Trustworthiness can be conveyed by sending a costly signal in advance. In an experiment, we find that the smaller the percentage of trustworthy people in a group, the higher is their percentage of signaling. The introduction of signaling has strong distributional effects. It may be efficient...

Coleman (1990) describes 'calculative trust'. He states that, in order to trust, the value of trust has to be larger than the value of mistrust. So if subjects have (not personally but on average) rational expectations about the trustworthiness of their transaction partners, we should expect the...

No measurement without theory. Ex post inferences from descriptive statistics or regression analyses are often misleading. Although this is well known, it is still a frequent occurrence. In this paper we illustrate the problem by analysing a dataset that appears to suggest that there is a...

Rationales und emotionales Verhalten werden zu Unrecht als vollständige Gegensätze angesehen. Automatisch entstehende Emotionen dienen vielmehr einer oft vorteilhaften Selbstbindung. Objektiv irrationale Drohungen werden glaubhaft, Versprechungen müssen nicht durch kostspielige Verträge oder...

In German mobile phone contracts, calls in the provider's home net are usually less expensive than external calls (to the network of a competitor). Thus customers have to compare vectors of prices, and such a comparison can be the source of a fallacy in the presence of network externalities....

In the wake of the Enron and Worldcom financial scandals that rocked Wall Street in 2002, the US government’s financial regulatory body, the Security and Exchange Commission (SEC) took the unprecedented step in June 2002 of requiring that the chief executives and chief financial officers of...

Handlungsempfehlungen (deutsch): Gegenseitigkeit und Vertrauen können in verschiedener Weise den Abschluss internationaler Klimaschutzvereinbarungen fördern: 1. Klimapolitische Instrumente sollten derart gestaltet werden, dass sie mit dem Prinzip der Gegenseitigkeit („Reziprozität“)...

The launch of a public project requires “enough” support from a group of n players. If players have only binary decision sets (participate or not, vote approvingly or not) this game is called a Binary Threshold Public Goods game (BTPG). In this paper we keep the individual cost/benefit...