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on Experimental Economics |
| By: | Stanton, Angela A. |
| Abstract: | This paper reviews the literature of behavioral-, experimental-, and neuro-economics research with the ultimatum and the dictator games. “One may wonder whether Adam Smith, were he working today, would not be a neuroeconomi[st]” Aldo Rustichini 2005 |
| Keywords: | Literature Review of behavioral-; experimental- and neuro-economics using ultimatum and dictator game |
| JEL: | D01 A10 |
| Date: | 2006–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:767&r=exp |
| By: | Wu, Steven; Roe, Brian; Sporleder, Thomas |
| Abstract: | Experimental economics is used to investigate two important hypotheses proposed in the economics literature on tournaments. Specifically, we test for a hypothesized “disincentives effect” which can occur in tournaments with mixed ability agents. We also test the well known hypothesis that, when common shocks are an important source of risk, tournaments can filter out this common shock and reduce earnings risk to workers. We find that disincentive effects arose in our tournament experiments, although these effects are not as strong as we predicted in our theoretical model and simulations. We also find that tournaments can be very effective at reducing earnings variation when common shocks are important. Taken together, these results suggest that the benefits of risk reduction from eliminating common shocks might outweigh the disincentive effects arising from mixed tournaments. We also find that the difference in average earnings between low and high ability agents is greater under tournaments than under absolute performance contracts. |
| Keywords: | mixed tournaments; incentives; relative performance contracts; experimental economics |
| JEL: | D86 J33 |
| Date: | 2006–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:21&r=exp |
| By: | Lombardelli, Clare; Proudman, James; Talbot, James |
| Abstract: | We report the results of an experimental analysis of monetary policy decision making under uncertainty. A large sample of economics students played a simple monetary policy game, both as individuals and in committees of five players. Our findings - that groups make better decisions than individuals - accord with previous work by Blinder and Morgan. We also attempt to establish why this is so. Some of the improvement is related to the ability of committees to strip out the effect of bad play, but there is a significant additional improvement, which we associate with players learning from each other’s interest rate decisions. |
| Keywords: | Monetary policy; experimental economics; central banking; uncertainty |
| JEL: | G00 G0 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:823&r=exp |
| By: | Lupia, Arthur; Prior, Markus |
| Abstract: | Surveys provide widely-cited measures of political knowledge. Do unusual aspects of survey interviews reduce their relevance? To address this question, we embedded a set of experiments in a representative survey of over 1200 Americans. A control group answered political knowledge questions in a typical survey context. Respondents in treatment groups received the same questions in different contexts. One group received a monetary incentive for answering questions correctly. Others were given more time to answer the questions. The treatments increase the number of correct answers by 11-24 percent. Our findings imply that conventional knowledge measures confound respondents’ recall of political information and their motivation to engage the survey question. The measures also provide unreliable assessments of respondents’ abilities to access information that they have stored in places other than their immediately available memories. As a result, existing knowledge measures likely underestimate peoples’ capacities for informed decision making. |
| Keywords: | political knowledge; economic knowledge; experimental economics; incentives; survey |
| JEL: | H30 H31 C90 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:103&r=exp |