We experimentally test overconfidence in investment decisions by offering participants the possibility to substitute their own for alternative investment choices. Overall, 149 subjects participated in two experiments, one with just one risky asset, the other with two risky assets. Overconfidence...

We present an experimental test of a shirking model where monitoring intensity is endogenous and effort a continuous variable. Wage level, monitoring intensity and consequently the desired enforceable effort level are jointly determined by the maximization problem of the firm. As a result,...

Using an intergenerational trilateral laboratory gift-exchange game, we investigate how employers' own performance in a real effort task impacts on the wage setting behavior of younger and older employers. We find that the employers' own past performance strongly affects wage setting behavior,...