nep-exp New Economics Papers
on Experimental Economics
Issue of 2014‒10‒03
fifteen papers chosen by

  1. On Replication and Perturbation of the McKelvey and Palfrey Centipede Game Experiment By James C. Cox; Duncan James
  2. What is Trustworthiness and What Drives It? By James C. Cox; Rudolf Kerschbamer; Daniel Neururer
  3. Does expressing disapproval influence future cooperation? An experimental study By Anastasios Koukoumelis; M. Vittoria Levati
  4. Changing partner in a cheap talk game: experimental evidence By Bonroy, O.; Garapin, A.; Llerena, D.
  5. Gender Differences in Risk Preferences and Stereotypes: Experimental Evidence from a Matrilineal and a Patrilineal Society By Andreas Pondorfer; Toman Omar Mahmoud; Katrin Rehdanz; Ulrich Schmidt
  6. Strategic Disclosure of Demand Information by Duopolists: Theory and Experiment By Jos Jansen; Andreas Pollak
  7. Why Do People Give? Testing Pure and Impure Altruism By Mark Ottoni-Wilhelm; Lise Vesterlund; Huan Xie
  8. How private is private information? The ability to spot deception in an economic game By Belot, Michele; van de Ven, Jeroen
  9. Tell Me Something I Don’t Already Know:Informedness and External Validity in Information Programs By David P. Byrne; Andrea La Nauze; Leslie A.Martin
  10. The “Inflow-Effect” – Trader Inflow and Bubble Formation in Asset Markets By Michael Kirchler; Caroline Bonn; Jürgen Huber; Michael Razen
  11. Self-Confidence, Overconfidence and Prenatal Testosterone Exposure: Evidence from the Lab By Dalton, Patricio S.; Ghosal, Sayantan
  12. Impact of Human Resource Development Training on Crop Damages by Wild Animals in Developing Countries: Experimental Evidence from Rural Pakistan By Kurosaki, Takashi; Khan, Hidayat Ullah
  13. Survey design and the determinants of subjective wellbeing: an experimental analysis By Holford, Angus; Pudney, Stephen
  14. What is ‘Fair’ Distribution under Collaboration?:Evidences from Lab-Experiments By Natsuka Tokumaru; Hiroyuki Uni
  15. The permanent input hypothesis : the case of textbooks and (no) student learning in Sierra Leone By Sabarwal, Shwetlena; Evans, David K.; Marshak, Anastasia

  1. By: James C. Cox; Duncan James
    Abstract: null
    Date: 2014–08
  2. By: James C. Cox; Rudolf Kerschbamer; Daniel Neururer
    Abstract: This paper reports the results of experiments designed to isolate the impact of various combinations of the following motives on trustworthiness: (i) unconditional other-regarding preferences -- like altruism, inequality aversion, quasi-maximin, etc.; (ii) deal-responsiveness -- reacting to actions that allow for a mutual improvement by adopting behavior that implies a mutual improvement; (iii) gift-responsiveness -- reacting to choices that allow the trustee to obtain an improvement by adopting actions that benefit the trustor; and (iv) vulnerability-responsiveness -- reacting to the vulnerability of the trustor by adopting actions that do not hurt the trustor. Our results indicate that -- besides unconditional other-regarding preferences -- vulnerability-responsiveness is an important determinant of trustworthiness even in cases where the vulnerability of the trustor does not come together with a gift to the trustee. Motivated by our empirical findings we provide formal definitions of trust and trustworthiness based on revealed willingness to accept vulnerability and the response to it.
    Keywords: trustworthiness, trust, trust game, investment game, deal-responsiveness, gift-responsiveness, vulnerability-responsiveness, generosity, reciprocity
    JEL: C70 C91 D63 D64
    Date: 2014–09
  3. By: Anastasios Koukoumelis (Max Planck Institute of Economics, Jena); M. Vittoria Levati (University of Verona, and Max Planck Institute of Economics, Jena)
    Abstract: We report on an experiment designed to explore whether a written expression of disapproval affects future levels of cooperation. In between two identical public goods games, participants play a mini dictator game that, depending on the treatment, either gives or does not give the recipient the opportunity to text the dictator. The recipients of an unfair offer contribute significantly less in the second public goods game. Yet, the contribution reductions are significantly smaller in the treatments allowing for recipient communication. To control for belief-based explanations of these findings, we run treatments where we elicit beliefs about the others' contributions. It turns out that the reductions in contributions, but not the reductions in beliefs, of the unfairly treated recipients are notably smaller when messaging is possible. This tends to suggest that allowing for communication opportunities helps to curtail selfishness.
