We study if there is an association between culture on gender roles and the gender gap in choice of major. For this purpose, we use the epidemiological approach and sibling comparisons. We find that the gender gap in STEM is smaller for individuals who originate in countries where women are more likely, relative to men, to major in STEM. We observe a similar pattern when we study the probability to major in a male- or female-dominated field. We present suggestive evidence that cultural beliefs explain our results. Thus, to limit gender segregation in education this study points to the importance of changing gendered beliefs about educational choices. However, the results indicate that the gender convergence in STEM and male-dominated fields is driven by the fact that men, not women, choose less gender-typical majors. This suggests that to increase women’s participation in STEM and male-dominated fields, policies in other areas, e.g., directed towards changing workplace characteristics, may also be necessary.

We study how subjects deal with fatigue in a sequence of tournaments that are linked through fatigue spillovers. We develop a model that allows us to predict the consequences of varying the severity of competition as well as the ease of recovery over time. Even in the presence of fatigue, effort should positively respond to an increase in incentives in a single tournament. A less obvious consequence is the need for strategic resting before and after that tournament. We test our theory using a chosen-effort experiment. While an increase in incentives in the second of three tournaments does lead to higher effort in that tournament, we observe only a tendency for the predicted strategic resting before and after. The increase in incentives does not yield the predicted higher total effort. When recovery is made harder, effort responds negatively as predicted. We complement our study with a real-effort task. Subjects seem to have difficulties simultaneously dealing with physical fatigue as well as the cognitive problem of allocating effort over time.

It is standardly assumed that individuals react to perceived unfairness or norm violations in precisely the same area or relationship where the original offense has occurred. However, grievances over being exposed to injustice may have even broader consequences and also spill over to other contexts, causing non-compliant behavior there. We present evidence that such “fairness spillovers” can incur large economic costs: a belief that there is unfairness in taxation in the sense that the rich do not pay enough taxes is associated with a twenty percent higher level of paid absenteeism from work.

Bubbles are omnipresent in lab experiments with asset markets. Most of these experiments are conducted in environments with only human traders. Since today's markets are substantially determined by algorithmic trading, we use a laboratory experiment to measure how human trading depends on the expected presence of algorithmic traders. We find that bubbles are clearly smaller when human traders expect algorithmic traders to be present.

We analyze optimal contracts in a hierarchy consisting of a principal, a supervisor and an agent. The supervisor is either neutral or altruistic towards the agent, but his preferences are private information. In a model with two supervisor types, we find that the optimal contract may be very simple, paying the supervisor a flat wage independent of his type and his evaluation of the agent's effort. Such a contract induces the neutral type of supervisor to report the agent's performance truthfully, while the altruistic type reports favorably independent of performance. Accordingly, overstated performance (leniency bias) may be the outcome of an optimal contract under informational asymmetries.

We augment a standard tax model by concerns about tax equity: people get upset when labour is taxed more heavily than capital. Even the slightest concern for tax equity invalidates the common tenet that capital remains tax-exempt in small open economies. This holds for exogenous as well as for endogenous government expenditures and irrespective of whether concerns with tax equity only cause emotional discomfort or also impact on work incentives. If concerns with tax equity get more intense, the economy may choose higher taxes on labour and move to the downward sloped part of its Laffer curve. For endogenous government spending, stronger concerns with tax equity may lead to a larger size of the public sector.