Anchoring is one of the most studied and robust behavioral biases, but there is little knowledge about its persistence and magnitude in economic settings. This article studies the role of anchoring bias in strategic interactions. We test experimentally two different anchor types using auctions....

We use a ‘multi-player dictator game' (MDG) with ‘social information' about the contribution decision about a previous dictator to examine whether average contributions as well as the behavioural strategy adopted are affected by the first amount presented (the ‘anchor') using a sequential...

Existing models of regret aversion assume that individuals can make an ex-post comparison between their choice and a foregone alternative. Yet in many situations such a comparison can be made only if someone else chose the alternative option. We develop a model where regret-averse agents must...

We study a giver's generosity depending on her relationship with the recipient and the observer. We assign different group identities to the players using a variation of the minimum group paradigm, and test the effect of group memberships on altruistic giving in the dictator game with a passive...

In this paper we use an experiment to compare a theory of risk aversion and a theory of spite as an explanation for overbidding in auctions. As a workhorse we use the second-price all-pay and the first-price winner-pay auction. Both risk and spite can be used to rationalize deviations from risk...

Anchoring is one of the most studied and robust behavioral biases, but there is little knowledge about its persistence in strategic settings. This article studies the role of anchoring bias in private-value auctions. We test experimentally two different anchor types. The announcement of a random...

This paper explores the binary choice of an agent who must allocate her attention to noisy information obtained from costly experimentation to improve her knowledge in a context of uncertainty.We model a two period-lived agent who must decide whether to invest or not in each period. Initial...

In the first part of this paper, we elicit time preferences by using the experimental and econometric methods of Benhabib-Bisin-Schotter (2006). We follow the matching task procedure on money-time pairs with real rewards. Among the model specifications we use, the one with exponential...

We propose and experimentally test a theory of strategic behavior in which players are cognitively imprecise and perceive a fundamental parameter with noise. We focus on 2 x 2 coordination games, which generate multiple equilibria when perception is precise. When adding a small amount of...

This paper considers an experimental market entry game, where the decision problem involves several heterogeneous markets and players have an opportunity to enter several markets simultaneously. We find that groups fail to coordinate on any of the multiple pure strategy Nash equilibria by...