The editor of this compendium of essays on experimental economics
is the founder of the field. As such, he offers an exceptional
perspective. This book provides an excellent set of readings
for those who are aware of experimental economics, and serves as an
excellent introduction for those who are not aware of the advances that
have been made in this exciting field.
The book begins by addressing the distinctions between economics
and psychology and considering how such distinctions influence both the
design and the result of experimental markets in economics. Four
excellent essays encapsulate many of the premises underlying
experimental economics, such as induced value and the sometimes
startling results that occur in experiments.
Part 2 addresses the results of experimental bargaining markets and
their consequences for the study of game theory. These essays include
the results of specific game forms, such as the ultimatum, dictator, and
repeated games. Cooperative extensive games and evolutionary games are
also considered. The authors focus on both the implications for further
developments in bargaining theory and the contrast with psychological
Finally, Part 3 presents the results of experimental markets that
explore the effects of institutional design on the behavior of markets.
This is one of the most important contributions of experimental
economics--exploring the degree to which classical theories of
market behavior survive under nonclassical market structures.
The final essay discusses stock market “bubbles.” This
essay will, no doubt, cause lively discussion among the readership as to
whether the bubbling is a result of the behavior of individuals or of
the design of the experiment.
This excellent book summarizes both the important and the recent
work in experimental economics in various contexts. The authors include
many of the top researchers currently working in the field. This book is
a must for every economics scholar.