Experimental economics summary paper Essay Example | Topics and Well Written Essays - 500 words - 4

Experimental economics summary paper - Essay Example The article describes how two variations on similar experiments test consumer behavior of people put in different market-type situations. The first variety of the game takes place between two people who are put in multiple sessions of a staged bargaining situation. They are to divide a sum between themselves and their acceptance or rejection of the proposed division determines what they get. One of them takes the lead and makes the other an offer of division. If the other person accepts the offer, they keep the money according to that division. On rejection, both participants get nothing. The second variety places a group of up to nine people in a bidding session against a ‘seller’. The seller’s acceptance or rejection of individual offers determines earnings in this case. The ‘buyers’ each make an offer for an object that is of the same monetary value to them and is of no value to the ‘seller’. If the seller accepts the highest offer, he gets the money and the buyer receives the difference between the highest price and the value of the object. On the seller’s rejection, nobody receives anything.