nep-exp New Economics Papers
on Experimental Economics
Issue of 2016‒07‒23
23 papers chosen by

  1. The Choice of Honesty: An Experiment Regarding Heterogeneous Responses to Situational Social Norms By Rajna GIBSON BRANDON; Carmen TANNER; Alexander F. WAGNER
  2. Couple's Labor Supply, Taxes, and the Division of Housework in a Gender-Neutral Lab By Melanie Schröder; Norma Burow
  3. The Dollar Auction Game: A laboratory comparison between Individuals and Groups By Morone, Andrea; Nuzzo, Simone; Caferra, Rocco
  4. Evolution of Cooperation in Public Good Game By Colasante, Annarita
  5. Risk and punishment revisited. Errors in variables and in the lab By Christoph Engel; Oliver Kirchkamp
  6. Mis-Judging Merit: The Effects of Adjudication Errors in Contests By Astrid, Gamba; Luca, Stanca;
  7. Social surplus determines cooperation rates in the one-shot Prisoner's Dilemma By Luca Rigotti
  8. I lie? We lie! Why? Experimental evidence on a dishonesty shift in groups By Kocher, Martin G.; Schudy, Simeon; Spantig, Lisa
  9. Fair share and social effciency: a mechanism in which peers decide on the payoff division By Lu Dong; Rod Falvey; Shravan Luckraz
  10. History-Dependent Risk Preferences: Evidence from Individual Choices and Implications for the Disposition Effect By Angie ANDRIKOGIANNOPOULOU; Filippos PAPAKONSTANTINOU
  11. New consumers behaviours in the sharing economy: an experimental analysis on food waste reduction By Andrea Morone; Enrica Imbert; Marcello Morone; Pasquale Falcone; Piergiuseppe Morone
  12. Using Personalized Feedback to Increase Data Quality and Respondents' Motivation in Web Surveys? By Simon Kühne; Martin Kroh
  13. Valuing Free Media in GDP: An Experimental Approach By Leonard Nakamura; Jon Samuels; Rachel Soloveichik
  14. Intergenerational sustainability and the degree of capitalism in the society: A field experiment By Shibly Shahrier; Koji Kotani; Tatsuyoshi Saijo
  15. Move it! How an Electric Contest Motivates Households to Shift their Load Profile By Sylvain Weber; Stefano Puddu; Diana Pacheco
  16. Efficiency in Decentralized Markets with Aggregate Uncertainty By Lucas Maestri; Dino Gerardi; Braz Camargo
  18. When the State Gives Back: Trust and Trustworthiness after a Land Restitution Program By Francesco Bogliacino; Gianluca Grimalda; Laura Jiménez; Daniel Reyes Galvis; Cristiano Codagnone
  19. Civility vs. Incivility in Online Social Interactions: An Evolutionary Approach By Antoci, Angelo; Delfino, Alexia; Paglieri, Fabio; Panebianco, Fabrizio; Sabatini, Fabio
  20. Emotion Research in Economics By Klaus Wälde
  21. Are Behavioral Biases Stable Across Markets and Prevalent Across Individuals? Evidence from Individual Betting Choices OR from SSRN: Individual Reaction to Past Performance Sequences: Evidence from a Real Marketplace By Angie ANDRIKOGIANNOPOULOU; Filippos PAPAKONSTANTINOU
  22. The Miracle of Peer Review and Development inScience: An Agent-Based Model By Simone Righi; Karoly Takacs
  23. A mathematical model for a gaming community By Romulus Breban

  1. By: Rajna GIBSON BRANDON (University of Geneva and Swiss Finance Institute); Carmen TANNER (University of Zurich); Alexander F. WAGNER (University of Zurich and Swiss Finance Institute)
    Abstract: We conduct a laboratory experiment in which we expose participants to situational social norms of approval or disapproval of lying. While participants on average conform to the situational pressure, the results highlight important differences in individual reactions. Situational norms crowd out intrinsic preferences for truthfulness; conversely, these preferences support resistance against "bad" norms. The extent and direction of the interaction of individual characteristics with situational norms and with economic incentives shed light on why people act truthfully. Out of several possible explanations, self-signaling under situational pressure provides the most convincing account of the evidence from the experiment.