    Keywords: Public goods game, dictator minigame, emotions, cooperation
    JEL: C72 C91 C92 D63
    Date: 2014–09–08
  4. By: Bonroy, O.; Garapin, A.; Llerena, D.
    Abstract: This paper considers the effects of the opportunity to change partners on communication. We experiment a standard cheap talk game where a player observes a private forecast before disclosing it (truthfully or untruthfully) in a message that he/she sends to his/her partner. Two treatments are applied: i) each two-player team remains unchanged until the experiment ends; and ii) players are offered the possibility to change their partner. We find that the opportunity to change partners affects communication in the relationship positively. Interestingly, this effect is explained by more beliefs in the messages and not by more truthful disclosure.
    JEL: C90 D82
    Date: 2014
  5. By: Andreas Pondorfer; Toman Omar Mahmoud; Katrin Rehdanz; Ulrich Schmidt
    Abstract: We use a controlled experiment to analyze gender differences in risk preferences and stereotypes about risk preferences of men and women across two distinct island societies in the Pacific: the patrilineal Palawan in the Philippines and the matrilineal Teop in Papua New Guinea. We find no gender differences in actual risk preferences, but evidence for culture-specific stereotypes. Like men in Western societies, Palawan men overestimate women’s actual risk aversion. By contrast, Teop men underestimate women’s actual risk aversion. We argue that observed differences in stereotypes between the two societies are determined by the different social status of women
    Keywords: Gender roles, culture, stereotype, experiment, risk aversion
    JEL: C93 D81 J15 J16
    Date: 2014–09
  6. By: Jos Jansen (Department of Economics and Business, Aarhus University, Denmark); Andreas Pollak (University of Cologne)
    Abstract: We study the strategic disclosure of demand information and product-market strategies of duopolists. In a setting where firms may fail to receive information, we show that firms selectively disclose information in equilibrium in order to influence their competitor’s product-market strategy. Subsequently, we analyze the firms’ behavior in a laboratory experiment. We find that subjects often use selective disclosure strategies, and this finding appears to be robust to changes in the information structure, the mode of competition, and the degree of product differentiation. Moreover, subjects in our experiment display product-market conduct that is largely consistent with theoretical predictions.
    Keywords: duopoly, Cournot competition, Bertrand competition, information disclosure, incomplete information, common value, product differentiation, asymmetry, skewed distribution, laboratory experiment
    JEL: C92 D22 D82 D83 L13 M4
    Date: 2014–09–01
  7. By: Mark Ottoni-Wilhelm (Indiana University Purdue University-Indianapolis); Lise Vesterlund (University of Pittsburgh); Huan Xie (Concordia University)
    Abstract: The extant experimental design to investigate warm glow and altruism elicits a single measure of crowd-out. Not recognizing that impure altruism predicts crowd-out is a function of giving-by-others, this design's power to reject pure altruism varies with the level of giving-by-others, and it cannot identify the strength of warm glow and altruism preferences. These limitations are addressed with a new design that elicits crowd-out at a low and at a high level of giving-by-others. Consistent with impure altruism we find decreasing crowd-out as giving-by-others increases. However warm glow is weak in our experiment and altruism largely explains why people give.
    Date: 2014–09
  8. By: Belot, Michele; van de Ven, Jeroen
    Abstract: We provide experimental evidence on the ability to detect deceit in a buyer-seller game with asymmetric information. Sellers have private information about the buyer's valuation of a good and sometimes have incentives to mislead buyers. We examine if buyers can spot deception in face-to-face encounters. We vary (1) whether or not the buyer can interrogate the seller, and (2) the contextual richness of the situation. We find that the buyers' prediction accuracy is above chance levels, and that interrogation and contextual richness are important factors determining the accuracy. These results show that there are circumstances in which part of the information asymmetry is eliminated by people's ability to spot deception.
    Keywords: Deception, lie detection, asymmetric information, face-to-face interaction, experiment,
    Date: 2013
  9. By: David P. Byrne; Andrea La Nauze; Leslie A.Martin
    Abstract: Information programs that leverage peer comparisons are used to encourage pro-social behavior in many contexts. We document how imperfect information generates heterogenous responses to treatments involving personalized feedback and peer comparisons. In our field experiment in retail electricity, we find that most households either overestimate or underestimate their relative energy consumption pre-treatment. Households that overestimated respond to new information by temporarily increasing electricity consumption, whereas households that underestimated take steps that lead to long term energy conservation. We explore the implications of these results for the external validity and design of information programs.
