This paper empirically analyzes whether government size is conducive or detrimental to life satisfaction in a cross-section of 74 countries. We thus provide a test of the longstanding dispute between standard neoclassical economic theory and public choice theory. According to the neoclassical...

To understand cooperative behaviour in social-dilemma experiments, we need to understand the game participants play not only in monetary but in preference terms. Does a Nash-prediction based on participants' actual preferences describe their behaviour in a public-good experiment well? And if...

The disposition effect, i.e., the tendency to sell winning stocks too early and losing stocks too late is one of the most frequently observed and discussed biases of financial investors. We investigate in a laboratory experiment whether the option of automatic selling devices causally reduces...

Crawford and Iriberri (AER, 2007) show how a level-k model can be based on salience to explain behaviour in games with distinctive action labels, taking hide-and-seek games as an example. This study presents four dierent experiments designed to measure salience. When based on any of these...

This paper presents results from an experiment on the effects of retail-price recommendations (RPRs) on consumer and retailer behavior. Despite their non-binding nature, RPRs may influence consumersÕ willingness to pay by setting a reference point. Loss averse consumers will then be reluctant...

We provide evidence that people have preferences for data privacy and show that these preferences partly reflect peopleÕs interest in controlling who receives their private information. Participants of an experiment face the decision to share validated personal information with peers. We...

This paper studies the exertion of market power in large buyer groups confronting an incumbent monopolist and a potential market entrant in a repeated trade situation. In the experiment, buyer power can either occur as demand withholding when only the incumbent is present in the market, or it...

Models of evolutionary game theory have shown that punishment may be an adaptive behaviour in environments characterised by a social-dilemma situation. Experimental evidence closely corresponds to this finding but questions the cooperation-enhancing effect of punishment if players are allowed to...