R. Mark Isaac - Böcker

For several decades, the orthodox economics approach to understanding choice under risk has been to assume that each individual person maximizes some sort of personal utility function defined over purchasing power. This new volume contests that even the best wisdom from the orthodox theory has not yet been able to do better than supposedly naïve models that use rules of thumb, or that focus on the consumption possibilities and economic constraints facing the individual. The authors assert this by first revisiting the origins of orthodox theory. They then recount decades of failed attempts to obtain meaningful empirical validation or calibration of the theory. Estimated shapes and parameters of the "curves" have varied erratically from domain to domain (e.g., individual choice versus aggregate behavior), from context to context, from one elicitation mechanism to another, and even from the same individual at different time periods, sometimes just minutes apart.This book proposes the return to a simpler sort of scientific theory of risky choice, one that focuses not upon unobservable curves but rather upon the potentially observable opportunities and constraints facing decision makers. It argues that such an opportunities-based model offers superior possibilities for scientific advancement. At the very least, linear utility – in the presence of constraints - is a useful bar for the "curved" alternatives to clear.

This special volume is devoted to a single topic. In the past several years, many governments, including the United States and Canada, launched a major shift to what are sometimes called "incentive based" pollution control procedures. Because these proposed systems inherently required institutional design, they constituted a natural domain for laboratory experimental economics research.

Volume 8 of "Research in Experimental Economics" provides a forum for papers incorporating laboratory experimental economics. These specifically include interdisciplinary papers, papers that report experimental design innovations and papers that report detailed data. The paper by Isaac, Walker and Williams is an example. It discusses the design of instructional experiments in such areas as monopoly, asset trading double auctions, and public goods. The paper also examines practical issues of using laboratory experiments as a teaching tool. Four papers report on public goods research. Krishnamurthy, motivated by research questions in Marketing, examines the role of non-binding, face-to-face communication in public goods environments with and without provision points. Chewning, Coller, and Laury incorporate a natural modification of previous provision-point environments, namely, multiple provision points in which additional amounts of the public good will be provided at increasing threshold steps. The paper by Packard, Isaac, and Bial extends research on the marginal per capita return effect (broken down between the MPCR affecting own payoff and affecting others). This paper takes that distinction to a boundary in which the public good provides no marginal per capita return to the contributor. The paper by Croson examines, in the light of the literature on team production, the effect in a public goods environment of different levels of feedback on others' contributions. In one treatment, individuals know only the aggregate contributions of others, while in the other treatment they had information on individual decisions. The paper by Kelly extends existing research regarding single sellers by providing for multiproduct monopolists. It is not merely the addition of additional products that distinguishes this paper, but also the fact that monopolists have a bundling decision to make. This volume concludes with two papers that use controlled experiments for testing policy-relevant allocation mechanisms. Elliott, Kruse, Schulze, and Ben-David examine four mechanisms for the rationing of productive inputs that are subject to supply shocks. Electricity markets are one obvious motivation, but certainly not the only one. Ishikida, Ledyard, Olson, and Porter present experimental "testbedding" research on the California RECLAIM emissions permit market.

This volume will present experimental economics research focusing on issues of environmental quality and sustainability. Specific topics will include institutions for cap-and-trade, eco-tourism, urban sprawl, and optimal pollution control strategies. In addition to the traditional 'introduction', we are asking an expert on engineering issues in energy, the environment, and sustainability to write an essay highlighting the benefits to scientists and engineers of understanding human behaviour.

For several decades, the orthodox economics approach to understanding choice under risk has been to assume that each individual person maximizes some sort of personal utility function defined over purchasing power. This new volume contests that even the best wisdom from the orthodox theory has not yet been able to do better than supposedly naïve models that use rules of thumb, or that focus on the consumption possibilities and economic constraints facing the individual. The authors assert this by first revisiting the origins of orthodox theory. They then recount decades of failed attempts to obtain meaningful empirical validation or calibration of the theory. Estimated shapes and parameters of the "curves" have varied erratically from domain to domain (e.g., individual choice versus aggregate behavior), from context to context, from one elicitation mechanism to another, and even from the same individual at different time periods, sometimes just minutes apart.This book proposes the return to a simpler sort of scientific theory of risky choice, one that focuses not upon unobservable curves but rather upon the potentially observable opportunities and constraints facing decision makers. It argues that such an opportunities-based model offers superior possibilities for scientific advancement. At the very least, linear utility – in the presence of constraints - is a useful bar for the "curved" alternatives to clear.

Research in Experimental Economics focuses on laboratory experimental economics, but welcomes work from authors of theoretical, empirical, or field economic research if it would be of interest to the broader experimental economics community. The goal of Research in Experimental Economics is to be complementary with, and not in competition with, traditional journals as outlets for experimental work. Research in Experimental Economics has the freedom to consider papers that may not be appropriate for traditional journals for a variety of reasons. Some examples of these strengths include: theme volumes, replication studies, research which requires longer manuscripts for presentation of data or analysis, and papers on methodological topics. The volumes of Research in Experimental Economics are not tied to specific, recurring conferences. Typically, a volume theme is established with scholars who are willing to serve as volume-specific editors. The only constraint the senior editor places on the volume editors is that the papers should undergo a formal referee process using the same quality standards as traditional journals. Recent topics have included market power, charitable contributions, and field experiments.