The relationship between risk in the environment, risk aversion and inequality aversion is not well understood. Theories of fairness have typically assumed that pie sizes are known ex-ante. Pie sizes are, however, rarely known ex ante. Using two simple allocation problems-the Dictator and...

With about two initial public offerings per year, the number of publicly traded degree-granting providers of post-secondary education in the United States has grown steadily ever since the Apollo Group (University of Phoenix, College of Financial Planning, etc.) went public in December 1994. To...

Berg et al. (Games and Economic Behavior, 10, pp. 122–142, 1995) study trust and reciprocity in an investment setting. They find significant amounts of trust and reciprocity and conclude that trust is a guiding behavioral instinct (a “primitive†in their terminology). We modify...

Recently, it has been argued that the evidence in social science research suggests that deceiving subjects in an experiment does not lead to a significant loss of experimental control. Based on this assessment, experimental economists were counseled to lift their de facto prohibition against...

In this paper we address an asymmetric information problem in the fundraising industry, the fundraising problem. The problem arises from donors’ lack of information about the quality of charities that solicit donations. We focus on one particular solution of this problem, certification, where...

We analyze tournaments of heterogeneous players from an organizer’s perspective. Using a simple model of a noisy tournament, we demonstrate how the likelihood of selecting the best player, here termed the “predictive power” of a tournament, depends on the tournament format, the...

The round-robin tournament format for N players is a scheme that matches players with one another in all possible N(N - 1)/2 pairwise comparisons. A noisy round-robin tournament adds the possibility of upsets, or noise, and hence reduces the power of the tournament to reveal the true ranking of...

Drawing on Gneezy and Rustichini (2000), we illustrate that subjects' cognitive abilities seem at least as important for their performance as do financial incentives they face. Theorists should thus pay more attention to the ability aspect of cognitive production.

Recently, it has been argued that the evidence in social science research suggests that deceiving subjects in an experiment does not lead to a significant loss of experimental control. Based on this assessment, experimental economists were counseled to lift their de facto prohibition against...

Murray Rothbard's posthumous Economic Thought Before Adam Smith is notable for its vilification of 'the quiet Scottish professor.' While there is little disagreement that Smith was, at best, an ambivalent champion of free markets, Rothbard's indictment of him as a proto-Marxist is less than...