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on Cognitive and Behavioural Economics |
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Issue of 2021‒11‒15
seven papers chosen by Marco Novarese Università degli Studi del Piemonte Orientale |
| By: | Tetsuya Kawamura; Tiffany Tsz Kwan Tse |
| Abstract: | A growing body of literature in experimental economics examines how cognitive ability affects cooperation in social dilemma settings. We contribute to the existing literature by studying this relationship in a more complex and strategic environment when the number of partners increases in an infinitely repeated public goods game. We designed four treatments with different continuation probability under two conditions: whether cooperation can be sustained as risk dominance or not. We asked participants to decide whether to cooperate in every period in the first five rounds. They were further asked to decide if they should elicit their strategy at the beginning of each super game using the strategy method in the last five rounds. We found that participants with greater cognitive abilities cooperated more (less) when cooperation could(not) be sustained as risk dominance. A similar trend was observed in the frequency of fully cooperative strategies. We also found that participants with greater cognitive abilities employed lenient and forgiving strategies more frequently when the continuation probability was far higher than the risk dominant threshold level. |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:1146&r= |
| By: | Marco Lambrecht; Eugenio Proto; Aldo Rustichini; Andis Sofianos |
| Abstract: | We investigate in a laboratory setting whether revealing information on intelligence affects behavior in games with repeated interactions. In our experimental design we communicate information on the cognitive ability of both players. We use three stage games: Prisoners’ Dilemma (PD) and two versions of Battle of Sexes (BoS), with high and low payoff inequality. We find that the information affects strategic behavior significantly in two distinct ways. In PD, disclosure markedly hampers cooperation, as higher intelligence players are less cooperative once they are made aware that they play against someone of lower ability than themselves in the disclosure treatment. Similarly, in BoS with low payoff inequality, disclosure disrupts coordination on outcomes with positive payoffs, as higher intelligence players try to force their most preferred outcome onto the less intelligent. However, in BoS with high payoff inequality, this pattern of behavior dramatically changes. Disclosure does not significantly affect coordination rates. Differently from the low payoff inequality game, coordination is achieved more often on outcomes that favour less intelligent players. We conjecture that when coordination becomes more difficult, because of the high inequality between payoffs, intelligence and inequality together form a coordination device. |
| Keywords: | repeated prisoners dilemma, cooperation, intelligence, IQ |
| JEL: | C73 C91 C92 D83 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9372&r= |
| By: | Mourelatos, Evangelos |
| Abstract: | This research explores whether there is a link between mood and ethical perceptions in online labor markets. The experimental design allows to track the determinants of the underlying mechanism of individuals’ behavior within and without the treatment context. By using OLS estimation methods the paper also provides empirical evidence for several statistically significant effects of personality traits on ethical perceptions, value co-creation and relationship quality. In general, the positive mood manipulation lead to an increase of individuals’ ethical perceptions, value co-creation and relationship quality. These findings suggest that mainly the effect of positive mood on the outcomes operates through the trait of agreeableness. Contributions to the ethical perception, mood research and online-economy literature are discussed |
| Keywords: | ethical perception,value co-creation,mood,personality,online labor markets |
| JEL: | D91 D87 D53 D23 D01 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:244735&r= |
| By: | Michael Thaler |
| Abstract: | When people choose what messages to send to others, they often consider how others will interpret the messages. In many environments, particularly in politics, people are motivated to hold particular beliefs and distort how they process information in directions that favor their motivated beliefs. This paper uses two experiments to study how message senders are affected by receivers' motivated beliefs. Experiment 1, conducted using an online sample of social media users, analyzes the effect of incentivizing senders to be perceived as truthful. These incentives cause senders to send less truthful messages. When incentivized, senders send more false information when it aligns with receivers' politically-motivated beliefs, controlling for receivers' current beliefs. However, receivers do not anticipate the adverse effects of senders' incentives. Experiment 2 isolates the role that information processing plays by analyzing an environment in which receivers assess the truthfulness of messages from a computer and senders choose one of the computer's messages to determine their earnings. Senders predict that receivers distort information processing in the direction of their politics, demand information about receivers' political preferences, and condition on the receivers' politics to strategically choose less truthful computer messages. |