    Keywords: Crowding-out, honesty, norm conformity, protected values, self-signaling, situational social norms.
    JEL: G02 G30 C91 M14
  2. By: Melanie Schröder; Norma Burow
    Abstract: We use a lab-in-the-field experiment to investigate intra-couple labor supply decisions and the division of housework under individual and joint income taxation systems. In order to eliminate problems of endogenous intra-couple time use decisions, we exogenously varied not only the taxation system but also the intra-couple roles of primary and secondary earners. Using work effort as a proxy for labor supply, 62 established couples, both cohabiting and married (124 participants), performed real effort tasks under a piece rate payment system within a given time. Prior to this paid task, couples had to decide upon the allocation of an unpaid task serving as our proxy for housework. In our gender neutral lab, we find tax-effects only on men’s labor supply but not on women’s and no gender differences in the allocation of housework. Instead, the allocation of housework follows a purely economic rationale with the majority of secondary earners taking responsibility. This is even confirmed by a shift to a more egalitarian allocation when individual taxation is applied. However, one result replicates real world findings with married male participants providing more labor supply than cohabiting men and married women less than cohabiting women. This result hinges on the stability of specialization in married couples, which seems to overcome the gender neutral lab.
    Keywords: real effort experiment, labor supply, housework, income taxation, household decision making, gender
    JEL: H31 D13 C93 J16
    Date: 2016
  3. By: Morone, Andrea; Nuzzo, Simone; Caferra, Rocco
    Abstract: By means of a laboratory experiment, this paper aims at studying how individuals and groups behave in a simple game such as the dollar auction. This game is extremely interesting since it induces subjects to fall prey into the paradigm of escalation, which is driven by agents’ commitment to higher and higher bids. Indeed, whenever each participant commits himself to a bid, the lower bidder, moved by the wish to win as well as to defend his prior investment, finds it in his best interest to place a higher bid to overcome his opponent. The latter mechanism may lead subjects to overbid, implying that the winner pays more than the auctioned value. The aim of the paper is to analyze bidder’s behavior, comparing individuals vs. groups’ decisions within the dollar auction framework. We find that groups are closer than individuals to the Nash equilibrium, and that experience reduces the escalation phenomenon, but it has a different impact on winners and losers.
    Keywords: escalation; winner’s curse
    JEL: C91
    Date: 2016–07–18
  4. By: Colasante, Annarita
    Abstract: This paper presents an investigation about cooperation in a Public Good Game using an Agent Based Model calibrated on experimental data. Starting from the experiment proposed in Colasante and Russo (2016), we analyze the dynamic of cooperation in a Public Good Game where agents receive an heterogeneous income and choose both the level of contribution and the distribution rule. The starting point is the calibration and the output validation of the model using the experimental results. Once tested the goodness of fit of the Agent Based Model, we run some policy experiment in order to verify how each distribution rule, i.e. equidistribution, proportional to contribution and progressive, affects the level of contribution in the simulated model. We find out that the share of cooperators decreases over time if we exogenously set the equidistribution rule. On the contrary, the share of cooperators converges to 100% if we impose the progressive rule. Finally, the most interesting result refers to the effect of the progressive rule. We observe that, in the case of high inequality, this rule is not able to reduce the heterogeneity of income.
    Keywords: Public Good Game, Cooperation, Social Influence
    JEL: C63 D71 H41
    Date: 2016
  5. By: Christoph Engel (Max Planck Institute for Research on Collective Goods); Oliver Kirchkamp (University Jena, School of Economics)
    Abstract: We provide an example for an errors in variables problem which might be often neglected but which is quite common in lab experimental practice: In one task, attitude towards risk is measured, in another task participants behave in a way that can possibly be explained by their risk attitude. How should we deal with inconsistent behaviour in the risk task? Ignoring these observations entails two biases: An errors in variables bias and a selection bias. We argue that inconsistent observations should be exploited to address the errors in variables problem, which can easily be done within a Bayesian framework.
