This study uses the methods of experimental economics to investigate possible reasons for the lack of empirical support for the Hotelling rule for nonrenewable resources. We argue that as long as resource stocks are large enough, producers may choose to (partially) ignore the dynamic component...

According to the outside option principle the holdup problem can be lifted by structuring the post-investment bargaining stage in such a way that the non-investing party has a binding outside option. The investor then becomes residual claimant and has the appropriate incentives to invest. Theory...

We report results from an experiment based on a simplified version of Hart's (1995) property rights theory of the firm. Only one manager invests and this investment is completely specific. In that case the theory predicts that the level of investment is not affected by the level of no-trade...

A large number of recent experimental studies show that women are less likely to sort into competitive environments. While part of this effect may be explained by gender differences in risk attitudes and overconfidence, previous studies have attributed the majority of the gender gap to gender...

An extensive literature documents that people are willing to sacrifice personal material gain to adhere to a moral motive. Yet, less is known about what happens when moral motives are in conflict. We hypothesize that individuals engage in what we term “motive selection,” namely adhering to...

A large body of evidence suggests that people are willing to sacrifice personal material gain in order to adhere to a moral motive such as fairness or truth-telling. Yet less is known about what happens when moral motives are in conflict. We hypothesize that in such situations, individuals...

Although market-based environmental policy instruments feature prominently in economic theory and are widely employed, they often meet with public resistance. We argue that such resistance may be driven by a feeling of moral responsibility where citizens prefer to tackle environmental problems...