In a world of imperfect information, reputations often guide the sequential decisions to trust and to reward trust. We consider two-player situations, where one player - the truster - decides whether to trust, and the other player - the temptee - has a temptation to betray when trusted. The...

The BP Deepwater Horizon oil spill highlighted the glaring weakness in the current liability and regulatory regime for oil spills and for environmental catastrophes more broadly. This article proposes a new liability structure for deep sea oil drilling and for catastrophic risks generally. It...

Humans naturally dispose of objects that disgust them. Is this phenomenon so deeply embedded that even incidental disgust - i.e., where the source of disgust is unrelated to a possessed object - triggers disposal? Two experiments were designed to answer this question. Two film clips served as...

For several decades now a debate has raged about policy-making by litigation. Spurred by the way in which tobacco, environmental, and other litigation has functioned as an alternative form of regulation, the debate asks whether policy-making or regulation by litigation is more or less socially...

There is a low but uncertain probability that climate change could trigger “mega-catastrophes,” severe and at least partly irreversible adverse effects across broad regions. This paper first discusses the state of current knowledge and the defining characteristics of potential climate change...

This study assesses the factors influencing the movement of people across health plans. We distinguish three types of cost-related transitions: adverse selection, the movement of the less healthy to more generous plans; adverse retention, the tendency for people to stay where they are when they...

Policymaking for posterity involves current decisions with distant consequences. Contrary to conventional prescriptions, we conclude that the greater wealth of future generations may strengthen the case for preserving environmental amenities; lower discount rates should be applied to the far...

We test whether and how membership in the upper class affects ethical behavior in a large representative population sample. Using objective measures of socioeconomic status to define class, we find no evidence of a general tendency for upper class to be less ethical, although we do replicate...

Deep-seated, persistent uncertainty is a pernicious feature of climate change. One key parameter, equilibrium climate sensitivity, has eluded almost all attempts at pinning it down more precisely than a ‘likely’ range that has stalled at 1.5–4.5°C for over thirty-five years. The marginal...

We study the classic divide-and-choose method for equitably allocating divisible goods between two players who are rational, self-interested Bayesian agents. The players have additive private values drawn from common priors. We characterize the structure of optimal divisions in the...