    Keywords: Risk, lab experiment, public good, errors in variables, Bayesian inference
    JEL: C91 D43 L41
    Date: 2016–07
  6. By: Astrid, Gamba; Luca, Stanca;
    Abstract: Adjudication errors in contests have a dual nature: they imply at the same time the unjust exclusion of a meritorious candidate (exclusion error) and the unjust inclusion of a non-meritorious one (inclusion error). We study theoretically and experimentally the effects of adjudication errors on contestants' effort, explicitly disentangling the respective effects of exclusion and inclusion errors. We show how behavioral aspects, such as risk aversion, loss aversion and the framing of the incentive scheme (prize vs. penalty) shape the effects of judgement errors on effort. The experimental findings indicate that mis-judgements negatively affect bids, with exclusion and inclusion er- rors contributing equally to the disincentive effects of adjudication errors. A penalty framing significantly increases bids, relative to a prize framing, both in the absence of judgement errors and in the presence of adjudication errors. On the other hand, no significant interaction is found between the framing of the incentive scheme and the disincentive effects of judgement errors.
    Keywords: adjudication errors, contests, all-pay auction, experiment
    JEL: C72 C91 D44
    Date: 2016–07–14
  7. By: Luca Rigotti
    Abstract: We provide evidence on how cooperation rates vary across payoff parameters in the Prisoner’s Dilemma (PD), using four one-shot games that differ only in the payoffs from mutual cooperation. In our experiment, participants play only the PD game, and play the game once and only once, so there are no potential confounds or methodological issues. Our results show that higher monetary payoffs from cooperation are associated with substantially higher cooperation rates, which increase monotonically from 23% to 60%. Participants’ beliefs about cooperation rates track closely actual cooperation rates: higher cooperation is expected from others when mutual cooperation payoffs are higher. This is true also for participants who, in a follow-up experiment, only make guesses about the choices of others.
    Date: 2016–01
  8. By: Kocher, Martin G.; Schudy, Simeon; Spantig, Lisa
    Abstract: Unethical behavior such as dishonesty, cheating and corruption occurs frequently in organizations or groups. Recent experimental evidence suggests that there is a stronger inclination to behave immorally in groups than individually. We ask if this is the case, and if so, why. Using a parsimonious laboratory setup, we study how individual behavior changes when deciding as a group member. We observe a strong dishonesty shift. This shift is mainly driven by communication within groups and turns out to be independent of whether group members face payoff commonality or not (i.e. whether other group members benefit from one’s lie). Group members come up with and exchange more arguments for being dishonest than for complying with the norm of honesty. Thereby, group membership shifts the perception of the validity of the honesty norm and of its distribution in the population.
    Keywords: dishonesty; lying; group decisions; communication; norms; experiment
    JEL: C91 C92 D03
    Date: 2016–07–14
  9. By: Lu Dong (School of Economics, University of Nottingham); Rod Falvey (Bond Business School, Bond University); Shravan Luckraz (School of Economics, University of Nottingham, Ningbo China)
    Abstract: We propose and experimentally test a mechanism for a class of principal-agent problems in which agents can observe each others' efforts. In this mechanism each player costlessly assigns a share of the pie to each of the other players, after observing their contributions, and the final distribution is determined by these assignments. We show that cooperation can be achieved under this simple mechanism and, in a controlled laboratory experiment, we find that players use a proportional rule to reward others in most cases and that the players' contributions improve substantially and almost immediately with 80% of players contributing fully.
