The canonical model in economics considers people to be rational and self-regarding. However, much evidence challenges this view, raising the question of when "Economic Man" dominates the outcome of social interactions, and when bounded rationality or other-regarding preferences dominate. Here we show that strategic incentives are the key to answering this question. A minority of self-regarding...

Embeddedness of interfirm relationships in the social structure resulting from prior partnerships engenders order in new tie formation. However, competitive incentives make firms likely to undermine the order that they achieve through the formation of interfirm relationships. We focus empirically on unplanned dissolution of joint ventures between firms competing in the same industry and examine...