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on Cognitive and Behavioural Economics |
| By: | Karol Jan BOROWIECKI (Department of Economics, Trinity College Dublin) |
| Abstract: | I investigate the consequences of long-run persistence of a societies’ preference towards cultural goods. Historical cultural activity is approximated with the frequency of births of classical composers during the Renaissance and is linked with contemporary supply of cultural activities in Italian provinces. Areas with a one-standard-deviation higher number of composer births expose nowadays up to 0.4 standard deviations higher supply of cultural activities (such as concerts or theater performances). Those provinces seem to exhibit today also a somewhat lower supply of non-cultural activities. The results point at a tantalising divergence in societies’ cultural preferences which is attributable to events rooted long in the past. Furthermore, the findings imply a remarkable persistency of the geography of artistic activity. While human capital is found to be potentially a driver for spill-over effects across different cultural disciplines over time, other unobservable factors, such as societies’ preference traits, determine the persistency within most closely related cultural areas. |
| Keywords: | Economic development, Culture, Institutions, Path Dependence, Endogenous preferences |
| JEL: | N33 N34 O10 Z1 Z10 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep0312&r=cbe |
| By: | Alexander Sebald; Markus Walzl |
| Abstract: | We conduct a laboratory experiment with agents working on and principals benefitting from a real effort task in which the agents' performance can only be evaluated subjectively. Principals give subjective performance feedback to agents and agents have an opportunity to sanction principals. In contrast to existing models of reciprocity we find that agents tend to sanction whenever the feedback of principals is below their subjective self-evaluations even if agents' payoffs are independent of it. In turn, principals provide more positive feedback (relative to their actual performance assessment of the agent) if this does not affect their payoffs. |
| Keywords: | Contracts, Subjective Performance Evaluations, Reciprocity |
| JEL: | D01 D02 D82 D86 J41 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2012-15&r=cbe |
| By: | Benno Torgler (QUT); Christoph A Schaltegger (QUT) |
| Abstract: | In this study of the persistent social phenomenon of suicide, we find that even though theological and social differences between Catholicism and Protestantism have decreased, Catholics are still less likely than Protestants to commit or accept suicide. This difference remains even after we control for such confounding factors as social and religious networks. Although religious networks do mitigate suicides among Protestants, the influence of church attendance is more dominant among Catholics. The methodological strength of our paper is that it uses two data sets: a 20-year panel for Switzerland and a cross-sectional analysis of alternative religious concepts like religious commitment and religiosity in 414 European regions. We find that these alternative concepts strongly reduce acceptance of suicide. |
| Keywords: | SUICIDE, RELIGION, PROTESTANTISM, CATHOLICISM |
| JEL: | Z12 I20 J24 |
| Date: | 2012–08–02 |
| URL: | http://d.repec.org/n?u=RePEc:qut:dpaper:288&r=cbe |
| By: | Boldyrev, Ivan A.; Herrmann-Pillath, Carsten |
| Abstract: | In his Idea of Justice, Amartya Sen compares the two basic approaches to evaluate institutions, transcendental institutionalism and realization-focused comparisons. Referring to Smith's Impartial Spectator, he argues in favour of the latter and proposes the principle of Open Impartiality. However, this cannot solve the tension between universalism and contextualization of values that Sen therefore inherits from Smith. Based on recent Hegel scholarship, we argue that some of the difficulties can be resolved, considering the role Smith played in the development of Hegel's thinking. Hegel's concept of recognition plays an essential role in establishing the possibility of impartiality both on the level of consciousness and on the level of institutional intersubjectivity. Hegel's critique of Kants formalist ethics (also considered as transcendental institutionalism by Sen), his analysis of the civil society in the Philosophy of Right, especially his focus on associations and estates, can serve as a model for making Sen's focus on public discourse theoretically more concise and pragmatically feasible. Hegel shows that universalistic attitudes can only emerge in specific institutional contexts. -- |
| Keywords: | Theory of Moral Sentiments,Sen,Hegel,recognition,civil society,associations,public discourse |
| JEL: | B12 B25 B52 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fsfmwp:193&r=cbe |
| By: | Vostroknutov Alexander (METEOR) |
