Trust is a vital element of any society. Previous studies using trust games have provided insight into understandings of trusting behavior. However, investors' behaviors can be confounded by their risk preferences in the game, and little is known about the relationship between stake size and beliefs of others' good intentions underlying trust. We thus used a variant of the trust game and conducted two experiments to examine how stake size affects investors' beliefs about receivers' trustworthiness, with model-based analyses. We showed that, when holding all else equal, investors trusted more, but their expectations of reciprocation declined as stake size increased. However, actual receivers' reciprocation rates showed the opposite trend to investors' pessimistic beliefs. Furthermore, following previous studies in social psychology, we hypothesized that investors' social preferences (social value orientation) moderated the beliefs underlying trust, but they had no explanatory powers in investors' expectations of reciprocation. These results suggest that peoples' naive beliefs about stake size play a more important role in trust decisions than expected.

© 2020 The Author(s) What types of people are most concerned about the sustainability of our society? Does empowering such people in the political process influence us to make collective decisions that best serve the interests of future generations? This study invites 1000 parents with children under the legal voting age and 1000 parents with children over the legal voting age to an incentivized donation experiment in which a donation will be made to non-profit organizations committed to a better future society. The size of the donation per participant is determined by vote among the participants. We compare two voting rules: ordinary voting, whereby each participant is given one ballot, and proxy voting, whereby parents with unenfranchised children are given an extra ballot on behalf of their children. We observe that, with ordinary voting, the mothers with children under the voting age exhibit a higher degree of altruism towards future generations. With proxy voting, however, this distinction disappears. Furthermore, with proxy voting, the overall average donation indicated by participants is smaller than that indicated under ordinary voting. These observations imply that empowering institutionally those who tend to be more altruistic does not necessarily result in collective decisions that are more altruistic towards future generations.

Social norms for cooperation are often supported by positive and negative sanctions. Simultaneously, positive interactions in human relationships via sanctions are promoted by positive social behavior. This study investigates the relationship between social behavior and sanctions based on economic laboratory experiments. Participants with unique IDs make decisions on the contribution to public goods, which is inefficient for society. After participating in the public goods game, they decide whether to use the sanctions. The type of sanctions are varied, such as no sanction, only punishable, only rewardable, and all of these are possible. We found that inefficient social behavior increases under conditions where participants can reward each other and that the level of social activity and rewards are positively correlated. To exclude the possibility of the participants misunderstanding inefficiency, we performed an additional experiment that emphasizes the meaning of inefficiency that the contribution toward public goods reduces profits in society as a whole. We found that even with this emphasis, the high level of contributions is sustained when sanctions are possible. A group-level comparison showed that the group that maintained bad norms used the reward option more. Our results suggest that people maintain bad norms in anticipation of positive interaction.

Three societies, namely the hunter-gatherer, the agrarian and the industrial, represent the course of human history of cultural and economic development. In this course, each society exhibits distinct cultures and daily life practices that shape human behaviors and preferences, characterizing temporal actions and consequences at the individual and group levels. We examine individual and group time preferences and their relation across the three societies. To this end, we conduct a field experiment to elicit individual and group discount factors in three societies of Indonesia-(i) the fisheries, (ii) the farming and (iii) the urban societies-as proxies of the hunter-gatherer, agrarian and industrial societies, respectively. We find that both individual and group discount factors are the lowest (highest) in the fisheries (agrarian) society, while those in the urban society are in the middle. We also observe that the determinants of group discount factors differ across societies: members of the lowest and middle discount factors in a group play an important role in determining the group discount factor in the fisheries society, while only the members with the middle discount factor are key in agrarian and urban societies. Overall, our results suggest that individual and group discount factors non-monotonically change as societies transition from fisheries to agrarian and from agrarian to urban and that comparatively shortsighted people (the lowest and middle) are more influential than farsighted people in determining group time preferences.

