|
on Evolutionary Economics |
| By: | Hitoshi Matsushima (The University of Tokyo); Tomomi Tanaka (Economic Development & Global Education, LLC); Tomohisa Toyama (Kogakuin University) |
| Abstract: | We examine repeated prisoners’ dilemma with imperfect private monitoring and random termination where the termination probability is low. We run laboratory experiments and show subjects retaliate more severely when monitoring is more accurate. This experimental result contradicts the prediction of standard game theory. Instead of assuming full rationality and pure self-interest, we introduce naivete and social preferences, i.e., reciprocal concerns, and develop a model that is consistent with, and uniquely predicts, the observed behavior in the experiments. Our behavioral model suggests there is a trade-off between naivete and reciprocity. When people are concerned about reciprocity, they tend to make fewer random choices. |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:cfi:fseres:cf309&r=evo |
| By: | Surajeet Chakravarty (Department of Economics, University of Exeter); Miguel A. Fonseca (Department of Economics, University of Exeter) |
| Abstract: | We study using laboratory experiments the impact on cooperation of allowing individuals to invest in group-specific, excludable public goods. We find that allowing different social groups to voluntarily contribute to such goods increases total contributions. However, a significant proportion of that contribution goes towards the group-specific club good, rather than the public good, even when the latter has higher financial returns to cooperation. We find significant evidence of in-group biases, which are manifested by positive in-group reciprocity. That is, club goods allow subjects to display their preferences for interaction with their in-group members, as well as in positive in-group reciprocity. |
| Keywords: | club goods, social identity, experiment |
| JEL: | C92 D02 D03 H41 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:exe:wpaper:1302&r=evo |
| By: | Liang, Pinghan; Meng, Juanjuan |
| Abstract: | This paper conducts a laboratory experiment to investigate the role of social connections in behavioral indirect reciprocity. We provide the evidence of spillovers effects of social ties, e.g., the recipient’s indirect reciprocal act varies with the relations between the donor and a third party. Naturally occurring friendship is employed to study social connections. Thus, a beneficiary might either be a “friend” or a “stranger” of the donor. We demonstrate that knowing social connections significantly increases the recipient’s repayment only if the donor is kind enough in the first place. Overall, recipients’ indirect reciprocity almost doubles when introducing social networks among donors and beneficiaries. It is also shown that this spillovers effect is unlikely the result of recipients’ perception of donors’ expectations. Major theories of social preferences, e.g., fairness, intention-based, guilt-aversion, cannot offer satisfactory explanations of our findings. We propose an explanation based on in-group and out-group differences but with endogenous group status, in which social connections play a crucial role. |
| Keywords: | indirect reciprocity, social connections, spillovers, social preferences |
| JEL: | C91 D03 D85 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:45270&r=evo |
| By: | Adam Zylbersztejn (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | Several experimental studies show that ex post communication promotes generosity in situations where individual incentives contradict with common interest, like the provision of public goods. The root underlying the effect of this institution, especially in a repeated interaction, is nonetheless still obscure. This study provides a novel empirical testbed for two mechanisms by which ex post communication may affect behavior in repeated interactions : one is related to strategic signaling, the other involves emotions induces by others' opinions. The main findings are as follows. First, the presence of ex post communication (conducted through the attribution of costless disapproval points) fosters pro-social behavior and reduces free-riding. Second, I find systematic evidence that subjects tend to use ex post communication as a signaling device, whilst no evidence in favor of the emotion-based hypothesis. A possible interpretation of this phenomenon is that ex post messages are used to announce future sanctions for free-riding. |
| Keywords: | Public goods game; voluntary contribution mechanism; ex post communication |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00800587&r=evo |
| By: | Evelyn Korn (University of Marburg); Stephan Meisenzahl (University of Marburg); Johannes Ziesecke (University of Marburg) |
| Abstract: | Conventional wisdom has it that economic training and education tends to produce less cooperative people – where cooperation means following group-oriented goals. This issue has attracted particular attention in discussions of the current economic crisis where it was asked if increasing marketization of societies has created an environment encouraging amoral selfish behavior of financial intermediaries and other economic agents. We provide some evidence against this claim with the help of an experiment, using an investment game with a public-goods character. Modest guidance of strategic abilities increases the degree of cooperation if the institutional setting permits reputation building. We thus conclude that economic practice can enhance cooperation in a socially stable environment. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201316&r=evo |