    Keywords: mechanism design, experimental economics, fairness, distributive justice
    Date: 2016–10
  10. By: Angie ANDRIKOGIANNOPOULOU (University of Geneva and Swiss Finance Institute); Filippos PAPAKONSTANTINOU (Imperial College London)
    Abstract: We use trading data from a sports wagering market to estimate individual risk preferences within the prospect-theory paradigm. The experimental-like features of this market greatly facilitate the estimation of risk preferences, while our long panel enables us to study whether preferences vary across individuals and depend on earlier outcomes. Our estimates i) extend support for existing experimental findings --- mild utility curvature, moderate loss aversion, and probability overweighting of extreme outcomes --- to a real market setting that shares similarities with traditional financial markets, ii) reveal that risk attitude is widely heterogeneous and history-dependent, and iii) indicate that prospect theory can better explain the prevalence of the disposition effect than previously thought.
    Keywords: Risk Preferences, State Dependence, History Dependence, Heterogeneity, Prospect Theory, Disposition Effect
    JEL: D03 D12 D14 D81 G02 G11
  11. By: Andrea Morone; Enrica Imbert; Marcello Morone; Pasquale Falcone; Piergiuseppe Morone
    Abstract: Food security, along with growing population and the associated environmental concerns, make food waste and loss a central topic in economic analysis. While food losses occur mostly at the production, postharvest and processing phases of the supply chain, food waste takes place mainly at the end of the chain and therefore concerns primarily the habits and behaviour patterns of retailers and consumers. Many solutions and practices have been proposed and oftentimes implemented in order to "keep food out of landfills", thus reducing food waste at the source. However, little attention has been paid to the possible sharing of consumer-side food surplus. In this context, food sharing could represent an effective way to tackle food waste at the consumers' level, with both environmental and economic potential positive effects. Currently, several initiatives and start-ups are being developed in the US and Europe, involving the collection and use of the excess of food from consumers and retailers and the promotion of collaborative consumption models (e.g. Foodsharing, Growington, Feastly, etc.). Nevertheless, there is still little empirical evidence testing the effectiveness of introducing sharing economy approaches to reduce food waste. This study seeks to fill this gap through a framed field experiment. We run two experimental treatments; in the control treatment students were asked to behave according to their regular food consumption habits, and in the food sharing treatment the same students were instructed to purchase food, cook and consume it collectively. Preliminary results showed that the adoption by households of food sharing practices do not automatically translate into food waste reduction. A number of factors (environmental and economic awareness, domestic skills and collaborative behaviors) might act as 'enablers' to make sharing practices effective.
    Date: 2016
  12. By: Simon Kühne; Martin Kroh
    Abstract: Web surveys technically allow providing feedback to respondents based on their previous responses. This personalized feedback may not only be used to target follow-up questions, it also allows test results to be returned immediately to respondents. This paper argues that the possibility of learning something about themselves increases respondents’ motivation and possibly the accuracy of responses. While past studies mainly concentrate on the effects of providing study results on future response rates, thus far survey research lacks of theoretical and empirical contributions on the effects of personalized, immediate, feedback on response behavior. To test this, we implemented a randomized trial in the context of the Berlin Aging Study II (BASE-II) in 2014, providing feedback regarding the respondents’ personality tests (Big-Five personality inventory) to a subgroup of the sample. Results show moderate differences in response behavior between experimental and control group (item nonresponse, response styles, internal consistency, socially desirable responding, corrective answers, and response times). In addition, we find that respondents of the experimental group report higher levels of satisfaction with the survey.
