We focus on understanding norms, behavioral traits, and institutions that can promote cooperation in societies of strangers. Many economic interactions in modern societies are among anonymous individuals who meet occasionally and do not know each others' history. While cooperation in social dilemma situations among partners is easier to achieve, this project aims to understand what makes mutually advantageous transactions possible among strangers. We employ a rigorous theoretical approach to define issues and design experimental studies. This project is articulated into three parts. Part one aims to measure the norms of cooperation among strangers absent any formal institution. Part two assesses the impact of specific monitoring, communication, commitment, and other institutions in promoting cooperation. Part three focuses on the role of money as a special type of institution in the promotion of cooperation. Expected contributions will be in areas that include economics, political science, sociology, management and organizational behavior. The research proposed will advance the understanding of the role of economic and legal institutions in anonymous economies, of the nature of social capital, and what can prevent conflict in organizations. It may lead to new insights into policy-related issues such as unemployment, financial markets, and economic governance.
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