This paper investigates a new voting rule wherein some people are given extra votes to serve as proxies for future generations. We predict that this voting scheme affects the voting behavior of those who do not receive an extra vote (i.e., single-ballot voters) because they are less likely to become a pivot, while proxy voters are expected to behave in support of the future generation. To test this prediction, we compare three scenarios wherein single-ballot voters would cast a vote: (a) one-voter-one-vote scenario wherein all voters cast only a single ballot; (b) a standard proxy-voting scenario wherein other voters cast two ballots, and the second vote is to cast for the benefit of a future generation; and (c) a non-proxy-voting scenario wherein other voters cast two ballots with no explanation for the second vote. The result shows that single-ballot voters are less inclined to vote for the future-oriented option in (c) than in (a). This indicates the potential drawback of the new voting scheme. However, there is no difference in the single-ballot voters’ decision between (a) and (b), indicating that the explanation of the second ballot as the proxy is important for reducing the intergenerational inequality through this voting reform.

Second-order free riders, who do not owe punishment cost to first-order free riders in public goods games, lead to low cooperation. Previous studies suggest that for stable cooperation, it is critical to have a pool punishment system with second-order punishment, which gathers resources from group members and punishes second-order free riders as well as first-order free riders. In this study, we focus on the priority of punishment. We hypothesize that the pool punishment system that prioritizes second-order punishment is more likely to achieve cooperation than the system that prioritizes first-order punishment, because the former is more likely to obtain sufficient punishment resources. In the experiments, we compare four pool punishment systems: 1To2 (first-order punishment to second-order punishment), 2To1 (second-order punishment to first-order punishment), 1ONLY (first-order punishment only), and 2ONLY (second-order punishment only). We find that the 2To1 and 2ONLY systems can receive more support than the 1To2 and 1ONLY systems and only the 2To1 system can achieve high cooperation. However, the effect of priority of second-order punishment is observed only when the punishment ratio (PR) is low (Experiment 1), not high (Experiment 2), in which the punishment resource is relatively abundant.

We identify the necessary and sufficient condition under which the Shapley value coincides with the prenucleolus for general TU games. For 0-normalized 3-person games, the coincidence holds if and only if the game is symmetric or satisfies the PS property (Kar et al., 2009). We also identify the necessary and sufficient coincidence condition in the following allocation problems: the airport games (Littlechild and Owen, 1973), the bidder collusion games (Graham et al., 1990) and the polluted river games (Ni and Wang, 2007). The coincidence between the Shapley value and the CIS and ENSC values is discussed as well. (C) 2017 Elsevier B.V. All rights reserved.

The article, Negotiating with the future: incorporating imaginary future generations into negotiations, written by Yoshio Kamijo, Asuka Komiya, Nobuhiro Mifune and Tatsuyoshi Saijo, was originally published Online First without open access. After publication in volume 12, issue 3, page 409–420 the author decided to opt for Open Choice and to make the article an open access publication. Therefore, the copyright of the article has been changed to © The Author(s) 2017 and the article is forthwith distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons. org/licenses/by/4.0/), which permits use, duplication, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made.

People to be born in the future have no direct influence on current affairs. Given the disconnect between people who are currently living and those who will inherit the planet left for them, individuals who are currently alive tend to be more oriented toward the present, posing a fundamental problem related to sustainability. In this study, we propose a new framework for reconciling the disconnect between the present and the future whereby some individuals in the current generation serve as an imaginary future generation that negotiates with individuals in the real-world present. Through a laboratory-controlled intergenerational sustainability dilemma game (ISDG), we show how the presence of negotiators for a future generation increases the benefits of future generations. More specifically, we found that when faced with members of an imaginary future generation, 60% of participants selected an option that promoted sustainability. In contrast, when the imaginary future generation was not salient, only 28% of participants chose the sustainable option.

Sustainability has become a key issue in managing natural resources together with growing concerns for capitalism, environmental and resource problems. We hypothesize that the ongoing modernization of competitive societies, which we refer to as "capitalism," affects human nature for utilizing common pool resources, thus compromising sustainability. To test this hypothesis, we design and implement a set of dynamic common pool resource games and experiments in the following two types of Nepalese areas: ( i) rural ( non-capitalistic) and ( ii) urban ( capitalistic) areas. We find that a proportion of prosocial individuals in urban areas is lower than that in rural areas, and urban residents deplete resources more quickly than rural residents. The composition of proself and prosocial individuals in a group and the degree of capitalism are crucial in that an increase in prosocial members in a group and the rural dummy positively affect resource sustainability by 65% and 63%, respectively. Overall, this paper shows that when societies move toward more capitalistic environments, the sustainability of common pool resources tends to decrease with the changes in individual preferences, social norms, customs and views to others through human interactions. This result implies that individuals may be losing their coordination abilities for social dilemmas of resource sustainability in capitalistic societies.

