Enforcement can affect compliance directly and indirectly, through spillovers. We study intertemporal enforcement spillovers by conducting a randomized field experiment in a university exam. The initial phase of the experiment is the exam itself. We induce variation in enforcement by randomly...

People have the natural tendency to be optimistic and believe that good outcomes in the future are more likely, but also want to avoid overestimation that could result in bad decision-making. Brunnermeier, Brunnermeier and Parker (2005) and Brunnermeier et al. (2007) established an optimal...

The overconfidence bias is discussed extensively in economic studies, yet fails to hold experimentally once monetary incentives and feedback are implemented. We consider overconfidence as a social bias. For a simple real effort task, we show that, individually, economic conditions effectively...

We develop a decision framework with imperfect information to analyze the effects of transaction costs on the tendency for individuals to remain with a default option. We demonstrate how transaction costs can be a more important source of such default effects than commonly thought. A further,...

This paper experimentally investigates the nature of impulses in impulse learning. Particularly, we analyze whether positive feedback (i.e., yielding a superior payoff in a game) or negative feedback (i.e., yielding an inferior payoff in a game) leads to a systematic change in the individual...

We add social norms into Laffont’s mechanism designed for environmental risk. We find with endogenous social norms and asymmetric information about personal norms, the optimal contract induces more (less) effort from the “green” (“brown”) firm.

Hyperbolic discounting with naiveté is widely believed to provide a better explanation than exponential discounting of why people borrow so much and why they wait so long to save for retirement. We reach a different set of conclusions. We show that if financial planning is enriched to include...

We conduct experiments with adolescent participants on repeated fixed play in three different zero-sum games which have mixed strategy minimax solutions. Further, we collect subject information on cognitive abilities and participation rates in competitive activities. We find the adolescents’...

I put forward a concise and intuitive formula for the calculation of the valuation for a good in the presence of the expectation that further, related, goods will soon become available. This valuation is tractable in the sense that it does not require the explicit resolution of the consumer’s...

How do people react to a mix of good deeds to a third party and bad deeds against them? A modified ultimatum game shows that previous good deeds make responders substantially more tolerant to unfair proposals.