How do people perceive a social dilemma such as the Prisoner’s Dilemma if the problem is framed focusing entirely on monetary incentives – as commonly done in laboratory experiments? Focusing on the involved conflict between strategic and moral incentives, we designed a two-stage experiment...

This paper considers the endogenous formation of an institution to provide a public good. If the institution governs only its members, players have an incentive to free ride on the institution formation of others and the social dilemma is simply shifted to a higher level. Addressing this...

This paper proposes a bounded rationality approach to model equilibrium play in games. It is based on the observation that decision makers often do not seem to fully distinguish between different but seemingly similar decisions. To capture this, for each player a similarity grouping of decisions...