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on Cognitive and Behavioural Economics |
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Issue of 2023‒12‒18
four papers chosen by |
| By: | Taisuke Imai; Klaus M. Schmidt |
| Abstract: | Loss aversion postulates that people prefer avoiding losses over acquiring gains of equal size. It is a central part of prospect theory and, according to Daniel Kahneman, “the most significant contribution of psychology to behavioral economics” (Kahneman, 2011, p. 300). It has powerful implications for decision theory and has been fruitfully applied in many subfields of economics. However, because the reference point is often not well defined and loss aversion interacts with other behavioral biases, there is some controversy about the concept. |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:1218&r=cbe |
| By: | Aidin Hajikhameneh; Erik O. Kimbrough; Brock Stoddard |
| Abstract: | Research in social science has shown the importance of individualism and collectivism (I/C) in human behavior. Individualists tend to see people in isolation, while collectivists are more prone to see people as interconnected members of groups, and this has consequences for behavior, governance, and economic outcomes. We examine the role of I/C on cooperation experimentally in infinitely repeated prisoner’s dilemmas (IRPD) played with in- and outgroup members. We predict that collectivists will be more cooperative, forgiving and defect less with in-group members than out-group members. Individualists are predicted to make similar strategic decisions for in- and out-group members. In an effort to causally affect the I/C scores of our subjects, as well as to strengthen in- and out-group connections, subjects completed a group-identity task prior to the I/C instrument and IRPD in the Strong Identity treatment. In our Weak Identity treatment, subjects completed a task on their own and were simply told they were assigned to groups. During the experiment, across supergames, subjects were randomly matched with in- and out-group partners. Findings reveal that our treatment effects are largely null. The only significant effect on strategic behavior was that larger defection payoffs led to more defection and less cooperation by subjects in all treatments. Key Words: Individualism, collectivism, cooperation, repeated games, strategy, experiments |
| JEL: | C91 C92 C73 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:23-11&r=cbe |
| By: | Giuseppe Attanasi (Sapienza University of Rome, Italy; BETA, University of Strasbourg, France; Université Côte d'Azur, CNRS, GREDEG, France); Barbara Buljat Raymond (Université Côte d'Azur, France; GREDEG CNRS); Agnès Festré (Université Côte d'Azur, France; GREDEG CNRS); Andrea Guido (Université Bourgogne Franche-Comté; Burgundy School of Business) |
| Abstract: | We test whether augmented reality (AR) can serve as a fundraising tool by providing a more immersive way of communicating about environmental issues. In two incentivized studies, we exposed people to AR visualizations illustrating the consequences of plastic pollution, and measure the effect on participant' psychological distance, concern, intention to act and real proenvironmental behavior (donation to pro-environmental organizations). Results show evidence of heterogeneous effects depending on participants’ self-reported pro-environmental attitudes and personal characteristics: following the intervention, individuals with low environmental engagement were likely to reduce their psychological distance, while the opposite happened for individuals engaged in sustainable practices. However, despite AR visualizations reduced the psychological distance of a subset of individuals, our experimental intervention did not increase donation levels. Taken together, our results raise concerns about the use of AR technologies in fundraising and highlight the need for personalised interventions that take into account the heterogeneity of target groups. |
| Keywords: | Augmented Reality (AR), experiment, decision making, environmental fundraising, psychological distance, pro-environmental behavior, pro-environmental attitudes |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2023-15&r=cbe |
| By: | Snower, Dennis |
| Abstract: | This article's point of departure is that most of life's challenges are collective challenges, to be addressed through collective action that can be successful only when people act beyond enlightened self-interest. This is the opposite of the methodological individualism that underlies mainstream economic and political analysis. The core idea is that to address our collective challenges, we need to coordinate our collective capacities at a scale and scope at which these challenges occur. As our challenges vary through time, often unpredictably, our capacities are continually in danger of becoming decoupled from our challenges. Thus our survival and wellbeing depends on our success in continually recoupling our capacities with our challenges. Such recoupling invariably involves not just cooperation (working with others to achieve one's own goals), but also collaboration (working with others towards common goals). When individuals collaborate, they participate in the purposes and welfare of the social groups in which they are embedded. Recoupling deserves to become a central guide for public policy, business strategy and civic action. |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:amz:wpaper:2023-24&r=cbe |