Most research in economics models agents somehow motivated by out-comes. Here, we model agents motivated by procedures instead, whereprocedures are dened independently of an outcome. To that end, wedesign procedures which yield the same expected outcomes or carry thesame information on other's...

All rulers face political competition, both from rivals within their state, andfrom other states to which their subjects may exit. In a simple model, both kinds of competitionare substitutes. Internal competition (democracy) benefits citizens by allowingthem to replace rent-seeking rulers. But...

A common feature of the literature on the evolution of preferencesis that evolution favors nonmaterialistic preferences only if preferencetypes are observable at least to some degree. We argue that this resultis due to the assumption that in each state of the evolutionary dynam-ics some Bayesian...

We analyze the effect of investments in corporate social responsibility(CSR) on workers’ motivation. In our experiment, a gift exchange game variant,CSR is captured by donating a certain share of profits to a charity. Weare testing for CSR effects by varying the possible share of profits given...

We construct a simple three person trust game with one trustor and two trustees. The trustorhas the possibility to either trust both trustees or none, while the trustees make their decisionseither sequentially or simultaneously, depending on the treatment. When trustees play...

Actual behaviour is inuenced in important ways by moral emotions,for instance guilt or shame (see among others Tangney et al., 2007). Belief-dependant models of social preferences using the framework of psycho-logical games aim to consider such emotions to explain other-regardingbehaviour. Our...

Recent research has cast some doubt on the general validity of outcome-basedmodels of social preferences. We develop a model based on cognitive dissonance thatfocuses on the importance of self-image. An experiment (a dictator game variant)tests the model.First, we nd that subjects whose choices...

We exploit a controlled frameless laboratory experiment to study settlement negoti-ations and the plainti¤’s decision to raise a lawsuit in case of an impasse. We …nd thatgreater variance in court outcomes increases the litigation rate and lowers the settlementrate. This latter …nding goes...

We present an experiment designed to test the Modigliani-Miller theorem. Applyinga general equilibrium approach and not allowing for arbitrage among firmswith different capital structures, we find that, in accordance with the theorem, participantswell recognize changes in the systematic risk of...

Different evaluators typically disagree how to rank different candidates since theycare more or less for the various qualities of the candidates. It is assumed that allevaluators submit vector bids assigning a monetary bid for each possible rank order.The rules must specify for all possible...