Experimental Methods for the General Economist: Five Lessons from the Lab

Abstract

I review five primary results from experimental economics that impact the economics profession as a whole. These results regard the relative (un)importance of subject sophistication in laboratory markets, the importance of gender on economic outcomes, the propensity for humans to behave in less than fully rational ways, the importance of trading institutions on economic performance, and the behavioral relevance of economic theory. I find that economics as a profession has benefited from the use of experimental methods by fostering a dialogue between theorists and empiricists, better informing policy and improving data collection techniques.