We report the results of an experimental investigation of the Baron and Ferejohn (1989) model of legislative bargaining with cheap talk. Communication results in substantially increased proposer power, close to the stationary subgame perfect equilibrium prediction. This is achieved primarily...

In this paper we examine the effects of limited liability on mortgage dynamics. While the literature has focused on default rates, renegotiation, or loan rates individually, we study them together as equilibrium outcomes of the strategic interaction between lenders and borrowers. We present a...

Whether CEOs and other senior executives are too highly compensated is one of the most publicized and divisive issues in corporate governance. In this paper, we address this question not by asking whether executives are paid more than the value they create, but by asking whether firms could pay...

Negotiating groups composed of 4 members with different social motives were examined to determine the impact of social motive composition on negotiation behavior. Theories of negotiation, experimental games, and group altruism were used to develop hypotheses regarding how social motive...