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

Field evidence suggests that agents belonging to the same group tend to behave similarly, i.e., behavior exhibits social interaction effects. Testing for such effects raises severe identification problems. We conduct an experiment that avoids these problems. The main design feature is that each...

Field evidence suggests that people belonging to the same group often behave similarly, i.e., behavior exhibits social interaction effects. We conduct a laboratory experiment that avoids the identification problem present in the field and allows us to study the behavioral logic of social...