We construct a general equilibrium model of a two-country trading block where governments through tax policies attract mobile capital, and provide an imported public consumption good. At Nash equilibrium, when the public good is under-provided, (i) a country with a large GDP, has a large Nash...

We model a firm in an institutional market setting, consisting of a production technology and its governance. The governance consists of a hierarchical firm structure, a cost efficiency parameter,and an internal pay system. The depth of the firm is determined by profit maximization under the...

Empirical evidence is provided for the importance of non-reciprocal pro-social behavior of individuals in an anonymous, n-person pure public good setting. A unique panel data set of 136,000 observations is matched with an extensive survey. Even under anonymous conditions, a large number of...

We study framing effects in repeated social dilemmas by comparing payoff-equivalent Give- and Take-framed public goods games under varying matching mechanisms (Partners or Strangers) and levels of feedback (Aggregate or Individual). In the Give-framed game, players contribute to a public good,...

Experimental studies show that the Nash equilibrium and its refinements are poor predictors of behavior in non-cooperative strategic games. Cooperation models, such as ERC and inequality aversion, yield superior predictions compared to the standard game theory predictions. However, those models...

Do democratically chosen rules lead to more cooperation and, hence, higher efficiency, than imposed rules? To discuss when such a "dividend of democracy" obtains, we review experimental studies in which material incentives remain stacked against cooperation (i.e., free-riding incentives prevail)...

In this experiment, we endogenize the choice of which contribution scheme is implemented in a public good game. We investigate three rule-based contribution schemes and a voluntary contribution mechanism (VCM). The game is implemented either as a Single- or a Multi-Phase Game. In the...