Experimental Business Research

Experimental Business Research includes papers that were presented at the First Asian Conference on Experimental Business Research held at the Hong Kong University of Science and Technology (HKUST), on December 7-10, 1999. The conference was organized by

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EXPERIMENTAL BUSINESS RESEARCH

Edited by

Rami Zwick Hong Kong University ofScience and Technology and

Amnon Rapoport University ofArizona, USA

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SPRINGER SCIENCE+BUSINESS MEDIA, LLC

ISBN 978-1-4419-4910-3 ISBN 978-1-4757-5196-3 (eBook) DOI 10.1007/978-1-4757-5196-3

Library of Congress Cataloging-in-Publication Data A C.I.P. Catalogue record for this book is available from the Library of Congress.

Copyright q:, 2002 by Springer Science+Business Media New York Originally published by Kluwer Academic Publishers in 2002 AII rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, mechanical, photo-copying, recording, or otherwise, without the prior written permission of the publisher, Springer Science+Business Media, LLC.

Printed on acid-free paper.

Contents

Preface Rami Zwick and Amnon Rapoport PART I

IX

COORDINATION & DYNAMIC DECISION MAKING

Chapter 1 An Experimental Study of Saving and Investing in a Complex Stochastic Environment Vital Anderhub, Werner Giith and Florian Knust .................

3

Chapter 2 Dynamic Decision Making in Marketing Channels: An Experimental Study of Cycle Time, Shared Information and Customer Demand Patterns Sunil Gupta, Joel H. Steckel and Anirvan Banerji ................

21

Chapter 3 Cooperation in Single Play, Two-Person Extensive Form Games Between Anonymously Matched Players Kevin McCabe, Mary Rigdon and Vernon Smith ................. 49 Chapter 4 Coordination in the Aggregate without Common Knowledge or Outcome Information Amnon Rapoport, Darryl A. Seale and James E. Parco ............

69

Chapter 5 Behavioral Accounting Experiments in Market and Game Settings William S. Waller. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..

101

Chapter 6 Behavioral Strategies in Repeated Pure Coordination Games Rami Zwick, Amnon Rapoport and Alison King Chung Lo . . . . . . . ..

135

vi

PART II

Contents

AUCTIONS

Chapter 7 Externalities and Alternative Auction Rules for Access to Rail Networks: Some Evidence from the Laboratory Paul 1. Brewer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..

169

Chapter 8 Equilibrium Bidding Strategies under the English and the Second-Price Auctions Soo Hong Chew and Naoko Nishimura ........................

197

Chapter 9 Physiological Anticipation and Endowment Effects: Inferred Brain Function in the Formation of Allocations in an English Auction John Dickhaut, Kip C. S. Smith, Kevin McCabe, Nicole R. Peck and Vijay Rajan . . . . . . . . . . . . . . . . . . . . . . . . . . . ..

207

Chapter 10 Price Disclosure, Marginal Abatement Cost Information and Market Power in a Bilateral Ghg Emissions Trading Experiment Yoichi Hizen and Tatsuyoshi Saijo . . . . . . . . . . . . . . . . . . . . . . . . . . . ..

231

PART III

LEARNING AND CONSTRUCTION

Chapter 11 EWA Learning in Bilateral Call Markets Colin F. Camerer, David Hsia and Teck-Hua Ho . . . . . . . . . . . . . . . . ..

255