nep-exp New Economics Papers
on Experimental Economics
Issue of 2013‒12‒20
fourteen papers chosen by
Daniel Houser
George Mason University

  1. Temporary Workers Are Not Free-Riders: An Experimental Investigation By D. Dragone; F. Galeotti; R. Orsini
  2. Experimental Evidence on the Effects of Home Computers on Academic Achievement among Schoolchildren By Fairlie, Robert W.; Robinson, Jonathan
  3. Is Information Power? Using Mobile Phones and Free Newspapers during an Election in Mozambique By Jenny Aker, Paul Collier, Pedro C. Vicente
  4. Migrant Remittances and Information Flows: Evidence from a Field Experiment By Catia Batista; Gaia Narciso
  5. Access to Techonology and the Transfer Function of Community Colleges: Evidence from a Field Experiment By Fairlie, Robert W.; Grunberg, Samantha H.
  6. Choosing inequality: An experimental analysis of the impact of social immobility on the democratic election of distribution rules By Wolf, Stephan; Lenger, Alexander
  7. Are Women “Naturally” Better Credit Risks in Microcredit? Evidence from Field Experiments in Patriarchal and Matrilineal Societies in Bangladesh By Sugato Chakravarty; S. M. Zahid Iqbal; Abu Zafar M. Shahriar
  8. Reference Points, Performance and Ability: A Real Effort Experiment on Framed Incentive Schemes By Katharina Hilken; Stephanie Rosenkranz; Kris De Jaegher; Marc Jegers
  9. Does Anticipated Regret Really Matter? Revisiting the Role of Feedback in Auction Bidding By Peter Katuscak; Fabio Michelucci; Miroslav Zajicek
  10. Pre-Trade Transparency and Informed Trading an Experimental Approach to Hidden Liquidity By : Arie E. Gozluklu
  11. Business Literacy and Development: Evidence From a Randomized Controlled Trial in Rural Mexico By Gabriela Calderón; Jesse M. Cunha; Giacomo De Giorgi
  12. The impact of high school financial education : experimental evidence from Brazil By Bruhn, Miriam; de Souza Leao, Luciana; Legovini, Arianna; Marchetti, Rogelio; Zia, Bilal
  13. Does Growing Up in a High Crime Neighborhood Affect Youth Criminal Behavior? By Anna Piil Damm; Christian Dustmann
  14. On the Impact of Microcredit: Evidence from a Randomized Intervention in Rural Ethiopia By Jaikishan Desai; Kristin Johnson; Alessandro Tarozzi

  1. By: D. Dragone; F. Galeotti; R. Orsini
    Abstract: We conduct an artefactual field experiment to study whether the individual preferences and propensity to cooperate of temporary workers differ from permanent contract workers. We find that temporary and permanent contract workers have different other-regarding preferences, but display similar contribution patterns in an anonymous Public Good Game. Students, instead, are more selfish and contribute less than temporary and permanent workers.
    JEL: C72 C93 D23 H41 J54
    Date: 2013–12
  2. By: Fairlie, Robert W.; Robinson, Jonathan
    Abstract: Computers are an important part of modern education, yet many schoolchildren lack access to a computer at home. We test whether this impedes educational achievement by conducting the largest-ever field experiment that randomly provides free home computers to students. Although computer ownership and use increased substantially, we find no effects on any educational outcomes, including grades, test scores, credits earned, attendance and disciplinary actions. Our estimates are precise enough to rule out even modestly-sized positive or negative impacts. The estimated null effect is consistent with survey evidence showing no change in homework time or other "intermediate" inputs in education.
    Keywords: Social and Behavioral Sciences, education, technology, digital divide, experiment, computers
    Date: 2013–01–01
  3. By: Jenny Aker, Paul Collier, Pedro C. Vicente
    Abstract: Incumbent politicians in African countries have been cementing their positions in recent elections. That was the case of the Mozambican election of 2009, where the ruling party secured 75 percent of the vote, amid low participation and clear challenges of political accountability. We conducted a field experiment implemented nationwide based on three interventions providing information to voters and calling for their participation in the elections: an SMS civic education campaign centered on the elections, an SMS hotline to which citizens were able to report electoral misconduct, and the distribution of a free newspaper door-to-door focusing on voter education. We measure the effects of these treatments by looking at official electoral results, a behavioral measure of political participation, reports by electoral observers, and surveys. We find a clear positive effect of all treatments on voter turnout, close to five percentage points. Some treatments benefitted incumbents. We also have evidence that the distribution of the free newspaper led to more accountability-based participation and to a decrease in the incidence of electoral problems. All treatments increased information but caused diverse effects on perceptions about politics.
