nep-exp New Economics Papers
on Experimental Economics
Issue of 2010‒02‒27
five papers chosen by
Daniel Houser
George Mason University

  1. Trust, Information Acquisition and Financial Decisions: A Field Experiment By Sonia Di Giannatale; Alexander Elbittar; Patricia López Rodriguez; María José Roa
  2. Breaking the norm: An empirical investigation into the unraveling of good behavior By Hill, Ruth Vargas; Maruyama, Eduardo; Viceisza, Angelino
  3. Applying Quadratic Scoring Rule transparently in multiple choice settings: A note By Florian Artinger; Filippos Exadaktylos; Hannes Koppel; Lauri Sääksvuori
  4. Ethnic Discrimination in Germany's Labour Market: A Field Experiment By Kaas, Leo; Manger, Christian
  5. Are Happiness and Productivity Lower among University Students with Newly-Divorced Parents? An Experimental Approach By Proto, Eugenio; Sgroi, Daniel; Oswald, Andrew J.

  1. By: Sonia Di Giannatale (Centro de Investigación y Docencia Económicas); Alexander Elbittar (Centro de Investigación y Docencia Económicas); Patricia López Rodriguez (Universidad Iberoamericana); María José Roa (Centro de Investigación y Docencia Económicas)
    Abstract: In this paper we analyze the relationship between financial decisions, information acquisition, and trust. In particular, our hypothesis is that financial transactions depend, among other variables, on the level of trust, reciprocity and association among individuals. Also, individuals’ willingness to acquire and process information relevant to perform financial transactions is related not only to their cognitive abilities, but also to the level of trust they have in the financial institutions. We conducted a field experiment using the trust game, with two important variations, with the partners of an of credit and savings cooperative located in a rural area of México. Our results indicate that those individuals who frequently visit their friends show greater willingness to trust other individuals. In contrast, those individuals who visit their families more regularly show less willingness to reciprocate, while active members of the cooperative show greater reciprocity. Regarding the acquisition of information, we find that just over 2/3 of the participants buy the maximum of pieces of information. However, none of the pieces of information acquired appears to affect the transfers among participants. Possibly for our experimental subjects trust plays an overextended role in financial decision making that makes information acquisition less relevant than it is for other types of individuals making the same sort of decisions.
    Keywords: Social Networks, Information, Social Preferences, Cooperation, Trust, Reciprocity, Financial Development, Field Experiments
    Date: 2010–02–17
  2. By: Hill, Ruth Vargas; Maruyama, Eduardo; Viceisza, Angelino
    Abstract: We present results from an artefactual field experiment conducted in rural Peru that considers how observing nonreciprocal behavior influences an individual's decision to reciprocate. Specifically, we consider the behavior of second movers in a trust game, assessing how their decision to reciprocate is influenced by the observed behavior of others and the extent to which their actions can be observed. In documenting how an external shock to the number observed not to reciprocate influences reciprocation, the paper endeavors to provide some insight into how reciprocity can unravel when individuals are learning behavior in a new market institution.
    Keywords: artefactual field experiment, norms, nonreciprocal behavior, Trust, Markets, Institutions,
    Date: 2010
  3. By: Florian Artinger (Max Planck Institute for Human Development and Technical University Berlin); Filippos Exadaktylos (University of Granada); Hannes Koppel (Max Planck Institute of Economics); Lauri Sääksvuori (Max Planck Institute of Economics)
    Abstract: The quadratic scoring rule (QSR) is often used to guarantee an incentive compatible elicitation of subjective probabilities over events. Experimentalists have regularly not been able to ensure that subjects fully comprehend the consequences of their actions on payoffs given the rules of the games. In this note, we present a procedure that allows the transparent use of the QSR even in multiple-choice scenarios. For that purpose, two methodological means are applied: an alternative representation of the score and a short learning period to familiarize subjects with the payoff mechanism. The results suggest that both means were necessary and successful in facilitating subjects’ understanding of the rule.
    Keywords: quadratic scoring rule, belief elicitation, saliency, experiment
    Date: 2010–02–10
  4. By: Kaas, Leo (University of Konstanz); Manger, Christian (University of Konstanz)
    Abstract: This paper studies ethnic discrimination in Germany's labour market with a correspondence test. To each of 528 advertisements for student internships we send two similar applications, one with a Turkish-sounding and one with a German-sounding name. A German name raises the average probability of a callback by about 14 percent. Differential treatment is particularly strong and significant at smaller firms at which the applicant with the German name receives 24 percent more callbacks. Discrimination disappears when we restrict our sample to applications including reference letters which contain favourable information about the candidate’s personality. We interpret this finding as evidence for statistical discrimination.
    Keywords: correspondence test, hiring discrimination, ethnic discrimination
    JEL: C93 J71
    Date: 2010–02
  5. By: Proto, Eugenio (University of Warwick); Sgroi, Daniel (University of Warwick); Oswald, Andrew J. (University of Warwick)
    Abstract: We live in a high-divorce age. It is now common for university faculty to have students who are touched by a recent divorce. It is likely that parents themselves worry about effects on their children. Yet there has been almost no formal research into the important issue of how recent parental-divorce affects students at university. This paper designs such a study. In it, to avoid 'priming', we measure students' happiness with life before we inquire into their family background. We also measure student achievement in a randomized-trial productivity task. Our results seem both of scientific interest and of potential interest to parents. This study finds no evidence that students suffer after parental divorce
    Keywords: labor productivity, divorce, well-being, happiness, experimental economics
    JEL: J24 C91
    Date: 2010–02

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