nep-cbe New Economics Papers
on Cognitive and Behavioural Economics
Issue of 2010‒11‒06
nine papers chosen by
Marco Novarese
University Amedeo Avogadro

  1. Deciding to Decide: Gender, Leadership and Risk-Taking in Groups By Seda Ertac; Mehmet Y. Gurdal
  2. Does procedural fairness crowd out other-regarding concerns? A bidding experiment By Werner Güth; M. Vittoria Levati; Matteo Ploner
  3. Social Norms and Economic Incentives in Firms By Huck, Steffen; Kübler, Dorothea; Weibull, Jörgen
  4. Trust me, it is High Trust: On Trust and its Measurement By Christian Lukas; Peter Walgenbach
  5. The Survival of the Conformist: Social Pressure and Renewable Resource Management By Alessandro Tavoni; Maja Schlüter; Simon Levin
  6. Mentoring, Educational Services, and Incentives to Learn: What Do We Know About Them? By Rodriguez-Planas, Nuria
  7. Referenda under Oath By Nicolas Jacquemet; Alexander James; Stephane Luchini; Jason Shogren
  8. Geography of Scientific Knowledge: A Proximity Approach By Koen Frenken
  9. Reintegrating the Social Sciences: The Dahlem Group By David Colander; Roland Kupers; Thomas Lux; Casey Rothschild

