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on Cognitive and Behavioural Economics |
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Issue of 2016‒02‒12
twelve papers chosen by Marco Novarese Università degli Studi del Piemonte Orientale |
| By: | Fadong Chen; Urs Fischbacher |
| Abstract: | There is ample evidence that people differ considerably in the strength of their social preferences. We identify individual heterogeneity in social motives and selfishness in a series of binary three-person dictator games. Based on this identification, we analyze response time to investigate the cognitive processes of distributional preferences. We find that response time increases with the number of conflicts between individually relevant motives and the difficulty of the decisions. The selfish motive is more intuitive for subjects who are more selfish. This is evidence for both, evidence accumulation models and dual-process theory, and we can show that heterogeneity in preferences is reflected in heterogeneity in the underlying cognitive processes. This shows that it is important to take heterogeneity of preferences into account when investigating the cognitive processes of social decision making. |
| Keywords: | distributional preferences, cognitive process, response time, heterogeneity |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:twi:respas:0101&r=cbe |
| By: | Chiara Felli; Werner Güth; Esther Mata-Pérez; Giovanni Ponti |
| Abstract: | Unlike letting the Ultimatum Game be played in the strategy mode with monotonic response strategy, both players, the proposer as well as the responder, are allowed to concede. Proposers would concede by increasing second, third, ... binding offers. Similarly, responders concede by decreasing binding acceptance thresholds. Treatments differ in whether to avoid early conflict at least one party must concede. The other condition varies the number of possible concessions, namely, two versus four. Since accepting every positive (last) offer is weakly undominated, the benchmark outcome is the usual one with the smallest positive offer accepted (at least in last attempt). If concessions are necessary, the responder might prefer larger early acceptance thresholds allowing him to concede. Similarly, a proposer might begin by offering much less than what she is finally willing to concede. Our experimental findings confirm the hypothesis of more frequent and larger concessions by responder participants for whom the concessions are hypothetical and essentially mean to rely on weakly dominant behavior. According to our data, the need of concessions weakens the power advantage of the proposer. Surprisingly, the longer horizon does not improve the chances of an agreement, even when no concessions are needed. |
| Keywords: | Bargaining Experiments, Concession Making |
| JEL: | C72 C78 |
| URL: | http://d.repec.org/n?u=RePEc:lui:cesare:1507&r=cbe |
| By: | Zhixin Dai (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France); Fabio Galeotti (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France); Marie Claire Villeval (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France) |
| Abstract: | We conduct an artefactual field experiment using a diversified sample of passengers of public transportations to study attitudes towards dishonesty. We find that the diversity of behavior in terms of dis/honesty in laboratory tasks and in the field correlate. Moreover, individuals who have just been fined in the field behave more honestly in the lab than the other fare-dodgers, except when context is introduced. Overall, we show that simple tests of dishonesty in the lab can predict moral firmness in life, although frauders who care about social image cheat less when behavior can be verified ex post by the experimenter. |
| Keywords: | Dishonesty, fare-dodging, field experiment, external validity, public transportations |
| JEL: | B41 C91 C93 K42 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1605&r=cbe |
| By: | Dietmar Fehr; Matthias Sutter |
| Abstract: | Human communication in organizations often involves a large amount of gossiping about others. Here we study in an experiment whether gossip affects the efficiency of human interactions. We let subjects play a trust game. Third parties observe a trustee?s behavior and can gossip about it by sending a message to the trustor with whom the observed trustee will be paired (for the first time) in the next round. While messages are non-verifiable and sometimes also incorrect, the possibility of gossip is highly efficiency-increasing compared to a situation without any gossip. In two further control treatments, we show that the mere fact of being observed by third parties cannot explain the efficiency-increasing effect of gossip, and that noisy gossip (where information transmission from third parties to trustors can fail) still increases efficiency, but less so than if information transmission is undisturbed. |
| Keywords: | gossip, communication, trust game, efficiency |
| JEL: | C72 C92 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2016-03&r=cbe |
