Multi-unit auctions are sometimes plagued by the so-called exposure problem. In this paper, we analyze a simple game called the ‘chopstick auction’ in which bidders are confronted with the exposure problem. We do so both in theory and in a laboratory experiment. In theory, the chopstick...

We study experimentally how taxpayers choose between two tax regimes to fund a public good. The first-best tax regime imposes a general, distortion-free income tax. However, this tax cannot be enforced. The second-best alternative supplements the income tax by a specific commodity tax. This tax...

This paper studies the evasion of TV license fees in Austria. We exploit border differentials to identify the effect of fees on evasion. Comparing municipalities at the low- and high-fee side of state borders reveals that higher fees trigger significantly more evasion. The central estimate from...

Introducing a threshold in the sense of a minimal project size transforms a public goods game with an inefficient equilibrium into a coordination game with a set of Pareto-superior equilibria. Thresholds may therefore improve efficiency in the voluntary provision of public goods. In our one-shot...

We run a large-scale natural field experiment to evaluate alternative strategies to enforce compliance with the law. The experiment varies the text of mailings sent to potential evaders of TV license fees. We find a strong alert effect of mailings, leading to a substantial increase in...

We analyze a contest between two groups where group members have differing valuations for the contested rent. Generically the pivotal group member with the median valuation of the rent will not act himself but will want to send a group member that has preferences different to her own into the...

The corporate finance literature documents that managers tend to overinvest into physical assets. A number of theoretical contributions have aimed to explain this stylized fact, most of them focussing on a fundamental agency problem between shareholders and managers. The present paper shows that...

Recent laboratory evidence suggests that social preferences may affect contractual outcomes under moral hazard. In accordance with previous research, this paper uses written personality tests for job candidates as a proxy for whether firms care about personality traits of employees, in...

We provide an overview over different literature streams that aim at explaining the origin of persistent productivity differences across organizations by variation in the use of management practices. We focus on human resource management (HRM) practices, document gaps in the literature, and show...

We provide evidence that German savings banks – where local politicians are by law involved in their management – systematically adjust lending policies in response to local electoral cycles. The different timing of county elections across states and the existence of a control group of...