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on Cognitive and Behavioural Economics |
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Issue of 2019‒10‒28
eight papers chosen by Marco Novarese Università degli Studi del Piemonte Orientale |
| By: | Timothy Shields (Economic Science Institute, Chapman University; Argyros School of Business and Economics, Chapman University); Eric Schniter (Economic Science Institute, Chapman University; Argyros School of Business and Economics, Chapman University); Daniel Sznycer (Department of Psychology, University of Montreal) |
| Abstract: | Trust-based interactions with robots are increasingly common in the marketplace, workplace, on the road, and in the home. However, a looming concern is that people may not trust robots as they do humans. While trust in fellow humans has been studied extensively, little is known about how people extend trust to robots. Here we compare trust-based investments and emotions from across three nearly identical economic games: human-human trust games, human-robot trust games, and human-robot trust games where the robot decision impacts another human. Robots in our experiment mimic humans: they are programmed to make reciprocity decisions based on previously observed behaviors by humans in analogous situations. We find that people invest similarly in humans and robots. By contrast, the social emotions elicited by the interactions (but not non-social emotions) differed across human and robot trust games, and did so lawfully. Emotional reactions depended on how one’s trust game decision interacted with the partnered agent’s decision, and whether another person was affected economically and emotionally. |
| Keywords: | Trust; Robots; Artificial Intellgience; Emotion; Experiment |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:18-22&r=all |
| By: | James Alm (Tulane University); Laura Rosales Cifuentes (Gandour Consultores); Carlos Mauricio Ortiz Niño (Gandour Consultores); Diana Rocha (Gandour Consultores) |
| Abstract: | The Government of Colombia imposes a variety of taxes that must be paid by individual wage earners, called in their entirety "social protection contributions". Since 2007 individual payments have been collected using an on-line mechanism. In order to improve compliance, the Government used a controlled field experiment in which various "pop-up messages" were sent to individuals when making their on-line payments, as behavioral "nudges". We examine the impact of these nudges on individual reporting behavior. We find mixed evidence that these messages increased compliance rates relative to a control group that received a so-called "neutral" message. However, we also demonstrate that the use as the control group of individuals receiving a so-called "neutral" message creates considerable bias; that is, the receipt of any message of any type clearly influences behavior. Instead, we show that the appropriate control group should be individuals who receive no message at all. |
| Keywords: | tax compliance; behavioral economics; nudges; controlled field experiments. |
| JEL: | H2 H26 C9 |
| Date: | 2019–10 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1908&r=all |
| By: | Geraldes, Diogo; Heinicke, Franziska; Rosenkranz, Stephanie |
| Abstract: | The expanding literature on lying has exclusively considered lying behavior within a one-dimensional context. While this has been an important first step, many real-world contexts involve the possibility of simultaneously lying in more than one dimension (e.g., reporting one’s income and expenses in a tax declaration). In this paper, we experimentally investigate individual lying behavior in both one- and two-dimensional contexts to understand whether the multi-dimensionality of a decision affects lying behavior. In the one-dimensional treatment, participants are asked to roll two dice in one hand and to report the sum of both dice. In the two-dimensional treatment, participants are asked to roll two dice at the same time, but one in each hand, and to report the two dice separately. Our paper provides the first evidence regarding lying behavior in a multi-dimensional context. Using a two-dimensional die-roll task, we show that participants lie partially between dimensions, which results in greater overreporting of the lower outcome die. These findings suggest a thought-provoking policy to tackle the infamous societal challenge of tax fraud: Tax report checks should focus on the item(s) for which a taxpayer profile hints at higher self-benefits in case of misreporting. |
| Keywords: | lying, honesty, morals, multidimensional, lab experiment, lab-in-the-field experiment |
| JEL: | C91 C93 D82 H26 |
| Date: | 2019–10–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:96640&r=all |
| By: | Janina Enachescu (University of Vienna); Žiga Puklavec (University of Vienna); Christian Martin Bauer (University of Vienna); Jerome Olsen (University of Vienna); Erich Kirchler (University of Vienna); James Alm (Tulane University) |
| Abstract: | In this paper we present initial investigations of the role of emotions on tax compliance decisions. We first introduce selected emotion theories, and we also present different paths by which emotions can possibly affect tax decisions, namely indirectly via mood and emotions unrelated to the tax decision itself (or "incidental emotions") and directly via emotions that are elicited in the taxation context itself (or "integral emotions"). We then present and discuss an experimental study investigating the first path suggested above, the influence of positive versus negative mood on tax compliance. Further, we also present and analyze a study exploring emotions elicited by the taxation context. Finally, we suggest that a fruitful path for future research is the integration of emotions into the slippery slope framework of tax compliance. |
| Keywords: | Tax compliance, incidental emotions, integral emotions, behavioal economics, nudges, laboratory experiments. |
