Why do people frequently cooperate in defiance of their immediate incentives? One explanation is that individuals are conditionally cooperative. As an explanation of behavior in one-shot settings, such preferences require individuals to be able to discern their opponents' preferences. Using data...

We analyze the behavior of game-show contestants who play a one-shot game called Friend or Foe. While it is a weakly dominant strategy not to cooperate, almost half the contestants on the show choose to play ?friend.? Remarkably, the behavior of contestants remains uncha nged even when stakes...

This article introduces a market-based methodology for evaluating the performance of MBA programs. The authors seek to distinguish the quality of a program from the quality of its students. They judge a program's performance by its value added, measured by the graduates' salaries, after...

When consumers share similar preferences, additional consumers will bring forth products that confer positive "preference externalities" on others. However, if distinct groups of consumers have substantially different preferences, the groups bring forth products with more appeal to themselves...

Recent technological advances have dramatically lowered the cost of transmitting information over large distances. In the late 1990s, the New York Times implemented a national distribution strategy, expanding delivery in over 100 cities. Using cross-sectional and longitudinal data on local...

Mergers can reduce costs and alter incentives about how to position products, so that theory alone cannot predict whether mergers will increase product variety. We document the effect of mergers on variety by exploiting the natural experiment provided by the 1996 Telecommunications Act. We find...

Scholars working on the border of economics and psychology have documented many contexts in which individual decision-making is unreliable and might be improved by paternalistic interventions. Against this mounting body of negative evidence, economists' default belief in consumer sovereignty has...

Intro -- Contents -- Preface -- Introduction -- Part One: Theory -- 1. Markets and the Tyranny of the Majority -- 2. Are "Lumpy" Markets a Problem? -- Part Two: Empirical Evidence -- 3. Who Benefits Whom in Practice -- 4. Who Benefits Whom in the Neighborhood -- Part Three: Market Solutions and...