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Marco Casari

Università di Bologna, Departent of Economics, Faculty Member

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Marco Casari has earned a Ph.D. California Institute of Technology and held positions at Ohio State University, the Autonoma University in Barcelona, and Purdue University.

His research is about the foundations of cooperation in societies from both an institutional and a behavioral perspectives. His recent projects employ laboratory experiments to study cooperation in global climate change, the emergence of money as a medium of exchange, the regional divides in terms of civicness, and cooperation in continuous time.

He has received an ERC Starting Grant to study cooperation among strangers and financial support from other public and private institutions. Publications have appeared among others in Econometrica, the American Economic Review, Proceeding of the National Academy of Sciences, Frontiers in Cognitive Neurosciences, the Economic Journal, Games and Economic Behavior, Experimental Economics, and the Journal of Economic History.

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Cristina Bicchieri

University of Pennsylvania

University College Cork

Vincenzo Bavoso

The University of Manchester

University of Cologne

Armando Marques-Guedes

UNL - New University of Lisbon

Shabib H . Syed

University of the Punjab, Lahore, Pakistan

Rice University

LUISS Guido Carli

University of Edinburgh

Roperto Jr Deluna

University of Southeastern Philippines

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Papers by Marco Casari

The Coordination Value of Monetary Exchange: Experimental Evidence

Social Science Research Network, 2011

Under what conditions can cooperation be sustained in a network of strangers? Here we study the r... more Under what conditions can cooperation be sustained in a network of strangers? Here we study the role of institutions and uncover a new behavioral foundation for the use of monetary systems. In an experiment, anonymous subjects could cooperate or defect in bilateral random encounters. This sequence of encounters was indefinite; hence multiple equilibria were possible, including full intertemporal cooperation supported by a social norm based on community punishment of defectors. We report that such social norm did not emerge. Instead, the availability of intrinsically worthless tokens favored the coordination on intertemporal cooperation in ways that networks of strangers were unable to achieve through social norms.

Pre-commitment and flexibility in a time decision experiment

Journal of Risk and Uncertainty, Feb 11, 2009

A dynamically inconsistent decision maker may deviate from her plan of action as the future draws... more A dynamically inconsistent decision maker may deviate from her plan of action as the future draws near. An exponential discounter may do exactly the same when facing an uncertain future. Through an experiment we elicit preferences for pre-commitment and flexibility to help disentangle these two classes of explanations for choice reversal over time. Evidence of widespread commitment favors a preference-based explanation over an uncertainty-based one.

How Groups Reach Agreement in Risky Choices: An Experiment

Economic Inquiry, Feb 8, 2011

This paper studies how groups resolve disagreement in lottery choices. In an experiment, subjects... more This paper studies how groups resolve disagreement in lottery choices. In an experiment, subjects submit individual proposals, exchange chat messages, and must reach unanimity. Overall, group choices are more coherent and closer to risk neutrality than individuals'. The proposal of the minority prevails in about one instance out of five. About one third of the groups do not reach immediate agreement after communication. In these groups, extrovert subjects are more likely to lead the group outcome than confused or conscientious subjects. The amount, equality and timing of chat messages help us to predict which choice prevails in the group.

Understanding an economic dilemma : essays on common property resources

Introduction: special issue on the economics of climate change and sustainability (Part A)

Environment and Development Economics, Nov 7, 2019

Climate change is one of the most significant and complex challenges facing the world's economies... more Climate change is one of the most significant and complex challenges facing the world's economies. The necessity to enlarge the knowledge base regarding climate change and its impacts and to design efficient policies is widely accepted by the scientific community, the decision makers and the general public. This special issue, which will be published in two parts in the current and subsequent issue of Environment and Development Economics, is a selection of papers related to the topic of the international workshop on 'The Economics of Climate Change and Sustainability' organized by the Economics Department of the University of Bologna in April 2018. The papers in this special issue cover a wide range of climate-change-related topics, which include endogenous growth and overlapping generation models; climate-related financing and green bonds; demographics; location decisions; technology diffusion; quantitative relationships and experimental approaches. We hope that this special issue will provide some new insights into the economics of climate change and help to identify new directions for future research.

