The great recession (2008) triggered an apparent discrepancy between empirical findings and macroeconomic models based on rational expectations alone. This gap led to a series of recent developments of a behavioral microfoundation of macroeconomics combined with the underlying experimental and...

A distinctive feature of humans compared to other species is the high rate of cooperation with non-kin. One explanation is that humans are motivated by concerns for social esteem. In this paper we experimentally investigate the impact of anticipated verbal feedback on altruistic behavior. We...

Absentmindedness is a special case of imperfect recall which according to Piccione and Rubinstein (1997a) leads to time inconsistencies. Aumann, Hart and Perry (1997a) question their argument and show how dynamic inconsistencies can be resolved. The present paper explores this issue from a...

Cooperation problems are at the heart of many everyday situations. In this paper, we propose a very simple and light-handed mechanism to sustain cooperation and test its performance in a rich laboratory environment. The mechanism moderates cooperation by controlling experiences, more...

Choosing between selfish and non-selfish behavior in real life is a repeated decision with var-ying time spans between repetitions. To learn more about the dynamics of altruistic behavior, we use repeated standard dictator experiments. The dynamics of prosocial behavior in these experiments...

We study experimentally whether the endowment effect survives in a social and strategic context. Participants are asked for their Willingness-to-Accept (WTA) or Willingness-to-Pay (WTP) to play a series of 2x2 games. In the second part of the experiment, we study the endowment effect in...

Within the area of Behavioral game theory, we focus on a specific context, namely, on a game we called the Alternative traveler’s dilemma. In this context, we observe that participants tend to choose strictly dominated strategies. In order to explain similar tendencies in other games,...

We analyze subjects' eye movements while they make decisions in a series of one-shot games. The majority of them perform a partial and selective analysis of the payoff matrix, often ignoring the payoffs of the opponent and/or paying attention only to specific cells. Our results suggest that...

We test experimentally an explanation of over and under confidence as motivated by (perhaps unconscious) strategic concerns, and find compelling evidence supporting this hypothesis in the behavior of participants who send and respond to others ́statements of confidence about how well they have...

We examine whether the "Level-k" model of strategic behavior generates reliable cross-game predictions within an individual. We find no correlation in subjects' estimated levels of reasoning across two families of games. Furthermore, estimating a higher level for Ann than Bob in one family of...