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on Cognitive and Behavioural Economics |
| By: | Andreas Ortmann (School of Economics, University of New South Wales) |
| Abstract: | To discuss experimental results without discussing how they came about makes sense when the results are robust to the way experiments are conducted. Experimental results, however, are – arguably more often than not – sensitive to numerous design and implementation characteristics such as the use of financial incentives, deception, and the way information is presented. To the extent that economists and psychologists have different experimental practices, this claim is of obvious practical and interpretative relevance. In light of the empirical results summarized below, it seems warranted to say that it does not make sense to report experimental results without reporting the design and implementation choices that were made. |
| Keywords: | Duhem-Quine problem; experimental design; experimental implementation; financial incentives; deception |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:swe:wpaper:2010-06&r=cbe |
| By: | Borrill, Paul L.; Tesfatsion, Leigh S. |
| Abstract: | This study provides a basic introduction to agent-based modeling (ABM) as a powerful blend of classical and constructive mathematics, with a primary focus on its applicability for social science research. The typical goals of ABM social science researchers are discussed along with the culture-dish nature of their computer experiments. The applicability of ABM for science more generally is also considered, with special attention to physics. Finally, two distinct types of ABM applications are summarized in order to illustrate concretely the dualit of ABM: Real-world systems can not only be simulated with verisimilitude using ABM; they can also be efficiently and robustly designed and constructed on the basis of ABM principles. 　 |
| JEL: | B4 C6 C9 D E |
| Date: | 2010–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:31674&r=cbe |
| By: | Beresford, Alastair R. (University of Cambridge); Kübler, Dorothea (WZB - Social Science Research Center Berlin); Preibusch, Sören (University of Cambridge) |
| Abstract: | We measure willingness to pay for privacy in a field experiment. Participants were given the choice to buy a maximum of one DVD from one of two online stores. One store consistently required more sensitive personal data than the other, but otherwise the stores were identical. In one treatment, DVDs were one Euro cheaper at the store requesting more personal information, and almost all buyers chose the cheaper store. Surprisingly, in the second treatment when prices were identical, participants bought from both shops equally often. |
| Keywords: | privacy, willingness to pay, field experiments |
| JEL: | C93 D12 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5017&r=cbe |
| By: | Jakobsson, Niklas (Department of Economics, School of Business, Economics and Law, Göteborg University); Kotsadam, Andreas (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Trafficking in humans for sexual exploitation is an economic activity driven by profit motives. Laws regarding commercial sex influence the profitability of trafficking. Using cross country data we show that trafficking of persons for commercial sexual exploitation is least prevalent in countries where prostitution is illegal, most prevalent in countries where prostitution is legalized, and in between in those countries where prostitution is legal but procuring illegal. Case studies of countries that have changed legal framework support the claims on the direction of causality as well as the causal mechanisms. The results suggest that criminalizing buying and/or selling sex may reduce the amount of trafficking to a country.<p> |
| Keywords: | law and economics; prostitution; sexual exploitation; sex slavery; trafficking |
| JEL: | F22 K14 |
| Date: | 2010–07–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0458&r=cbe |
| By: | Gary Charness (Department of Economics, University of California - University of California, Santa Barbara); David Masclet (CREM - Centre de Recherche en Economie et Management - CNRS : UMR6211 - Université de Rennes I - Université de Caen); Marie-Claire Villeval (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - Ecole Normale Supérieure Lettres et Sciences Humaines) |
| Abstract: | In this paper, we investigate individuals' investment in status in an environment where no monetary return can possibly be derived from reaching a better relative position. We use a real-effort experiment in which we permit individuals to learn and potentially improve their status (rank). We find that people express both intrinsic motivation and a taste for status. Indeed, people increase their effort when they are simply informed about their relative performance, and people pay both to sabotage others' output and to artificially increase their own relative performance. In addition, stronger group identity favors positive rivalry and discourages sabotage among peers. |
| Keywords: | Status seeking ; rank ; competitive preferences ; experiment |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00497974_v1&r=cbe |
| By: | Sergio Sousa (University of Nottingham) |
| Abstract: | This paper reports on an experiment designed to examine the effects of small-scale changes in wealth on risk attitudes. We find that the money given prior to risky choices does not induce a change of subjects' risk preferences. This result supports a key assumption in a recent literature over calibration critique of decision theories. Furthermore, as the money given to subjects in our experiment is administered in between risky tasks and framed as a reward rather than a windfall gain, our result suggests that experimental findings reporting that a prior monetary gain induces individuals to take more risks (house-money effect) may be more sensitive to prior experience with the risk-elicitation task or framing of the money than previously thought. |
| Keywords: | risk aversion, wealth effects, risk-elicitation, house-money effect, narrow framing |
| JEL: | C91 D01 D81 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:cdx:dpaper:2010-11&r=cbe |
| By: | Simon Gaechter (University of Nottingham); Elke Renner (University of Nottingham) |
| Abstract: | Belief elicitation is an important methodological issue for experimental economists. There are two generic questions: 1) Do incentives increase belief accuracy? 2) Are there interaction effects of beliefs and decisions? We investigate these questions in the case of finitely repeated public goods experiments. We find that belief accuracy is significantly higher when beliefs are incentivized. The relationship between contributions and beliefs is slightly steeper under incentives. However, we find that incentivized beliefs tend to lead to higher contribution levels than either non-incentivized beliefs or no beliefs at all. We discuss the implications of our results for the design of public good experiments. |
