Essays on social norms and cooperation

This thesis is a collection of experimental and theoretical studies on social norms and cooperation. The first two chapters focus on effects of social norms on people's behaviour in strategic situations. The Golden Rule is first studied in an ultimatum bargaining experiment. The results show that while most people follow the Golden Rule in the ultimatum game situation, experience and feedback of playing the opposite role has an important effect on golden-rule behaviour. Then the link between people's expectation of social norms and their own behaviour is studied in an experiment of a trust game. Only about half of the subjects show a consistent behaviour according to their own expected norm. Moreover, experience and feedback has asymmetric effects on the behaviour of trustors and trustees. In next two chapters, the way people cooperate and how to sustain a more efficient cooperative result are studied by using both theoretical and experimental methods. I first experimentally explore the mechanisms that make people more willing to cooperate and increase the overall welfare in a public goods game. Then I theoretically study a well-established cooperative solution for the bankruptcy problem and design a non-cooperative game that gives the solution as the unique sub-game perfect equilibrium outcome.