This paper reports results from a series of laboratory experiments designed to evaluate the impact of exposure risk on market performance. Exposure risk arises when there are complementarities between trades, e.g. when the purchase of a new house requires selling the old one. The continuous...

We conduct a model validation analysis of several behavioral models of voter turnout, using laboratory data. We call our method of model validation concealed parameter recovery, where estimation of a model is done under a veil of ignorance about some of the experimentally controlled parameters...

Conventional wisdom suggests that a global increase in monetary rewards should induce agents to exert higher effort. In this paper we demonstrate that this may not hold in team settings. In the context of sequential team production with positive externalities between agents, incentive reversal...

This computerized web experiment immerses students in an environment where they are in the role of bank managers, complementing existing experiments in which they act as depositors. The experiment is programmed to run on a variety of devices, including student’s phones and is suitable for use...

We report on an experiment comparing compulsory and voluntary voting institutions in a voting game with common preferences. Rational choice theory predicts sharp differences in voter behavior between these two institutions. If voting is compulsory, then voters may find it rational to vote...

A burgeoning literature in the neurosciences suggests that individuals modify their behavior not only in response to their own experiences, but also from what they learn about the experiences of others engaged in similar tasks. Importantly, these different forms of learning are associated with...

We analyze a controlled price formation experiment in the laboratory that shows evidence for bubbles. We calibrate two models that demonstrate with high statistical significance that these laboratory bubbles have a tendency to grow faster than exponential due to positive feedback. We show that...

We study the interplay of inequality and trust in a dynamic growth game, in which trust increases efficiency and thus allows higher growth of the laboratory economy in the future. We find that trust (as measured by the percentage of wealth invested in a trust game) is initially high in a...

Using laboratory experiments within a New Keynesian sticky price framework, we study the process of inflation expectation formation. We focus on adaptive learning and rational expectations contrary to the previous literature that mostly studied simple heuristics. Using a test for rational...

This paper extends choice theory by allowing for the interaction between cognitive costs and social norms. The authors experimentally investigate the role of imitation and temporal decisional patterns when participants face a task which is costly in cognitive terms. They identify two main...