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on Cognitive and Behavioural Economics |
| By: | Isaac Kalonda-Kanyama (Department of Economics, The University of Kansas); Oasis Kodila-Tedika (Department of Economics, Universite de Kinshasa) |
| Abstract: | We analyze the effect of the average level of intelligence on different measures of the quality of institutions, using a 2006 cross-sectional sample of 113 countries. The results show that average IQ positively affects all the measures of institutional quality considered in our study, namely government efficiency, regulatory quality, rule of law, political stability and voice and accountability. The positive effect of intelligence is robust to controlling for other determinants of institutional quality. |
| Keywords: | governance, institutions, intelligence. |
| JEL: | D73 I2 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:kan:wpaper:201206&r=cbe |
| By: | Alessia Isopi (School of Economics, University of Nottingham); Daniele Nosenzo (School of Economics, University of Nottingham); Chris Starmer (School of Economics, University of Nottingham) |
| Abstract: | This paper reports an experiment designed to test whether prior consultation within a group affects subsequent individual decision making in tasks where demonstrability of correct solutions is low. In our experiment subjects considered two paintings created by two different artists and were asked to guess which artist made each painting. We observed answers given by individuals under two treatments: in one, subjects were allowed the opportunity to consult with other participants before making their private decisions; in the other there was no such opportunity. Our primary findings are that subjects in the first treatment evaluate the opportunity to consult positively but they perform significantly worse and earn significantly less. |
| Keywords: | Consultation; Decision making; Group decisions; Individual decisions |
| JEL: | C91 C92 D80 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2011-08&r=cbe |
| By: | Dulleck, Uwe (Queensland University of Technology); Johnston, David W. (Monash University); Kerschbamer, Rudolf (University of Innsbruck); Sutter, Matthias (University of Innsbruck) |
| Abstract: | Evidence on behavior of experts in credence goods markets raises an important causality issue: Do "fair prices" induce "good behavior", or do "good experts" post "fair prices"? To answer this question we propose and test a model with three seller types: "the good" choose fair prices and behave consumer-friendly; "the bad" mimic the good types' price-setting, but cheat on quality; and "the naive" fall victim to a projection bias that all sellers behave like the bad types. OLS, sample selection and fixed effects regressions support the model's predictions and show that causality goes from good experts to fair prices. |
| Keywords: | credence goods, experts, pricing, experiment, other regarding preferences, signalling, projection bias |
| JEL: | C91 L15 D82 D40 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6491&r=cbe |
| By: | Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University); Johansson-Stenman, Olof (Department of Economics, School of Business, Economics and Law, Göteborg University); Pham, Khanh Nam (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | We measure people’s prosocial behavior, in terms of voluntary money and labor time contributions to an archetypical public good, a bridge, and in terms of voluntary money contributions in a public good game, using the same non-student sample in rural Vietnam at four different points in time from 2005 to 2011. Two of the experiments are natural experiment, one is a field experiment and one is a public good experiment. Since the experiments were conducted far apart in time, the potentially confounding effects of moral licensing and moral cleansing are presumably small, if existing at all. Despite large contextual variations, we find a strong positive and statistically significant correlation between voluntary contributions in these experiments, whether correcting for other covariates or not. This suggests that pro-social preferences are fairly stable over long periods of time and contexts.<p> |
| Keywords: | natural field experiment; preference stability; social preferences; moral licensing; moral cleansing. |
| JEL: | C93 H41 |
| Date: | 2012–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0531&r=cbe |
| By: | Robert Hoffmann (Nottingham University Business School) |
| Abstract: | This article surveys the experimental economics approach to the study of religion. The field has a place in the context of the scientific study of religion generally and the social psychology of religion in particular, but employs distinct economic methods which promise new and different insights. In particular, certain features of the experimental approach as used by economists such as incentive compatibility are particularly appropriate for studying the effect of religion on individual behaviour. The paper discusses results obtained so far in terms of two roles of religion in shaping individual behaviour, i.e. as a social group identifier and as a set of values. |
