This study validates a survey-based measure of general risk attitude by an incentive compatible experiment among more than 900 participants in rural Thailand. The survey measure of self-assessed risk attitude provides a useful approximation of the experimentally derived risk attitude. This holds when we add various socio-demographic control variables to the survey-experiment-relation which are ...

A stable market structure is a partition of the firms in an industry such that there is no incentive for any breakups or mergers. Characterizing such stability requires an endogenization of both the core and Cournot equilibrium as well as all hybrid equilibria. This paper solves for the stable partitions in a general oligopoly by providing a tractable condition: a partition is stable if and onl...

Using a sample of male and female workers from the 1992 Employment in Britain survey we estimate a generalised grouped zero-inflated Poisson regression model of employees’ selfreported lateness. Reflecting theoretical predictions from both psychology and economics, lateness is modelled as a function of incentives, the monitoring of and sanctions for lateness within the workplace, job satisfacti...

In this paper, collusive price leadership in homogeneous good capacity-constrained repeated price competition is examined. In the stage game, firms choose their timing of price setting. Although setting a price early is disadvantageous per se, a large firm has an incentive to move early in order to demonstrate its commitment not to deviate. If the discount factor is not too large, this behavior...

Informational asymmetries abound in economic decision making and often provide an incentive for deception through telling a lie or misrepresenting information. In this paper I use a cheap-talk sender-receiver experiment to show that telling the truth should be classified as deception too if the sender chooses the true message with the expectation that the receiver will not follow the sender’s (...

This paper analyzes the effects of additional information in a life insurance market under adverse selection. Individuals have an incentive to acquire information about their risk type if their informational status cannot be observed by insurers. In aggregate, however, the existence of a testing opportunity has an effect on the equilibrium premium. We describe the conditions under which, from a...

This paper examines the welfare implications of an existence of free trade agreements (FTAs) and customs unions (CUs) in the GATT system, in the presence of cross-foreign ownership among countries. In particular, two GATT regimes are analyzed: a pure GATT regime without any regional free trade agreements, and modified GATT regime with either an FTA or a CU. This paper argues that, when foreign ...

We investigate the impact of founding family ownership structure on the agency cost of debt. We find that founding family ownership is common in large, publicly traded firms and is related, both statistically and economically, to a lower cost of debt financing. Our results are consistent with the idea that founding family firms have incentive structures that result in fewer agency conflicts bet...

This paper uses a novel empirical setting to explore the association between a firm’s operational risk, managerial monitoring costs, and the level of CEO equity incentives. We investigate a sample of supplier firms that rely on a few large customers for the bulk of their revenues. We predict that supplier firms with higher customer concentration face both higher exogenous idiosyncratic risk and...

In a signaling game between a receiver and senders, prejudice occurs if senders are pre-judged based on an index such as race without reference to their qualifying signals. This paper investigates what makes the receiver ignore senders’ informative signals in favor of the uninformative index. Prejudice arises when competition between senders erodes their signaling incentive and reduces the qual...