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on Cognitive and Behavioural Economics |
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Issue of 2024‒02‒12
three papers chosen by |
| By: | Deborah Kistler; Su Nanxu; Christian Thoeni |
| Abstract: | We study the effect of three salience manipulations on cooperation in a standard public goods game. A standard social preferences model enriched by salience weights provides hypotheses about the expected effects of our salience manipulations. We test these predictions in a laboratory experiment using different techniques to manipulate the salience of either the highest or lowest contribution in the group. We find no systematic effect of the salience manipulation on cooperation, even though our regression analysis suggests that subjects’contributions are positively linked to the salient contribution. This is because subjects systematically reduce their contributions in the maximum condition relative the minimum condition. These two effects offset each other, resulting in contribution levels which are surprisingly unresponsive to our salience manipulations. |
| Keywords: | salience, inequality aversion, experiment, public goods game |
| JEL: | D83 D91 C91 C72 H41 |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:lau:crdeep:22.10&r=cbe |
| By: | Mohammed Abdellaoui (HEC Paris - Ecole des Hautes Etudes Commerciales); Han Bleichrodt (UA - Université d'Alicante, Espagne); Cédric Gutierrez (Università Bocconi) |
| Abstract: | Overconfident behavior, the excessive willingness to bet on one's performance, may be driven by optimistic beliefs and/or ambiguity attitudes. Separating these factors is key for understanding and correcting overconfident behavior, as they call for different corrective actions. We present a method to do so, which we implement in two incentivized experiments. The first experiment shows the importance of ambiguity attitudes for overconfident behavior. Optimistic ambiguity attitudes (ambiguity seeking) counterbalanced the effect of pessimistic beliefs, leading to neither over- nor underconfident behavior. The second experiment applies our method in contexts where overconfident behavior is expected to vary: easy versus hard tasks. Our results showed that task difficulty affected both beliefs and ambiguity attitudes. However, although beliefs were more optimistic for relative performance (rank) and more pessimistic for absolute performance (score) on easy tasks compared with hard tasks, ambiguity attitudes were always more optimistic on easy tasks for both absolute and relative performance. Our findings show the subtle interplay between beliefs and ambiguity attitudes: they can reinforce or offset each other, depending on the context, increasing or lowering overconfident behavior. This paper was accepted by Yuval Rottenstreich, behavioral economics and decision analysis. Funding: This work was supported by HEC Paris research budget and Bocconi junior researchers' grants. Supplemental Material: The data and online appendix are available at https://doi.org/10.1287/mnsc.2021.00165 . |
| Date: | 2023–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04383402&r=cbe |
| By: | Nobuyuki Hanaki; Yuta Takahashi |
| Abstract: | We present and conduct a novel experiment on a multi-period beauty contest game motivated by the canonical New-Keynesian model. Participants continuously provide forecasts for prices spanning multiple future periods. These forecasts determine the price for the current period and participants’ payoffs. Our findings are threefold. First, the observed prices in the experiment deviate more from the rational expectations equilibrium prices under strategic complementarity than under strategic substitution. Second, participants’ expectations respond to announcements of future shocks on average. Finally, participants employ heuristics in their forecasting; however, the choice of heuristic varies with the degree of strategic complementarity. |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:1213r&r=cbe |