The Nash equilibrium predictions of standard game theory often fail in experimental tests. While innumerable refinements to Nash equilibrium have been suggested, they too fail in empirical tests. What seems apparent is that humans rely on a rich mixture of contextual cues and signals to determine how to strategize about their own choices and those of their counterparts.
Our research concentrates on a simple social signal -- the human face. In particular we examine the emotional cues registered by the face and investigate the meaning of those cues mean for signaling an actor's intentions. We explore the impact of facial cues in two sets of experiments. The first concerns human facial expressions. In the second set of experiments we simplify and control the facial cues by substituting schematic line drawings that resemble the ubiquitous "happy face". We focus on the two-branch, sequential bargaining game developed by Hoffman, McCabe and Smith. Our findings suggest that intentions to trust and reciprocate can be signaled by facial expressions.