This experimental study investigates two bargaining games with twosided incomplete information between a seller and a buyer. In the first game with no outside options many subjects do not use the incomplete information to their advantage as predicted. We find that a model with adjusting priors...

This paper studies the vulnerability of the pivotal mechanism with respect to manipulation by groups. In a lab experiment, groups decide on the implementation of various alternatives, some of which imply opposite interests for the two subgroups. We investigate the occurrence of tacit and...

In division problems with entitlements, we investigate whether fairness concerns overrule strategic behavior and inhibit full use of the decision-making power. In a lab experiment where entitlements are derived from costly contributions, we vary bargaining power by using either the majority rule...