| By: | Julie Moschion (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Domenico Tabasso (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | This paper studies the respective influence of intergenerational transmission and the environment in shaping individual trust. Focusing on second generation immigrants in Australia and the United States, we exploit the variation in the home and in the host country to separate the effect of the cultural background from that of the social and economic conditions on individual trust. Our results indicate that trust in the home country contributes to the trust of second generation immigrants in both host countries, but particularly so in the United States. Social and economic conditions in the host country, such as crime rate, economic inequality, race inequality and segregation by country of origin, also affect trust. Evidence for first generation immigrants confirms that the transmission of trust across generations is primarily important in the United States, and, that differences in trust levels between the two host countries increase with acculturation. |
| Keywords: | Trust, migration, culture |
| JEL: | J15 O15 Z10 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2013n02&r=evo |
| By: | Binzel, Christine; Carvalho, Jean-Paul (University of California, Irvine) |
| Abstract: | This paper examines the economic origins of the Islamic revival that took place in Egypt in the 1970-80s, and in Muslim societies more generally. We provide the first systematic evidence of a decline in social mobility among educated youth in Egypt. Developing a behavioral model of religion, we then characterize conditions under which a temporary decline in social mobility produces a large and long-lasting rise in religious participation. Religion in our model helps to cope with loss, which occurs when one's consumption falls below an expectations-based reference point. The model provides an explanation for why the educated middle class were in the vanguard of the Islamic revival. Rather than undermining religious belief and participation, our analysis suggests that economic development can make societies more prone to religious revivals. |
| Keywords: | Islamic revival, education, social mobility, inequality, social movements, Egypt |
| JEL: | D10 D63 I24 J24 J62 O10 Z12 Z13 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7259&r=evo |
| By: | Ivo Bischoff (University of Kassel); Thomas Krauskopf (University of Kassel) |
| Abstract: | We investigate the motives of pro-social behavior in collective decisions in an economic experiment. It compares individual behavior in private and collective decisions in a unified experimental setup. Subjects are given an individual endowment and have to decide how much of it to donate to charity. The experiment is combined with two long questionnaires that provide us with background information on subjects and enables us to learn more about the motives driving their behavior. Contrary to theoretical predictions, the distribution of amounts donated individually is remarkably similar to the distribution of amounts proposed for collective donation. In regressions, we find individual donations to be driven by consequentialist motives, social norms and moral convictions. In collective decisions, neither the motiverelated variables nor any of the control variables are found significant. Comparing subjects’ affective state before and after the experiment, we find that individual donations create a feeling of warm glow while collective donations do not. On the other hand, the change in affective state in the collective decision is higher the higher the amount proposed for the collective donation. This pattern is consistent with expressive motives. |
| Keywords: | voting motives, voluntary contributions, redistribution, charity, economic experiment, warm-glow, Immanuel Kant, affect |
| JEL: | C90 D72 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201319&r=evo |
| By: | Kuhn, Michael A. (University of California, San Diego); Kuhn, Peter J. (University of California, Santa Barbara); Villeval, Marie Claire (CNRS, GATE) |
| Abstract: | We experimentally manipulate two aspects of the cognitive environment, cognitive depletion and recent sugar intake, and estimate their effects on individuals' time preferences in a way that allows us to identify the structural parameters of a simple (α,β,δ) intertemporal utility function for each person. We find that individuals exposed to a prior cognitive load, individuals who consumed a sugared drink, and individuals who consumed a sugar-free drink all defer more income than a control group exposed to none of these conditions. Structural estimates show that all three effects are driven entirely by increases in the intertemporal price elasticity parameter (α). Together, our results suggest that at least for complex economic decisions like intertemporal financial choice, the ‘attention/focusing' effect of both prior cognitively demanding activity and prior assignment of a primary reward can improve decision-making. |
| Keywords: | time preferences, self-control, depletion, sucrose, experiment |
| JEL: | C91 D90 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7273&r=evo |
| By: | Aleksejus Kononovicius; Valentas Daniunas |
| Abstract: | The current economic crisis has provoked an active response from the interdisciplinary scientific community. As a result many papers suggesting what can be improved in understanding of the complex socio-economics systems were published. Some of the most prominent papers on the topic include (Bouchaud, 2009; Farmer and Foley, 2009; Farmer et al, 2012; Helbing, 2010; Pietronero, 2008). These papers share the idea that agent-based modeling is essential for the better understanding of the complex socio-economic systems and consequently better policy making. Yet in order for an agent-based model to be useful it should also be analytically tractable, possess a macroscopic treatment (Cristelli et al, 2012). In this work we shed a new light on our research group's contributions towards understanding of the correspondence between the inter-individual interactions and collective behavior. We also provide some new insights into the implications of the global and local interactions, the leadership and the predator-prey interactions in the complex socio-economic systems. |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1303.3693&r=evo |