    JEL: C93 D12 D84 L94 Q41
    Date: 2014
  10. By: Michael Kirchler; Caroline Bonn; Jürgen Huber; Michael Razen
    Abstract: We investigate the impact of trader and cash inflow on bubble formation in asset markets with a novel design featuring heterogeneous information and a constant fundamental value. Implementing seven treatments we find that (i) only the joint inflow of traders and cash triggers bubbles (“inflow-effect”). (ii) In treatments with trader and cash inflow only in the first half of the market, prices converge to fundamentals towards maturity of the asset. This inflow-effect is very robust as we observe bubbles in almost all of the 24 markets with trader inflow. The analysis of traders’ beliefs reveals that (iii) despite fundamentals staying constant, beliefs about fundamentals co-move with upwardly trending prices. Finally, we report a speculative motive only among the optimists in treatments where we observe bubbles.
    Keywords: Experimental finance, inflow-effect, trader inflow, asset market, bubble, market efficiency
    JEL: C92 D84 G10
    Date: 2014–09
  11. By: Dalton, Patricio S.; Ghosal, Sayantan
    Abstract: This paper examines whether the degree of confidence and overconfidence in one's ability is determined biologically. In articular, we study whether foetal testosterone exposure correlates with an incentive-compatible measure of confidence within an experimental setting. We find that men (rather than women) who were exposed to high testosterone levels in their mother's womb are less likely to overestimate their actual performance, which in turn helps them to gain higher monetary rewards. Men exposed to low prenatal testosterone levels, instead, set unrealistically high expectations which results in self-defeating behaviour. These results from the lab are able to reconcile hitherto disconnected evidence from the field, by providing a link between traders'overconfidence bias, long-term financial returns and prenatal testosterone exposure.
    Keywords: 2D:4D, testosterone, neuroeconomics, expectations, overcon dence, self-confidence, goals,
    Date: 2014
  12. By: Kurosaki, Takashi; Khan, Hidayat Ullah
    Abstract: Based on a four-year panel dataset of households collected in rural Pakistan, we examine the impact of an intervention on households’capacity to reduce income losses due to attacks by wild boars. A local NGO implemented the intervention as a randomized controlled trial at the beginning of the second year. We find that the intervention was highly effective in eliminating the crop-income loss in the second year, but that effects disappeared in the third and fourth years. Our finding suggests the difficulty in technology transfer through the training or the high implicit cost incurred by the households in implementing the treatment. Therefore, the intervention was not sustainable at the household level. Nevertheless, due to spillover effects, the intervention could have been cost-effective at the project level.
    Keywords: wild animal attack, production risk, randomized controlled trial, cost-benefit analysis, Pakistan
    JEL: O13 O15 Q12
    Date: 2014–08
  13. By: Holford, Angus; Pudney, Stephen
    Abstract: We analyse the results of experiments on questionnaire design and interview mode in the first four waves (2008-11) of the UK Understanding Society Innovation Panel survey. The randomised experiments relate to job, health, income, leisure and overall life-satisfaction questions and vary the labeling of response scales, mode of interviewing, and location of questions within the interview. We find significant evidence of an influence of interview mode and question design on the distribution of reported satisfaction measures, particularly for women. Results from the sort of conditional modeling used to address real research questions appear less vulnerable to design influences.  
    Date: 2014–07–23
  14. By: Natsuka Tokumaru; Hiroyuki Uni
    Date: 2014–09
  15. By: Sabarwal, Shwetlena; Evans, David K.; Marshak, Anastasia
    Abstract: A textbook provision program in Sierra Leone demonstrates how volatility in the flow of government-provided learning inputs to schools can induce storage of these inputs by school administrators to smooth future consumption. This process in turn leads to low current utilization of inputs for student learning. A randomized trial of a public program providing textbooks to primary schools had modest positive impacts on teacher behavior but no impacts on student performance. In many treatment schools, student access to textbooks did not actually increase because a large majority of the books were stored rather than distributed to students. At the same time, the propensity to save books was positively correlated with uncertainty on the part of head teachers regarding government transfers of books. The evidence suggests that schools that have high uncertainty with respect to future transfers are more likely to store a high proportion of current transfers. These results show that reducing uncertainty in school input flows could result in higher current input use for student learning. For effective program design, public policy programs must take forward-looking behavior among intermediate actors into account.
    Keywords: Tertiary Education,Education For All,Primary Education,Secondary Education,Teaching and Learning
    Date: 2014–09–01

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