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on Cognitive and Behavioural Economics |
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Issue of 2021‒01‒25
seven papers chosen by Marco Novarese Università degli Studi del Piemonte Orientale |
| By: | Glätzle-Rützler, Daniela (University of Innsbruck); Lergetporer, Philipp (Ifo Institute for Economic Research); Sutter, Matthias (Max Planck Institute for Research on Collective Goods) |
| Abstract: | Many important intertemporal decisions are made by groups rather than individuals. What happens to collective decisions when there is internal conflict about the tradeoff between present and future has not been thoroughly investigated so far. We study experimentally the causal effect of group members' heterogeneous payoffs from waiting on intertemporal choices. We find that three-person groups behave more patiently than individuals. This effect stems from the presence of at least one group member with a high payoff from waiting. We analyze additional treatments, group chat content, and survey data to uncover the mechanism through which heterogeneity in groups increases patience. |
| Keywords: | patience, time preferences, group decisions, payoff heterogeneity, experiment |
| JEL: | C91 C92 D03 D90 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14025&r=all |
| By: | Daniela Glätzle-Rützler (Department of Public Finance, University of Innsbruck); Philipp Lergetporer (Center for the Economics of Education, ifo Institute Munich, and CESifo); Matthias Sutter (Max Planck Institute for Research on Collective Goods, University of Cologne, University of Innsbruck and IZA Bonn) |
| Abstract: | Many important intertemporal decisions are made by groups rather than individuals. What happens to collective decisions when there is internal conflict about the tradeoff between present and future has not been thoroughly investigated so far. We study experimentally the causal effect of group members’ heterogeneous payoffs from waiting on intertemporal choices. We find that three-person groups behave more patiently than individuals. This effect stems from the presence of at least one group member with a high payoff from waiting. We analyze additional treatments, group chat content, and survey data to uncover the mechanism through which heterogeneity in groups increases patience. |
| Keywords: | patience, time preferences, group decisions, payoff heterogeneity, experiment |
| JEL: | C91 C92 D03 D90 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:054&r=all |
| By: | Claussen, Jörg; Kretschmer, Tobias; Khashabi, Pooyan; Seifried, Mareike |
| Abstract: | Despite some advantages over traditional (offline) labor markets - such as lower search costs, better matching and improved monitoring - online labor markets (OLMs) have not taken off as initially expected. In this paper, we study the factors that limit perceived project success on OLMs. Using psychological contract theory, we theorize how common OLM features including contracts with virtual monitoring, multi-freelancer projects, and simultaneous projects by a client trigger the perception of psychological contract breach among OLM participants and reduce perceived project success for both participants. We test these hypotheses using an extensive dataset with more than 143,000 transactions on the world's largest freelancing platform, Upwork, and find that - contrary to predictions from agency theory - projects equipped with strict freelancer monitoring (hourly-pay contracts) and projects enabling peer comparison (multi-freelancer projects or multiple simultaneous projects), lead to lower perceived project success both from the freelancer's and the client's perspective. Our work implies that transactions on online labor markets should not be viewed solely as agency relations, and that some features that supposedly reduce agency costs and improve efficiency on OLMs come at the cost of triggering the perception of psychological contract breach. |
| Keywords: | Online labor markets,gig economy,outsourcing,psychological contract theory,platforms,knowledge work |
| JEL: | L14 L24 J44 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:20078&r=all |
| By: | Bosworth, Steven J. (University of Reading); Snower, Dennis J. (Hertie School of Governance) |
| Abstract: | This paper models the welfare consequences of social fragmentation arising from technological advance. We start from the premise that technological progress falls primarily on market-traded commodities rather than prosocial relationships, since the latter intrinsically require the expenditure of time and thus are less amenable to productivity increases. Since prosocial relationships require individuals to identify with others in their social group whereas marketable commodities are commonly the objects of social status comparisons, a tradeoff arises between in-group affiliation and inter-group status comparisons. People consequently narrow the bounds of their social groups, reducing their prosocial relationships and extending their status-seeking activities. As prosocial relationships generate positive externalities whereas status-seeking activities generate negative preference externalities, technological advance may lead to a particular type of "decoupling" of social welfare from material prosperity. Once the share of status goods in total production exceeds a crucial threshold, technological advance is shown to be welfare-reducing. |
| Keywords: | conspicuous consumption, bowling alone, decoupling, social fragmentation, growth |
| JEL: | D63 D69 D71 E71 I39 O33 Z10 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14042&r=all |
