Bargaining and market behavior in Jerusalem, Ljubljana, Pittsburgh, and Tokyo: An experimental study (by Alvin E. Roth, Vesna Prasnikar, Masahiro Okuno-Fujiwara, and Shmuel Zamir)

Homo economicus has no gender, age, or cultural identity, but is it plausible to assume that all people behave in the same way? This paper is one of the first experimental studies in economics to tackle cultural differences with data. In a simple set of bargaining and market experiments, the authors studied potential differences in four different cultures – the US, Yugoslavia, Israel, and Japan. In short, they found no cultural differences in the markets, all of which converged to the predicted subgame perfect outcome. However, they did find differences in bargaining behavior, shedding light on underlying fairness perceptions and motives.