nep-cbe New Economics Papers
on Cognitive and Behavioural Economics
Issue of 2022‒04‒25
seven papers chosen by
Marco Novarese
Università degli Studi del Piemonte Orientale

  1. Motivated Reasoning, Information Avoidance, and Default Bias By Katharina Momsen; Sebastian O. Schneider
  2. Adding household surveys to the behavioral economics toolbox: Insights from the SOEP Innovation Sample By Fischbacher, Urs; Neyse, Levent; Richter, David; Schröder, Carsten
  3. Reward perception, but not reward inequality is associated with increased bribe-taking in a laboratory task By Bahník, Štěpán; Vranka, Marek Albert
  4. Loss Aversion or Lack of Trust: Why Does Loss Framing Work to Encourage Preventative Health Behaviors? By Emily A. Beam; Yusufcan Masatlioglu; Tara Watson; Dean Yang
  5. What motivates people to pay their taxes? Evidence from four experiments on tax compliance By Eric Floyd; Michael Hallsworth; John List; Robert Metcalfe; Kristian Rotaru; Ivo Vlaev
  6. Pollution Pictures: Psychological Exposure to Pollution Impacts Worker Productivity in a Large-scale Field Experiment By Nikolai Cook, Anthony Heyes
  7. Opinions as Facts By Leonardo Bursztyn; Aakaash Rao; Christopher Roth; David Yanagizawa-Drott

  1. By: Katharina Momsen; Sebastian O. Schneider
    Abstract: We investigate whether the presence of a default interacts with the willingness of decision-makers to gather, process and consider information. In an online experiment, where about 2,300 participants choose between two compiled charity donation options worth $100, we vary the availability of information and the presence of a default. Information avoidance, when possible, increases default effects considerably, manifesting a hitherto undocumented channel of the default bias. Moreover, we show that defaults trigger motivated reasoning: In the presence of a default – even if self-selected–, participants consider new information to a lower degree than without a preselected option.
    JEL: C90 D64 D83 D91
    Date: 2022–05
  2. By: Fischbacher, Urs; Neyse, Levent; Richter, David; Schröder, Carsten
    Abstract: Integrating economic experiments into household surveys provides unique possibilities. We introduce the German Socio-Economic Panel's Innovation Sample (SOEPIS), which offers researchers detailed panel data and the possibility to collect personalized experimental and survey data for free. We present the options that this provides and give examples illustrating these options.
    Keywords: Experiments,Household Survey,Panel Study,Economic Methods,Economic Preferences,Behavioral Economics,SOEP
    JEL: C83 C9 D1 D9
    Date: 2022
  3. By: Bahník, Štěpán (University of Economics, Prague); Vranka, Marek Albert (University of Economics)
    Abstract: People are more likely to behave selfishly when such behavior is easier to justify. When one receives a lesser reward for the same performed task, the perceived unfairness of the reward may serve as a justification for subsequent selfish behavior. In the present study, we let participants to break rules in a sorting task in order to increase their rewards while simultaneously harming a third party, simulating a bribe-taking. Although we did not find evidence that manipulation of perceived reward inequality affects bribe-taking, people who perceived their reward more negatively behaved more selfishly and took more bribes, causing more harm to the charity.
    Date: 2022–03–16
  4. By: Emily A. Beam; Yusufcan Masatlioglu; Tara Watson; Dean Yang
    Abstract: We implemented a field experiment designed to increase participants’ willingness to visit a health clinic. We find differential responses to a $50 incentive framed as a loss versus framed as a gain. We find little support for the notion that loss aversion is responsible for the effectiveness of loss framing. Instead, it appears that loss framing promotes take-up by raising the perceived probability that the incentive will be provided as promised. The results suggest trust is an alternative pathway through which loss framing may affect behavior, and trust may be an important way to promote desirable health behaviors.
    JEL: C93 D03 I12
    Date: 2022–03
  5. By: Eric Floyd; Michael Hallsworth; John List; Robert Metcalfe; Kristian Rotaru; Ivo Vlaev
    Abstract: In this study, we first present a large natural field experiment that tested messages aimed at increasing tax compliance. We find that the main drivers of changes in compliance are messages describing the monitoring and enforcement behavior of the tax collector. A second natural field experiment built on the results of the first experiment to further investigate what kinds of costs resulting from tax collector oversight are salient to taxpayers. Specific time and cognitive incentives did not significantly increase payment rates, whereas stating non-specific costs of inaction did. Additional analyses suggest the increase in compliance is likely due to a 'fill in the blank' effect in which taxpayers assume the consequence is a fine. Interestingly, specifically stating maximum fine or jailtime consequences have the largest effect in a laboratory setting but only if the consequences are interpreted as realistic. Overall, our study reinforces that tax authorities can use short messages to increase tax compliance; the estimated accelerated revenue from the two field studies amounts to 9.9m GBP.
    Date: 2022
  6. By: Nikolai Cook, Anthony Heyes (Wilfrid Laurier University)
    Abstract: While contemporaneous exposure to polluted air has been shown to reduce labor supply and worker productivity, little is known about the underlying channels. We present first causal evidence that psychological exposure to pollution - the "thought of pollution" - can influence employment performance. Over 2000 recruits on a leading micro-task platform are exposed to otherwise identical images of polluted (treated) or unpolluted (control) scenes. Randomization across the geographically-dispersed workforce ensures that treatment is orthogonal to physical pollution exposure. Treated workers are less likely to accept a subsequent offer of work (labor supply) despite being offered a piece-rate much higher than is typical for the setting. Conditional on accepting the offer, treated workers complete between 5.1% to 10.1% less work depending on the nature of their assigned task. We nd no effect on work quality. Suggestive evidence points to the role of induced negative sentiment. Decrements to productivity through psychological mechanisms are plausibly additional to any from physical exposure to polluted air.
    Keywords: Air Pollution, Gig Economy, Randomization, Labor Productivity
    JEL: Q53 J24
    Date: 2022
  7. By: Leonardo Bursztyn (University of Chicago and NBER); Aakaash Rao (Harvard University); Christopher Roth (University of Cologne, Econtribute, CAGE Warwick, CESifo, CEPR, briq); David Yanagizawa-Drott (University of Zurich and CEPR)
    Abstract: The rise of opinion programs has transformed television news. Because they present anchors’ subjective commentary and analysis, opinion programs often convey conflicting narratives about reality. We experimentally document that people across the ideological spectrum turn to opinion programs over “straight news,” even when provided large incentives to learn objective facts. We then examine the consequences of diverging narratives between opinion programs in a high-stakes setting: the early stages of the COVID-19 pandemic in the US. We find stark differences in the adoption of preventative behaviors among viewers of the two most popular opinion programs, both on the same network, which adopted opposing narratives about the threat posed by the COVID-19 pandemic. We then show that areas with greater relative viewership of the program downplaying the threat experienced a greater number of COVID-19 cases and deaths. Our evidence suggests that opinion programs may distort important beliefs and behaviors.
    Keywords: Opinion programs, Media, Narratives
    JEL: C90 D83 D91 Z13
    Date: 2022–04

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