| Abstract: | A model of belief dependent preferences in finite multi-stage games with observable actions isproposed. It combines two dissimilar approaches: incomplete information (Levine, 1998) andintentionality (Dufwenberg and Kirchsteiger, 2004; Falk and Fischbacher, 2006). Incompleteinformation is important because social preferences are not directly observable; intentions arefound to be indispensable in explaining behavior in games (Falk, Fehr, and Fischbacher, 2008). Inthe model it is assumed that the players have social attitudes that define their socialpreferences. In addition, players care differently about the payoffs of other players depending ontheir beliefs about their social attitude and possibly on the beliefs of higher orders. As thegame unfolds players update their beliefs about the types of other players. An action of a playershows intention when she chooses it anticipating future belief updating by others. A reasoningprocedure is proposed that allows players to understand how to update beliefs by constructing asequence of logical implications. |
| Keywords: | microeconomics ; |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umamet:2012015&r=cbe |
| By: | Geoffroy de Clippel; Kareen Rozen |
| Abstract: | Theories of bounded rationality are typically characterized over an exhaustive data set. This paper aims to operationalize some leading theories when the available data is limited, as is the case in most practical settings. How does one tell if observed choices are consistent with a theory of bounded rationality if the data is incomplete? What information can be identified about preferences? How can out-of-sample predictions be made? Our approach is contrasted with earlier attempts to examine bounded rationality theories on limited data, showing their notion of consistency is inappropriate for identifiability and out-of-sample prediction. |
| Keywords: | # |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:bro:econwp:2012-7&r=cbe |
| By: | Yamamura, Eiji |
| Abstract: | Smokers are more impatient and, unlike nonsmokers, they tend to prefer current benefits. In this paper, individual-level data from Japan are used to examine how preferences for divorce and extramarital sex are different between smokers and nonsmokers. After controlling for various individual characteristics, the major findings are as follows: (1) smokers are more likely to have a positive view about divorce than nonsmokers; (2) smokers are more likely to have a positive view about extramarital sex than nonsmokers. These results were observed regardless of the individual’s marital status. The findings here about smoker’s preferences are consistent with the characteristics of smokers suggested in the literature. |
| Keywords: | smokers; divorce; extramarital sex |
| JEL: | I12 J12 |
| Date: | 2012–08–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:40922&r=cbe |
| By: | Michele Belot (University of Oxford); Marcel Fafchamps (University of Oxford) |
| Abstract: | Some evidence suggests that people behave more pro-socially in small groups than in market-like situations. We construct an experiment in which people choose between allocations that affect their payoff and that of others. The choices of some participants are randomly selected to determine payoffs. We test whether people exhibit different other-regarding preferences depending on how the choice is framed. To mimic a market-like environment, we ask subjects to select a type of partner, either high or low. Selecting a partner of a given type effectively removes this pairing from other players. We compare this treatment to two alternatives where people are first assigned to groups of two high and two low participants. In one treatment, they are then asked to choose between a high and low partner. In the other, they are asked to choose between two payoff allocations for the four individuals. These two treatments make the implication of one's choice on others more salient. We find that most subjects pursue their self-interest, but high payoff participants behave more altruistically in small groups while low payoff participants display more invidious choices in the market-like environment. The implication is that while some efficiency can be achieved in small groups thanks to altruism, a market-like environment reduces good samaritan tendencies, possibly because the negative effect of one's choice on others is less salient. |
| Keywords: | Behavioral experiment, Social preferences, Partnership formation |
| JEL: | C90 D63 D64 Z13 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:cex:dpaper:2012001&r=cbe |
| By: | Cappelen, Alexander W. (Dept. of Economics, Norwegian School of Economics and Business Administration); Nielsen, Ulrik H. (University of Copenhagen); Sørensen, Erik Ø. (Dept. of Economics, Norwegian School of Economics and Business Administration); Tungodden, Bertil (Dept. of Economics, Norwegian School of Economics and Business Administration); Tyran, Jean-Robert (University of Vienna) |
| Abstract: | It has been shown that participants in the dictator game are less willing to give money to the other participant when their choice set also includes the option to take money. We examine whether this effect is due to the choice set providing a signal about entitlements in a setting where entitlements initially may be considered unclear. We find that the share of positive transfers depends on the choice set even when there is no uncertainty about entitlements, and that this choice-set effect is robust across a heterogenous group of participants recruited from the general adult population in Denmark. The findings are consistent with dictator giving partly being motivated by a desire to signal that one is not entirely selfish or by a desire to follow a social norm that is choice-set dependent. |
