The Role of Experiments for the Development of Economic Theories

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The Role of Experiments for the Development of Economic Theories

Author Info

Klaus M. Schmidt () (Department of Economics, University of Munich, Ludwigstr. 28, D-80539 München(Germany))

Abstract

Economic experiments interact with economic theories in various ways. First of all they are used to test economic theories. However, they can neither confirm nor falsify them in a strict sense. They rather inform us about the range of applicability, the robustness and the predictive power of a theory. Furthermore, economic experiments discover and isolate phenomena and challenge economic theorists to explain them. Finally, many economic experiments are “material” models. They are used to analyse and predict how changes in the environment affect economic outcomes. However, they cannot offer an explanation for what we observe. This has to be provided by economic theory.

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Paper provided by SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich in its series Discussion Papers with number 252.

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Date of creation: Jan 2009
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Handle: RePEc:trf:wpaper:252

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Find related papers by JEL classification:
B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General

This paper has been announced in the following NEP Reports:

NEP-ALL-2009-01-31 (All new papers)
NEP-EXP-2009-01-31 (Experimental Economics)

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Other versions:
- Ernst Fehr & Alexander Klein & Klaus M. Schmidt, 2005. "Fairness and Contract Design," Discussion Papers 67, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich. [Downloadable!]
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Other versions:
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Other versions:
- Klaus Abbink & Bernd Irlenbusch & Paul Pezanis-Christou & Bettina Rockenbach & Abdolkarim Sadrieh & Reinhard Selten, 2001. "An Experimental Test of Design Alternatives for the British 3G / UMTS Auction," Bonn Econ Discussion Papers bgse25_2001, University of Bonn, Germany. [Downloadable!]
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Other versions:
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Other versions:
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