Accurately measuring preferences and beliefs in surveys is crucial for social science research, but standard monetary incentives cannot be used when responses cannot be verified. We study two psychological mechanisms for improving answer quality that can be applied to unverifiable questions: (i)...

Accurately measuring preferences and beliefs in surveys is crucial for social science research, but standard monetary incentives cannot be used when responses cannot be verified. We study two psychological mechanisms for improving answer quality that can be applied to unverifiable questions: (i)...

Mechanism design teaches us that a mediator can strictly improve the chances of peace between two opponents even when the mediator has no independent resources, is less informed than the two parties, and has no enforcement power. We test the theory in a lab experiment where two subjects...

We conduct an experiment in which we elicit subjects’ beliefs over opponents’ behavior multiple times for a given game without feedback. We find that the large majority of individual subjects have stochastic belief reports, which we argue cannot be explained by learning or measurement error....

We study an axiomatic variant of quantal response equilibrium (QRE) for normal form games that augments the regularity axioms (Goeree et al., 2005) with various forms of “symmetry” across players and actions. The model refines regular QRE, generalizes logit QRE, and is tractable in many...

Mechanism design teaches us that a mediator can strictly improve the chances of peace between two opponents even when the mediator has no independent resources, is less informed than the two parties, and has no enforcement power. We test the theory in a lab experiment where two subjects...

Quantal response equilibrium (QRE) of McKelvey and Palfrey (1995) relaxes the rationality requirement of Nash equilibrium by allowing for probabilistic mistakes or “noise in actions” while maintaining that beliefs are correct. QRE is well-studied, and much is known about the falsifiable...

We endogenize the precision parameter "lambda" of logit quantal response equilibrium (LQRE) (McKelvey and Palfrey, 1995). In the first stage of an endogenous quantal response equilibrium (EQRE), each player chooses precision optimally subject to costs, given correct beliefs over other players'...

Standard factor pricing models do not capture well the common time-series or cross-sectional variation in average returns of financial stocks. We propose a five-factor asset pricing model that complements the standard Fama and French (1993) three-factor model with a financial sector ROE factor...