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on Cognitive and Behavioural Economics |
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Issue of 2014‒04‒05
fourteen papers chosen by Marco Novarese Universita' del Piemonte Orientale Amedeo Avogadro |
| By: | Kettner , Sara Elisa; Ceccato , Smarandita |
| Abstract: | We show that social context matters in gender-paired dictator decisions. Our experiment investigates the influence of gender-pairing and framing on monetary transfers in a 2x2x2 design where sender gender, recipient gender, and frame, i.e. give or take, are varied. We are the first to combine all three variables and uncover that giving information about the gender of the recipient accommodates framing effects. If each of the three manipulated variables were to be analyzed independently, our data would confirm previous findings where females transfer more than males and framing has no effect (Eckel and Grossman, 1998; Dreber et al., 2013). However, we investigate the manipulated variables in interaction and find that framing matters when information about recipient gender is salient. For both genders, transfers in opposite-sex pairs are always higher than in same-sex pairs, but signicantly higher in the take frame. We thus suggest that the gender composition of the sample, gender-pairing, or beliefs about the counterpart's gender should be controlled for in experiments testing gender differences in social interaction. |
| Keywords: | Framing; Gender Differences; Gender-Pairing; Dictator Game; Experiment |
| Date: | 2014–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:awi:wpaper:0557&r=cbe |
| By: | David Hugh-Jones; David Reinstein |
| Abstract: | In public goods environments, the threat to punish non-contributors may increase contributions. However, this threat may make players' contributions less informative about their true social preferences. This lack of information may lead to lower contributions after the threat disappears, as we show in a two stage model with selfish and conditionally cooperatives types. Under specified conditions welfare may be improved by committing not to punish or exclude. Our laboratory evidence supports this. Contributions under the threat of targeted punishment were less informative of subjects' later choices than contributions made anonymously. Subjects also realised that these were less informative, and their incentivized predictions reflected this understanding. We find evidence of conditional cooperation driven by beliefs over other's contributions. Overall, our anonymous treatment led to lower first-stage contributions but significantly higher second-stage contributions than our revealed treatment. Our model and evidence may help explain why anonymous contributions are often encouraged in the real world. |
| Date: | 2014–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:esx:essedp:750&r=cbe |
| By: | Ambrosino, Angela |
| Abstract: | The paper investigates two different approaches to the analysis of institutions using game theory and discusses their methodological and theoretical implications for further research. Starting from von Neumann and Morgenstern’s theory, we investigate how game theory has been applied to the analysis of institutions, these being considered, as in Hayek (1967, 1988a) as the unplanned outcomes of self-interested individual behavior. We focus on Schotter’s (1981) and Schelling’s (1960) alternative approaches. The different ways in which these authors use von Neumann and Morgenstern’s concepts of coalition and indeterminacy of solutions play an important role in explaining the spontaneous emergence of institutions from interaction. We argue that this issue is also of importance in explaining how Schotter and Schelling’s theories fit with the main features of Hayek's theory of institutions. |
| Keywords: | Institutions, Game Theory, Cognition, Hayek, Schotter, Schelling |
| JEL: | B40 B31 B52 B20 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:42752&r=cbe |
| By: | Ward, Patrick S.; Singh, Vartika |
| Abstract: | Advances in agricultural development have largely been a direct result of increased usage of new technologies. Among other important factors, farmers’ perceptions of risks associated with the new technology as well as their ability or willingness to take risks greatly influences their adoption decisions. In this paper we conduct a series of field experiments in rural India in order to measure preferences related to risk, potential loss, and ambiguity. Disaggregating by gender, we find that on average women are significantly more risk averse and loss averse than men, though the higher average risk aversion arises due to a greater share of women who are extremely risk averse. |
| Keywords: | Technology adoption, rural population, Agricultural technology, uncertainty, propect theory, |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1324&r=cbe |
| By: | David Reinstein; |
