in a treatment starting with equal endowments, but decreases over time. In a...

Retributive responses play a role in human behavior. Are they triggered primarily by supposed intentions or by observed consequences of actions? Experimental studies were conducted of retributive responses in situations in which the individual actor may inflict harmful consequences without...

We conduct a field experiment in a naturally occurring labor environment and track whether the performance of workers responds to unexpected wage increases. Specifically, we investigate how the timing of wage increases affects efforts. We find that workers performance is about 11% higher for the...

Werner Güth's ultimatum game played a key role in the development of multiple research areas, several of which are highlighted.

We report on two experiments designed to investigate the role of beliefs for ingroup favoritism. On average, dictators transfer substantially more to recipients who are publicly known to share the same group identity, compared to transfers given to recipients who are publicly known to be...