Strategies of cooperation and punishment among students and clerical workers

Journal of Economic Behavior and Organization, Oct 1, 2013

We study individual behavior of students and workers in an experiment where they repeatedly faced... more We study individual behavior of students and workers in an experiment where they repeatedly faced with the same cooperative task. The data show that clerical workers differ from college students in overall cooperation rates, strategies adopted, and use of punishment opportunities. Students cooperate more than workers, and cooperation increases in both subject pools when a personal punishment option is available. Students are less likely than workers to adopt strategies of unconditional defection and more likely to select strategies of conditional cooperation. Finally, students are more likely than workers to sanction uncooperative behavior with decentralized punishment and also personal punishment when available.

Gender Discrimination and Common Property Resources

RePEc: Research Papers in Economics, Dec 1, 2015

In an open economy with common property resources at the community level, marriage and migratory ... more In an open economy with common property resources at the community level, marriage and migratory decisions crucially depend on inheritance rules on the commons. Motivated by the traditional management of the commons in the Italian Alps, we present a model that fits the evolution of property rights observed over six centuries. Women's rights over the commons were progressively eroded from the Middle Ages until 1800, when there was an almost universal adoption of a patrilineal inheritance system. Communities switched from an egalitarian system to a patrilineal inheritance system in an attempt to protect the per capita endowment of common resources from outside immigration. The model shows that inheritance rules have clear-cut implications for marriage strategies, migratory flows, and fertility rates.

Cooperation among strangers with and without a monetary system

Edward Elgar Publishing eBooks, Oct 15, 2020

Human societies prosper when their members move beyond local exchange and cooperate with outsider... more Human societies prosper when their members move beyond local exchange and cooperate with outsiders in the creation of wealth. Collaboration of this type presents formidable challenges because interaction is impersonal, reciprocity is unfeasible and trust cannot be easily established. Here we study this cooperation problem by modeling strategic interaction among strangers through an Intertemporal Exchange Game. The setup can be easily implemented in the laboratory to study a variety of cooperation-enhancing institutions. In particular, we study the role of a fiat monetary system by introducing intrinsically worthless tokens that can be offered in exchange for cooperation. The experiments show that a monetary system spontaneously emerges in the laboratory, and is a key institution to promote cooperation among strangers.

Can Genetic Algorithms Explain Experimental Anomalies?

Computational Economics, Oct 1, 2004

It is common to find in experimental data persistent oscillations in the aggregate outcomes and h... more It is common to find in experimental data persistent oscillations in the aggregate outcomes and high levels of heterogeneity in individual behavior. Furthermore, it is not unusual to find significant deviations from aggregate Nash equilibrium predictions. In this paper, we employ an evolutionary model with boundedly rational agents to explain these findings. We use data from common property resource experiments (Casari and Plott, 2003). Instead of positing individual-specific utility functions, we model decision makers as selfish and identical. Agent interaction is simulated using an individual learning genetic algorithm, where agents have constraints in their working memory, a limited ability to maximize, and experiment with new strategies. We show that the model replicates most of the patterns that can be found in common property resource experiments.

Gender Discrimination in Property Rights

Social Science Research Network, Dec 10, 2013

Starting from the medieval period, women in the Italian Alps experienced a progressive erosion in... more Starting from the medieval period, women in the Italian Alps experienced a progressive erosion in property rights over the commons. We collected documents about the evolution of inheritance regulations on collective land issued by hundreds of peasant communities over a period of six centuries (13th-19th). Based on this original dataset, we provide a long-term perspective of decentralized institutional change in which gender-biased inheritance systems emerged as a defensive measure to preserve the wealth of community insiders. This institutional change had implications also for the protection from economic shocks, for population growth, and for marriage strategies.

Money is more than memory

Journal of Monetary Economics, Apr 1, 2020

Impersonal exchange is the hallmark of an advanced society and money is one key institution that ... more Impersonal exchange is the hallmark of an advanced society and money is one key institution that supports it. Economic theory regards money as a crude arrangement for monitoring counterparts' past conduct. If so, then a public record of past actions-or memory-should supersede the function performed by money. This intriguing theoretical postulate remains untested. In an experiment, we show that the suggested functional equivalence between money and memory does not translate into an empirical equivalence: money removed the incentives to free ride, while memory did not. Monetary systems performed a richer set of functions than just revealing past behaviors.

