nep-cbe New Economics Papers
on Cognitive and Behavioural Economics
Issue of 2024–12–16
two papers chosen by
Marco Novarese, Università degli Studi del Piemonte Orientale


  1. The psychology of prizes: Loss aversion and optimal tournament rewards By Dmitry Ryvkin; Qin Wu
  2. Induced Anxiety Influences The Perception Of Negative Facial Expressions In Single Faces And Face Ensembles By Dmitry A. Koch; Evgenia E. Fedorova; Dmitry V. Lyusin

  1. By: Dmitry Ryvkin; Qin Wu
    Abstract: We study the optimal allocation of prizes in rank-order tournaments with loss averse agents. Prize sharing becomes increasingly optimal with loss aversion because more equitable prizes reduce the marginal psychological cost of anticipated losses. Furthermore, loss aversion can boost effort if prizes are sufficiently equitable, but otherwise effort declines with loss aversion. Overall, these results give credence to more equitable allocations of competitive rewards. A win-win scenario is where optimal prizes are equitable even under loss neutrality, in which case the principal benefits from agents' loss aversion.
    Date: 2024–11
    URL: https://d.repec.org/n?u=RePEc:arx:papers:2411.01068
  2. By: Dmitry A. Koch (National Research University Higher School of Economics); Evgenia E. Fedorova (National Research University Higher School of Economics); Dmitry V. Lyusin (National Research University Higher School of Economics)
    Abstract: The visual system enables us to quickly recognize different facial expressions despite the high complexity of human faces. This impressive ability to perceive emotions can be biased by social anxiety, which might lead to an overestimation of social threats from individuals. However, it is still under consideration how state anxiety influences our ability to process and summarize information from a group as an ensemble. The current study aims to examine whether state anxiety impairs our ability to assess the mean emotional expression of multiple faces by intensity overestimation of decreased accuracy. The experiment included two sessions, the first one involved no anxiety induction procedure, while the second session included anxiety induction. In both sessions, participants performed an adjustment task estimating the average emotion intensity for either single face or face ensemble condition. The final sample consisted of 46 individuals (mean age: 21±2.97) who successfully exhibited induced anxiety. The results indicated that anxious perceivers overestimated the average emotional intensity not only in the single face condition but also in the ensemble condition. Furthermore, we have shown that the emotion amplification stemmed from a systematic bias of the average emotion intensity, rather than from impaired accuracy. Our results demonstrate that state anxiety is likely to navigate attention to the faces with the most intensive facial expressions and, subsequently, bias their average impression. Exploring the effects of anxiety on ensemble perception is essential for further revealing the complexities of social cognition and how emotional biases can alter group-level information processing
    Keywords: ensemble coding, anxiety, summary statistics, emotion, social cognition.
    JEL: Z
    Date: 2024
    URL: https://d.repec.org/n?u=RePEc:hig:wpaper:140psy2024

This nep-cbe issue is ©2024 by Marco Novarese. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at https://nep.repec.org. For comments please write to the director of NEP, Marco Novarese at <director@nep.repec.org>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.