We employ laboratory methods to study stability of competitive equilibrium in Scarf’s economy (International Economic Review, 1960). Tatonnement theory predicts that prices are globally unstable for this economy, i.e. unless prices start at the competitive equilibrium they oscillate without...

This paper reports an experiment investigating how different kinds of experience influence the endowment effect. Previous studies have investigated how the endowment effect is influenced by experience gained through repetition of decision problems and trading in natural and experimental markets....