| By: | Imen Bouhlel (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (... - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015 - 2019) - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur); Michela Chessa (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (... - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015 - 2019) - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur); Agnès Festré (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (... - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015 - 2019) - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur); Eric Guerci (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (... - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015 - 2019) - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur) |
| Abstract: | Information search and opinion formation are central aspects of decision making in consumers choices. Indeed, before taking a decision, the alternatives among which the rational choice will be made should be clearly valued. In standard economic theory, the search dynamics is generally neglected because the process is assumed to be carried out without any cost or without spending time. However, whenever only a significant collection of experience can provide the bulk of relevant information to make the best choice, as it is the case for experience goods (Nelson, 1970), some engendered costs in collecting such information might be considered. Our paper lies on a conceptual framework for the analysis of an individual sequential search task among a finite set of alternatives. This framework is inspired by both the Secretary problem (Ferguson et al., 1989) and the multi-armed bandit problem (Robbins, 1952). We present a model where an individual is willing to locate the best choice among a set of alternatives. The total amount of time for searching is finite and the individual aims at maximizing the expected payoff given by an exploration-exploitation trade-off: a first phase for exploring the value of new alternatives, and a second phase for exploiting her past collected experience. The task involves an iterative exploitation – i.e., where the final payoff does not only depend on the value of the chosen alternative, but also on the remaining time that has not been dedicated to exploration –. Given the finite horizon of time, the optimal stopping strategy can be assimilated to a satisficing behavior (Simon, 1956). We manipulate the degree of certainty of information, and we find that the optimal stopping time is later under the uncertain information condition. We experimentally test the model's predictions and find a tendency to oversearch when exploration is costly, and a tendency to undersearch when exploration is relatively cheap. We also find under the certain information condition that participants learn to converge towards the optimal stopping time, but this learning effect is less present under the uncertain information condition. Regret and anticipation lead to more exploration under both information conditions. A gender effect is also exhibited with women tending to explore more than men. |
| Date: | 2020–12–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-03036851&r=all |
| By: | Kiessling, Lukas (Max Planck Institute for Research on Collective Goods); Chowdhury, Shyamal (University of Sydney); Schildberg-Hörisch, Hannah (Heinrich Heine University Düsseldorf); Sutter, Matthias (Max Planck Institute for Research on Collective Goods) |
| Abstract: | We study whether and how parents interfere paternalistically in their children's intertemporal decision-making. Based on experiments with over 2,000 members of 610 families, we find that parents anticipate their children's present bias and aim to mitigate it. Using a novel method to measure parental interference, we show that more than half of all parents are willing to pay money to override their children's choices. Parental interference predicts more intensive parenting styles and a lower intergenerational transmission of patience. The latter is driven by interfering parents not transmitting their own present bias, but molding their children's preferences towards more time-consistent choices. |
| Keywords: | parental paternalism, time preferences, convex time budgets, present bias, intergenerational transmission, parenting styles, experiment |
| JEL: | C90 D1 D91 D64 J13 J24 O12 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14030&r=all |
| By: | Mukhdoomi, Arooba; Farooqi, Asma; Attaullah Khan, Tabbassum; Ajmal, Warisha; Tooba, Zorain |
| Abstract: | The study aims to investigate the impact of smart phones addiction on academic performance of college students. For the purpose, we have used “Theory of Planned Behavior (TPB)” in investigating the academic performance. Moreover, the study also emphasized that whether smart phone self-efficacy, interaction competency and behavioral intention influences the academic performance of college students in positive way and negative way using that TPB model, data are collected from the students of Iqra University north campus using quantitative research. In this research we have used correlation design because we have studied relationship between Smartphone self-efficacy (SSE), interaction competency (IC), behavioral intention (BI) and Academic performance (AA). This design tells us how much independent variables (SSE, IC and BI) impact on dependent variable (AA). From the finding we came to know that there is a positive relationship between behavioral intention and academic performance. This proves that until and unless students are not intrinsically motivated, they cannot use smart phone in a positive way…… The limitation of the study is; the study is carried out by the students of university due to limited time period. Moreover, time constrains also act as a barrier in collecting many responses. Hence, the sample size might not be appropriate to increase the generalizability of this paper. Therefore, the study can’t apply on other regions. Furthermore, more variables should be taken into consideration to examine the overall Smartphone impact in a holistic way. |
| Keywords: | Holistic study, Academic performance, Smartphone Self-efficacy, Interaction competency and Behavioral intention. |
| JEL: | I2 I23 M0 M1 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104485&r=all |