| Abstract: | This essay broadly considers gifts, giving and gift economies, modern and pre-modern, from a mainstream (and behavioural) economics perspective. |
| Date: | 2014–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:esx:essedp:749&r=cbe |
| By: | Michela Ponzo; Vincenzo Scoppa (Dipartimento di Economia, Statistica e Finanza, Università della Calabria) |
| Abstract: | We investigate to what extent crowd support contributes to the home advantage in soccer, disentangling this effect from other mechanisms such as players’ familiarity with the stadium and travel fatigue. To evaluate the relevance of crowd support in determining home advantage we analyze same-stadium derbies (matches among teams that share the same stadium) in which teams enjoy different levels of support from the crowd – the home team has many more supporters, mainly because of season ticket holders – while teams do not differ in terms of travel fatigue or familiarity with the stadium. Our estimation results suggest the existence of a sizable crowd support’s effect on the home advantage generated both through the influence on referee’s decisions and through the encouragement of players’ performance. |
| Keywords: | Soccer, Home Advantage, Crowd Support, Social Pressure, Team Performance, Attendance, Travel Fatigue, Stadium Familiarity, Referee Home Bias |
| JEL: | D89 L83 D81 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201402&r=cbe |
| By: | Sebastian J. Goerg (Department of Economics, Florida State University); David B. Johnson (Department of Economics, University of Calgary); Jonathan D. Rogers (New York University, Abu Dhabi) |
| Abstract: | Traditionally, allocations by dictators in Dictator Games (gifts) have been explained by aspects of altruism, reciprocity, and fairness. However, this assumes the gift to be desirable to the dictators and responder. Giving may also be driven by the source of the endowment. We examine this by using three sources to generate the endowment in a Dictator Game:(1) undergraduate students, (2) Amazon Mechanical Turk workers, and (3) users of a racially/ethnically charged web forum. This endowment is provided to subjects in a traditional laboratory experiment. We find dictator similarity with the source of the endowment influences their allocation decision; the more similar subjects feel to the source the more of the endowment they keep. Our results suggest that decisions can be strongly influenced by the provider of income shocks. |
| Keywords: | Experiment; Inequality; Approval |
| JEL: | C78 C91 C99 D31 D64 D74 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:fsu:wpaper:wp2014_03_01&r=cbe |
| By: | Schnedler, Wendelin; Vanberg, Christoph |
| Abstract: | Anecdotal, empirical, and experimental evidence suggests that offering extrinsic rewards for certain activities can reduce people's willingness to engage in those activities voluntarily. We propose a simple rationale for this 'crowding out' phenomenon, using standard economic arguments. The central idea is that the potential to earn rewards in return for an activity may create incentives to play 'hard to get' in an effort to increase those rewards. We discuss two specic contexts in which such incentives arise. In the first, refraining from the activity causes others to attach higher value to it because it becomes scarce. In the second, restraint serves to conceal the actor's intrinsic motivation. In both cases, not engaging in the activity causes others to offer larger rewards. Our theory yields the testable prediction that such effects are likely to occur when a motivated actor enjoys a sufficient degree of 'market power.' |
| Keywords: | intrinsic motivation; crowding out; behavioral economics; market power; hidden information |
| Date: | 2014–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:awi:wpaper:0559&r=cbe |
| By: | Michael Hallsworth; John A. List; Robert D. Metcalfe; Ivo Vlaev |
| Abstract: | Tax collection problems date back to the earliest recorded history of mankind. This paper begins with a simple theoretical construct of paying (rather than declaring) taxes, which we argue has been an overlooked aspect of tax compliance. This construct is then tested in two large natural field experiments. Using administrative data from more than 200,000 individuals in the UK, we show that including social norms and public goods messages in standard tax payment reminder letters considerably enhances tax compliance. The field experiments increased taxes collected by the Government in the sample period and were cost-free to implement, demonstrating the potential importance of such interventions in increasing tax compliance. |
| JEL: | C93 H2 H26 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20007&r=cbe |
| By: | Oechssler, Jörg; Roomets, Alex |
