We empirically assess whether hindsight bias has consequences on how citizens evaluate their political actors. Using an incentivized elicitation technique, we demonstrate that people systematically misremember their past policy preferences regarding how to best fight the Covid-19 pandemic. At...

Effective organizations are able not only to coordinate their members on efficient strategies but also to adapt members' strategies to unforeseen change in an efficient manner. We explore whether part of organizational culture - namely, relational contracts that facilitate both coordination and...

Under weak contract enforcement the trading parties’ trust, defined as their belief in other’s trustworthiness, appears important for realizing gains from trade. In contrast, under strong contract enforcement beliefs about other’s trustworthiness appear less important, suggesting that...

There is vast heterogeneity in the human willingness to weigh others’ interests in decision making. This heterogeneity concerns the motivational intricacies as well as the strength of other-regarding behaviors, and raises the question how one can parsimoniously model and characterize...

The ability to uncover preferences from choices is fundamental for both positive economics and welfare analysis. Overwhelming evidence shows that choice is stochastic, which has given rise to random utility models as the dominant paradigm in applied microeconomics. However, as is well known, it...

Trust affects almost all human relationships – in families, organizations, markets and politics. However, identifying the conditions under which trust, defined as people’s beliefs in the trustworthiness of others, has a causal effect on the efficiency of human interactions has proven to be...

Repeated interactions provide a prominent but paradoxical hypothesis for human cooperation in one-shot interactions 1–3. Intergroup competitions 4–7 provide a different hypothesis that is intuitively appealing but heterodox. We show that neither mechanism reliably supports the evolution of...

The widespread use of markets leads to unprecedented material well-being in many societies. We study whether market interaction, as a side effect, erodes moral values. An encompassing understanding of the virtues and vices of markets, including their possible impact on moral values, is necessary...

Increasing inequality and associated egalitarian sentiments have again put redistribution on the political agenda. Other-regarding preferences may also affect support for redistribution, but knowledge about their distribution in the broader population and how they are associated with political...

We review the vast literature on social preferences by assessing what is known about their fundamental properties, their distribution in the broader population, and their consequences for important economic and political behaviors. We provide, in particular, an overview of the empirically...