  1. By: Seda Ertac (Koc University); Mehmet Y. Gurdal (TOBB ETU)
    Abstract: Being the leader in a group often involves making risky decisions that affect the payoffs of all members, and the decision to take this responsibility in a group is endogenous in many contexts. In this paper, we experimentally study: (1) the willingness of men and women to make risky decisions on behalf of a group, (2) the amount of risk men and women take for the group, in comparison to their individual decisions. We observe a striking difference between males and females, with a much lower fraction of women being willing to make the group decision than men. The amount of risk taken for the group is generally lower than in the case where subjects decide for themselves only, indicating a cautious shift. The women that would like to make the group decision and the women that do not are no different in terms of how much risk they take for themselves, nor for their group. For men, on the other hand, we find that the ones who would like to lead tend to take more risk on behalf of the group. We also present several results on the relationship of risk-taking and leadership decisions with personality traits.
    Keywords: Conditional CAPM
    Date: 2010–10
  2. By: Werner Güth (Max Planck Institute of Economics, Strategic Interaction Group); M. Vittoria Levati (Max Planck Institute of Economics, Strategic Interaction Group); Matteo Ploner (Department of Economics, CEEL, University of Trento, Italy)
    Abstract: Bidding rules that guarantee procedural fairness may induce more equilibrium bidding and moderate other-regarding concerns. In our experiment, we assume commonly known true values and only two bidders to implement a best-case scenario for other-regarding concerns. The two-by-two factorial design varies ownership of the single indivisible commodity (an outside seller versus collective ownership) and the price rule (first versus second price). Our results indicate more equilibrium behavior under the procedurally fair price rule, what, however, does not completely crowd out equality and efficiency seekin
    Keywords: Auctions, Fair Division Games, Procedural fairness
    JEL: D44 C92
    Date: 2010–10–26
  3. By: Huck, Steffen (University College London); Kübler, Dorothea (WZB - Social Science Research Center Berlin); Weibull, Jörgen (Stockholm School of Economics)
    Abstract: This paper studies the interplay between economic incentives and social norms in firms. We introduce a general framework to model social norms arguing that norms stem from agents’ desire for, or peer pressure towards, social efficiency. In a simple model of team production we examine the interplay of different types of contracts with social norms. We show that one and the same norm can be output-increasing, neutral, or output-decreasing depending on the incentive scheme. We also show how social norms can induce multiplicity of equilibria and how steeper economic incentives can reduce effort.
    Keywords: social norms, incentives, contracts
    JEL: D23
    Date: 2010–10
  4. By: Christian Lukas (Department of Economics, University of Konstanz, Germany); Peter Walgenbach (School of Economics and Business Administration, Friedrich Schiller University of Jena, Germany)
    Abstract: As the positive impact of trust on business success is widely undisputed, the question of how to measure trust naturally arises. Both expectations of trustworthy behavior and possible gains and losses from a trusting relationship influence the level of trust between two parties or individuals. This paper explores whether an exchange featuring (almost) equal expected gains and expected losses for a trusting individual is evidence for high trust or low trusts; we argue that such an exchange tends to display low trust. A simple trust measure is suggested that can be applied both in experimental and analytical research.
    Keywords: trust, trust measurement, trust as behavior, agency theory, behaviroal game theory, investment game
    JEL: D6 M5
    Date: 2010–10–29
  5. By: Alessandro Tavoni (Advanced School of Economics at the University of Venice); Maja Schlüter (Leibniz-Institute of Freshwater Ecology and Inland Fisheries); Simon Levin (Department of Ecology and Evolutionary Biology at Princeton University)
    Abstract: This paper examines the role of pro-social behavior as a mechanism for the establishment and maintenance of cooperation in resource use under variable social and environmental conditions. By coupling resource stock dynamics with social dynamics concerning compliance to a social norm prescribing non-excessive resource extraction in a common pool resource (CPR), we show that when reputational considerations matter and a sufficient level of social stigma affects the violators of a norm, sustainable outcomes are achieved. We find large parameter regions where norm-observing and norm-violating types coexist, and analyze to what extent such coexistence depends on the environment.
    Keywords: Cooperation, Social Norm, Ostracism, Common Pool Resource, Evolutionary Game Theory, Replicator Equation, Agent-based Simulation, Coupled Socio-resource Dynamics
    JEL: C73 Q20 D70
    Date: 2010–10
  6. By: Rodriguez-Planas, Nuria (Universitat Autònoma de Barcelona)
    Abstract: This paper reviews recent studies on the effectiveness of services and incentives offered to disadvantaged youth. We focus our analysis on three types of interventions: mentoring, educational services, and financial rewards. The objective of this article is threefold. First, we explain alternative theoretical points of view in favor (or against – when applicable) each of these interventions. Then, we discuss how recent empirical work has affected that view, and we summarize the latest findings. We conclude with a discussion on what questions remain to be examined. Our hope is that this article will serve as a resource for those seeking to understand what educational interventions work and for whom, and to use as a starting point to illuminate the debate on where to go next.
    Keywords: cognitive and non-cognitive skills, intrinsic and extrinsic motivation, at-risk youth, resilience, deviancy training, deterrence, primary- and high-school, post-secondary education, remedial programs, incentives on inputs and outputs
    JEL: C93 I21 I22 I28 J24
    Date: 2010–10
  7. By: Nicolas Jacquemet (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Alexander James (University of Wyoming - Department of Economics and Finance); Stephane Luchini (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579); Jason Shogren (Departement Economy and Finance, University of Wyoming - University of Wyoming)
    Abstract: Herein we explore whether a solemn oath can eliminate hypothetical bias in a voting referenda, a design commonly promoted in nonmarket valuation exercises for its incentive compatibility properties. First, we reject the null hypothesis that a hypothetical bias does not exist. Second, we cannot reject the hypothesis that people who sign an oath are as likely to vote for the public good (e.g., wind energy R&D) in a hypothetical referenda as in a real one. This result opens interesting avenues for improving the elicitation of preferences in the lab.
    Keywords: Dichotomous Choice Mechanism; Hypothetical bias; Oath; Preference revelation
    Date: 2010–06–08
  8. By: Koen Frenken
    Abstract: The geography of scientific knowledge is defined as the replication process of locally produced knowledge claims. Proximity in social, cognitive, and physical dimensions promotes the sharing of tacit knowledge. Thus, given the complementarity between tacit and codified knowledge, proximity supports the replication of codified knowledge claims. Distinguishing between controversial and uncontroversial contexts, one can understand the sociology of science as explaining the behaviour of scientists from their proximity to other scientists, and the sociology of scientific knowledge as describing the processes that constitute the proximity between scientists.
    Keywords: replication, knowledge claim, proximity, mobility, controversy, incentives, sociology of science, economics of science, geography of science, sociology of scientific knowledge
    Date: 2010–03
  9. By: David Colander; Roland Kupers; Thomas Lux; Casey Rothschild
    Abstract: Social science disciplines see themselves as distinct, with their own territory, their own methods, and their own framework. Within such an environment multidisciplinary work involves enormous conflict and translation problems. This situation is no longer acceptable. Dealing with modern problems requires researchers with broad transdisciplinary knowledge and with the ability to communicate with other social science researchers in a way that will allow them to arrive at transdisciplinary recommendations. Complex issues such as healthcare, income distributions, crime prevention, industrial policy, agriculture require not only insights from multiple social disciplines, but the integration of those insights. This document offers a proposal for training social science researchers. Specifically, it proposes reintegrating the social sciences by modifying the current system of training—which provides completely separate training for researchers in each sub-discipline—to incorporate a common first year “core"of training for all social science researchers. If implemented, the proposal will reduce the babble that currently characterizes much of the interdisciplinary conversations.
    Date: 2010

This nep-cbe issue is ©2010 by Marco Novarese. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.