Using Psychological Game Theory we develop a general framework allowing players
to exhibit procedural concerns. We present two areas in which procedural concerns play
a key role. First, we apply our framework to policy experiments and show that the way
in which researchers allocate subjects into treatment and control groups influences the
experimental results. Second, we analyze the problem of appointing agents into jobs
that differ in terms of their desirability. Because of procedural concerns the principal’s
choice of appointment procedure affects the subsequent effort choice of agents. We test
this hypothesis in a field experiment and find consistent results.