This paper investigates whether Varian's (1994) compensation mechanism can work in a laboratory. The results show that this mechanism does not work as in the theory. We found that the magnitude of penalties crucially affects subjects' behavior.

This paper investigates whether Varian's(1994) compensation mechanism can work in a laboratory. The results show that this mechanism does not work as in the theory. We found that the magnitude of penalties crucially affects subjects' behavior.

We conducted a field experiment on the Internet and investigated the participants' belief updating in an individual learning environment where they observe a sequence of private signals and in a social learning environment where they observe a sequence of other people's actions. We observed that...

We conducted a field experiment on the Internet and investigated the participants’ belief updating in an individual learning environment where they observe a sequence of private signals and in a social learning environment where they observe a sequence of other people’s actions. We observed...