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Business Drinking: Evidence from A Lab-in-the-Field Experiment

Daniel Houser () and Jianxin Wang ()
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Jianxin Wang: Interdisciplinary Center for Economic Science and Department of Economics, George Mason University

No 1074, Working Papers from George Mason University, Interdisciplinary Center for Economic Science

Abstract: Although alcohol consumption is an important component of business negotiations across many cultures, this behavior remains unmodeled. Here, we develop a theory that combines guilt-aversion with a canonical alcohol myopia framework. Our GAAM (guilt aversion and alcohol myopia) model predicts that intoxication increases promise-making, but has no effect on promise-breaking. We test these predictions using a prisoner’s dilemma game with pre-play communication in a lab-in-the-field experiment. Among males, we find behavior consistent with predictions. We do not observe intoxication to impact female promise-making or promise-breaking behaviors, consistent with previous empirical findings that females are relatively insensitive to alcohol-induced myopia.

Keywords: : business drinking; communication; guilt aversion; alcohol myopia; gender difference (search for similar items in EconPapers)
JEL-codes: C78 C93 D91 (search for similar items in EconPapers)
Pages: 53
Date: 2021-03
New Economics Papers: this item is included in nep-cbe and nep-exp
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