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on Experimental Economics |
| By: | Jana Vyrastekova; Sander Onderstal; Pierre Koning |
| Abstract: | Using a simple production game, we investigate whether public firms perform better when they increase the power of their workers’ incentive schemes. In a laboratory experiment, subjects choose between a ‘public firm’ and a ‘private firm’ with team and individual incentives, respectively. When exposed to individual incentives, workers in the public firm increase effort in one parametrisation, but show a decrease in another. One reason for the latter observation is that reciprocators self-select in the public firm, rendering cooperation profitable. |
| Keywords: | Personnel Economics; Game theory; Experiments; Nonprofit organizations and public enterprise |
| JEL: | M5 C7 C9 L3 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:60&r=exp |
| By: | L. Cameron; A. Chaudhuri; N. Erkal; L. Gangadharan |
| Abstract: | This paper examines cultural differences in attitudes towards corruption by analysing individual-decision making in a corrupt experimental environment. Attitudes towards corruption play a critical role in the persistence of corruption. Our experiments differentiate between the incentives to engage in corrupt behaviour and the incentives to punish corrupt behaviour and allow us to explore whether, in environments characterized by lower levels of corruption, there is both a lower propensity to engage in corrupt behaviour and a higher propensity to punish corrupt behaviour. Based on experiments run in Australia (Melbourne), India (Delhi), Indonesia (Jakarta) and Singapore, we find that there is more variation in the propensities to punish corrupt behaviour than in the propensities to engage in corrupt behaviour across cultures. The results reveal that the subjects in India exhibit a higher tolerance towards corruption than the subjects in Australia while the subjects in Indonesia behave similarly to those in Australia. The subjects in Singapore have a higher propensity to engage in corruption than the subjects in Australia. We also vary our experimental design to examine the impact of a more effective punishment system and the effect of the perceived cost of bribery. |
| Keywords: | Corruption, Experiments, Punishment, Cultural Analysis |
| JEL: | C91 D73 O17 K42 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:mlb:wpaper:943&r=exp |
| By: | David Masclet (CREM - Centre de Recherche en Economie et Management - http://crem.univ-rennes1.fr/ - [CNRS : UMR6211] - [Université Rennes I][Université de Caen] - []); Marc Willinger (LAMETA - Laboratoire Montpellierain d'économie théorique et appliquée - http://www.lameta.univ-montp1.fr/ - [CNRS : UMR5474][INRA] - [Université Montpellier I] - [Ecole Nationale Supérieure Agronomique de Montpellier]) |
| Abstract: | We run a series of experiments in which subjects have to choose their level of contribution to a pure public good. Our design differs from the standard public good game with respect to the decision procedure. Instead of deciding simultaneously in each round, subjects are randomly ordered in a sequence which differs from round to round. We compare sessions in which subjects can observe the exact contributions from earlier decisions ("Sequential treatment with Information") to sessions in which subjects decide sequentially but cannot observe earlier contributions ("Sequential treatment without information"). Furthermore, we investigate the effect of group size on aggregate contributions. Our result indicate that contributing sequentially increases the level of contribution to the public good when subjects are informed about the contribution levels of lower ranked subjects. Moreover, we observe that earlier players in the sequence try to influence positively the contributions of subsequent decision makers in the sequence, by making a large contribution. Such behaviour is motivated by the belief that subsequent players will reciprocate by also making a large contribution. |
| Keywords: | Public good; sequential Game; contribution |
| Date: | 2006–03–17 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00009661_v1&r=exp |
| By: | L. Gangadharan; A. Farrell; R. Croson |
| Abstract: | Emissions trading is an important regulatory tool in environmental policy making. Unfortunately the effectiveness of these regulations is difficult to measure in the field due to the unavailability of appropriate data. In contrast, experiments in the laboratory can provide guidance to regulators and legislatures about the performance of different market features in emission trading programs. This paper reports on the implementation of three different institutional designs, and presents experimental results investigating important features of emissions trading regimes: the ability to make investments in emissions abatement, ability to bank allowances and a declining emissions cap, both with and without uncertainty. These features are observed in virtually all existing air pollution emissions trading programs currently in place and will almost certainly be part of future applications. Like previous experimental studies of emissions trading, this paper shows that the efficiency gains expected from economic theory emerge observationally. We also show reduced efficiency when permits are bankable due to over-banking and when investments in emissions abatement are possible due to overinvesting. These tendencies do not worsen, however, when emissions caps decline. |
| Keywords: | Emissions Trading, Investment in Abatement, Banking, Laboratory Experiments |
| JEL: | Q20 C91 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:mlb:wpaper:942&r=exp |
| By: | David Masclet (CREM - Centre de Recherche en Economie et Management - http://crem.univ-rennes1.fr/ - [CNRS : UMR6211] - [Université Rennes I][Université de Caen] - []); Laurent Denant (CREM - Centre de Recherche en Economie et Management - http://crem.univ-rennes1.fr/ - [CNRS : UMR6211] - [Université Rennes I][Université de Caen] - []); Charles Noussair (EMORY UNIVERSITY - Emory University - [Emory University] - [] - []) |
| Abstract: | We present the results of an experiment that explores the sanctioning behavior of individuals who experience a social dilemma. In the game we study, players choose contribution levels to a public good and subsequently have multiple opportunities to reduce the earnings of the other members of the group. The treatments vary in terms of individuals' opportunities to (a) avenge sanctions that have been directed toward themselves, and (b) punish others' sanctioning behavior with respect to third parties. We find that the individuals avenge sanctions they have received, punish those who fail to sanction third parties, and punish low contributors, even when punishment is costly to the sanctioner. When there are five rounds of unrestricted sanctioning, contributions and welfare are significantly lower than when only one round of sanctioning opportunities exists, and welfare is lower than the zero-cooperation benchmark. |
| Keywords: | Public Good; Punishment; Revenge; counterpunishement |
| Date: | 2006–03–17 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00009664_v1&r=exp |
| By: | Cook, Joseph; Plott, Charles R. |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:clt:sswopa:1240&r=exp |
| By: | Einat Neuman (Academic College of Tel Aviv-Yaffo); Shoshana Neuman (Bar-Ilan University, CEPR and IZA Bonn) |
| Abstract: | The standard assumption in economic theory is that preferences are stable. In particular, they are not changed as a result of experience with the good/service/event. Behavioral scientists have challenged this assumption and claimed (providing evidence) that preferences are constantly changing when experience is accumulated. This paper tests the effect of experience on preferences for attributes of health-care events. We are using two very different samples and a methodology that facilitates the estimation of marginal utilities of various attributes of a composite non-traded health-care service. Discrete Choice Experimental design is employed for the analysis of samples of (1) women who gave birth, and (2) women who were diagnosed with breast cancer. For each group we had information on experience. In the case of women who gave birth, the sample was decomposed into 3 sub-samples: pregnant women with their first child (no experience); women after one delivery (single experience); and mothers after more than one delivery (multiple experience). Preferences of the 3 sub-groups have then been compared. The breast cancer patients reported the number of chemotherapy/radiation treatments they have already received, thus enabling the construction of an experience variable and testing for the effect of experience on preferences. The basic finding is that preferences for health-care attributes are significantly changed as a result of experience with the health event. However, the amount of experience is irrelevant. |
| Keywords: | preferences, experience, Discrete Choice Experiment, health-care, delivery, breast cancer |
| JEL: | D12 I19 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2028&r=exp |