nep-exp New Economics Papers
on Experimental Economics
Issue of 2015‒03‒27
fifteen papers chosen by

  1. Professional Identity, Bribery and Public Service Delivery: Evidence from a Lab-in-the-Field Experiment in Burundi By Jean-Benoit Falisse; Natassia Leszcynska
  2. Social information 'nudges': An experiment with multiple group references By Shaun Hargreaves Heap; Abhijit Ramalingam; David Rojo Arjona
  3. Is 2% the Solution? Experimental Evidence on the New CSR Rule in India By Desai, Naman; Pingali, Viswanath; Tripathy, Arindam
  4. Can We Steer Income Comparison Attitudes by Information Provision?: Evidence from Randomized Survey Experiments in the US and the UK By Hitoshi Shigeoka; Katsunori Yamada
  5. The Effect of Game Method on Student Achievements By Ömer Beyhan
  6. Resources for conflict: Constraint or wealth? By Kyung Hwan Baik; Subhashish M. Chowdhury; Abhijit Ramalingam
  7. Escaping Expectations-Driven Liquidity Traps: Experimental Evidence By Luba Petersen; Jasmina Arifovic
  8. ‘Doggedness’ or ‘disengagement’? An experiment on the effect of inequality in endowment on behaviour in team competitions By Sean P. Hargreaves Heap; Abhijit Ramalingam; Siddharth Ramalingam; Brock V. Stoddard
  9. Incentivizing Cost-Effective Reductions in Hospital Readmission Rates By James C. Cox; Vjollca Sadiraj; Kurt E. Schnier; John F. Sweeney
  10. Effects of Absurdity in Advertising on Consumers’ Attitude Toward the Ad and Recall By SERDAR YILDIZ
  11. Using lotteries to incentivize safer sexual behavior : evidence from a randomized controlled trial on HIV prevention By Nyqvist,Martina Björkman; Corno,Lucia; De Walque,Damien B. C. M.; Svensson,Jakob
  12. Improving Saudi Technical College students Skills in Accounting Courses By Fahad Alamr
  13. The Implications of Daylight Saving Time: A Field Experiment on Cognitive Performance and Risk Taking By Markus Schaffner; Jayanta Sarkar; Benno Torgler; Uwe Dulleck
  14. The gold standard for randomised evaluations: from discussion of method to political economics By Florent Bédécarrats; Isabelle Guérin; François Roubaud
  15. The Conditional Contribution Mechanism for the Provision of Public Goods By Reischmann, Andreas

  1. By: Jean-Benoit Falisse; Natassia Leszcynska
    Date: 2015–03
  2. By: Shaun Hargreaves Heap (King's College London); Abhijit Ramalingam (University of East Anglia); David Rojo Arjona (University of Leicester)
    Abstract: Social information 'nudges' concerning how others perform typically boost individual performances in experiments with one group reference point. However, in many natural settings, sometimes due to policy, there are several such group reference points. We address the complications that such multiple group social information might introduce through an experiment. The boost to average performance is significant and comparable to the one group case. Between-group inequality does not change. Individual inequality falls, however, because the boost is largest among the pre-‘nudge’ very poor performers. Finally, the boost to average performance is highest when individuals freely choose their group affiliations.
    Keywords: social comparison, nudge, effort provision, reference points
    JEL: C91 D03 D60
    Date: 2015–03
  3. By: Desai, Naman; Pingali, Viswanath; Tripathy, Arindam
    Abstract: The Indian government became the first regulator in the world to mandate a minimum CSR spending on certain specified social welfare activities. Prior research in psychology indicates that individuals tend to focus heavily (Anchor) on the initial information or estimate in a decision making context. Therefore, we conduct two experiments to examine the role of the 2% minimum CSR spending limit as an anchor. The first experiment was conducted to establish the effects of anchoring on decisions related to charitable giving. The results of this experiment indicate that participants’ charitable contribution was significantly higher in the treatment where no minimum limit was stipulated compared to the treatment where a minimum limit was stipulated. This result suggests that participants did anchor on the minimum stipulated limit while deciding on the amount of charitable contribution. The second experiment was conducted to examine if anchoring specifically affected CSR spending decisions. The results of the experiment indicated that the amount of reported CSR spending was lower when the minimum 2% rule was imposed versus when it was not imposed. Additionally, the results also indicate that when the 2% rule was not imposed the participants appeared to anchor on the overall financial requirement of the CSR activity and decided to spend more or less depending on the financial requirement of the CSR activity.