In this study, we conducted a laboratory experiment to assess preemptive striking by and towards individuals or groups. In the framework of a preemptive strike game, we set the following four conditions: one person faced another person, one person faced a three-person group, a three-person group faced an individual, and a three-person group faced another three-person group. Previous studies have revealed that greed is activated when participants belong to a group, while fear is activated when participants interact with a group, and further, that attacking behaviors in the preemptive strike game are driven by fear. These observations led to a hypothesis that high attack rates would be realized when participants interact with a group, regardless of whether the participants make decisions as individuals or a group. The results of our experiment, however, rejected this hypothesis. Among the four conditions, the attack rate was highest when a three-person group faced an individual. As possible reasons for our observation, we discuss the potential threat stemming from the imbalance in the effectiveness of attack between individuals and groups, and the (incorrect) belief by groups that single individuals would be more likely to attack out of fear.

We examine three tools that can enhance coordination success in a repeated multiple-choice coordination game. Gradualism means that the game starts as an easy coordination problem and moves gradually to a more difficult one. The Endogenous Ascending mechanism implies that a gradual increase in the upper bound of coordination occurs only if coordination with the Pareto superior equilibrium in a stage game is attained. The Endogenous Descending mechanism requires that when the game's participants fail to coordinate, the level of the next coordination game be adjusted such that the game becomes simpler. We show that gradualism may not always work, but in such instances, its effect can be reinforced by endogeneity. Our laboratory experiment provides evidence that a mechanism that combines three tools, herein termed the "Gradualism with Endogenous Ascending and Descending (GEAD)'' mechanism, works well. We discuss how the GEAD mechanism can be applied to real-life situations that suffer from coordination failure.

The purpose of this paper is to introduce a new basis of the set of all TU games. Shapley (1953) introduced the unanimity game in which cooperation of all players in a given coalition yields payoff. We introduce the commander game in which only one player in a given coalition yields payoff. The set of the commander games forms a basis and has two properties. First, when we express a game by a linear combination of the basis, the coefficients related to singletons coincide with the Shapley value. Second, the basis induces the null space of the Shapley value. (C) 2016 Elsevier B.V. All rights reserved.

In this study, we provide a theory to explain how bottom punishment or top reward enhances performance of teams when there is heterogeneity across players in cost-performance relationships. In contrast to the existing literature, we consider three types of performance functions: additive, weakest link (the performance is the min of performances of n contestants), and best shot (the performance is the max of performances of n contestants). For any of the three types, we derive easy-to-check sufficient conditions to judge whether reward or punishment is better. From the sufficient condition for the additive performance function, we know that punishment is better for less heterogeneous people and reward is better for more heterogeneous people. In addition, the sufficient conditions for the best-shot and weakest-link cases suggest that some unintuitive results hold; even under the best-shot (weakest link) performance function, the bottom punishment (top reward) becomes better when the gap in the abilities of contestants becomes very small (large). (C) 2015 Elsevier B.V. All rights reserved.

By focusing on players' relative contributions, we study some properties for values in positive cooperative games with transferable utilities. The well-known properties of symmetry (also known as "equal treatment of equals") and marginality are based on players' marginal contributions to coalitions. Both Myerson's balanced contributions property and its generalization of the balanced cycle contributions property (Kamijo and Kongo Int J of Game Theory 39:563-571, 2010; BCC) are based on players' marginal contributions to other players. We define relative versions of marginality and BCC by replacing marginal contributions with relative contributions, and examine efficient values satisfying each of the two properties. On the class of positive games, a relative variation of marginality is incompatible with efficiency, and together with efficiency and the invariance property with respect to the payoffs of players under a player deletion, a relative variation of BCC characterizes the proportional value and egalitarian value in a unified manner.

