In this paper we examine the strategic savviness of the medieval church as portrayed in Richard Wagner's Tannhäuser. We show that the church employed an optimal randomization strategy based on arguments of dominance or trembling-hand perfection. Particular attention is paid to the employed...

We provide supporting evidence from the laboratory for the Nash predictions of the homogeneous-good Bertrand model under asymmetric constant unit costs.

We examine the role of consumer networks in markets that suffer from moral hazard. Consumers exchange information with neighbors about past experiences with different sellers. Networks foster incentives for reputation building and enhance trust and efficiency in markets.

The formation of an alliance in conflict situations is known to suffer from a collective action problem and from the potential of internal conflict. We show that budget constraints of an intermediate size can overcome this strong disadvantage and explain the formation of alliances.