Topic: Bargaining and Time Preferences: An Experimental Study
Speaker: Wooyoung LIM, Hong Kong University of Science and Technology
Time: Tuesday,September 24, 13:30-15:00
Location: Room 217, Guanghua Building 2
We provide the first experimental test of theRubinstein(1982) model of bargaining, wherethe cost of disagreement is actual payoff delay. Our design has all bargaining take place withina single session, but exogenously varies the delay per round at the individual level (week/month,with/without front-end delay) and implements delayed payoffs via an online payment system.We formally derive the basic theoretical predictions under the null hypothesis of exponentialdiscounting (immediate agreement, proposer advantage, effective delay advantage, and front-enddelay neutrality) and the differential predictions under the alternative hypothesis of present bias(front-end delay advantage), and we purposefully design our treatments to test these. In contrastto the mixed evidence from prior experiments, none of which implement actual payoff delay, we find overwhelming behavioral support for the theory when accounting for present bias.
Prof. Wooyoung LIM is an associate professor of the Department of Economics, the Hong Kong University of Science and Technology. His research interests focus on Game Theory and Experimental Economics. Futher information can be found at:http://www.bm.ust.hk/econ/faculty-and-staff/directory/wooyoung
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