Recently developed models of fairness can explain a wide variety of seemingly contradictory facts. The most controversial and yet unresolved issue in the modeling of fairness preferences concerns the behavioral relevance of fairness intentions. Intuitively, fairness intentions seem to play an...

This paper aims at showing the relevance of procedural utility for economics: people do not only care about outcomes, as usually assumed in economics, they also value the processes and conditions leading to outcomes. The psychological foundations of procedural utility are outlined and it is...

This paper shows that identical offers in an ultimatum game generate systematically different rejection rates depending on the other offers that are available to the proposer. This result casts doubt on the consequentialist practice in economics to define the utility of an action solely in terms...

We derive a necessary and sufficient condition for the existence of equilibria with only two active players in the all-pay auction with complete information and identity-dependent externalities. This condition shows that the generic equilibrium of the standard all-pay auction is robust to the...

There are at least two reasons why multiple prizes can be optimal in symmetric imperfectly discriminating contests. First, the introduction of multiple prizes reduces the standard deviation of contestants’ effort in asymmetric equilibria, when the majority of contestants actively participate...

The optimal contest architecture for symmetric imperfectly discriminating contests is shown to be generically the two-stage tournament (rather than the one-stage contest). In the first stage the contestants compete in several parallel divisions for the right to participate in the second stage....