| Keywords: | Dictator game; motivation; choice |
| JEL: | C91 D63 |
| Date: | 2012–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2012_014&r=cbe |
| By: | Rtischev, Dimitry |
| Abstract: | Evolution of preferences models often assume that all agents display and observe preferences costlessly. Instead, we endogenize mindsight (to observe preferences) and transparency (to show preferences) as slightly costly mechanisms that agents may or may not possess. Unlike in the costless models, we show that universal rule-rationality, mindsight and transparency do not constitute an equilibrium but universal act-rationality, mind-blindness, and opaqueness do. We also find that rule-rationality, mindsight, and transparency may exist in evolved populations, albeit only in a portion of the population whose size fluctuates along an orbit around a focal point. We apply our results to Ultimatum and Trust games to explore how costly and optional mindsight may affect economic performance in interactions among evolved agents. |
| Keywords: | evolution of preferences; act-rationality; rule-rationality; ultimatum game; trust game |
| JEL: | D83 C73 D87 |
| Date: | 2012–08–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:40890&r=cbe |
| By: | Abi ADAMS; Laurens CHERCHYE; Bram DE ROCK; Ewout VERRIEST |
| Abstract: | This paper develops a revealed preference methodology for exploring whether time inconsistencies in household choice are the product of nonstationarities at the individual level or the result of individual heterogeneity and renegotiation within the collective unit. An empirical application to household-level microdata highlights that an explicit recognition of the collective nature of choice allows the vast majority of household behaviour to be rationalised by theory that assumes preference stationarity at the individual level. For our particular short panel data set, simply permitting limited intrahousehold heterogeneity in time preferences allows the choices of 98.4% of the sample to be rationalised by a model that assumes exponential discounting at the individual level. We also find that couples characterized by lower divergence in spousal discount rates are older, more likely to have children and wealthier, which we take as indications of experiencing higher match quality. |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:ces12.12&r=cbe |
| By: | Brekke, Kjell Arne (Dept. of Economics, University of Oslo); Konow , James (Department of Economics, Loyola Marymount University,); Nyborg, Karine (Dept. of Economics, University of Oslo) |
| Abstract: | In social dilemmas, there is tension between cooperation that promotes the common good and the pursuit of individual interests. International climate change negotiations provide one example: although abatement costs are borne by individual countries, the benefits are shared globally. We study a multi-period, threshold public goods game with unequally endowed participants and communication in which the decision variable is framed in three seemingly inconsequential ways: as absolute contributions, contributions relative to endowments and in terms of the effects of contributions on final payoffs. We find considerable agreement that “rich” (or high endowed) persons contribute more than “poor” (or low endowed) individuals at levels that are invariant across frames. Frames do, however, significantly affect both preferred and actual contributions for the poor: they contribute significantly less when the decision variable makes the effects on final payoffs salient than when it is framed in terms of absolute contributions. Contributions are explained mostly by self-interest, justice preferences, and experiencing failed negotiations, but we find no effects of reciprocity toward individuals or of the suggestions of others about what one should contribute. |
| Keywords: | Public good game; threshold; communication; fairness; endowment heterogeneity |
| JEL: | D63 D64 H41 |
| Date: | 2012–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2012_016&r=cbe |
| By: | Ronald Peeters; Marc Vorsatz; Markus Walzl |
| Abstract: | We conduct a laboratory experiment with a constant-sum sender-receiver game to investigate the impact of individuals' first- and second-order beliefs on truth-telling. While senders are more likely to lie if they expect the receiver to trust their message, they are more likely to tell the truth if they belief the receiver expects them to tell the truth. Our results therefore indicate that second-order beliefs are an important component of the motives for individuals in strategic information transmission. |
| Keywords: | Experiment, Sender-receiver games, Strategic information transmission, Guilt-from-blame, let-down aversion |
| JEL: | C70 C91 D03 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2012-17&r=cbe |
| By: | Geoffroy de Clippel |
| Abstract: | Implementation theory assumes that participants’ choices are rational,in the sense of being derived from the maximization of a contextindependent preference. The paper investigates implementation under complete information when the mechanism designer is aware that individuals suffer from cognitive biases that lead to violations of IIA, or cannot exclude the possibility of such “irrational” behavior. |
| Keywords: | # |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:bro:econwp:2012-6&r=cbe |