Weak reciprocity alone cannot explain peer punishment

Behavioral and Brain Sciences, Jan 31, 2012

Economists and biologists have proposed a distinction between two mechanisms-"strong" and "weak" ... more Economists and biologists have proposed a distinction between two mechanisms-"strong" and "weak" reciprocity-that may explain the evolution of human sociality. Weak reciprocity theorists emphasize the benefits of long-term cooperation and the use of low-cost strategies to deter free-riders. Strong reciprocity theorists, in contrast, claim that cooperation in social dilemma games can be sustained by costly punishment mechanisms, even in one-shot and finitely repeated games. To support this claim, they have generated a large body of evidence concerning the willingness of experimental subjects to punish uncooperative freeriders at a cost to themselves. In this article, I distinguish between a "narrow" and a "wide" reading of the experimental evidence. Under the narrow reading, punishment experiments are just useful devices to measure psychological propensities in controlled laboratory conditions. Under the wide reading, they replicate a mechanism that supports cooperation also in "real-world" situations outside the laboratory. I argue that the wide interpretation must be tested using a combination of laboratory data and evidence about cooperation "in the wild." In spite of some often-repeated claims, there is no evidence that cooperation in the small egalitarian societies studied by anthropologists is enforced by means of costly punishment. Moreover, studies by economic and social historians show that social dilemmas in the wild are typically solved by institutions that coordinate punishment, reduce its cost, and extend the horizon of cooperation. The lack of field evidence for costly punishment suggests important constraints about what forms of cooperation can or cannot be sustained by means of decentralised policing.

Carbon is forever: A climate change experiment on cooperation

Journal of Environmental Economics and Management, Nov 1, 2018

Greenhouse gases generate impacts that can last longer than human civilization itself. Such persi... more Greenhouse gases generate impacts that can last longer than human civilization itself. Such persistence may affect the behavioral ability to cooperate. Here we study mitigation efforts within a framework that reflects key features of climate change and then contrasts a dynamic versus a static setting. In a treatment with persistence, the pollution cumulates and generates damages over time while in another treatment it has only immediate effects and then disappears. We find that cooperation is not hampered, on average, by pollution persistence. Mitigation efforts, though, should not be delayed, because cooperation levels appear to deteriorate for high stocks of pollution.

On the Design of Peer Punishment Experiments

Experimental Economics, Jun 1, 2005

We discuss how technologies of peer punishment might bias the results that are observed in experi... more We discuss how technologies of peer punishment might bias the results that are observed in experiments. A crucial parameter is the "fine-to-fee" ratio, which describes by how much the punished subjects income is reduced relatively to the fee the punishing subject has to pay to inflict punishment. We show that a punishment technology commonly used in experiments embeds a variable fine-to-fee ratio and show that it confounds the empirical findings about why, whom, and how much subjects punish.

Introduction: special issue on the economics of climate change and sustainability (Part B)

Environment and Development Economics, Jan 22, 2020

Climate change is considered to be one of the most significant and complex challenges facing the ... more Climate change is considered to be one of the most significant and complex challenges facing the world in the twenty-first century. As such, it is essential to increase the knowledge base regarding climate change and how best to address its impacts through efficient policies. This special issue, which is divided into two parts-published in the previous and current issues of Environment and Development Economics-is a selection of papers related to 'The Economics of Climate Change and Sustainability', the topic of an international workshop organized by the Economics Department of the University of Bologna in April 2018. The papers in this special issue cover a wide range of climate-change-related topics, including endogenous growth and overlapping generation models; climate-related financing and green bonds; demography; location decisions and technology diffusion; quantitative relationships and experimental approaches. They aim at providing new insights into the economics of climate change and help to identify new directions for future research.

