A childhood intervention to improve the social skills and self-control of at-risk kindergarten boys in 1980s had positive impacts over life course: higher trust as adolescents; increased group membership, education, reduced criminality young adults; marriage employment adults. Using administrative data, we find this average yearly income by about 20 percent decreased transfers almost 40 percent...

We present experimental results on the ultimatum bargaining game which support an evolutionary explanation of subjects’ behaviour in the game. In these experiments subjects interacted with each other and also with virtual players, i.e. computer programs with prespecified strategies. Some of these virtual players were designed to play the equitable allocation, while others exhibited behaviour cl...

This paper analyzes how preferences for a noneconomic characteristic (e.g., caste) can affect equilibrium patterns of matching, and empirically evaluates this in the context of middle-class Indian arranged marriages. We show theoretically how the equilibrium consequences of caste depend on whether preferences are towards one’s own group or for “marrying up.” We then estimate actual preferences ...

We experimentally investigate in village India how belief systems that hierarchize social groups affect the groups’ responses to economic opportunities. Earlier we found that making caste salient hurt low caste performance both absolutely and relative to the high caste’s. To examine the possible role of mistrust, we manipulate the scope for discretion in rewarding performance. When offered a ga...

Experiments have shown that people have a natural taste for cooperation. This paper takes a first step in understanding how formal and informal institutions might be designed to utilize these private tastes to facilitate more efficient economic interactions. We examine a twice-played prisoner’ dilemma in which the total of the stakes in the two periods is fixed, but the distribution of these st...

Corruption often creates a “briber’s dilemma”: each of the “clients” competing for a rent allocated by a government official has an incentive to pay bribes to try to obtain preferential treatment, but they would all be better off if they could mutually commit not to pay bribes. This paper uses a model of linked games to show how informal relationships among the clients may enable them to enforc...

Incentives and Group Identity This paper investigates in a principal-agent environment whether and how group membership influences the effectiveness of incentives and when incentives can have “hidden costs”, i.e., a detrimental effect. We show experimentally that in all interactions control mechanisms can have hidden costs for reasons specific to group membership. In within-group interactions c...

The rise in online social networking has brought about a revolution in social relations. However, its effects on offline interactions and its implications for collective well-being are still not clear and are under-investigated. We study the ecology of online and offline interaction in an evolutionary game framework where individuals can adopt different strategies of socialization. Our main res...

Empirical evidence is provided for the importance of pro-social behavior of individuals in an anonymous, n-person public good setting. A unique panel data set of 136,000 observations is matched with an extensive survey. Even under anonymous conditions, a large number of individuals are prepared to donate quite a significant sum of money. Cooperation conditional on giving by specific other perso...

This paper estimates the intergenerational transmission of trust by studying second generation immigrants in 29 European countries with ancestry in 87 nations. There is significant transmission of trust on the mother’s side. The transmission is stronger in Northern Europe. Ancestry from more developed countries suggests a stronger transmission of trust, but the heterogeneity in ancestry dissip...