Field evidence suggests that arbitration increases negotiation dispute rates. We study repeated bargaining in a laboratory to understand the reasons why. Our results represent a reinterpretation of an explanation known as the narcotic effect. The standard interpretation assumes that the...

Electronic reputation or feedback mechanisms aim to mitigate the moral hazard problems associated with exchange among strangers by providing the type of information available in more traditional close-knit groups, where members are frequently involved in one another's dealings. In this paper, we...

The amount of institutional intervention necessary to secure efficiency-enhancing cooperation in markets and organizations, in circumstances where interactions take place among essentially strangers, depends critically on the amount of information informal reputation mechanisms need transmit....

Does social network structure influence coordination? We examine a coordination game in which each player engages with an exogenously connected “local” subset of the player population, the pattern of links defining a social network. Players know the number of local links they possess but...

In both dictator and impunity games, one player, the dictator, divides a fixed amount of money between himself and one other, the recipient. Recent lab studies of these games have produced seemingly inconsistent results, reporting substantially divergent amounts of dictator giving. Also, one...

Procedures are the area where fairness arguably has its largest influence on modern societies. The experiments we report provide an initial characterization of that influence and suggest new interpretations for some well-known results. We find that procedural fairness is conceptually distinct...

The concept of self-centered fairness, as embodied in ERC preferences, organizes the data from the two-person ultimatum and dictator game, as well as the Gthvan Damme game, the market game, the dictator game with multiple recipients, and the fixed total sacrifice effect as observed in this...

This chapter describes a sequence of four experiments. The hypotheses tested are all informed by one or more of the aforementioned types of models. Each experiment builds on the findings of the previous experiment in the sequence. At the same time, each experiment involves a different game,...