| Date: | 2021–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2111.06062&r= |
| By: | Oberrauch, Luis; Kaiser, Tim |
| Abstract: | We study the role of cognitive ability and financial literacy for inter-temporal decision-making using an adapted version of the Convex Time Budget Protocol. We document substantial heterogeneity in choice-patterns and estimated parameters at the individual-level: We find that subjects with higher cognitive ability and domain specific-knowledge are more likely to make patient inter-temporal choices, to allocate the entire budget to a single payment-date, and to allocate the entire budget to corner choices as interest rates increase. At the same time, domain specific knowledge is uncorrelated with choice consistency and estimated individual error parameters, suggesting these results are not driven by a reduction in random noise among high ability respondents. These results serve as suggestive evidence for inter-temporal arbitrage among high ability respondents, thereby revealing a potential confound in time-preference elicitation tasks relying on time-dated monetary rewards. |
| Keywords: | Intertemporal choice,cognitive ability,financial literacy,narrow bracketing,arbitrage |
| JEL: | G53 D15 D91 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:245802&r= |
| By: | Thomas Dohmen (IZA (Schaumburg-Lippe-Strasse 5-9, 53113 Bonn, Germany), University of Bonn (Institute for Applied Microeconomics, Adenauerallee 24-42, 53113 Bonn, Germany), Maastricht University (Tongersestraat 53, 6211 LM Maastricht, The Netherlands)); Arjan Non (Erasmus University Rotterdam (E building, Burgemeester Oudlaan 50, 3062 PA Rotterdam, The Netherlands)); Tom Stolp (Maastricht University (Tongersestraat 53, 6211 LM Maastricht, The Netherlands)) |
| Abstract: | We conduct laboratory experiments to investigate basic predictions of principal-agent theory about the choice of piece rate contracts in the presence of output risk, and provide novel insights that reference dependent preferences affect the tradeoff between risk and incentives. Subjects in our experiments choose their compensation for performing a real-effort task from a menu of linear piece rate and fixed payment combinations. As classical principal-agent models predict, more risk averse individuals choose lower piece rates. However, in contrast to those predictions, we find that low-productivity risk averse workers choose higher piece rates when the riskiness of the environment increases. We hypothesize that reference points affect piece rate choice in risky environments, such that individuals whose expected earnings would exceed (fall below) the reference point in a risk-free environment behave risk averse (seeking) in risky environments. In a second experiment, we exogenously manipulate reference points and confirm this hypothesis. |
| Keywords: | Incentive, piece-rate, risk, reference point, laboratory experiment |
| JEL: | D81 D91 M52 |
| Date: | 2021–11 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:125&r= |
| By: | Nikolaos Misirlis (HAN - Hogeschool van Arnhem en Nijmegen); Marjon Elshof (HAN - Hogeschool van Arnhem en Nijmegen); Maro Vlachopoulou (UoM - University of Macedonia [Thessaloniki]) |
| Abstract: | Purpose: In this article we aim to model social media users' behavior in relation with the use of specified Facebook pages and groups, related to eHealth, specifically to healthy diet and sport activities. The study represents to the best of our knowledge the first region-focused on a specific geographical area research. Methods: The users' personality is measured through the well-known Big Five model and the behavior is predicted with the Theory of Planned Behavior (TPB). Structural Equation Modeling is used in order to statistically control the associations among the diverse observed and latent variables. Results: The results suggest an extended theory of planned behavior in combination with personality traits, on eHealth field. Openness and Extraversion do not seem to have positive effect on Attitude. Users' attitude can be affected positively from Agreeableness and Subjective Norms, guiding to finally positive affection of users' actual behavior. Agreeableness cannot influence behavior, directly, nor through SN, since the hypothesis path A-SN is not verified, but it can through Attitude. Neuroticism was negatively correlated to PBC but this hypothesis was not, also, confirmed in the proposed model. Implications: While literature confirms all of our hypotheses, in our study only 8 in 12 are finally confirmed. The difference between the present model and literature findings can be located on the different cultural dimensions among the different studies. The present survey is focused on the Greek region with all the participants to be Greeks. This location-based limitation could be surpassed by conducting the same research on different geographical regions and then confront the outcomes. |
| Keywords: | Big Five Personality Model,Personality traits,Facebook,Theory of Planned Behavior |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03381355&r= |