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on Cognitive and Behavioural Economics |
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Issue of 2026–06–15
three papers chosen by Marco Novarese, Università degli Studi del Piemonte Orientale |
| By: | Galmarini, Umberto; Gamba, Astrid (Insubria University); Martínez-Macías, Ibai (University of The Basque COuntry (UPV/EHU)) |
| Abstract: | Do individuals become more generous after harming others, or less generous after doing the right thing? We study whether moral behavior spills over across sequential decisions through moral accounting: individuals may offset prior moral debts through subsequent prosocial behavior (moral cleansing) or draw on prior moral credits to justify lower generosity (moral licensing). In an online experiment, participants first make a fair or unfair allocation in a Dictator Minigame. They then learn whether the Receiver’s payoff was determined by their own choice or by chance, and make an unanticipated decision about whether to donate part of their earnings to a charity. By varying responsibility for realized social outcomes, the design generates different moral states associated with the same first-stage choice, which can trigger compensatory behavior in the subsequent donation decision. We find a sharp asymmetry. After choosing the fair allocation, being responsible for the Receiver’s favorable outcome significantly reduces subsequent donations, consistent with moral licensing. After choosing the unfair allocation, responsibility has no average effect on giving, but this null effect conceals substantial heterogeneity in individual responses. Overall, the results show that responsibility for outcomes can shape later prosocial behavior, but does so asymmetrically across good and bad deeds. |
| Date: | 2026–05–17 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:g7tuh_v2 |
| By: | Wu, Yining (UBS Investment Bank) |
| Abstract: | This paper develops a state-dependent version of Prospect Theory in which loss aversion, reference adaptation, and probability weighting vary with resource buffers, attention constraints, and boundary-risk context. Prospect Theory is usually treated as a descriptive account of deviations from expected-utility rationality. This paper proposes a finite-capacity bridge model: bounded agents operating under scarcity, limited attention, finite memory, and finite update capacity should exhibit state-dependent risk preferences. The model introduces a vector-valued resource buffer, perceived distance to a constraint threshold, event-class-dependent probability weighting, and a nudge-bandwidth model. It predicts that loss aversion should rise under scarcity and downside exposure, reference baselines should adapt more slowly under depletion, and probability weighting should become more distorted for low-capacity agents and boundary-relevant rare events. The paper includes deterministic synthetic simulations and a replication package, but does not fit human-subject data. It is intended as a theoretical working paper and empirical identification framework for future tests of state-dependent Prospect Theory. |
| Date: | 2026–05–19 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:pj43k_v1 |
| By: | Pascal Nieder; Sven Arne Simon |
| Abstract: | Compliance with complex regulatory requirements can be challenging. We study why and how complexity affects non-compliance in terms of incorrect reporting. Our novel experimental design isolates two distinct complexity effects: an increase in honest mistakes and a substantial shift toward self-serving dishonesty. We identify two mechanisms for this dishonesty shift. First, individuals with social image concerns systematically take advantage of plausible deniability. Second, we document an unexplored form of dishonesty: besides conscious lies, individuals use fraudulent shortcuts in response to complex cheating opportunities. |
| Keywords: | dishonest behavior, complexity, lying, non-compliance, experiment |
| JEL: | C91 D91 H26 K42 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12692 |