| Abstract: | We implement an experiment to elicit subjects’ ambiguity attitudes in the spirit of Ellsberg’s three-color urn. The procedure includes three design elements that (together) have not been featured in similar experiments: Strict ambiguity preferences, a single decision, and a mechanical randomization device with an unknown distribution (to both subjects and experimenters). We use this device in order to eliminate possible ‘strategic’ ambiguity related to subjects’ beliefs about the experimenters’ motivations. In addition, we survey 40 experimental studies on Ellsberg’s two- and three-color problems, and find that, on average, slightly more than half of subjects are classified as ambiguity averse. Our results, with our new design, fall on the low end of the range of results in the surveyed studies, and are comparable to a control test where “strategic” ambiguity was induced. |
| Keywords: | ambiguity aversion; uncertainty; experiment; Ellsberg. |
| Date: | 2014–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:awi:wpaper:0555&r=cbe |
| By: | Gaudeul, A.; Crosetto, P.; Riener, G. |
| Abstract: | We explore in an experiment what leads to the breakdown of partnerships. Subjects are assigned a partner and participate in a repeated public good game with stochastic outcomes. They can choose each period between staying in the public project or working on their own. There is excessive exit as subjects overestimate the likelihood their partner will leave. High barriers to exit thus improve welfare. We observe that exit is driven by failure within the common project but also by pay-off comparisons across options and beliefs about being exploited. Those considerations increasingly matter as we lower exit costs across treatments. |
| Keywords: | BREAKUP;COLLABORATION;COOPERATION;EXIT;IMPERFECT PUBLIC MONITORING;MORAL HAZARD;PARTNERSHIP;PUNISHMENT;PUBLIC GOOD;REPEATED GAME;SOCIAL RISK;TEAM |
| JEL: | C23 C92 H41 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:gbl:wpaper:2014-02&r=cbe |
| By: | Leonardo Becchetti (University of Rome "Tor Vergata"); Nazaria Solferino (University of Rome "Tor Vergata"); M. Elisabetta Tessitore (University of Rome "Tor Vergata") |
| Abstract: | The choice between performing a task today or procrastinating it until tomorrow or later is the building block of any economic action. In our paper we aim to enrich the theoretical literature on procrastination by outlining conditions for bad and good procrastination and looking at the special cases of pathological procrastination, the curse of perfec- tionism and productive procrastination. We discuss how our theoreti- cal framework may be applied to explain different types of (education, investment and production) microeconomic decisions and which policy measures can be taken to avoid bad procrastination. |
| Keywords: | Time-Inconsistent Preferences, Optimal Effort, Procras- tination, Intertemporal Choice |
| JEL: | A12 D03 D11 D74 D91 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:ent:wpaper:wp53&r=cbe |
| By: | Maria De Paola; Vincenzo Scoppa (Dipartimento di Economia, Statistica e Finanza, Università della Calabria) |
| Abstract: | Procrastination produces harmful effects for human capital investments and studying activities. Using data from a large sample of Italian undergraduates, we measure procrastination with the actual behaviour of students, considering the delay in finalizing their university enrolment procedure. We firstly show that procrastination is a strong predictor of students’ educational achievements. This result holds true controlling for quite reliable measures of cognitive abilities, a number of background characteristics and indicators of students’ motivation. Secondly, we investigate, using a Regression Discontinuity Design, the effects of a remedial program in helping students with different propensity to procrastinate. We show that the policy especially advantages students who tend to procrastinate, suggesting that also policies not directly aimed at handling procrastination can help to solve self-control problems. |
| Keywords: | Procrastination, Self-control, Time preferences, Time consistency, Impatience, human capital, academic success, dropout, remedial courses |
| JEL: | D03 I21 D91 J01 J24 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201401&r=cbe |
| By: | Frolov, Daniil; Lavrentyeva, Anna |
| Abstract: | The article presents the critical review of physical and biological metaphors in the institutional economic theory. It is proved that physical (including mechanistic) analogies are most adequate for the associative characteristic of a statics and kinetics of institutional systems, and biological – for the figurative description of their evolution. Efficiency of use of metaphors and analogies from the most developed, vanguard areas of natural-science researches is shown. |
| Keywords: | metaphors, institutionalism, institutions, path dependence, vacuum, field, impurities, niche construction, transplantation, genetics, evolution |
| JEL: | B52 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:55011&r=cbe |