Solar geoengineering may lead to excessive cooling and high strategic uncertainty

Proceedings of the National Academy of Sciences of the United States of America, Jun 1, 2020

Governing climate geoengineering: Side-payments are not enough

RePEc: Research Papers in Economics, 2021

Climate geoengineering strategies can help reduce the economic and ecological impacts of global w... more Climate geoengineering strategies can help reduce the economic and ecological impacts of global warming. However, governing geoengineering is challenging: since climate preferences vary across countries, excessive deployment relative to the socially optimal level is likely. Through a laboratory experiment on a public good-or-bad game, we study whether side-payments can address this governance problem. While theoretically effective, our experimental results show only a modest impact of side-payments on outcomes, especially in a multilateral setup. Replacing unstructured bilateral exchanges with a treaty framework simplifies the action space and performs moderately better.

Partners or Strangers? Cooperation, Monetary Trade, and the Choice of Scale of Interaction

RePEc: Research Papers in Economics, 2018

We show that monetary exchange facilitates the transition from small to large-scale economic inte... more We show that monetary exchange facilitates the transition from small to large-scale economic interactions. In an experiment, subjects chose to play an "intertemporal cooperation game" either in partnerships or in groups of strangers where payoffs could be higher. Theoretically, a norm of mutual support is sufficient to maximize efficiency through large-scale cooperation. Empirically, absent a monetary system, participants were reluctant to interact on a large scale; and when they did, efficiency plummeted compared to partnerships because cooperation collapsed. This failure was reversed only when a stable monetary system endogenously emerged: the institution of money mitigated strategic uncertainty problems.

On Negative Time Preference

RePEc: Research Papers in Economics, Aug 1, 2010

Survey data show that subjects positively discount both gains and losses but discount gains more ... more

Emergence of Endogenous Legal Institutions: The Rural Charters in Northern Italy

RePEc: Research Papers in Economics, Nov 1, 2000

Common-pool resources create a well known social dilemma, and to solve the problem the recent lit... more Common-pool resources create a well known social dilemma, and to solve the problem the recent literature in economics has focused on how repeated interaction can promote informal cooperation without the need for formal legal or political institutions. This paper examines a particular example of a common resource: common property in alpine communities of Northern Italy between the 13th and the 19th century. There, rather than relying on repeated interaction alone, users created formal mechanisms that regulated behavior and access to the common property via quotas and time restrictions. Because the formal institutions existed side by side with the sort of repeated interaction that would bread informal cooperation, there was a paradoxical redundancy of institutions. On one hand, formal regulations were probably the best way to limit the overuse of the commons. We consider the tradeoff between developing formal regulations versus relying on informal cooperation. Under certain conditions, the cost of building formal institutions is repaid by a large gain in efficiency. On the other hand, the users themselves had to create and administer the formal institutions, and since the benefits of formal regulations are a public good, each individual has an incentive to free ride. The collective action problem of providing regulatory services was surmounted thanks to the repeated interaction among users. The paradox is thus resolved.

The Coordination Value of Monetary Exchange: Experimental Evidence

Social Science Research Network, 2011

Under what conditions can cooperation be sustained in a network of strangers? Here we study the r... more Under what conditions can cooperation be sustained in a network of strangers? Here we study the role of institutions and uncover a new behavioral foundation for the use of monetary systems. In an experiment, anonymous subjects could cooperate or defect in bilateral random encounters. This sequence of encounters was indefinite; hence multiple equilibria were possible, including full intertemporal cooperation supported by a social norm based on community punishment of defectors. We report that such social norm did not emerge. Instead, the availability of intrinsically worthless tokens favored the coordination on intertemporal cooperation in ways that networks of strangers were unable to achieve through social norms.

Pre-commitment and flexibility in a time decision experiment

Journal of Risk and Uncertainty, Feb 11, 2009

A dynamically inconsistent decision maker may deviate from her plan of action as the future draws... more A dynamically inconsistent decision maker may deviate from her plan of action as the future draws near. An exponential discounter may do exactly the same when facing an uncertain future. Through an experiment we elicit preferences for pre-commitment and flexibility to help disentangle these two classes of explanations for choice reversal over time. Evidence of widespread commitment favors a preference-based explanation over an uncertainty-based one.

