nep-cbe New Economics Papers
on Cognitive and Behavioural Economics
Issue of 2017‒03‒05
eight papers chosen by
Marco Novarese
Università degli Studi del Piemonte Orientale

  1. Exposure to poverty and productivity By Dalton, Patricio; Gonzalez Jimenez, Victor; Noussair, Charles
  2. How long do you think it will take? Field Evidence on Gender Differences in Time Optimism By Kataria, Mitesh
  3. The influences of social context on the measurement of distributional preferences By Greiff, Matthias; Ackermann, Kurt; Murphy, Ryan O.
  4. Microfoundations for Structures and Evolution: Evidence from Experiments By Francesco Bogliacino; Cristiano Codagnone
  5. Soft Commitments, Reminders and Academic Performance By Himmler, Oliver; Jaeckle, Robert; Weinschenk, Philipp
  6. Signaling Cooperation By Heinz, Matthias; Schumacher, Heiner
  7. Mother’s Time Allocation, Child Care and Child Cognitive Development By Brilli, Ylenia
  8. Allais for the Poor: Relations to Ability, Information Processing and Risk Attitudes By Tabea Herrmann; Olaf Hübler; Lukas Menkhoff; Ulrich Schmidt

  1. By: Dalton, Patricio (Tilburg University, School of Economics and Management); Gonzalez Jimenez, Victor (Tilburg University, School of Economics and Management); Noussair, Charles (Tilburg University, School of Economics and Management)
    Abstract: We study whether exposure to poverty can induce affective states that decrease productivity. In a controlled laboratory setting, we find that subjects randomly assigned to a treatment, in which they view a video featuring individuals that live in extreme poverty, exhibit lower subsequent productivity compared to subjects assigned to a control treatment. Questionnaire responses, as well as facial recognition software, provide quantitative measures of the affective state evoked by the two treatments. Subjects exposed to images of poverty experience a more negative affective state than those in the control treatment. Further analysis shows that individuals in a more positive emotional state exhibit less of a treatment effect. Also, those who exhibit greater attentiveness upon viewing the poverty video are less productive. The results are consistent with the notion that exposure to poverty can induce a psychological state in individuals that adversely affects productivity.
    Date: 2017
  2. By: Kataria, Mitesh (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Evidence from ten natural field studies comparing long-distance runners' incentivized predictions of race finishing time with their actual finishing time is reported. A modest but regular bias is found. Male runners are consistently found to be more time optimistic than female runners and finish slower than they predict to finish. Males are found to over-appreciate their physical fitness. To the extent this behaviour carries over to other contexts, such as the labor market, the tendency of men to overestimate their capacity could lead to distorted self-appraisals and give them advantages in terms of higher salaries and better positions.
    Keywords: Overconfidence; Time optimism; Gender differences
    JEL: C93 D01 D03
    Date: 2017–02
  3. By: Greiff, Matthias; Ackermann, Kurt; Murphy, Ryan O.
    Abstract: Different social contexts have been used when measuring distributional preferences. This could be problematic as contextual variance may inadvertently muddle the measurement process. We use a within-subjects design and measure distributional preferences in resource allocation tasks with role certainty, role uncertainty, decomposed games, and matrix games. Results show that, at the aggregate level, role uncertainty and decomposed games lead to higher degrees of prosociality when compared to role certainty. At the individual level, we observe considerable differences in behavior across the social contexts, indicating that the majority of people are sensitive to these different social settings but respond in different ways.
    JEL: C91 D03 D64
    Date: 2016
  4. By: Francesco Bogliacino; Cristiano Codagnone
    Abstract: The article discusses whether and to what extent experiments can contribute to a research paradigm based on the study of human behaviour in complex evolving environments and on the problem of asymmetric adjustment among different components of economic system along certain trajectories, focusing on the possibility that experimental evidence may represent an external consistency check on this type of heterodox modelling. It considers methodological issues related with the concept of validity, the evidence on rationality of human agents, and the possibility to identify a microfoundation alternative to homo oeconomicus, discussing the evidence on humans as strong reciprocators, as trusting individuals and as embedded in social norms.
    Keywords: Experiments; Causality; Heuristics; Learning; Bounded Rationality; Altruism; Punishment; Trust; Norms
    JEL: C9 C18 D01 D03
    Date: 2017–02–24
  5. By: Himmler, Oliver; Jaeckle, Robert; Weinschenk, Philipp
    Abstract: A large share of students in higher education graduates with delay or fails to obtain a degree at all. In our field experiment, students can sign a non-binding agreement and self-commit to staying on track for graduation. We provide first evidence that soft commitment devices can enhance educational progress and -- more generally -- improve the completion of complex tasks such as passing exams. A pure reminder treatment does not change behavior, suggesting that the effects are not driven by increased salience. As predicted by a simple decision model, we show that procrastinators benefit most from the soft commitment device.
    Keywords: Commitment Device; Reminder; Procrastination; Education; Field Experiment
    JEL: C93 D03 I20
    Date: 2017–01–23
  6. By: Heinz, Matthias; Schumacher, Heiner
    Abstract: We examine what an applicant’s vita signals to potential employers about her willingness to cooperate in teams. Intensive social engagement may credibly reveal that an applicant cares about the well‐being of others and therefore is less likely to free‐ride in teamwork situations. We find that contributions in a public goods game strongly increase in a subject’s degree of social engagement as indicated on her résumé (and rated by an independent third party). Engagement in other domains, such as student or sports associations, is not positively correlated with contributions. In a prediction experiment with human resource managers from various industries, we find that managers use résumé content effectively to predict relative differences in subjects’ willingness to cooperate. Thus, young professionals signal important behavioral characteristics to potential employers through the choice of their extracurricular activities.
    JEL: C72 C92 D82
    Date: 2016
  7. By: Brilli, Ylenia (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper analyzes the effects of maternal employment and non-parental child care on child cognitive development, taking into account the mother's time allocation between leisure and child-care time. I estimate a behavioral model, in which maternal labor supply, non-parental child care and time allocation decisions are considered to be endogenous choices of the mother, and the child cognitive development depends on maternal and non-parental child care. The results show that the mother's child-care time is more productive than non-parental child care, at any age of the child. This implies that a reduction in a mother's child-care time, induced by a higher labor supply, may not be compensated for by the increase in non-parental child care use, and, hence, may lead to a negative effect on the child's cognitive ability. The estimation of a counterfactual model where a mother can only allocate her time between child care and work shows that neglecting the mother's time allocation choice between child care and leisure overestimates the productivity of a mother's time with the child.
    Keywords: mother employment; mother time allocation; non-parental child care; child development; structural estimation
    JEL: C15 D13 J13 J22
    Date: 2017–02–28
  8. By: Tabea Herrmann; Olaf Hübler; Lukas Menkhoff; Ulrich Schmidt
    Abstract: This paper complements evidence on the Allais paradox from advanced countries and educated people by a novel investigation in a poor rural area. The share of Allais-type behavior is indeed high and related to characteristics of “lacking ability”, such as poor education, unemployment, and little financial sophistication. Based on prospective reference theory, we extend these characteristics by biased processing of probabilistic information. Finally, we reveal that Allais-type behavior is linked to risk-related characteristics, such as risk tolerance and optimism. This indicates a potential problem as exactly the more dynamic among the poor tend to make inconsistent decisions under uncertainty.
    Keywords: Field experiments, Allais paradox, socio-demographic characteristics, prospective reference theory, first order stochastic dominance, risk attitude, optimism
    JEL: D81 D3 O10
    Date: 2017

This nep-cbe issue is ©2017 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.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.