We study strategic interaction in an experimental social-preferences vacuum chamber. We mute social preferences by letting participants knowingly interact with computers. Our new design allows for indirect strategic interaction: there are several waves in which computer players inherit the...

We investigate how heterogeneous social preferences affect the communication of painful information in social relationships. We characterize the existence conditions for a pooling equilibrium in which individuals conceal painful information because revealing the latter would signal that they are...

This paper investigates how an increase in competition for workers infuences the impact of social preferences on labor market outcomes. By sorting into firms with homogeneous work forces, workers can alleviate their suffering from social comparisons. Competition promotes choice and thus...

This paper studies a monopsonistic firm's optimal employment contracts if workers have private information on both their propensity for social comparisons and their ability. Employees of the firm are taken to form their own distinct reference group. It is shown that screening workers with equal...

In recent decades, many firms offered more discretion to their employees, often increasing the productivity of effort but also leaving more opportunities for shirking. These high-performance work systems are difficult to understand in terms of standard moral hazard models. We show experimentally...

In recent decades, many firms offered more discretion to their employees, often increasing the productivity of effort but also leaving more opportunities for shirking. These “high-performance work systems” are difficult to understand in terms of standard moral hazard models. We show...

In recent decades, many firms offered more discretion to their employees, often increasing the productivity of effort but also leaving more opportunities for shirking. These "high-performance work systems" are difficult to understand in terms of standard moral hazard models. We show...