    Keywords: voter education, political economy, cell phones, newspapers, randomized experiment, field experiment, Mozambique, Africa
    JEL: D72 O55 P16
    Date: 2013–06
  4. By: Catia Batista (Nova University of Lisbon); Gaia Narciso (Trinity College Dublin)
    Abstract: Do information flows matter for remittance behavior? We design and implement a randomized control trial to quantitatively assess the role of communication between migrants and their contacts abroad on the extent and value of remittance flows. In the experiment, a random sample of 1,500 migrants residing in Ireland was offered the possibility of contacting their networks outside the host country for free over a varying number of months. We find a sizable, positive impact of our intervention on the value of migrant remittances sent. Our results exclude that the remittance effect we identify is a simple substitution effect. Instead, our analysis points to this effect being a likely result of improved information via factors such as better migrant control over remittance use, enhanced trust in remittance channels due to experience sharing, or increased remittance recipients’ social pressure on migrants.
    Keywords: information flows, international migration, migrantnetworks, remittances, randomized control trial
    JEL: F22 J61 O15
    Date: 2013–12
  5. By: Fairlie, Robert W.; Grunberg, Samantha H.
    Abstract: Access to information may represent an important barrier to learning about and ultimately transferring to 4-year colleges for low-income community college students.  This paper explores the role that access to information technology, in particular, plays in enhancing, or possibly detracting from, the transfer function of the community college.  Using data from the first-ever field experiment randomly providing free computers to students, we examine the relationships between access to home computers and enrollment in transferable courses and actual transfers to 4-year colleges.  The results from the field experiment indicate that the treatment group of students receiving free computers has a 4.5 percentage point higher probability of taking transferable courses than the control group of students not receiving free computers.  The evidence is less clear for the effects on actual transfers to 4-year colleges and the probability of using a computer to search for college information (which possibly represents one of the mechanisms for positive effects).  In both cases, point estimates are positive, but the confidence intervals are wide.  Finally, power calculations indicate that sample sizes would have to be considerably larger to find statistically significant treatment effects and reasonably precise confidence intervals given the actual transfer rate point estimates.  
    Keywords: Social and Behavioral Sciences, education, community college, transfers, technology, computers, digital divide, experiment
    Date: 2013–11–01
  6. By: Wolf, Stephan; Lenger, Alexander
    Abstract: Mainstream economists usually identify a fundamental conflict between efficiency and justice in re-source allocation: markets are generally considered an efficient allocation tool, but create unequal results. Corresponding governmental redistribution shall equalize some of these market results, but leads to inefficiency due to disincentives both for net payers and net receivers. Consequently, this pa-per analyses the impact of social inequality on distributive choices in an experimental democracy. In our experiment, we find that stark inequality is generally accepted provided a strong egalitarian in-come floor is ensured. Even though our samples showed a very strong egalitarian inclination, complete egalitarianism was not a stable outcome. Some degree of differentiation always emerged on an initial egalitarian base. --
    Date: 2013
  7. By: Sugato Chakravarty (Purdue University); S. M. Zahid Iqbal (Purdue University); Abu Zafar M. Shahriar (Monash University)
    Abstract: We use controlled experiments to identify the proximal causes of gender differences in the repayment of microcredit. We recruit male and female subjects from a patriarchal and a matrilineal community in Bangladesh, who live in the same villages, and find that the female subjects have a greater willingness to repay microcredit in every society irrespective of the type of loan. Thus, the observed gender differences in the repayment of microcredit cannot be explained by the different roles that women play in different societies. In other words, women are “naturally” better credit risks than men in microcredit. We confirm that our results are not driven by the common culture and values among our subjects that stem from geographical proximity.
    Keywords: microfinance,nature; nurture; competition; loan repayment
    Date: 2013–12
  8. By: Katharina Hilken; Stephanie Rosenkranz; Kris De Jaegher; Marc Jegers
    Abstract: The paper investigates the effect of four differently framed payment contracts on the agent's effort provision and performance in a real effort experiment. The four incentive payments are framed as a base wage and bonuses (one immediately pays bonuses, the other only after an initial performance-independent part), penalties or a combination of bonuses and penalties. The base wage that is offered, induces the reference point. The participants provide real effort and are paid for finding pairs in a customized Memory game. The bonus-only frame elicits the highest effort, whereas frames with penalties lag behind. Ability positively complements the effect of effort on performance. The combination of penalties and bonuses minimises the costs of the principal only for low levels of performance employing heterogeneous agents. For higher performance levels, framing a base wage with bonuses is cost-effective.