| Keywords: | religion, religiosity, experiments |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2011-07&r=cbe |
| By: | Migheli, Matteo; Ortona, Guido; Ponzano, Ferruccio |
| Abstract: | According to commonsense wisdom, under proportionality a small centrist party enjoys an excess of power with reference to its share of seats (or votes) due to the possibility of blackmailing the larger ones. This hypothesis has been challenged on a theoretical ground, with some empirical support. In this paper we use simulation to test its validity. Our results strongly provide evidence that the hypothesis is actually wrong. What occurs is a transfer of power from the peryphery of the political spectrum towards the center, buth the major gainers are the large centrist parties and not the small ones. |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:uca:ucapdv:167&r=cbe |
| By: | Blais, Andre (Université de Montréal); Laslier, Jean-François (Ecole Polytechnique); Sauger, Nicolas (Sciences Po Paris); Van Der Straeten, Karine (Toulouse School of Economics) |
| Abstract: | The paper proposes a way to measure mechanical and psychological effects of majority runoff versus plurality electoral systems in candidate elections. Building on a series of laboratory experiments, we evaluate these effects with respect to the probability of electing a Condorcet winner candidate. In our experiment, the runoff system very slightly favours the Condorcet winner candidate, but this total effect is small. We show that this is the case because the mechanical and psychological effects tend to cancel each other out. Compared to plurality, the mechanical effect of runoffs is to systematically advantage the Condorcet winner candidate, as usually assumed; but our study detects an opposite psychological effect, to the disadvantage of this candidate. |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:25770&r=cbe |
| By: | Loukas Balafoutas; Glenn Dutcher; Florian Lindner; Dmitry Ryvkin |
| Abstract: | Tournaments are widely used in organizations, explicitly or implicitly, to reward the best-performing employees, e.g., through promotion or bonuses, and to punish the worst-performing employees, e.g., through firing or unfavorable job assignments. We use a principal-agent model to compare the efficiency of two tournament incentive schemes, reward tournament and punishment tournament, which, respectively, reward the best performer and punish the worst performer. We show that while the two schemes are equivalent when agents are symmetric in their ability, the equivalence is broken in the presence of heterogeneity. Specifically, punishment tournaments lead to higher profits of the firm. The reason is that low-ability agents are discouraged less in punishment tournaments than in reward tournaments, and hence can be compensated less to meet their participation constraints. Hence, our results predict that firms using punishment tournament contracts will perform better. |
| Keywords: | tournament, reward, punishment, contract, heterogeneous agents |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2012-08&r=cbe |
| By: | C. Mónica Capra; Bing Jiang; Jan Engelmann; Gregory Berns |
| Abstract: | There are two regularities we have learned from experimental studies of choice under risk. The first is that the majority of people weigh objective probabilities non-linearly. The second regularity, although less commonly acknowledged, is that there is a large amount of heterogeneity in how people distort probabilities. Despite of this, little effort has been made to identify the source of heterogeneity. In this paper, we explore the possibility that the probability distortions are linked to the personality profile of the decision maker. Using four widely utilized personality tests, we classify participants into three distinct personality types and find that these types have different risk characteristics. Particularly, the trait of motivation plays a role in explaining the attraction of gambling, while the trait of impulsiveness affects the discriminability of non-extreme probabilities. Our results suggest heterogeneity in probability distortions may be explained by personality profiles, which can be elicited though standard questionnaires. |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:emo:wp2003:1205&r=cbe |
| By: | Esther Kessler (University College London, Behavioural & Brain Sciences Unit); Maria Ruiz-Martos (Department of Economics, Universitat Jaume I); David Skuse (University College London, Behavioural & Brain Sciences Unit) |