| By: | Nobuyuki Hanaki (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis - CNRS - Centre National de la Recherche Scientifique); Nicolas Jacquemet (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics, CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Stéphane Luchini (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université Paul Cézanne - Aix-Marseille 3 - Université de la Méditerranée - Aix-Marseille 2 - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - AMU - Aix-Marseille Université); Adam Zylbersztejn (GATE - Groupe d'analyse et de théorie économique - UL2 - Université Lumière - Lyon 2 - Ecole Normale Supérieure Lettres et Sciences Humaines - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | How is one's cognitive ability related to the way one responds to strategic uncertainty? We address this question by conducting a set of experiments in simple 2 × 2 dominance solvable coordination games. Our experiments involve two main treatments: one in which two human subjects interact, and another in which one human subject interacts with a computer program whose behavior is known. By making the behavior of the computer perfectly predictable, the latter treatment eliminates strategic uncertainty. We find that subjects with higher cognitive ability are more sensitive to strategic uncertainty than those with lower cognitive ability. |
| Keywords: | Strategic uncertainty,Bounded rationality,Robot,Experiment |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-01261036&r=cbe |
| By: | L. Becchetti; V. Pelligra; F. Salustri; A. Vásquez |
| Abstract: | We report on a simple experimental study designed to investigate the different gender attitudes towards socially responsible consumption. We use the Vote-with-the-Wallet Game (VWG), a version of a repeated multiplayer prisoner’s dilemma that mimics the characteristics of the choice between a conventional and a socially responsible product. More precisely we test the effect of three factors - two different frames and an ex-post redistribution mechanism that transfers resources from purely self-interested consumers to responsible ones. We find that women remain significantly more cooperative (choosing more often the responsible good) when the redistribution mechanism is interrupted and are significantly less satisfied about the behavior of the other players in that treatment. |
| Keywords: | Responsible Consumption, Gender Differences, social preferences, lab experiment |
| JEL: | C72 C92 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201603&r=cbe |
| By: | Iñigo Iturbe-Ormaetxe; Giovanni Ponti; Josefa Tomás |
| Abstract: | Gneezy and Potters (1997) run an experiment to test the empirical content of Myopic Loss Aversion (MLA). They find that the attractiveness of a risky asset depends upon the investors’ time horizon: consistently with MLA, individuals are more willing to take risks when they evaluate their investments less frequently. This paper shows that these experimental findings can be easily accommodated by the most standard version of Expected Utility Theory, namely a CRRA specification. Additionally, we use four different datasets to estimate a CRRA model and two alternative MLA versions, together with various mixture specifications of the two competing models. Our econometric exercise finds little evidence of subjects’ loss aversion, which provides empirical ground for our theoretical claim. |
| Keywords: | Expected Utility Theory, Myopic Loss Aversion, Evaluation Period |
| JEL: | C91 D81 D14 |
| URL: | http://d.repec.org/n?u=RePEc:lui:cesare:1506&r=cbe |
| By: | Helia Marreiros (University of Southampton, Economics Department, School of Social Sciences); Mirco Tonin (Free University of Bolzano‐Bozen, Faculty of Economics and Management); Michael Vlassopoulos (University of Southampton, Economics Department, School of Social Sciences); M.C. Schraefel (University of Southampton, Electronics and Computer Sciences Department) |
| Abstract: | Personal data lie at the forefront of different business models and constitute the main source of revenue of several online companies. In many cases, consumers have incomplete information about the digital transactions of their data. This paper investigates whether highlighting positive or negative aspects of online privacy, thereby mitigating the informational problem, can affect consumers’ privacy actions and attitudes. Results of two online survey experiments indicate that participants adopt a more conservative stance on disclosing identifiable information, such as name and email, even when they are informed about positive attitudes of companies towards their privacy. On the other hand, they do not change their attitudes and social actions towards privacy. These findings suggest that privacy concerns are dormant and may manifest when consumers are asked to think about privacy; and that privacy behavior is not necessarily sensitive to exposure to objective threats or benefits of disclosing personal information. |
| Keywords: | survey experiment, information economics, privacy policies, salience, self-disclosure |
| JEL: | C83 L38 M38 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:bzn:wpaper:bemps34&r=cbe |