    Keywords: Real Effort Experiment, Optimal Payment Scheme, Principal-Agent Relationship, Ability, Bonus, Penalty
    JEL: M52 J33 C91
    Date: 2013–11
  9. By: Peter Katuscak; Fabio Michelucci; Miroslav Zajicek
    Abstract: Does the type of post-auction feedback affect bidding behavior in first price auctions? Filiz- Ozbay and Ozbay (2007) find that such manipulation can increase bids in a one-shot auction. They explain this as an effect of anticipated regret combined with the assumption that feedback directly affects salience of regret relative to material payoff. We revisit this important market design issue using four different auction protocols and a large sample of subjects. We do not find any systematic effect of feedback on the average bid/value ratio. This evidence indicates either the lack of anticipated regret or its manipulability by feedback in one-shot auctions.
    Keywords: auctions; bidding; feedback; regret;
    JEL: C91 C92 D44
    Date: 2013–06
  10. By: : Arie E. Gozluklu
    Date: 2012
  11. By: Gabriela Calderón; Jesse M. Cunha; Giacomo De Giorgi
    Abstract: A large share of the poor in developing countries run small enterprises, often earning low incomes. This paper explores whether the poor performance of businesses can be explained by a lack of basic business skills. We randomized the offer of a free, 48-hour business skills course to female entrepreneurs in rural Mexico. We find that those assigned to treatment earn higher profits, have larger revenues, serve a greater number of clients, are more likely to use formal accounting techniques, and more likely to be registered with the government. Indirect treatment effects on those entrepreneurs randomized out of the program, yet living in treatment villages, are economically meaningful, yet imprecisely measured. We present a simple model of experience and learning that helps interpret our results, and consistent with the theoretical predictions, we find that “low-quality” entrepreneurs are the most likely to quit their business post-treatment, and that the positive impacts of the treatment are increasing in entrepreneurial quality.
    Keywords: business literacy, development, entrepreneurship
    JEL: C93 I25 O12 O14
    Date: 2013–12
  12. By: Bruhn, Miriam; de Souza Leao, Luciana; Legovini, Arianna; Marchetti, Rogelio; Zia, Bilal
    Abstract: This paper studies the impact of a comprehensive financial education program spanning six states, 868 schools, and approximately 20,000 high school students in Brazil through a randomized control trial. The program increased student financial knowledge by a quarter of a standard deviation and led to a 1.4 percentage point increase in saving for purchases, better likelihood of financial planning, and greater participation in household financial decisions by students."Trickle-up"impacts on parents were also significant, with improvements in parent financial knowledge, savings, and spending behavior. The study also finds evidence that the program affected students'inter-temporal preferences and attitudes.
    Keywords: Tertiary Education,Financial Literacy,Education For All,Secondary Education,Primary Education
    Date: 2013–12–01
  13. By: Anna Piil Damm (Department of Economics and Business, Aarhus University); Christian Dustmann (University College London)
    Abstract: This paper investigates the effect of early exposure to neighborhood crime on subsequent criminal behavior of youth exploiting a unique natural experiment between 1986 and 1998 when refugee immigrants to Denmark were assigned to neighborhoods quasi-randomly. We find strong evidence that the share of young people convicted for crimes, in particular violent crimes, in the neighborhood increases convictions of male assignees later in life. No such effects are found for other measures of neighborhood crime including the rate of committed crimes. Our findings suggest social interaction as a key channel through which neighborhood crime is linked to individual criminal behavior.
    Keywords: Neighborhood effects, criminal convictions, social interactions, random allocation
    JEL: J0 H43
    Date: 2013–12
  14. By: Jaikishan Desai; Kristin Johnson; Alessandro Tarozzi
    Abstract: We use data from a randomized controlled trial conducted in 2003-2006 in rural Amhara and Oromiya (Ethiopia) to study the impacts of the introduction of micro finance in treated communities. We document that borrowing increased substantially in locations where the programs started their operations, but we find mixed evidence of improvements in a number of socio-economic outcomes, including income from agriculture, animal husbandry, non-farm self-employment, schooling and indicators of women's empowerment.
    Keywords: microcredit, cluster randomized controlled trial, Ethiopia
    JEL: O12 O16
    Date: 2013–10

This nep-exp issue is ©2013 by Daniel Houser. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.