IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-05068612.html
   My bibliography  Save this paper

Procedurally Fair Co-Determination with Endogeneous Value Uncertainty: An Experiment

Author

Listed:
  • Werner Güth

    (Max-Planck-Institute for Research on Collective Goods)

  • Ludivine Martin

    (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, LISER - Luxembourg Institute of Socio-Economic Research)

  • Tibor Neugebauer

    (uni.lu - Université du Luxembourg = University of Luxembourg = Universität Luxemburg)

  • Sotiria Xanalatou

    (uni.lu - Université du Luxembourg = University of Luxembourg = Universität Luxemburg)

Abstract

We present an experimental test of a procedurally fair co-determination mechanism where group members reduce their value uncertainty before submitting bids for a joint project. The results suggest a relatively efficient mechanism, with unprofitable projects being largely rejected and profitable ones accepted. Repeated interactions tended to enhance the efficiency, while uncertain information reduced it. The subjects invested surprisingly little search effort to reduce the uncertainty about the costs and benefits, and appeared to trade off search costs against higher bids. JEL Classification: C92; D70; D81; J52; L20

Suggested Citation

  • Werner Güth & Ludivine Martin & Tibor Neugebauer & Sotiria Xanalatou, 2025. "Procedurally Fair Co-Determination with Endogeneous Value Uncertainty: An Experiment," Post-Print hal-05068612, HAL.
    • Handle: RePEc:hal:journl:hal-05068612
    DOI: 10.3390/g16020019
    Note: View the original document on HAL open archive server: https://hal.science/hal-05068612v1
    as

    Download full text from publisher

    File URL: https://hal.science/hal-05068612v1/document
    Download Restriction: no
    File URL: https://libkey.io/10.3390/g16020019?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Werner Güth & Paul Pezanis-Christou, 2021. "An indirect evolutionary justification of risk neutral bidding in fair division games," International Journal of Game Theory, Springer;Game Theory Society, vol. 50(1), pages 63-74, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Werner Güth & Ludivine Martin & Tibor Neugebauer & Sotiria Xanalatou, 2025. "Procedurally Fair Co-Determination with Endogeneous Value Uncertainty: An Experiment," Games, MDPI, vol. 16(2), pages 1-28, April.
    2. Paul Pezanis-Christou & Hang Wu, 2018. "A non-game-theoretic approach to bidding in first-price and all-pay auctions," School of Economics and Public Policy Working Papers 2018-12, University of Adelaide, School of Economics and Public Policy.

    More about this item

    Keywords

    corporate governance; joint venture; experiment; auction; uncertainty;
    All these keywords.

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-05068612. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.