| Keywords: | Incentives, beliefs, experimental methodology, public goods |
| JEL: | C90 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:cdx:dpaper:2010-12&r=cbe |
| By: | Sutter, Matthias (University of Innsbruck); Feri, Francesco (University of Innsbruck); Kocher, Martin G. (University of Munich); Martinsson, Peter (University of Gothenburg); Nordblom, Katarina (Göteborg University); Rützler, Daniela (University of Innsbruck) |
| Abstract: | Social preferences have been shown to be an important determinant of economic decision making for many adults. We present a large-scale experiment with 883 children and adolescents, aged eight to seventeen years. Participants make decisions in eight simple, one-shot allocation tasks, allowing us to study the distribution of social preference types across age and across gender. Our results show that when children and teenagers grow older, inequality aversion becomes a gradually less prominent motivating force of allocation decisions. At the same time, efficiency concerns increase in importance for boys, and maximin-preferences turn more important in shaping decisions of girls. |
| Keywords: | children, social preferences, age, gender, experiment |
| JEL: | C91 D63 D64 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5016&r=cbe |
| By: | Alpízar, Francisco (Environment for Development Program, CATIE); Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | In a natural field experiment, we tested whether being alone or in a group had an effect on prosocial behavior as expressed in donations to a recreational park. We also explored whether the presence of people exogenous to the group at the time of the donation had any behavioral effect. Our first treatment aimed at identifying peer effects, whereas our second treatment was similar to being in the public eye. We found that being in a group significantly increases the share of people acting prosocially. Moreover, we found that only individuals who are part of a group are positively affected by the presence of a third party.<p> |
| Keywords: | Donation; natural field experiment; prosocial behavior; public disclosure |
| JEL: | C93 Q28 |
| Date: | 2010–07–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0456&r=cbe |
| By: | Simon Czermak; Francesco Feri; Daniela Rützler; Matthias Sutter |
| Abstract: | We examine the strategic sophistication of adolescents, aged 10 to 17 years, in experimental normal-form games. Besides making choices, subjects have to state their first- and second-order beliefs. We find that choices are more often a best reply to beliefs if any player has a dominant strategy and equilibrium payoffs are not too unequal. Using a mixture model we can estimate for each subject the probability to be any of eight different strategic and non-strategic types. The econometric estimation reveals that older subjects are more likely to eliminate dominated strategies, and that subjects with good math grades are more strategic. |
| Keywords: | Strategic thinking, beliefs, experiment, age, adolescents |
| JEL: | C72 C91 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2010-15&r=cbe |
| By: | Vittoria M. Levati (Max Planck Institute of Economics, Strategic Interaction Group, Jena, Germany); Matthias Uhl (Max Planck Institute of Economics, Strategic Interaction Group, Jena, Germany); Ro'i Zultan (Max Planck Institute of Economics, Strategic Interaction Group, Jena, Germany) |
| Abstract: | Absentmindedness is a special case of imperfect recall which according to Piccione and Rubinstein (1997a) leads to time inconsistencies. Aumann, Hart and Perry (1997a) question their argument and show how dynamic inconsistencies can be resolved. The present paper explores this issue from a descriptive point of view by examining the behavior of absentminded individuals in a laboratory environment. Absentmindedness is manipulated in two ways. In one treatment, it is induced by cognitively overloading participants. In the other, it is imposed by randomly matching decisions with decision nodes in the information set. The results provide evidence for time inconsistencies in all treatments. We introduce a behavioral principal, which best explains the data. |
| Keywords: | imperfect recall, absentmindedness, dynamic inconsistency, experiment |
| JEL: | C72 C91 D81 D83 |
| Date: | 2010–06–16 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2010-035&r=cbe |
| By: | Falck, Oliver (Ifo Institute for Economic Research); Woessmann, Ludger (Ifo Institute for Economic Research) |
| Abstract: | School choice research mostly focuses on academic outcomes. Policymakers increasingly view entrepreneurial traits as a non-cognitive outcome important for economic growth. We use international PISA-2006 student-level data to estimate the effect of private-school competition on students' entrepreneurial intentions. We exploit Catholic-Church resistance to state schooling in 19th century as a natural experiment to obtain exogenous variation in current private-school shares. Our instrumental-variable results suggest that a 10 percentage-point higher private-school share raises students' entrepreneurial intentions by 0.3-0.5 percentage points (11-18 percent of the international mean) even after controlling for current Catholic shares, students' academic skills, and parents' entrepreneurial occupation. |
| Keywords: | private school competition, entrepreneurship, Catholic schools |
| JEL: | I20 L33 L26 Z12 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5024&r=cbe |
| By: | Maria Saez Marti |
| Abstract: | I construct a theory of cultural transmission in which culture acquisition takes place in two stages, first in the family where parents transmit their own culture, and later in society where children are exposed to a wider set of cultural models. The role of models is to provide information about alternatives. Cultural variants differ in how strongly they are transmitted in the family and on how attractive they are to the children’s eyes. Attractiveness may depend on the actual models one can observe. I characterise the long run distribution of variants using directed trees and show that more visible cultural variants will have larger shares. Shares are also increasing in attractiveness and in family strength. When attractiveness is not context specific, variants competing with a wider set of variants, everything else equal, will have larger shares provided that copying is bidirectional. Expanding the set of models does not necessarily lead to an increase in shares. |
| Keywords: | Cultural transmission, role models, learning |
| JEL: | D10 I20 J13 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:zur:iewwpx:495&r=cbe |