nep-exp New Economics Papers
on Experimental Economics
Issue of 2009‒08‒30
eight papers chosen by
Daniel Houser
George Mason University

  1. Willingness to Pay to Reduce Future Risk By Jim Engle-Warnick; Julie Héroux; Claude Montmarquette
  2. Institution design in social dilemmas: How to design if you must? By Rockenbach, Bettina; Wolff, Irenaeus
  3. Constructing Gender in the Economics Lab By Boschini, Anne; Muren, Astri; Persson, Mats
  4. Counterpunishment revisited: an evolutionary approach By Wolff, Irenaeus
  5. Pay-as-you-speed:An economic field-experiment By Hultkrantz, Lars; Lindberg, Gunnar
  6. Harnessing the Power of Focal Points To Measure Social Agreement By Jim Engle-Warnick; Stuart Soroka
  7. Weak moral motivation leads to the decline of voluntary contributions By Charles FIGUIERES; Marc WILLINGER; David MASCLET
  8. Repetition of Interaction and Learning: An Experimental Analysis By Bradley R. Staats; Francesca Gino; Gary P. Pisano

  1. By: Jim Engle-Warnick; Julie Héroux; Claude Montmarquette
    Abstract: We elicit subjects’ willingness to pay to reduce future risk. In our experiments, subjects are given a cash endowment and a risky lottery. They report their willingness to pay to exchange the risky lottery for a safe one. Subjects play the lottery either immediately, eight weeks later, or twenty-five weeks later. Thus, both the lottery and the future are sources of uncertainty in our experiments. In two additional treatments, we control for future uncertainty with a continuation probability, constant and independent across periods, that simulates the chances of not returning to play the lottery after eight and twenty-five periods. We find evidence for present bias in both the time-delay sessions and the continuation probability sessions, suggesting that this bias robustly persists in environments including both risk and future uncertainty, and suggesting that the stopping rule may be a tool to continue study in this area without the need to delay payments into the future. <P>Nous mesurons la volonté des participants de payer pour réduire les risques futurs. Au cours de nos séances expérimentales, les participants reçoivent une dotation en espèces et une loterie risquée. Ils signalent leur volonté de payer pour échanger la loterie risquée pour une loterie moins risquée. Les participants jouent à la loterie soit immédiatement, ou huit semaines plus tard, ou vingt-cinq semaines plus tard. Ainsi, dans ces expériences, la loterie et le futur forment deux sources d'incertitude. Lors de deux traitements additionnels, nous contrôlons l'aspect incertain de l'avenir avec une probabilité de continuation, constante et indépendante à travers les périodes, qui simule les chances de ne pas revenir jouer à la loterie après huit et vingt-cinq périodes. Nous avons trouvé des preuves d'un biais pour le présent à la fois dans les séances avec un délai temporel, que dans les séances avec une probabilité de continuation, ce qui suggère que cette tendance persiste avec vigueur dans les environnements comprenant de l'incertitude provenant à la fois du risque et du futur. Ceci suggère que cette règle d'arrêt peut constituer un outil efficace pour étudier ce domaine sans la nécessité de retarder les paiements dans le futur.
    Keywords: Hyperbolic discounting, uncertainty, risk, experiments , escompte hyperbolique, incertitude, risque, expériences
    JEL: C91 D81
    Date: 2009–08–01
  2. By: Rockenbach, Bettina; Wolff, Irenaeus
    Abstract: Considerable experimental evidence has been collected on how to solve the public-good dilemma. In a 'first generation' of experiments, this was done by presenting subjects with a pre-specified game out of a huge variety of rules. A 'second generation' of experiments introduced subjects to two different environments and had subjects choose between those. The present study is part of a 'third generation', asking subjects not only to choose between two environments but to design their own rule sets for the public-good problem. Whereas preceding 'third-generation' experiments had subjects design and improve their strategies for a specified game, this study is the first to make an attempt at answering the question of how people would shape their environment to solve the public-good dilemma were they given full discretion over the rules of the game. We explore this question of endogenous institution design in an iterated design-and-play procedure. We observe a strong usage of punishment and redistribution components, which diminishes over time. Instead, subjects successfully contextualize the situation. Interestingly, feedback on fellow-players’ individual behavior tends to be rendered opaque. On average, rules do improve with respect to the welfare they elicit, albeit only to a limited degree.
    Keywords: Public good; strategy method; experiment; public choice
    JEL: C9 D7 D71 C92 D72 C72
    Date: 2009–07–17
  3. By: Boschini, Anne (Dept. of Economics, Stockholm University); Muren, Astri (Dept. of Economics, Stockholm University); Persson, Mats (Institute for International Economic Studies)
    Abstract: Several experimental studies on altruism have found women to be more generous than men. We investigate whether observed gender gaps in generosity can be explained by experimental setting, where some settings are more conducive than others to activating gender identity and social norms. In a dictator game we study priming along two dimensions: 1) some subjects enter their gender on the first page of the questionnaire (Pre) while others enter their gender on the last page (Post) and 2) some subjects are seated in single-sex rooms (Homogeneous) while others are seated in gender-mixed rooms (Mixed). It turns out that gender differences occur (women are more generous than men) only for the combination Pre and Mixed. The effect is driven by males: men are sensitive to priming, while women are not.
    Keywords: Gender roles; social norms; altruism; generosity; dictator game; priming
    JEL: C91 D64 J16
    Date: 2009–07–25
  4. By: Wolff, Irenaeus
