Breaking Up: Experimental Insights into Economic (Dis)Integration

Gabriele Camera, Lukas Hohl () and Rolf Weder ()
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Lukas Hohl: University of Basel
Rolf Weder: University of Basel

Working Papers from Chapman University, Economic Science Institute

Abstract: Standard international economic theory suggests that people should embrace economic integration because it promises large gains. But recent events such as Brexit indicate a desire for economic disintegration. Here we report results of an experiment, based on a strategic analytical framework, of how size and distribution of potential gains from integration in?uence outcomes and individuals’ inclination to embrace integration. We ?nd that cross-country inequality in potential gains acts as a friction to realize those gains. This suggests that to better understand recent phenomena, international economic theory should account for distributional considerations and behavioral aspects it currently ignores.

Keywords: Endogenous institutions; Globalization; Indefinitely repeated games; Social dilemmas (search for similar items in EconPapers)
JEL-codes: C70 C90 F02 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-exp, nep-gth, nep-int and nep-ltv
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https://digitalcommons.chapman.edu/esi_working_papers/285/

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Working Paper: Breaking Up: Experimental Insights into Economic (Dis)Integration (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:chu:wpaper:19-25

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