The costs and benefits of symmetry in common-ownership allocation problems
Alexander Brown () and
Rodrigo Velez ()
No 20140918-001, Working Papers from Texas A&M University, Department of Economics
In experimental partnership dissolution problems with complete information, the divide-and-choose mechanism is significantly superior to the winner's-bid-auction. The performance of divide-and-choose is mainly affected by reciprocity issues and not by bounded rationality. The performance of the winner's-bid-auction is significantly affected by bounded rationality. Contrary to theoretical predicitions divide-and-choose exhibits no first-mover bias.
Keywords: experimental economics; no-envy; divide-and-choose; winner's-bid auction; behavioral mechanism design (search for similar items in EconPapers)
JEL-codes: C91 D63 C72 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp and nep-gth
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http://respec.tamu.edu/brownsymmetry.pdf First version, 2014 (application/pdf)
Journal Article: The costs and benefits of symmetry in common-ownership allocation problems (2016)
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