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on Evolutionary Economics |
| By: | Jian-Qiao Zhu; Joshua C. Peterson; Benjamin Enke; Thomas L. Griffiths |
| Abstract: | Understanding how people behave in strategic settings–where they make decisions based on their expectations about the behavior of others–is a longstanding problem in the behavioral sciences. We conduct the largest study to date of strategic decision-making in the context of initial play in two-player matrix games, analyzing over 90, 000 human decisions across more than 2, 400 procedurally generated games that span a much wider space than previous datasets. We show that a deep neural network trained on these data predicts people’s choices better than leading theories of strategic behavior, indicating that there is systematic variation that is not explained by those theories. We then modify the network to produce a new, interpretable behavioural model, revealing what the original network learned about people: their ability to optimally respond and their capacity to reason about others are dependent on the complexity of individual games. This context-dependence is critical in explaining deviations from the rational Nash equilibrium, response times, and uncertainty in strategic decisions. More broadly, our results demonstrate how machine learning can be applied beyond prediction to further help generate novel explanations of complex human behavior. |
| Keywords: | behavioural game theory, large scale experiment, machine learning, behavioral economics, complexity |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11296 |
| By: | Benjamin Enke; Thomas Graeber; Ryan Oprea; Jeffrey Yang; Thomas W. Graeber |
| Abstract: | We report a large-scale examination of behavioral attenuation: due to information-processing constraints, the elasticity of people’s decisions with respect to economic fundamentals is generally too small. We implement more than 30 experiments, 20 of which were crowd-sourced from leading experts. These experiments cover a broad range of economic decisions, from choice and valuation to belief formation, from strategic games to generic optimization problems, involving investment, savings, effort supply, product demand, taxes, environmental externalities, fairness, cooperation, beauty contests, information disclosure, search, policy evaluation, memory, forecasting and inference. In 93% of our experiments, the elasticity of decisions to fundamentals decreases in participants’ cognitive uncertainty, our measure of the severity of information-processing constraints. Moreover, in decision problems with objective solutions, we observe elasticities that are universally smaller than is optimal. Many widely-studied decision anomalies represent special cases of behavioural attenuation. We discuss both its limits and why it often gives rise to the classic phenomenon of diminishing sensitivity. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11345 |
| By: | Holden, Stein T. (Centre for Land Tenure Studies, Norwegian University of Life Sciences); Tilahun, Mesfin (Centre for Land Tenure Studies, Norwegian University of Life Sciences) |
| Abstract: | Our study investigates how the devastating 2020-2022 Tigray War has affected the social preferences, reciprocity norms, and trust in a large sample of rural young adults in Tigray, Ethiopia, belonging to rural business groups. We rely on field experimental data with standardized incentivized experiments conducted in 2019 and 2023 to categorize subjects into social preference types. We also identify reciprocity norms, generosity, trustworthiness, and trust in in-group and out-group conditions for a large balanced sample (N=1939). The in-group framing is for subjects belonging to the same business group (N=238 business groups). The out-group is an unknown person from another business group in the same district. Overall, the war in Tigray has resulted in an erosion of within-community social capital. This erosion of social capital includes weakened reciprocity norms, a reduction in the share of the population that behaves altruistically or egalitarian, and a reduction in generosity, trustworthiness, and trust (reduction of 0.6-0.75 Cohen’s d units) that is strongest among those who behaved altruistically or egalitarian before the war. The same and similar effect sizes are also prevalent within business groups, but within business groups, social capital remains high compared to generalized social capital in the study areas. To a small extent, we find that differential exposure to violence or other war incidents among subjects explains the fairly large changes in social capital that our experiments revealed. This may imply that the war spillover effects overshadow the effects of individual war exposure. |
| Keywords: | War impacts; Social preferences; Reciprocity norms; Trust; Field experiment; Rural business groups; Ethiopia |
| JEL: | C93 D74 D84 D91 O12 |
| Date: | 2024–11–06 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:nlsclt:2024_006 |
| By: | Rafael Wilms; Nicolas Bastardoz; Clara Seif El Dahan; Philippe Jacquart (EM - EMLyon Business School) |
| Abstract: | In the emergence of the charismatic effect, the leader–follower value congruence assumption posits that the charisma signal creates a charismatic effect for followers who have congruent values with the leader but may repel followers with incongruent values. Whereas this assumption is a central pillar of charisma signaling, it has not been causally tested. We theorize the charisma signal, leader–follower value congruence, and their interaction as predictors of the charismatic effect (i.e., perceived leader charisma, prototypicality, and effectiveness). In three preregistered experiments, we manipulate the charisma signal and communicated leader values by relying on video-recorded speeches and measure follower values beforehand. We operationalize leader–follower value congruence as the degree to which communicated leader values and measured follower values match. Study 1 showed mixed results for the leader–follower value congruence assumption, whereas Studies 2 and 3 – using polarized rhetoric – fully support it. We found some evidence that value congruence moderates the charisma signal–charismatic effect relationship, such that the relationship becomes stronger (weaker) with more value congruence (incongruence) in Studies 1 and 3 (but not in Study 2). Theoretical and practical implications as well as limitations are discussed. |
| Keywords: | Perceived leader charisma, Leader prototypicality, Leader effectiveness, Leader-follower value congruence, Charisma signaling |
| Date: | 2024–10–05 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04742810 |