    Abstract: Evolutionary game theory has shown that in environments characterised by a social-dilemma situation punishment may be an adaptive behaviour. Experimental evidence closely corresponds to this finding but yields contradictory results on the cooperation-enhancing effect of punishment if players are allowed to retaliate against their punishers. The present study sets out to examine the question of whether cooperation will still be part of an evolutionary stable strategy if we allow for counterpunishment opportunities in a theoretic model and tries to reconcile the seemingly contradictory findings from the laboratory. We find that the apparent contradictions can be explained by a difference in the number of retaliation stages employed (one vs many) and even small differences in the degree of retaliativeness.
    Keywords: Public goods; Strong reciprocity; Conformism; Counter-punishment; Evolution of behavior
    JEL: H4 H41 C90 C7 C73
    Date: 2009–06
  5. By: Hultkrantz, Lars (Örebro University and VTI); Lindberg, Gunnar (VTI)
    Abstract: We report a vehicle-fleet experiment with an economic incentive given to car drivers for keeping within speed limits. A pay-as-you-speed traffic insurance scheme was simulated with a monthly participation bonus that was reduced by a non-linear speeding penalty. Actual speed was monitored by a GPS in-vehicle device. Participating drivers were randomly assigned into two-by two treatment groups, with different participation-bonus and penalty levels, and two control groups (high and low participation bonus, but no penalty). A third control group consists of drivers with the same technical equipment who did not participate but whose driving could be monitored. We evaluate changes in behaviour from twelve-month differences in proportion of driving time per month that the car was exceeding the maximum allowed speed on the road. We find that the participating drivers significantly reduced severe speeding violations during the first experiment month, while in the second experiment month, after having received feedback reports with an account of earned payments, only those participating subjects that were given a speeding penalty reduced severe speed violations. We find no significant effects from the size of the participation bonus (high vs. low), or the size of the penalty (high vs. low rate).
    Keywords: Traffic insurance; traffic safety; Intelligent Transport Systems; ITS; Intelligent Speed Adaptation; ISA
    JEL: H23 I18 K42 R41
    Date: 2009–08–26
  6. By: Jim Engle-Warnick; Stuart Soroka
    Abstract: This paper reports results from an application of Thomas Schelling’s (1960) concept of a focal point to the measure of social agreement on the received tone of media content. In our experiments, subjects rate the tone, positive, negative, or neutral, of newspaper articles and news broadcasts, with an incentive to coordinate responses. We compare the content analysis of a traditional subject pool with those of a representative cross-section of the general public. Our application of the coordination game with strategy labels illustrates that the concept of a focal point can be put to use as a measure of social agreement. <P>Le document présente les résultats obtenus en appliquant le concept de point focal, avancé par Thomas Schelling (1960), à la mesure de l’accord social concernant la perception du ton qui se dégage du contenu médiatique. Dans le cadre des expériences mises sur pied, les sujets évaluent le ton, positif, négatif ou neutre, adopté dans des articles de journaux et des bulletins de nouvelles et sont encouragés, par des mesures incitatives, à coordonner leurs réponses. Nous comparons l’analyse du contenu réalisée par un bassin traditionnel de sujets à celle menée par un échantillon représentatif du grand public. Notre application du jeu de coordination faisant appel à des étiquettes de stratégies démontre que la notion de point focal peut être utilisée pour mesurer l’accord social.
    Keywords: Coordination, focal point, experiment, content analysis, media, Coordination, point focal, expérience, analyse du contenu, médias
    Date: 2009–08–01
    Abstract: This paper provides a general framework that accounts for the decay of the average contribution observed in most experiments on voluntary contributions to a public good. Each player balances her material utility loss from contributing with her psychological utility loss of deviating from her moral ideal. The novel and central idea of our model is that people.s moral motivation is "weak": their judgement about what is the right contribution to a public good can evolve in the course of interactions, depending partly on observed past contributions and partly on an intrinsic "moral ideal". Under the assumption of weakly morally motivated agents, average voluntary contributions can decline with repetition of the game. Our model also explains other regularities observed in experiments, in particular the phenomenon of over-contributions compared to the Nash prediction and the so-called restart e¤ect, and it is compatible with the conditional cooperation hypothesis.
    Date: 2009–08
  8. By: Bradley R. Staats (University of North Carolina at Chapel Hill); Francesca Gino (University of North Carolina at Chapel Hill); Gary P. Pisano (Harvard Business School, Technology and Operations Management Unit)
    Abstract: The learning curve is used to investigate how increasing cumulative experience yields improved performance. Experience, however, can take many forms. Building on recent studies on learning in operations, we distinguish between repetition of task (i.e., prior experience with the task) and repetition of interaction (i.e., prior experience with team members). Repetition of interaction may improve learning, since experience working together aids in the identification, transfer, and application of knowledge among members within a group. Additionally, experience need not be constrained to one task. Prior work examining the relationship of multiple tasks (i.e., varied experience) and learning by groups finds inconsistent results. We hypothesize that repetition of interaction may help explain this difference, as familiar teams may be able to use the knowledge gained from the concurrent completion of multiple tasks while unfamiliar teams may not. Using an experimental study we find that while repetition of interaction has no effect on initial performance, it has a persistent effect on learning. By separately examining the repetition of interaction and repetition of task our work offers new insights and direction for the study of learning in operations.
    Keywords: Learning, Repetition of interaction, Repetition of task, Team familiarity, Varied experience
    Date: 2009–08

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