Andreoni (1993) has shown in an experimental study that crowding out is incomplete when an involuntary lump-sum tax is levied exogenously on individuals to finance the provision of a public good. In this paper, we (i) replicate Andreoni's experimental conditions, and (ii) introduce treatments...

In this paper we address the role of the veil of ignorance on work incentives and tax rates in a two-person real effort experiment. We find that effort levels decrease with a rise in tax rates. Tax revenues peak at intermediate tax rates of 50 percent to 65 percent, supporting the existence of a...

Bilateral joint ventures, such as marriage, are economically inspired by their prospects of labor division and specialization. However, specialization makes the partnerwho investsmore in relation-specificqualificationsmore exploitable (holdup problem). In a two-person experiment we study...