We examine experimentally how link costs affect the formation of links between a single seller and two potential buyers as well as the ensuing bargaining. Theory predicts that link costs lead to less competitive networks, with one link rather than two links, and that link costs do not affect the...

When truth conflicts with efficiency, can verbal communication destroy efficiency? Or are lies or vagueness used to hide inconvenient truths? We consider a sequential 2-player public good game in which the leader has private information about the value of the public good. This value can be low,...