Behavioral biases in forecasting, particularly the lack of adjustment from current values and the overall clustering of forecasts, are increasingly explained as resulting from the anchoring heuristic. Nonetheless, the classical anchoring experiments presented in support of this interpretation...

Markets for credence goods are classified by experts alone being able to identify consumers' problems and determine appropriate services for solution. Examining a market where experts have to invest in costly diagnosis to correctly identify problems and consumers being able to visit multiple...

In this paper, we shed light on the different moral costs of dishonesty and stealing. To accomplish this, we set up a die-rolling task which allowed participants to increase their own payout through dishonesty or theft. The results show that participants have fewer reservations about dishonesty...

The anchoring-and-adjustment heuristic has been studied in numerous experimental settings and is increasingly drawn upon to explain systematically biased decisions in economic areas as diverse as auctions, real estate pricing, sports betting and forecasting. In these cases, anchors result from...

In an experiment on moral cleansing with an endogenously manipulated moral self-image, we examine the relevance of the addressee of an immoral action. The treatments differ such that cheating on a die roll reduces either the experimenterś or another subjectś payoff. We find that cheating is...

We study the coexistence of strategies in the indirect reciprocity game where agents have access to second-order information. We fully characterize the evolutionary stable equilibria and analyze their comparative statics with respect to the cost-benefit ratio (CBR). There are indeed only two...

A person's reach of efficient economic activities is strongly influenced by the extent to which she grants trust towards other people. The radius of trust has recently gained interest as a concept to elucidate the underlying principles of how far a person extends her trust. However, empirical...

We study the robustness of reputation management systems against distortions in rating behavior. In a laboratory trust experiment with reputation management, we mimic a positive bias by exclusively offering the option to rate positively or to give no rating. As predicted by theoretical...

We study the coexistence of strategies in the indirect reciprocity game where agents have access to second-order information. We fully characterize the evolutionary stable equilibria and analyze their comparative statics with respect to the cost-benefit ratio (CBR). There are indeed only two...

Recent evidence suggests that nudges, i.e. alterations in the decisional context, can have large effects on decisions and can improve individual and public welfare. This paper presents the results of a controlled experiment that was designed to evaluate not only the effectiveness of a default...