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on Experimental Economics |
| By: | Peter Kuhn (Department of Economics, University of California - University of California, Santa Barbara); Marie-Claire Villeval (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure de Lyon) |
| Abstract: | Are women disproportionately attracted to work environments where cooperation rather than competition is rewarded? This paper reports the results of a real-effort experiment in which participants choose between an individual compensation scheme and a team-based payment scheme. We find that women are more likely than men to select team-based compensation in our baseline treatment, but women and men join teams with equal frequency when we add an efficiency advantage to team production. Using a simple structural discrete choice framework to reconcile these facts, we show that three elements can account for the observed patterns in the team-entry gender gap: (1) a gender gap in confidence in others (i.e. women are less pessimistic about their prospective teammates' relative ability), (2) a greater responsiveness among men to instrumental reasons for joining teams, and (3) a greater "pure" preference for working in a team environment among women. |
| Keywords: | Gender; cooperation; self-selection; confidence; experiment |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00633646&r=exp |
| By: | Julie Rosaz (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France); Marie-Claire Villeval (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France) |
| Abstract: | This paper presents the results of a laboratory experiment in which workers perform a real-effort task and supervisors report the workers’ performance to the experimenter. The report is non verifiable and determines the earnings of both the supervisor and the worker. We find that not all the supervisors, but at least one third of them bias their report. Both selfish black lies (increasing the supervisor’s earnings while decreasing the worker’s payoff) and Pareto white lies (increasing the earnings of both) according to Erat and Gneezy (2009)’s terminology are frequent. In contrast, spiteful black lies (decreasing the earnings of both) and altruistic white lies (increasing the earnings of workers but decreasing those of the supervisor) are almost non-existent. The supervisors’ second-order beliefs and their decision to lie are highly correlated, suggesting that guilt aversion plays a role. |
| Keywords: | lies, deception, self-image, guilt aversion, lie-aversion, evaluation, experiments |
| JEL: | C91 D82 M52 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1124&r=exp |
| By: | Céline Jullien (Grenoble Ecole de Management, 12 rue Pierre Sémard, 38003 Grenoble, Cedex 01, France); Virginie Pignon (Electricité de France); Stéphane Robin (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France); Carine Staropoli (University Panthéon Sorbonne, Centre d’Economie de la Sorbonne, 106 boulevard de l’Hôpital Bureau 514, 75013 Paris, France) |
| Abstract: | Competition among producers within an integrated electricity system is impeded by any limited transmission capacity there may be at its borders. Two alternative market mechanisms have recently been designed to organize the allocation of scarce transmission capacity at cross-border level : (i) the “implicit auction”, already used in some countries, and (ii) the “coordinated explicit auction”, proposed by the European Transmission System Operators (ETSO) but not implemented yet. The main advantage of the explicit auction is that it allows each country to keep its own power exchange running. In the European institutional context, this is seen as a factor of success of a market reform, although the explicit auction (not coordinated) is known to be less efficient than the implicit mechanism. The addition of a coordination dimension in the explicit auction is intended to solve problems of international flows. We use an experimental methodology to identify and compare in a laboratory setting the efficiency properties of these two market mechanisms, given a market structure similar to the existing one in continental Europe, i.e. a competitive oligopoly. Our main result highlights the inefficiency of the coordinated explicit auction compared to the performance of the implicit auction, measured in terms of both energy prices and transmission capacity allocation. We suggest that the poor performance of the coordinated explicit auction in the laboratory is due to the level of individual expectations about both energy and transmission prices that the mechanism demands. One solution to resolve this problem when the mechanism is implemented in the field would be to design an additional and secondary market for “used” transmission capacity. |
| Keywords: | auctions; congestion management; electricity markets; experimental economics |
| JEL: | C92 D43 D44 D49 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1121&r=exp |
| By: | Elisabeth Bügelmayer; C. Katharina Spieß |
| Abstract: | Although spiteful preferences play a crucial role in the development of human large-scale cooperation, there is little evidence on spiteful behavior and its determinants in children. We investigate the relationship between children’s cognitive skills and spiteful behavior in a sample of 214 preschoolers aged 5-6 and their mothers. Other-regarding behavior of both mothers and children is elicited through four simple allocation decisions. A key advantage of our study is that it is carried out in a household context. Therefore, we have information about both the child’s and mother’s cognitive and noncognitive skills as well as health and household characteristics. We find that higher cognitive skills are associated with more spiteful behavior in children. This relationship is even more pronounced among boys and possibly reflects differences in competitiveness. Moreover, we find further gender differences depending on the measure of cognitive skills and the degree of spite. These results shed light on the determinants of the development of other-regarding preferences in humans. |