  4. By: Hitoshi Shigeoka; Katsunori Yamada
    Abstract: Economists have long been concerned that negative attitudes about relative income reduce social welfare. This paper investigates whether such attitudes can be mitigated by a simple information treatment. Toward this end, we conducted an original randomized online survey experiment in the US and the UK. As a baseline result, we find that UK respondents compare their incomes with othersf at a much higher rate than US subjects do. Additionally, we find that our information treatment---suggesting that comparing income with others may diminish their welfare even when income levels are actually increasing---made respondents compare incomes more, rather than less. Interestingly, we find such effects only among UK respondents. The mechanism for this among UK respondents seems to be driven by those who are initially less comparison-conscious becoming more comparison-conscious, indicating that our information treatment gives moral glicenseh to make comparisons by informing that others actually do.
    Date: 2015–03
  5. By: Ömer Beyhan (Necmettin Erbakan Üniversity Ahmet KeleÅŸoğlu Education Faculty)
    Abstract: Game is the most natural learning tool. Game platform is the place where the child may test what he/she saw and heard, and reinforced what he/she learned. Child makes clear his/her senses by playing games, he/she improves the psychomotor skills by games. Game platform is the experiment room of a child. Such a room that, child attempts several trials there independently. He/she does, breaks, and applies different possibilities freely. In his/her small world, he/she makes the rules and changes them by himself/herself (Yörükoğlu, 1979). In this context, the effect of game method on the achievement while teaching geometry subjects of fifth class Mathematics course was analyzed. In this study, an experimental method, including pre-test and post-test control groups, was used in order to reveal student achievement of classes with and without being exposed to game method. While determining experimental and control groups, two classes out of four fifth classes were selected randomly. And 5-A class was selected as experimental group and 5-B class was selected as control group randomly. Forty one fifth grade students from two classes of Konya Hasan Ali Yücel Elementary School participated to this study during 2010-2011Spring terms. In order to analyze the data of this study, we preferred to use frequency, percentage distribution, standard deviation and t-test as statistical techniques. The data derived from the measurements was arranged by SPSS program on the computer. When we compared the significant difference between experimental and control groups, we observed that the students in the experimental group achieved pretty much than control group students. The experimental method applied in this study generated a remarkable difference in favor of the experimental group.
    Keywords: Game method, Teaching geometry, Mathematics course, Achievement, Experimental research
    JEL: I21
    Date: 2014–12
  6. By: Kyung Hwan Baik (Sungkyunkwan University); Subhashish M. Chowdhury (University of East Anglia); Abhijit Ramalingam (University of East Anglia)
    Abstract: We investigate the effects of the availability of resources that can be expended in conflict on conflict intensity. We run a between-subjects Tullock contest in which we vary the contest budget from Low to Medium to High, while keeping the Nash equilibrium bid the same. We find an 'inverted U-shaped' relationship between resource availability and conflict intensity. While standard error correction models can explain the first part of the relationship by attributing resources as constraint, they do not apply in the latter part. We further run a Wealth treatment in which the budget remains Medium, but a fixed payment independent of the contest outcome is provided. The level of conflict in the Wealth and the High treatment are not different. We conclude that the resources for conflict can have both a constraint as well as a wealth effect. When initial resources are scarce, they act as a constraint. As more resources become available, the constraint loosens up and conflict intensity increases. However, when resources are abundant, they are viewed as wealth and conflict intensity decreases.
