It has been shown that participants in the dictator game are less willing to give money to the other participant when their choice set also includes the option to take money. We examine whether this effect is due to the choice set providing a signal about entitlements in a setting where...

Introducing a threshold in the sense of a minimal project size transforms a public-good game with an inefficient equilibrium into a coordination game with a set of Pareto-superior equilibria. Thresholds may therefore improve efficiency in the voluntary provision of public goods. In our one-shot...

We investigate the "law of small numbers" using a unique panel data set on lotto gambling. Because we can track individual players over time, we can measure how they react to outcomes of recent lotto drawings. We can therefore test whether they behave as if they believe they can predict lotto...

We use the strategy method to classify subjects into cooperator types in a large-scale online Public Goods Game and find that free riders spend more time on making their decisions than conditional cooperators and other cooperator types. This result is robust to reversing the framing of the game...

The “gambler's fallacy” is the false belief that a random event is less likely to occur if the event has occurred recently. Such beliefs are false if the onset of events is in fact independent of previous events. We study gender differences in the gambler's fallacy using data from the Danish...

We experimentally investigate information aggregation through majority voting when some voters are biased. In such situations, majority voting can have a “dark side”, i.e. result in groups making choices inferior to those made by individuals acting alone. We develop a model to predict how...

Loss aversion is one of the most robust findings to have emerged from behavioral economics. Surprisingly little attention, however, has been devoted to nominal loss aversion, the interaction of loss aversion and money illusion. People tend to think of transactions in terms of their nominal...