How Groups Reach Agreement in Risky Choices: An Experiment

Economic Inquiry, Feb 8, 2011

This paper studies how groups resolve disagreement in lottery choices. In an experiment, subjects... more This paper studies how groups resolve disagreement in lottery choices. In an experiment, subjects submit individual proposals, exchange chat messages, and must reach unanimity. Overall, group choices are more coherent and closer to risk neutrality than individuals'. The proposal of the minority prevails in about one instance out of five. About one third of the groups do not reach immediate agreement after communication. In these groups, extrovert subjects are more likely to lead the group outcome than confused or conscientious subjects. The amount, equality and timing of chat messages help us to predict which choice prevails in the group.

Understanding an economic dilemma : essays on common property resources

Introduction: special issue on the economics of climate change and sustainability (Part A)

Environment and Development Economics, Nov 7, 2019

Climate change is one of the most significant and complex challenges facing the world's economies... more Climate change is one of the most significant and complex challenges facing the world's economies. The necessity to enlarge the knowledge base regarding climate change and its impacts and to design efficient policies is widely accepted by the scientific community, the decision makers and the general public. This special issue, which will be published in two parts in the current and subsequent issue of Environment and Development Economics, is a selection of papers related to the topic of the international workshop on 'The Economics of Climate Change and Sustainability' organized by the Economics Department of the University of Bologna in April 2018. The papers in this special issue cover a wide range of climate-change-related topics, which include endogenous growth and overlapping generation models; climate-related financing and green bonds; demographics; location decisions; technology diffusion; quantitative relationships and experimental approaches. We hope that this special issue will provide some new insights into the economics of climate change and help to identify new directions for future research.

Strategies of cooperation and punishment among students and clerical workers

Journal of Economic Behavior and Organization, Oct 1, 2013

We study individual behavior of students and workers in an experiment where they repeatedly faced... more We study individual behavior of students and workers in an experiment where they repeatedly faced with the same cooperative task. The data show that clerical workers differ from college students in overall cooperation rates, strategies adopted, and use of punishment opportunities. Students cooperate more than workers, and cooperation increases in both subject pools when a personal punishment option is available. Students are less likely than workers to adopt strategies of unconditional defection and more likely to select strategies of conditional cooperation. Finally, students are more likely than workers to sanction uncooperative behavior with decentralized punishment and also personal punishment when available.

Gender Discrimination and Common Property Resources

RePEc: Research Papers in Economics, Dec 1, 2015

In an open economy with common property resources at the community level, marriage and migratory ... more In an open economy with common property resources at the community level, marriage and migratory decisions crucially depend on inheritance rules on the commons. Motivated by the traditional management of the commons in the Italian Alps, we present a model that fits the evolution of property rights observed over six centuries. Women's rights over the commons were progressively eroded from the Middle Ages until 1800, when there was an almost universal adoption of a patrilineal inheritance system. Communities switched from an egalitarian system to a patrilineal inheritance system in an attempt to protect the per capita endowment of common resources from outside immigration. The model shows that inheritance rules have clear-cut implications for marriage strategies, migratory flows, and fertility rates.

Cooperation among strangers with and without a monetary system

Edward Elgar Publishing eBooks, Oct 15, 2020

Human societies prosper when their members move beyond local exchange and cooperate with outsider... more Human societies prosper when their members move beyond local exchange and cooperate with outsiders in the creation of wealth. Collaboration of this type presents formidable challenges because interaction is impersonal, reciprocity is unfeasible and trust cannot be easily established. Here we study this cooperation problem by modeling strategic interaction among strangers through an Intertemporal Exchange Game. The setup can be easily implemented in the laboratory to study a variety of cooperation-enhancing institutions. In particular, we study the role of a fiat monetary system by introducing intrinsically worthless tokens that can be offered in exchange for cooperation. The experiments show that a monetary system spontaneously emerges in the laboratory, and is a key institution to promote cooperation among strangers.

Can Genetic Algorithms Explain Experimental Anomalies?

Computational Economics, Oct 1, 2004

It is common to find in experimental data persistent oscillations in the aggregate outcomes and h... more It is common to find in experimental data persistent oscillations in the aggregate outcomes and high levels of heterogeneity in individual behavior. Furthermore, it is not unusual to find significant deviations from aggregate Nash equilibrium predictions. In this paper, we employ an evolutionary model with boundedly rational agents to explain these findings. We use data from common property resource experiments (Casari and Plott, 2003). Instead of positing individual-specific utility functions, we model decision makers as selfish and identical. Agent interaction is simulated using an individual learning genetic algorithm, where agents have constraints in their working memory, a limited ability to maximize, and experiment with new strategies. We show that the model replicates most of the patterns that can be found in common property resource experiments.