    Keywords: conflict, experiment, wealth effect, resource constraint
    JEL: C72 C91 D72 D74
    Date: 2015–03
  7. By: Luba Petersen (Simon Fraser University); Jasmina Arifovic (Simon Fraser University)
    Abstract: Can monetary or fiscal policy stabilize expectations in a liquidity trap? We study expectation formation near the zero lower bound using a learning-to-forecast laboratory experiment. Monetary policy targets inflation around a constant or state-dependent target. Subjects’ expectations significantly over-react to stochastic aggregate demand shocks and historical information leading many economies to experience severe deflationary traps. Neither quantitative nor qualitative communication of inflation targets reduce the duration or severity of economic crises. A stronger initial recovery of fundamentals or supplementary anticipated fiscal stimulus stabilizes expectations and increases the speed of macroeconomic recovery.
    Keywords: experimental macroeconomics, monetary policy, expectations, zero lower bound, learning to forecast, communication
    JEL: C92 E2 E52 D50 D91
    Date: 2015–03–14
  8. By: Sean P. Hargreaves Heap (King's College London); Abhijit Ramalingam (University of East Anglia); Siddharth Ramalingam (IDFC Foundation); Brock V. Stoddard (University of South Dakota)
    Abstract: Teams often suffer from a free rider problem with respect to individual contributions. That putting teams into competition with each other can mitigate this problem is an important recent insight. However, we know little about how inequality in endowment between teams might influence this beneficial effect from competition. We address this question with an experiment where teams contribute to a public good that then determines their chances of winning a Tullock contest with another team. The boost to efforts from competition disappears when inequality is high. This is mainly because the ‘rich’ ‘disengage’: they make no more contribution to a public good than they would when there is no competition. There is evidence that the ‘poor’ respond to moderate inequality ‘doggedly’, by expending more effort compared to competition with equality, but this ‘doggedness’ disappears too when inequality is high.
    JEL: C91 C92 D63 H41
    Date: 2015–02
  9. By: James C. Cox; Vjollca Sadiraj; Kurt E. Schnier; John F. Sweeney
    Abstract: The recent regulatory changes enacted by the Centers for Medicare and Medicaid Services (CMS) have identified hospital readmission rates as a critical healthcare quality metric. This research focuses on the utilization of pay-for-performance (P4P) mechanisms to cost effectively reduce hospital readmission rates and meet the regulatory standards set by CMS. Using the experimental economics laboratory we find that both of the P4P mechanisms researched, bonus and bundled payments, cost-effectively meet the performance criteria set forth by CMS. The bundled payment mechanism generates the largest reduction in patient length of stay (LOS) without altering the probability of readmission. Combined these results indicate that utilizing P4P mechanisms incentivizes cost effective reductions in hospital readmission rates.
    Keywords: Pay-for-Performance (P4P), Healthcare, Experiment
    JEL: C91 D81 I10
    Date: 2015–03
    Abstract: Absurdity is widely used in advertising, whereas the empirical studies on effects of absurdity in advertising are limited. This study is an experimental research to examine the effects of absurdity in advertising on consumers’ attitude toward the ad and recall. The presence and absence of a visual absurd stimulus was tested with print ads that were created for a fictitious outdoor clothing brand. It was hypothesized that using absurd elements in the print ad leads to more positive attitudes toward the ad than the non-absurd version of the same ad. It was also hypothesized that absurdity increases the recall of the brand name and the slogan. A student sample consisting of 160 subjects were chosen from 5 different faculties of Anadolu University. They were randomly assigned to two equivalent treatment groups according to viewing absurd or non-absurd print ads. As a result of the literature review it was noted that the product category attitude or involvement might moderate the effect of absurdity. Thus, the product category involvement was considered as a confounding variable and measured for all subjects. It was proved that both of the treatment groups were equivalent on the basis of involvement, age and gender. The results supported the hypothesis about the attitude toward the ad. The subjects who viewed the absurd ad had more positive attitudes toward the ad than the ones who viewed the non-absurd ad. On the other hand, the hypothesis on recall was partially supported. As a result of the unaided recall test it was found that absurdity increases the brand name recall. However, there was not a significant difference on slogan recall. Additionally, the results of the content analysis of the unaided recall test sheets revealed that the visual absurd element of the ad might cause misremembering of the slogan, because it was seen that a remarkable number of the subjects who viewed the absurd ad misremembered the slogan. At the end, all the findings were discussed; managerial implications were stated and further research areas were suggested to make a contribution to advertising and consumer research studies.
