We consider a principal-agent model of adverse selection where, in order to trade with the principal, the agent must undertake a relationship-specific investment which affects his outside option to trade, i.e. the payoff that he can obtain by trading with an alternative principal. This creates a...

A large body of literature has shown that social norms can be a powerful driver of human actions, and norm interventions often focus on shifting beliefs about average or majoritarian behavior. This work addresses a less studied aspect of norms, namely the role that their strength, tightness, and...

Descriptive norms - the behavior of other individuals in one's reference group - play a key role in shaping individual decisions. When characterizing the behavior of others, a standard approach in the literature is to focus on average behavior. In this paper, we argue both theoretically and...