| JEL: | H26 C91 |
| Date: | 2019–10 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1909&r=all |
| By: | Rablen, Matthew D. (University of Sheffield) |
| Abstract: | The psychological basis for rank-dependent probability weighting, and for an inverse-S probability weighting function (PWF) in particular, has often been questioned. I examine the existence and shape of the PWF in a model allowing for optimism/pessimism over probability distributions and for loss averse/gain loving stochastic reference dependence. I give commonly observed shapes of PWF a psychological interpretation. In particular, I establish a deep connection between two of the most established phenomena in decisionmaking: loss aversion and the inverse-S PWF: the former is a pre- condition for the latter. |
| Keywords: | probability weighting, rank dependent expected utility, loss aversion, reference dependence, optimism, pessimism |
| JEL: | D81 D01 |
| Date: | 2019–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12701&r=all |
| By: | Castriota, Stefano (University of Pisa); Tonin, Mirco (Free University of Bozen/Bolzano) |
| Abstract: | The empirical literature testing the economic theory of crime has extensively studied the relative importance of the probability and the severity of punishment with reference to planned criminal activities. There are, however, also unplanned crimes and in this paper we focus on a very serious and widespread one, hit-and-run road accidents. In fact, it is not only unplanned, but also largely committed by citizens without criminal records and the decision whether to stay or run must be taken within a few seconds. Using Italian data for the period 1996-2016, we rely on daylight as an exogenous source of variation affecting the probability of apprehension and find that the likelihood of hit-and-run conditional on an accident taking place increases by around 20% with darkness. Relying on two legislative reforms which increased the penalties in case of hit-and-run, we find no significant effect on drivers' behavior. Our results show that criminal activities in unplanned circumstances and under intense time pressure and emotional distress are deterred more by the certainty rather than the severity of legal sanctions. |
| Keywords: | crime, hit-and-run, road accidents, punishment |
| JEL: | D91 K14 K42 R41 |
| Date: | 2019–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12693&r=all |
| By: | Stefano Castriota (University of Pisa, Italy); Mirco Tonin (Free University of Bolzano, Italy) |
| Abstract: | The empirical literature testing the economic theory of crime has extensively studied the relative importance of the probability and the severity of punishment with reference to planned criminal activities. There are, however, also unplanned crimes and in this paper we focus on a very serious and widespread one, hit-and-run road accidents. In fact, it is not only unplanned, but also largely committed by citizens without criminal records and the decision whether to stay or run must be taken within a few seconds. Using Italian data for the period 1996-2016, we rely on daylight as an exogenous source of variation affecting the probability of apprehension and find that the likelihood of hit-and-run conditional on an accident taking place increases by around 20% with darkness. Relying on two legislative reforms which increased the penalties in case of hit-and-run, we find no significant effect on drivers’ behavior. Our results show that criminal activities in unplanned circumstances and under intense time pressure and emotional distress are deterred more by the certainty rather than the severity of legal sanctions. |
| Keywords: | Crime, hit-and-run, road accidents, punishment |
| JEL: | D91 K14 K42 R41 |
| Date: | 2019–10 |
| URL: | http://d.repec.org/n?u=RePEc:bzn:wpaper:bemps65&r=all |
| By: | Alain Mermoud (MILAC - Military Academy at ETH Zurich, HEC Lausanne - Faculté des Hautes Etudes Commerciales (HEC Lausanne)); Marcus Keupp (MILAC - Military Academy at ETH Zurich, ITEM - Institute of Technology Management [St. Gallen] - HSG - University of St.Gallen); Kévin Huguenin (HEC Lausanne - Faculté des Hautes Etudes Commerciales (HEC Lausanne)); Maximilian Palmié (ITEM - Institute of Technology Management [St. Gallen] - HSG - University of St.Gallen); Dimitri Percia David (MILAC - Military Academy at ETH Zurich, HEC Lausanne - Faculté des Hautes Etudes Commerciales (HEC Lausanne)) |
| Abstract: | Security information sharing (SIS) is an activity whereby individuals exchange information that is relevant to analyze or prevent cybersecurity incidents. However, despite technological advances and increased regulatory pressure, individuals still seem reluctant to share security information. Few contributions have addressed this conundrum to date. Adopting an interdisciplinary approach, our study proposes a behavioral framework that theorizes how and why human behavior and SIS may be associated. We use psychometric methods to test these associations, analyzing a unique sample of human Information Sharing and Analysis Centre (ISAC) members who share real security information. We also provide a dual empirical operationalization of SIS by introducing the measures of SIS frequency and intensity. We find significant associations between human behavior and SIS. Thus, the study contributes to clarifying why SIS, while beneficial, is underutilized by pointing to the pivotal role of human behavior for economic outcomes. It therefore extends the growing field of the economics of information security. By the same token, it informs managers and regulators about the significance of human behavior as they propagate goal alignment and shape institutions. Finally, the study defines a broad agenda for future research on SIS. |
| Keywords: | security information sharing,incentives,psychometrics,economics of information security,behavioural economics,behavioral economics,behavioral psychology |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02147702&r=all |