    Keywords: Absurdity, Advertising, Attitude toward the ad, Recall
    Date: 2014–10
  11. By: Nyqvist,Martina Björkman; Corno,Lucia; De Walque,Damien B. C. M.; Svensson,Jakob
    Abstract: Financial incentives are a promising HIV prevention strategy. This paper assesses the effect on HIV incidence of a lottery program in Lesotho with low expected payments but a chance to win a high prize conditional on negative test results for sexually transmitted infections. The intervention resulted in a 21.4 percent reduction in HIV incidence over two years. Lottery incentives appear to be particularly effective for individuals willing to take risks. This paper estimates a model linking sexual behavior to HIV incidence and finds that risk-loving individuals reduce the number of unprotected sexual acts by 0.3/month for every $1 increase in the expected prize.
    Date: 2015–03–18
  12. By: Fahad Alamr (Dammam University)
    Abstract: Saudi Technical Colleges provide programs in accounting. I summoned all accounting mentors from tow colleges, to discuss their current training strategies. 10 Trainers -out of 12- indicated that they use lecturing most of the time. Accordingly, I proposed a four weeks workshop on strategies for developing worksheets and administering group discussions. A four-weeks workshop was administered during the spring quarter 2013; the first two weeks designated for skill drills and training. The second two weeks the mentors practiced their acquired skills on real live situations. All 12 trainers attended the workshop. Six of them were training one group of students each during this quarter, and the other six were training two groups each. Therefore, our data collection process focused on the results collected from trainers with two groups; we used one group as an experimental group, and the other as a control group.Statistical analyses indicate there is statistically significant deference between the groups, to the benefit of the experimental groups.Some recommendations were suggested.
    Keywords: Saudi, Accounting, Technical,
    JEL: A00 A20
    Date: 2014–07
  13. By: Markus Schaffner; Jayanta Sarkar; Benno Torgler; Uwe Dulleck
    Abstract: To explore the effects of daylights saving time (DST) transition on cognitive performance and risk-taking behaviour immediately before and one week after the shift to DST, this study examines two Australian populations living in similar geographic surroundings who experience either no DST transition (Queensland) or a one-hour DST desynchronization (New South Wales). This exogenous variation creates natural control (QLD) and treatment (NSW) groups that enable isolation and identification of the DST transition’s effect on the two outcome variables. Proximity to the border ensures similar socio-demographic and socio-economic conditions and thus permits comparison of the cognitive performance and risk-taking behaviour of affected versus unaffected individuals. The results suggest that exposure to the DST transition has no significant impact on either cognitive performance or risk-taking behaviour.
    Keywords: Daylight Saving Time; Risk-Taking Behaviour; Cognitive Performance; Field Experiment
    JEL: D81 C93 C21 I1
    Date: 2015–03
  14. By: Florent Bédécarrats; Isabelle Guérin; François Roubaud
    Abstract: This last decade has seen the emergence of a new field of research in development economics: randomised control trials. This paper explores the contrast between the (many) limitations and (very narrow) real scope of these methods and their success in sheer number and media coverage. Our analysis suggests that the paradox is due to a particular economic and political mix driven by the innovative strategies used by the new school’s researchers and by specific interests and preferences in the academic world and the donor community.
    Keywords: Impact evaluation; randomised control trial; experimental method; political economy; development
    JEL: A11 B41 C93 D72 O10
    Date: 2015–03–16
  15. By: Reischmann, Andreas
    Abstract: Many mechanisms have been designed to solve the free-rider problem in public good environments. The designers of those mechanisms focused on good static equilibrium properties. In this paper, I propose a new mechanism for the provision of public goods that has good dynamic properties instead. The mechanism gives all agents the possibility to condition their contribution on the total level of contribution provided by all agents. Under a reasonable variant of Better Response Dynamics all equilibrium outcomes are Pareto efficient. This makes the mechanism particularly suited for repeated public good environments. In contrast to many previously suggested mechanisms, it does further not require an institution that has the power to enforce participation and/or transfer payments. Neither does it use any knowledge of agents preferences.
    Keywords: Mechanism Design; Public Goods; Better Response Dynamics.
    Date: 2015–03–17

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