page_title: Economic ethics
section_title: Experimental economics
hierarchical_section_title: Economic ethics / Application to economic methodologies / Experimental economics
caption_attribution_description: Politecnico di Torino; Student: Sajjad Khaksari; May 9, 2015; OV &amp; DP and BRT; Game Theory, A briefly attempt; Is it possible to modeling one of the reality of Transport&amp;Logistic World, thanks to the famous Game Theory? The main idea to write this paper began with this question. &lt;a href="https://www.academia.edu/13626461/Game_Theory_in_Transport_and_Logistic_World" rel="noreferrer nofollow"&gt;www.academia.edu/13626461/Game_Theory_in_Transport_and_Lo...&lt;/a&gt;
context_page_description: Economic ethics combines economics and ethics, uniting value judgements from both disciplines in order to predict, analyse and model economic phenomena. It encompasses the theoretical ethical prerequisites and foundations of economic systems. The school of thought dates back to the Greek philosopher Aristotle, whose Nicomachean Ethics describes the connection between objective economic principle and the consideration of justice. The academic literature on economic ethics is extensive, citing such authority as natural law and religious law as influences to normative rules in economics. The consideration of moral philosophy, or the idea of a moral economy, for example, is a point of departure in assessing behavioural economic models. Ethics presents a trilemma for economics, namely in standard creation, standard application, and who the beneficiaries of good, by these standards, should be. This, in conjunction with the fundamental assumption of rationality in economics, creates the link between itself and ethics as it is ethics which, in part, studies the concepts of right and wrong.
context_section_description: The development of experimental economics late throughout the 20th century created an opportunity to empirically verify the existence of normative ethics in economics. Vernon L. Smith and his colleagues discovered numerous occurrences that may describe economic choices under the veil of ignorance. Conclusions from following economic experiments indicate that economic agents use normative ethics in making decisions while also seeking to maximise their own payoffs. For example, in experiments on honesty, it is predicted that lying will occur when it increases these payoffs notwithstanding the fact that the results proved otherwise. It is found that people also employ the '50/50 rule' in dividing something regardless of the distribution of power in the decision making process. Experimental economic studies of altruism have identified it as an example of rational behaviour. The absence of an explanation for such behaviour indicates an antithesis in experimental economics that it interprets morality as both an endogenous and exogenous factor, subject to the case at hand. Research into the viability of normative theory as an explanation for moral reasoning is needed, with the experimental design focused on testing whether economic agents under the conditions assumed by the theory produce the same decisions as those predicted by the theory. This is given that, under the veil of ignorance, agents may be 'non-tuist' in the real world as the theory suggests.
caption: Example of game theory and associated payoffs.
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