Experimental Departures from Self-Interest when Competing Partnerships Share Output

 

Date: 2013-03-14
By: Cherry, Josh
Salant, Stephen
Uler, Neslihan
URL: http://d.repec.org/n?u=RePEc:rff:dpaper:dp-13-07&r=net
When every individual’s effort imposes negative externalities, self-interested behavior leads to socially excessive effort. To curb these excesses when effort cannot be monitored, competing output-sharing partnerships can form. With the right-sized groups, aggregate effort falls to the socially optimal level. We investigate this theory experimentally and find it makes correct qualitative predictions but there are systematic quantitative deviations, always in the direction of the socially optimal investment. By using data on subjects’ conjectures of each other’s behavior we show that deviations are consistent with both altruism and conformity (but not extremeness aversion).
Keywords: output-sharing, partnership solution, laboratory experiment, altruism, conformity
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Fairness norms can explain the emergence of specific cooperation norms in the Battle of the Prisoners Dilemma

Date: 2013-04-24
By: Fabian Winter (Max Planck Institute of Economics, Jena)
URL: http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2013-016&r=net
Cooperation norms often emerge in situations, where the long term collective benefits help to overcome short run individual interests, for instance in repeated Prisoner’s Dilemma (PD) situations. Often, however, there are different paths to cooperation, benefiting different kinds of actors to different degrees. This leads to payoff asymmetries even in the state of cooperation, and consequently can give rise to normative conflicts about which norms should be in place. This norm-coordination problem will be modeled as a Battle of the Sexes game (BoS) with different degrees of asymmetry in payoffs. We combine the PD and the BoS to the 3×3 Battle of the Prisoners Dilemma (BOPD) with several asymmetric cooperative and one non-cooperative equilibria. Bame theoretical and “behavioral" predictions are derived about the kind of norms that are likely to emerge under different shadows of the future and degrees of asymmetry and tested in a lab-experiment. Our experimental data show that game theory fairly well predicts the basic main effects of our experimental manipulations, but “behavioral" predictions perform better in describing the equilibrium selection process of emerging norms.
Keywords: Social norms, normative conflict, Prisoner’s Dilemma, coordination, experiment
JEL: Z13

Is Giving Equivalent to Not Taking in Dictator Games?

Date: 2013-04
By: Korenok Oleg (Department of Economics, VCU School of Business)
Edward L. Millner (Department of Economics, VCU School of Business)
Laura Razzolini (Department of Economics, VCU School of Business)
URL: http://d.repec.org/n?u=RePEc:vcu:wpaper:1301&r=net
We answer the question: Is giving equivalent to not taking? We show that, if giving is equivalent to not taking, impure altruism could account for List’s (2007) finding that the payoff to recipients in a dictator game decreases when the dictator has the option to take. We examine behavior in dictator games with different taking options but equivalent final payoffs. We find that the recipients tend to earn more as the amount the dictator must take to achieve a given final payoff increases. We conclude that not taking is not equivalent to giving and agree with List (2007) that the current social preference models fail to rationalize the observed data.
Keywords: Dictator Game; Impure Altruism; Taking
JEL: C91

On the Theory of the Competitive Firm Under Price Uncertainty*

Agnar Sandmo (1971) “On the Theory of the Competitive Firm Under Price Uncertainty."  The American Economic Review, Vol. 61, No. 1 (Mar., 1971), pp. 65-73.  URL: http://www.jstor.org/stable/1910541; lse.ac.uk 提供的 [PDF];****

==note by yinung==

這篇利用 risk-averse 的 utility function 假設, 證明完全競爭廠商, 在有 price uncertainty 下, 最佳決策是

p>c'(x)

where c'(x),邊際成本, is increasing in x

On the evolution of monopoly pricing in Internet-assisted search markets

Date: 2013
By: Aurora García-Gallego (LEE & Department of Economics, Universitat Jaume I, Castellón, Spain)
Nikolaos Georgantzis (GLOBE & Economics Department, University of Granada, Spain)
Ainhoa Jaramillo-Gutiérrez (EriCes & Dpt. of Applied Economics, University of Valencia, Spain)
Pedro Pereira (Autoridade da Concorrência and CEFAGE-UE, U. of Evora, Portugal)
J. Carlos Pernías-Cerrillo (Economics Department, Universitat Jaume I, Castellón, Spain)
URL: http://d.repec.org/n?u=RePEc:jau:wpaper:2013/05&r=net
We study the evolution of prices in markets assisted by price-comparison engines. We use laboratory data obtained under two industry sizes and two conditions concerning the sample (complete, incomplete) of prices available to informed consumers. Distributions are typically bimodal. One of the two modes, corresponding to monopoly prices, tends to increasingly attract prices over time. The second one, corresponding to interior prices, presents a decreasing trend. Monopoly pricing can be used as an insurance against more competitive (but riskier) behavior. In fact, subjects earning low profits due to interior pricing in the past are more likely to choose monopoly pricing.
Keywords: Internet Economics, price-comparison search engines, mixed strategy equilibria, experimental economics
JEL: D0