| Abstract: | Destructive behavior has mostly been investigated by games in which all players have the option to simultaneously destroy (burn) their partners' money. In the destructor game, players are randomly paired and assigned the roles of destructor versus passive player. The destructor player chooses to destroy or not to destroy a share of his passive partner's earnings. The passive partner cannot retaliate. In addition, a random event (nature) destroys a percentage of some passive subject's earnings. From the destructor player's view, destruction is benefit-less, costless, hidden and unilateral. Unilateral destruction diminishes with respect to bilateral destruction studies, but it does not vanish: 15% of the subjects choose to destroy. This result suggests that, at least for some, destruction is intrinsically pleasurable. |
| Keywords: | anti-social behaviour, nastiness, money-burning |
| JEL: | C72 C90 D82 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:jau:wpaper:2012/11&r=cbe |
| By: | Entorf, Horst (Goethe University Frankfurt) |
| Abstract: | This survey summarizes the classical fundamentals of modern deterrence theory, covers major theoretical and empirical findings on the impact of certainty and severity of punishment (and the interplay thereof) as well as underlying methodological problems, gives an overview of limitations and extensions motivated by recent findings of behavioral economics and discusses 'rational' deterrence strategies in subcultural societies. |
| Keywords: | economics of crime, behavioral economics, deterrence, survey |
| JEL: | K4 H0 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6516&r=cbe |
| By: | Pablo Branas-Garza (GLoBE, University of Granada and Economic Science Institute, Chapman University); Antonio M. Espin (GLoBE, University of Granada); Filippos Exadaktylos (GLoBE, University of Granada) |
| Abstract: | Economic experiments are usually conducted with university students who voluntarily choose to participate. Outside as well as within the discipline, there is some concern about how this “particular” subject pool may systematically produce biased results. Focusing on social preferences, this study employs a representative sample of a city’s population and reports behavioral data for five experimental decisions. The dataset allows for a ceteris paribus comparison between self-selected students (i.e. the standard subject pool) and the representative population. We demonstrate that in spite of volunteers’ and students’ effects, experimental subjects seem to be an appropriate subject pool for the study of social preferences. |
| Keywords: | experimental economics, external validity, subject pool, selfselection bias, field experiment. |
| JEL: | C90 D03 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:12-11&r=cbe |
| By: | De Witte, Kristof (KULeuven, Maastricht Universiteit); Rogge, Nicky (Hogeschool-Universiteit Brussel (HUB)) |
| Abstract: | The effectiveness of problem based learning (PBL) in terms of increasing student knowledge and skills has been extensively studied for higher education students and in non-experimental settings. This paper tests the effectiveness of PBL as an alternative instruction method in secondary education. In a controlled randomized experiment, we estimate its effect on tested student attainments, on perceived student attainments, on autonomous and controlled motivation and on class atmosphere. The outcomes indicate a non-significant negative effect on student achievements, a non-significant effect on motivation and a significant positive effect on class atmosphere. |
| Keywords: | Problem-based learning; Secondary education; Student achievements; Student motivation;Classroom social climate; Randomized experiment |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:hub:wpecon:201211&r=cbe |
| By: | Blais, Andre (Université de Montréal); Laslier, Jean-François (Ecole Polytechnique); Sauger, Nicolas (Sciences Po Paris); Van Der Straeten, Karine (Toulouse School of Economics) |
| Abstract: | The paper proposes a way to measure mechanical and psychological effects of majority runoff versus plurality electoral systems in candidate elections. Building on a series of laboratory experiments, we evaluate these effects with respect to the probability of electing a Condorcet winner candidate. In our experiment, the runoff system very slightly favours the Condorcet winner candidate, but this total effect is small. We show that this is the case because the mechanical and psychological effects tend to cancel each other out. Compared to plurality, the mechanical effect of runoffs is to systematically advantage the Condorcet winner candidate, as usually assumed; but our study detects an opposite psychological effect, to the disadvantage of this candidate. |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:25769&r=cbe |