| By: | Leonardo Becchetti (CEIS, University of Rome Tor Vergata); Vittorio Pelligra (University of Cagliari, CRENoS); Serena F. Taurino (University of Rome Tor Vergata) |
| Abstract: | We measure satisfaction about experimental outcomes, personal and other participants' behaviour after a multiperiod "hybrid contribution" multiplayer prisoner's dilemma called the "vote with the wallet" game. Our work shows that participants who cooperated above median (which we define as strong cooperators) are significantly more satisfied with the game in proportion to their cooperative choice. On the contrary, their satisfaction for the other players' behavior is negatively correlated with the extent of their own cooperative behavior and the non-cooperative behavior of the latter. The satisfaction of strong cooperators for their behavior in the game depends in turn on the share of their own cooperative choices. We document that a broader utility function including heterogeneity in expectations on other players' behavior, other-regarding preferences, and a negative reciprocity argument may account for the combination of the observed experimental and satisfaction findings. |
| Date: | 2016–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:rtv:ceisrp:363&r=cbe |
| By: | Fabrizio Germano (Universitat Pompeu Fabra and Barcelona Graduate School of Economics); Peio Zuazo-Garin (Universitat Rovira i Virgili, CREIP and BRiDGE) |
| Abstract: | We study an interactive framework that explicitly allows for nonrational behavior. We do not place any restrictions on how players’ behavior deviates from rationality. Instead we assume that there exists a probability p such that all players play rationally with at least probability p, and all players believe, with at least probability p, that their opponents play rationally. This, together with the assumption of a common prior, leads to what we call the set of p-rational outcomes, which we define and characterize for arbitrary probability p. We then show that this set varies continuously in p and converges to the set of correlated equilibria as p approaches 1, thus establishing robustness of the correlated equilibrium concept to relaxing rationality and common knowledge of rationality. The p-rational outcomes are easy to compute, also for games of incomplete information, and they can be applied to observed frequencies of play to derive a measure p that bounds from below the probability with which any given player chooses actions consistent with payoff maximization and common knowledge of payoff maximization. |
| Keywords: | strategic interaction,correlated equilibrium,robustness to bounded rationality,approximate knowledge,incomplete information,measure of rationality,experiments |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01251512&r=cbe |
| By: | Ulrich Berger (Department of Economics, Vienna University of Economics and Business) |
| Abstract: | Interpersonal trust is a one-sided social dilemma.Building on the binary trust game, we ask how trust and trustworthiness can evolve in a population where partners are matched randomly and agents sometimes act as trustors and sometimes as trustees. Trustors have the option to costly check a trustee's last action and to condition their behavior on the signal they receive. We show that the resulting population game admits two components of Nash equilibria. Nevertheless, the long-run outcome of an evolutionary social learning process modeled by the best response dynamics is unique. Even if unconditional distrust initially abounds, the trustors' checking option leads trustees to build a reputation for trustworthiness by honoring trust. This invites free-riders among the trustors who save the costs of checking and trust blindly, until it does no longer pay for trustees to behave in a trustworthy manner. This results in cyclical convergence to a mixed equilibrium with behavioral heterogeneity where suspicious checking and blind trusting coexist while unconditional distrust vanishes. |
| Keywords: | trust game, evolutionary game theory, reputation, best response dynamics |
| JEL: | C72 C90 |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp212&r=cbe |
| By: | Zhixin Dai (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon); Fabio Galeotti (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon); Marie Claire Villeval (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon) |
| Abstract: | We conduct an artefactual field experiment using a diversified sample of passengers of public transportations to study attitudes towards dishonesty. We find that the diversity of behavior in terms of dis/honesty in laboratory tasks and in the field correlate. Moreover, individuals who have just been fined in the field behave more honestly in the lab than the other fare-dodgers, except when context is introduced. Overall, we show that simple tests of dishonesty in the lab can predict moral firmness in life, although frauders who care about social image cheat less when behavior can be verified ex post by the experimenter. |
| Keywords: | Dishonesty, fare-dodging, field experiment, external validity, public transportations |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01265696&r=cbe |