In this article, we show experimentally that individuals can adapt their decision making to social environments, like markets, and respond strategically to biases, such as regret aversion. We find they can employ herding as a behaviorally rational strategy to improve their expected outcomes and...

Trading is more than a personal valuation of own property. Traders try to anticipate the WTP potential buyers have for the good they want to sell. They do not focus on the value the entitlement has for them, their personal valuation is only a reservation price. The law analyzes the Endowment...

Anticommons are a special kind of mixed-motive dilemma in which negative effects for society are caused by the excessive use of exclusion rights. In two fully incentivized experiments on trading goods with risky prospects, we disentangle three psychological sources that have been suggested to...

Promising serves as an important commitment mechanism by operating on a potential cheater’s internal value system. We present experimental evidence on what motivates people to keep their promises. First, they feel that they are duty-bound to keep their promises regardless of whether promisees...