| Keywords: | Spite, other-regarding preferences, cognitive skills, child experiments, household survey studies |
| JEL: | C90 C99 J24 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp404&r=exp |
| By: | Louis Puttermann; Jean-Robert Tyran; Kenju Kamei |
| Abstract: | The burgeoning literature on the use of sanctions to support public goods provision has largely neglected the use of formal or centralized sanctions. We let subjects playing a linear public goods game vote on the parameters of a formal sanction scheme capable both of resolving and of exacerbating the free-rider problem, depending on parameter settings. Most groups quickly learned to choose parameters inducing efficient outcomes. But despite uniform money payoffs implying common interest in those parameters, voting patterns suggest significant influence of cooperative orientation, political attitudes, and of gender and intelligence. |
| Keywords: | Public good; voluntary contribution; formal sanction; experiment; penalty; voting |
| JEL: | C91 C92 D71 D72 H41 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2010_20&r=exp |
| By: | Isabelle Vialle (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France); Luis Santos-Pinto (Faculty of Business and Economics, University of Lausanne, Internef 535, CH-1015, Lausanne, Switzerland); Jean-Louis Rullière (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France) |
| Abstract: | We use a laboratory experiment to study how perceptions of skill influence teamwork. Our design is based on Gervais and Goldstein (2007) theory of teams. Team output is increasing in skill and in effort, skill and effort are complements, and workers’ effort choices are complements. An overconfident agent thinks that his skill is higher than it actually is. We find that the presence of overconfi-dent workers in teams is beneficial for firms since it raises effort provision and team output. We also find that overconfidence leads to a Pareto improvement in workers’ payoffs. In contrast, underconfidence is detrimental to firms as well as workers. |
| Keywords: | Teamwork; Self-Confidence, Laboratory Experiment |
| JEL: | D81 C91 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1126&r=exp |
| By: | Lukas ANGST (Department of Economics, University of Zurich); Karol Jan BOROWIECKI (Department of Economics, Trinity College Dublin) |
| Abstract: | In this article we study the determinants of decision rights transfer and its effects on the motivation of an agent. The study is based on a laboratory experiment conducted on 130 subjects playing an innovative principal-agent game. Interestingly, the results show that agents do not favour a delegation and a decision is considered rather burdensome. Although the experiment could not give support for the behavioural hypothesis of higher effort provided by participants who receive choice subsequently, the survey illuminates the interaction between delegation motives, effort motivators, goals and other perceptions of the agents. |
| Keywords: | organizational behavior, incentives, experiments and contracts |
| JEL: | C92 D83 D23 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep1611&r=exp |
| By: | Sam Asher; Lorenzo Casaburi; Plamen Nikolov (Harvard University) |
| Abstract: | We study how gradualism -- increasing required levels (“thresholds”) of contributions slowly over time rather than requiring a high level of contribution immediately -- affects individuals’ decisions to contribute to a public project. Using a laboratory binary choice minimum-effort coordination game, we randomly assign participants to three treatments: starting and continuing at a high threshold, starting at a low threshold but jumping to a high threshold after a few periods, and starting at a low threshold and gradually increasing the threshold over time (the “gradualism” treatment). We find that individuals coordinate most successfully at the high threshold in the gradualism treatment relative to the other two groups. We propose a theory based on belief updating to explain why gradualism works. We also discuss alternative explanations such as reinforcement learning, conditional cooperation, inertia, preference for consistency, and limited attention. Our findings point to a simple, voluntary mechanism to promote successful coordination when the capacity to impose sanctions is limited. |
| Keywords: | Gradualism; Coordination; Cooperation; Public Goods; Belief-based Learning; Laboratory Experiment |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:nam:wpaper:1113&r=exp |
| By: | Lotito, Gianna; Migheli, Matteo; Ortona, Guido |
| Abstract: | In this work we use data on response times from a public good experiment to test the hypothesis that cooperation is instinctive, under the assumption that the longer the time of the decision, the less instinctive the choice. Results seem to support the hypothesis that cooperation is instinctive, while defection is 'rational'. Moreover, as the experiment is designed also to assess the effects of the consumption of relational goods on cooperation, we are also able to state that some types of relational goods, like team working, produce additional cooperation, but make it less spontaneous. We also detect that males seem to behave more instinctively than females. |
| Keywords: | response times; cooperation; public goods experiments; gender effect |
| JEL: | C91 H41 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:uca:ucapdv:161&r=exp |
| By: | Leonardo Becchetti (Faculty of Economics, University of Rome "Tor Vergata"); Giacomo Degli Antoni (University of Milano - Bicocca); Stefania Ottone (University of Milano - Bicocca); Nazaria Solferino (University of Calabria-Unical) |
