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Theory and experiment: What are the questions?

  • Smith, Vernon L.

This paper deals generally with testing questions that arise both when experimental observations are in accord with the actions we predict, and when they are not. In both cases the inference of truth from observation is inherently ambiguous, and we face the daunting challenge of using our experimental skills and imagination to reduce this ambiguity. Primarily and most difficult of all we have to constantly reevaluate everything, including ourselves, especially in examining how we talk about and interpret our data. Although I will be drawing on examples and experience from laboratory experiments, the issues I consider apply just as meaningfully to other empirical studies whether from field experiments or observations from past records of socioeconomic processes.

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File URL: http://www.sciencedirect.com/science/article/pii/S0167-2681(09)00033-X
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Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 73 (2010)
Issue (Month): 1 (January)
Pages: 3-15

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Handle: RePEc:eee:jeborg:v:73:y:2010:i:1:p:3-15
Contact details of provider: Web page: http://www.elsevier.com/locate/jebo

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  3. Elizabeth Hoffman & Kevin McCabe & Vernon Smith, 2000. "The Impact of Exchange Context on the Activation of Equity in Ultimatum Games," Experimental Economics, Springer, vol. 3(1), pages 5-9, June.
  4. Steven Gjerstad, 2007. "Price Dynamics in an Exchange Economy," Purdue University Economics Working Papers 1205, Purdue University, Department of Economics.
  5. Porter, David P & Smith, Vernon L, 1995. "Futures Contracting and Dividend Uncertainty in Experimental Asset Markets," The Journal of Business, University of Chicago Press, vol. 68(4), pages 509-41, October.
  6. Bart J. Wilson, 2008. "Contra Private Fairness," Working Papers 08-04, Chapman University, Economic Science Institute.
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  8. Smith, Vernon L & Suchanek, Gerry L & Williams, Arlington W, 1988. "Bubbles, Crashes, and Endogenous Expectations in Experimental Spot Asset Markets," Econometrica, Econometric Society, vol. 56(5), pages 1119-51, September.
  9. Hume, David, 1739. "A Treatise of Human Nature (II) Of the Passions," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 2, number hume1739a.
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  12. Todd L. Cherry & Peter Frykblom & Jason F. Shogren, 2002. "Hardnose the Dictator," American Economic Review, American Economic Association, vol. 92(4), pages 1218-1221, September.
  13. Smith, Vernon L, et al, 1982. "Competitive Market Institutions: Double Auctions vs. Sealed Bid-Offer Auctions," American Economic Review, American Economic Association, vol. 72(1), pages 58-77, March.
  14. Forsythe Robert & Horowitz Joel L. & Savin N. E. & Sefton Martin, 1994. "Fairness in Simple Bargaining Experiments," Games and Economic Behavior, Elsevier, vol. 6(3), pages 347-369, May.
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  16. Friedman, Daniel, 1984. "On the Efficiency of Experimental Double Auction Markets," American Economic Review, American Economic Association, vol. 74(1), pages 60-72, March.
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  18. Stanley Reiter, 1978. "A Dynamic Process of Exchange," Discussion Papers 347, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  19. Oxoby, Robert J. & Spraggon, John, 2008. "Mine and yours: Property rights in dictator games," Journal of Economic Behavior & Organization, Elsevier, vol. 65(3-4), pages 703-713, March.
  20. McCabe, Kevin A. & Rassenti, Stephen J. & Smith, Vernon L., 1998. "Reciprocity, Trust, and Payoff Privacy in Extensive Form Bargaining," Games and Economic Behavior, Elsevier, vol. 24(1-2), pages 10-24, July.
  21. Smith,Vernon L., 2009. "Rationality in Economics," Cambridge Books, Cambridge University Press, number 9780521133388, November.
  22. McCabe, Kevin & Houser, Daniel & Ryan, Lee & Smith, Vernon & Trouard, Ted, 2001. "A Functional Imaging Study of Cooperation in Two-Person reciprocal Exchange," MPRA Paper 5172, University Library of Munich, Germany.
  23. Jon Ketcham & Vernon L. Smith & Arlington W. Williams, 1984. "A Comparison of Posted-Offer and Double-Auction Pricing Institutions," Review of Economic Studies, Oxford University Press, vol. 51(4), pages 595-614.
  24. Andreoni, James, 1995. "Cooperation in Public-Goods Experiments: Kindness or Confusion?," American Economic Review, American Economic Association, vol. 85(4), pages 891-904, September.
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  29. Burnham, Terence & McCabe, Kevin & Smith, Vernon L., 2000. "Friend-or-foe intentionality priming in an extensive form trust game," Journal of Economic Behavior & Organization, Elsevier, vol. 43(1), pages 57-73, September.
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  33. Arlington W. Williams & John O. Ledyard & Steven Gjerstad & Vernon L. Smith, 2000. "Concurrent trading in two experimental markets with demand interdependence," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 16(3), pages 511-528.
  34. Erte Xiao & Daniel Houser, 2005. "Emotion expression in human punishment behavior," Experimental 0504003, EconWPA, revised 18 May 2005.
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  38. Hume, David, 1739. "A Treatise of Human Nature (I) Of the Understanding," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 1, number hume1739.
  39. Ernst Fehr & Urs Fischbacher, 2002. "Why Social Preferences Matter -- The Impact of Non-Selfish Motives on Competition, Cooperation and Incentives," Economic Journal, Royal Economic Society, vol. 112(478), pages C1-C33, March.
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