The fundamental question addressed in this research is the degree to which models of optimal intertemporal choice are good descriptions of non-interactive individual intertemporal behavior in the presence of habit formation. The existence of loss avoidance does, however, not explain why subjects...

The work illustrates that not all non-economic behavior is beyond economic analysis. The maintained assumption as economists is that individual behavior is consistent with self-interest. At its weakest, self-interest only means that choices conform to some underlying preference ordering that is...

This chapter reports on two experiments that were designed to test whether efficiency wage theories receive support in the laboratory. The idea is that theories which have no explanatory power even under the controlled circumstances of the laboratory, will not apply to the much more complicated...