Applying an indirect evolutionary approach with endogenous preference formation, we show that a legal system can induce players to reward trust even if material incentives dictate to exploit trust. By analyzing the crowding out or crowding in of trustworthiness implied by various verdict rules,...

A general framework is described specifying how boundedly rational decision makers generate their choices. Starting from a "Master Module" which keeps an inventory of previously successful and unsuccessful routines several submodules can be called forth which either allow one to adjust behavior...

By vetoing one questions mutually efficient agreements. On the other hand the threat of vetoing may prevent exploitation. Based on a generalization of ultimatum bargaining (Suleiman, 1996) we first elicit the responders' certainty equivalents for three different degrees of veto power. Afterwards...

Endogenous timing can help to derive the time structure of decision making instead of assuming it as exogenously given. In our study we consider a homogeneous market where, like in the model of Kreps and Scheinkman (1983), sellers determine "sales capacities" before prices. Sellers must serve...