Gender Discrimination in Property Rights

Social Science Research Network, Dec 10, 2013

Starting from the medieval period, women in the Italian Alps experienced a progressive erosion in... more Starting from the medieval period, women in the Italian Alps experienced a progressive erosion in property rights over the commons. We collected documents about the evolution of inheritance regulations on collective land issued by hundreds of peasant communities over a period of six centuries (13th-19th). Based on this original dataset, we provide a long-term perspective of decentralized institutional change in which gender-biased inheritance systems emerged as a defensive measure to preserve the wealth of community insiders. This institutional change had implications also for the protection from economic shocks, for population growth, and for marriage strategies.

Money is more than memory

Journal of Monetary Economics, Apr 1, 2020

Impersonal exchange is the hallmark of an advanced society and money is one key institution that ... more Impersonal exchange is the hallmark of an advanced society and money is one key institution that supports it. Economic theory regards money as a crude arrangement for monitoring counterparts' past conduct. If so, then a public record of past actions-or memory-should supersede the function performed by money. This intriguing theoretical postulate remains untested. In an experiment, we show that the suggested functional equivalence between money and memory does not translate into an empirical equivalence: money removed the incentives to free ride, while memory did not. Monetary systems performed a richer set of functions than just revealing past behaviors.

Weak reciprocity alone cannot explain peer punishment

Behavioral and Brain Sciences, Jan 31, 2012

Economists and biologists have proposed a distinction between two mechanisms-"strong" and "weak" ... more Economists and biologists have proposed a distinction between two mechanisms-"strong" and "weak" reciprocity-that may explain the evolution of human sociality. Weak reciprocity theorists emphasize the benefits of long-term cooperation and the use of low-cost strategies to deter free-riders. Strong reciprocity theorists, in contrast, claim that cooperation in social dilemma games can be sustained by costly punishment mechanisms, even in one-shot and finitely repeated games. To support this claim, they have generated a large body of evidence concerning the willingness of experimental subjects to punish uncooperative freeriders at a cost to themselves. In this article, I distinguish between a "narrow" and a "wide" reading of the experimental evidence. Under the narrow reading, punishment experiments are just useful devices to measure psychological propensities in controlled laboratory conditions. Under the wide reading, they replicate a mechanism that supports cooperation also in "real-world" situations outside the laboratory. I argue that the wide interpretation must be tested using a combination of laboratory data and evidence about cooperation "in the wild." In spite of some often-repeated claims, there is no evidence that cooperation in the small egalitarian societies studied by anthropologists is enforced by means of costly punishment. Moreover, studies by economic and social historians show that social dilemmas in the wild are typically solved by institutions that coordinate punishment, reduce its cost, and extend the horizon of cooperation. The lack of field evidence for costly punishment suggests important constraints about what forms of cooperation can or cannot be sustained by means of decentralised policing.

Carbon is forever: A climate change experiment on cooperation

Journal of Environmental Economics and Management, Nov 1, 2018

Greenhouse gases generate impacts that can last longer than human civilization itself. Such persi... more Greenhouse gases generate impacts that can last longer than human civilization itself. Such persistence may affect the behavioral ability to cooperate. Here we study mitigation efforts within a framework that reflects key features of climate change and then contrasts a dynamic versus a static setting. In a treatment with persistence, the pollution cumulates and generates damages over time while in another treatment it has only immediate effects and then disappears. We find that cooperation is not hampered, on average, by pollution persistence. Mitigation efforts, though, should not be delayed, because cooperation levels appear to deteriorate for high stocks of pollution.