| Abstract: | We device a randomized experiment with task performance in which players directly decide allocation criteria (with/without) veil of ignorance on payoff distribution under different criteria in a stakeholder/spectator position. Our main result is a strong and significant gender effect: women choose significantly more protection (that is, they choose criteria in which a part or all the total sum of money that must be allocated among participants is equally distributed) before (but not after) the removal of the veil of ignorance. They also reveal less overconfidence and significantly higher civicness and inequality aversion in ex post questionnaire responses, even though such differences are not enough to fully capture our main result. The puzzle when interpreting it is that the gendered preference for protection exists not only for stakeholders but also for spectators while it disappears for both once we remove the veil of ignorance. This makes it impossible to explain it exclusively with risk or competition aversion. |
| Keywords: | Distributive Justice; Gender Effects; Risk Aversion; Competition Aversion; Veil of Ignorance. |
| JEL: | C91 D63 J16 |
| Date: | 2011–10–24 |
| URL: | http://d.repec.org/n?u=RePEc:rtv:ceisrp:214&r=exp |
| By: | Egebark, Johan (Dept. of Economics, Stockholm University); Ekström, Mathias (Dept. of Economics, Stockholm University) |
| Abstract: | Users of the social networking service Facebook have the possibility to post status updates for their friends to read. In turn, friends may react to these short messages by writing comments or by pressing a Like button to show their appreciation. Making use of five Swedish accounts, we set up a natural field experiment to study whether users are more prone to Like an update if someone else has done so before. We distinguish between three different treatment conditions: (i) one unknown user Likes the update, (ii) three unknown users Like the update and (iii) one peer Likes the update. Whereas the first condition had no effect, both the second and the third increased the probability to express a positive opinion by a factor of two or more, suggesting that both number of predecessors and social proximity matters. We identify three reasonable explanations for the observed herding behavior and isolate conformity as the primary mechanism in our experiment. |
| Keywords: | Herding Behavior; Conformity; Peer Effects; Field Experiment |
| JEL: | A14 C93 D83 |
| Date: | 2011–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2011_0027&r=exp |
| By: | Di Bartolomeo Giovanni; Stefano Papa |
| Abstract: | This paper attempts to measure conditional and unconditional other-regarding preferences in two versions of an investment game: a canonical one and a cheap-talk variant where some pre-play is also allowed (i.e., non-binding unilateral messages). We find that counter-factual measures, as the well-known triadic design (Cox, 2004 [G&EB]) may systematically fail in distinguishing between conditional and unconditional other-regarding preferences due to the existence of frame effects. Specifically, by using indirect methods, we document conditional other-regarding preferences that are systematically neglected by the triadic approach. By inspecting result from the cheap-talk variant of the game, we also find that messages have no effect on average, but they affect the participants’ behavior leading to a polarization of their choices. |
| Keywords: | Conditional and unconditional other-regarding preferences, trust, reciprocity, investment game, frame effect, polarization effect, cheap talk |
| JEL: | C91 D83 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:ter:wpaper:0082&r=exp |
| By: | Siegried K. Berninghaus (Karlsruhe Institute of Technology (KIT), Institute for Economic Theory and Statistics); Thomas Neumann (Otto-von-Guericke-University Magdeburg, Faculty of Economics and Management, Empirical Economics); Bodo Vogt (Otto-von-Guericke-University Magdeburg, Faculty of Economics and Management, Empirical Economics) |
| Abstract: | Our study analyzes theories of learning for strategic interactions in networks. Participants played two of the 2 x 2 games used by Selten and Chmura (2008) and in the comment by Brunner, Camerer and Goeree (2009). Every participant played against four neighbors and could choose a different strategy against each of them. The games were played in two network structures: a attice and a circle. We compare our results with the predictions of different theories (Nash equilibrium, quantal response equilibrium, action-sampling equilibrium, payoff-sampling equilibrium, and impulse balance equilibrium) and the experimental results of Selten and Chmura (2008). One result is that the majority of players choose the same strategy against each neighbor. As another result we observe an order of predictive success for the stationary concepts that is different from the order shown by Selten and Chmura. This result supports our view that learning in networks is different from learning in random matching. |
| Keywords: | experimental economics, networks, learning |
| JEL: | C70 C73 C91 D83 D85 |
| Date: | 2011–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2011-048&r=exp |
| By: | Bauer, Michal (Charles University, Prague); Chytilová, Julie (Charles University, Prague); Pertold-Gebicka, Barbara (Charles University, Prague) |
| Abstract: | Other-regarding preferences are central for the ability to solve collective action problems and thus for society's welfare. We study how the formation of other-regarding preferences during childhood is related to parental background. Using binary-choice dictator games to classify subjects into other-regarding types, we find that children of less educated parents are less altruistic and more spiteful. This link is robust to controlling for a range of child, family, and peer characteristics, and is attenuated for smarter children. The results suggest that less educated parents are either less efficient to instill social norms or their children less able to acquire them. |
| Keywords: | other-regarding preferences, altruism, spite, experiments with children, family background, education |
| JEL: | C91 D64 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6026&r=exp |