nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2019‒05‒06
three papers chosen by
Matthew Baker
City University of New York

  1. When a Nudge Backfires:Using Observation with Social and Economic Incentives to Promote Pro-Social Behavior By Gary Bolton; Eugen Dimant; Ulrich Schmidt
  2. Dynastic Human Capital, Inequality and Intergenerational Mobility By Adermon, Adrian; Lindahl, Mikael; Palme, Mårten
  3. Behavioral Economics and the Value of a Statistical Life By Kniesner, Thomas J.

  1. By: Gary Bolton (University of Texas at Dallas); Eugen Dimant (University of Pennsylvania); Ulrich Schmidt (Kiel Institute for the World Economy)
    Abstract: Both theory and recent empirical evidence on nudging suggest that observability of behavior acts as an instrument for promoting (discouraging) pro-social (anti-social) behavior. Our study questions the universality of these claims. We employ a novel four-party setup to disentangle the roles that the relevant observational mechanisms play in affecting pro-/antisocial behavior. We systematically vary the observability of one's actions by others as well as the (non-)monetary relationship between observer and observee. Observability involving economic incentives crowds-out anti-social behavior in favor of more pro-social behavior. Surprisingly, observation without economic consequences fails to achieve any aggregate pro-social effect, and if anything it backfires. In additional experiments we confirm that this backfiring effect is driven by inequity concerns. We propose and successfully test a solution: increasing the focus on the underlying social norms.
    Keywords: Anti-Social Behavior, Experiment, Nudge, Pro-Social Behavior, Reputation
    Date: 2019–03
  2. By: Adermon, Adrian (IFAU); Lindahl, Mikael (University of Gothenburg); Palme, Mårten (Stockholm University)
    Abstract: We study the importance of the extended family – the dynasty – for the persistence in inequality across generations. We use data including the entire Swedish population, linking four generations. This data structure enables us to identify parents' siblings and cousins, their spouses, and the spouses' siblings. Using various human capital measures, we show that traditional parent-child estimates of intergenerational persistence miss almost one-third of the persistence found at the dynasty level. To assess the importance of genetic links, we use a sample of adoptees. We then find that the importance of the extended family relative to the parents increases.
    Keywords: intergenerational mobility, extended family, dynasty, human capital
    JEL: I24 J62
    Date: 2019–04
  3. By: Kniesner, Thomas J. (Claremont Graduate University)
    Abstract: There are many possible connections between VSL and behavioral economics. A list of topics includes endowment effects, risk salience, ambiguity aversion, present bias, reference groups, reference points, and experienced versus decision utilities. There are also nudges that connect to estimating or using VSL in government decisions and cousins of behavioral economic research including interpersonal heterogeneity, experiments, neuroeconomics, and beauty or personal attractiveness. Current evidence suggests that VSL and behavioral economics best connect via (1) possible multi-attribute reference group effects and (2) a possible distinction between decision utility and experienced utility.
    Keywords: VSL, behavioral economics, WTP, WTA, reference dependence, benefit-cost analysis, nudge, internality
    JEL: D61 D91 J17 J31
    Date: 2019–04

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