On the Design of Peer Punishment Experiments

Experimental Economics, Jun 1, 2005

We discuss how technologies of peer punishment might bias the results that are observed in experi... more We discuss how technologies of peer punishment might bias the results that are observed in experiments. A crucial parameter is the "fine-to-fee" ratio, which describes by how much the punished subjects income is reduced relatively to the fee the punishing subject has to pay to inflict punishment. We show that a punishment technology commonly used in experiments embeds a variable fine-to-fee ratio and show that it confounds the empirical findings about why, whom, and how much subjects punish.

Introduction: special issue on the economics of climate change and sustainability (Part B)

Environment and Development Economics, Jan 22, 2020

Climate change is considered to be one of the most significant and complex challenges facing the ... more Climate change is considered to be one of the most significant and complex challenges facing the world in the twenty-first century. As such, it is essential to increase the knowledge base regarding climate change and how best to address its impacts through efficient policies. This special issue, which is divided into two parts-published in the previous and current issues of Environment and Development Economics-is a selection of papers related to 'The Economics of Climate Change and Sustainability', the topic of an international workshop organized by the Economics Department of the University of Bologna in April 2018. The papers in this special issue cover a wide range of climate-change-related topics, including endogenous growth and overlapping generation models; climate-related financing and green bonds; demography; location decisions and technology diffusion; quantitative relationships and experimental approaches. They aim at providing new insights into the economics of climate change and help to identify new directions for future research.

Solar geoengineering may lead to excessive cooling and high strategic uncertainty

Proceedings of the National Academy of Sciences of the United States of America, Jun 1, 2020

Governing climate geoengineering: Side-payments are not enough

RePEc: Research Papers in Economics, 2021

Climate geoengineering strategies can help reduce the economic and ecological impacts of global w... more Climate geoengineering strategies can help reduce the economic and ecological impacts of global warming. However, governing geoengineering is challenging: since climate preferences vary across countries, excessive deployment relative to the socially optimal level is likely. Through a laboratory experiment on a public good-or-bad game, we study whether side-payments can address this governance problem. While theoretically effective, our experimental results show only a modest impact of side-payments on outcomes, especially in a multilateral setup. Replacing unstructured bilateral exchanges with a treaty framework simplifies the action space and performs moderately better.

Partners or Strangers? Cooperation, Monetary Trade, and the Choice of Scale of Interaction

RePEc: Research Papers in Economics, 2018

We show that monetary exchange facilitates the transition from small to large-scale economic inte... more We show that monetary exchange facilitates the transition from small to large-scale economic interactions. In an experiment, subjects chose to play an "intertemporal cooperation game" either in partnerships or in groups of strangers where payoffs could be higher. Theoretically, a norm of mutual support is sufficient to maximize efficiency through large-scale cooperation. Empirically, absent a monetary system, participants were reluctant to interact on a large scale; and when they did, efficiency plummeted compared to partnerships because cooperation collapsed. This failure was reversed only when a stable monetary system endogenously emerged: the institution of money mitigated strategic uncertainty problems.

On Negative Time Preference

RePEc: Research Papers in Economics, Aug 1, 2010

Survey data show that subjects positively discount both gains and losses but discount gains more ... more

Emergence of Endogenous Legal Institutions: The Rural Charters in Northern Italy

RePEc: Research Papers in Economics, Nov 1, 2000

Common-pool resources create a well known social dilemma, and to solve the problem the recent lit... more Common-pool resources create a well known social dilemma, and to solve the problem the recent literature in economics has focused on how repeated interaction can promote informal cooperation without the need for formal legal or political institutions. This paper examines a particular example of a common resource: common property in alpine communities of Northern Italy between the 13th and the 19th century. There, rather than relying on repeated interaction alone, users created formal mechanisms that regulated behavior and access to the common property via quotas and time restrictions. Because the formal institutions existed side by side with the sort of repeated interaction that would bread informal cooperation, there was a paradoxical redundancy of institutions. On one hand, formal regulations were probably the best way to limit the overuse of the commons. We consider the tradeoff between developing formal regulations versus relying on informal cooperation. Under certain conditions, the cost of building formal institutions is repaid by a large gain in efficiency. On the other hand, the users themselves had to create and administer the formal institutions, and since the benefits of formal regulations are a public good, each individual has an incentive to free ride. The collective action problem of providing regulatory services was surmounted thanks to the repeated interaction among users. The paradox is thus resolved.