This lecture will summarize what we have learned about cooperation and institutions formation through running lab experiments. Specifically, we will talk about people’s abilities to cooperate and form institutions to solve cooperation problems. Lab experiment are somewhat artificial, but they have the advantage of eliciting real (non-hypothetical) decisions under highly controlled conditions, allowing researchers to identify causal effects in a clean way. The results of this literature show that standard economics theory, based on rational and self-interested actors, often is too pessimistic when it comes to human cooperation, but sometimes is too optimistic when it comes to choosing the best institution.
Astrid Dannenberg is Professor of Environmental and Behavioral Economics at the University of Kassel, Germany. Her research focuses on human decision making, the drivers and barriers of cooperation, and how institutions can be designed to promote cooperation. Astrid received her M.Sc. in economics at the University of Mannheim and her PhD at the Otto-von-Guericke-University of Magdeburg. She previously was a Research Fellow at the Centre for European Economic Research in Mannheim, the University of Gothenburg, and Columbia University in New York City.