We establish a model wherein a private firm competes with a partially privatized firm whose objective function is endogenously determined through bargaining between owners the welfare-maximizing government and dividend-maximizing private shareholders. Many existing works on partial privatization have assumed that privatization increases the weight of profits in the partially privatized firm's objective, whereas it decreases the weight of welfare. However, our bargaining approach shows that this result can be reversed. (C) 2014 Elsevier B.V. All rights reserved.

This study investigates two centralized punishment institutions for a linear public goods game. These institutions require a certain contribution level and sanction under-contributing players. The two differ in who, among those who do not meet this requirement, receive sanctions. In one institution, all violators are sanctioned, and in the other, only the worst violator(s) is sanctioned. Theoretically, the public goods game of the latter institution yields contributions equal to or greater than that of the former institution with the same requirement and sanction level. The results of an experiment support this theoretical prediction. However, there is a discrepancy between the theory and laboratory observations in that the institution with the theoretically optimal requirement did not yield the highest profit. (C) 2014 Elsevier Inc. All rights reserved.

In this study, we provide a new solution for cooperative games with coalition structures. The collective value of a player is defined as the sum of the equal division of the pure surplus obtained by his coalition from the coalitional bargaining and of his Shapley value for the internal coalition. The weighted Shapley value applied to a game played by coalitions with coalition-size weights is assigned to each coalition, reflecting the size asymmetries among coalitions. We show that the collective value matches exogenous interpretations of coalition structures and provide an axiomatic foundation of this value. A noncooperative mechanism that implements the collective value is also presented.

Two keyword auction mechanisms, the Generalized Second-Price auction (GSP) and the Vickrey-Clarke-Groves mechanism (VCG), were compared theoretically and experimentally. The former is widely used in practice; the latter is not, but it has a dominant strategy equilibrium where all participants bid their true values. In the theoretical investigation, by applying the locally envy-free Nash equilibrium to the VCG, we found that the allocations are efficient and that upper and lower bounds of the auctioneer's revenue coincide in the two mechanisms. A laboratory experiment, in which the revenues and efficiencies were similar in both mechanisms, supported this result.

This paper investigates whether smokers exhibit greater time discounting than non-smokers, and how short-term nicotine deprivation affects time discounting. A unique feature of our experiment is that our subjects receive rewards not only of money, but also of actual tobacco. This is done in order to elicit smokers' true preferences. Smokers are more impatient than non-smokers, consistent with previous studies. Additionally, nicotine deprivation makes smokers even more impatient. These results suggest that nicotine concentration has different effects on time preferences in the short and long runs. © 2013 Elsevier Inc.

This study provides a unified axiomatic characterization method of one-point solutions for cooperative games with transferable utilities. Any one-point solution that satisfies efficiency, the balanced cycle contributions property (BCC), and the axioms related to invariance under a player deletion is characterized as a corollary of our general result. BCC is a weaker requirement than the well-known balanced contributions property. Any one-point solution that is both symmetric and linear satisfies BCC. The invariance axioms necessitate that the deletion of a specific player from games does not affect the other players' payoffs, and this deletion is different with respect to solutions. As corollaries of the above characterization result, we are able to characterize the well-known one-point solutions, the Shapley, egalitarian, and solidarity values, in a unified manner. We also studied characterizations of an inefficient one-point solution, the Banzhaf value that is a well-known alternative to the Shapley value. (C) 2011 Elsevier B,V. All rights reserved.

This paper Studies a non-cooperative mechanism implementing a cooperative solution for a situation in which members of a society are Subdivided into groups and/or coalitions and there is asymmetry among the individuals of the society. To describe hierarchical and horizontal cooperation structure simultaneously, we present unified classes of games, the games with social structure. and define a weighted value for these games. We show that our mechanism works in any zero-monotonic environment and implements the Shapley Value, the weighted Shapley value, the Owen's coalitional Value, and the weighted coalitional value, in some special cases. (C) 2008 Elsevier B.V. All rights reserved.