We study the interplay of inequality and trust in a dynamic game, in which trust increases efficiency and thus allows higher growth of the experimental economy in the future. We find that trust is initially high in a treatment starting with equal endowments, but decreases over time. In a...

This paper experimentally investigates the effects of a costly punishment option on cooperation and social welfare in long finitely repeated public good contribution games. In a perfect monitoring environment increasing the severity of the potential punishment monotonically increases both...

We report on an experiment using video technology to manipulate pre-play communication protocols in the lab and to study purely social effects of communication on donations and discrimination between potential receivers. The experimental design eliminates strategic factors by allowing two...