    Keywords: Personalized Feedback, Web Surveys, Online Surveys, Incentives, Respondent Motivation, Measurement Error, Survey Satisfaction, Big Five Personality Traits
    Date: 2016
  13. By: Leonard Nakamura; Jon Samuels; Rachel Soloveichik (Bureau of Economic Analysis)
    Date: 2016–06
  14. By: Shibly Shahrier (Kochi University of Technology); Koji Kotani (School of Economics and Management, Kochi University of Technology); Tatsuyoshi Saijo (School of Economics and Management, Kochi University of Technology)
    Abstract: Maintaining intergenerational sustainability is a minimum requirement for the existence of humankind, but it is now becoming one of the biggest challenges. Thus, it is necessary to understand what factors determine human preference and behavior for intergenerational sustainability. We hypothesize that ongoing modernization of competitive societies, which we call "capitalism," affects individual social preferences and other factors of human nature, compromising intergenerational sustainability. To examine this hypothesis, we implement an intergenerational sustainability dilemma game (ISDG) with "imaginary future generation" (IFG) as a policy tool (to prime people for future generations) in two types of Bangladeshi fields: (i) urban (capitalistic) and (ii) rural (less-capitalistic) areas. The analysis reveals that the likelihood of choosing intergenerational sustainable options significantly increases with the number of prosocial people in one generation and a regional dummy of rural areas. Since a considerable portion of people in rural areas are prosocial, rural people are identified to choose intergenerational sustainable options much more frequently than urban people. Moreover, the IFG treatment is not effective for urban people, implying that some stronger devices shall be necessary in capitalistic societies. Overall, our findings demonstrate that as societies become more capitalistic, intergenerational sustainability shall be further compromised through a change in both people's social preference and other factors captured by the regional effect.
    Keywords: Intergenerational sustainability, capitalism, social preference, culture and evolution
    Date: 2016–07
  15. By: Sylvain Weber (Institute of economic research IRENE, Faculty of Economics, University of Neuchâtel, Switzerland); Stefano Puddu (Institute of economic research IRENE, Faculty of Economics, University of Neuchâtel, Switzerland); Diana Pacheco (Institute of economic research IRENE, Faculty of Economics, University of Neuchâtel, Switzerland)
    Abstract: Photovoltaic systems generate electricity around noon, when many homes are empty. Conversely, residential electricity demand peaks in the evening, when production from solar sources is impossible. Based on a randomized control trial, we assess the effectiveness of alternative demand response measures aimed at mitigating these imbalances. More precisely, through information feedback and financial rewards, we encourage households to shift electricity consumption toward the middle of the day. Using a difference-in-differences approach, we find that financial incentives induce a significant increase of the relative consumption during the period of the day when most solar radiation takes place. Households mostly achieve this load shifting by decreasing evening consumption. Information feedback pushes households to decrease overall consumption, but induces no load shifting.
    Keywords: electricity usage, solar energy, demand response, randomized control trial, smart metering.
    JEL: C93 D12 L94 Q41
    Date: 2016–07
  16. By: Lucas Maestri (FGV/EPGE); Dino Gerardi (Collegio Carlo Alberto); Braz Camargo (Sao Paulo School of Economics - FGV)
    Abstract: We study efficiency in decentralized markets with aggregate uncertainty and one-sided private information. There is a continuum of mass one of uninformed buyers and a continuum of mass one of informed sellers. Buyers and sellers are randomly and anonymously matched in pairs over time, and buyers make the offers. We show that all equilibria become efficient as trading frictions vanish.
    Date: 2016
  17. By: Eun-Mi Lee (Izmir University of Economics); Ece Çam (Izmir University of Economics)
    Abstract: As people recognize the values of a healthy lifestyle, they are effectively attempting to enhance eating habits and they have a tendency to promote a healthier dietary behavior or strict diet to lose weight. Social media is an important source that people use to learn and obtain information about health and healthy life. Even though social media has the potential to be a crucial source for health information and issues, very few studies of the effectiveness of social media in this area have been investigated. The purpose of this research is to examine how different types of messages can contribute to the effectiveness of social media in health communication. The sample consisted of 159 participants who use social media. 2 (message frame: positive vs. negative) * 2 (message appeals: body image vs. health) between subject experimental design was used to test the hypotheses. The study shows that a positively framed message paired with a health focused message and a negatively framed message paired with a body image focused message exhibit a positive eWOM and message perception. This research offers direction for development of appropriate message types to improve social media effectiveness.
    Keywords: social media, message appeal, message frame, eating habit
  18. By: Francesco Bogliacino; Gianluca Grimalda; Laura Jiménez; Daniel Reyes Galvis; Cristiano Codagnone
    Abstract: Recent research in Economics has sought to understand the effects of exposure to violence on individual preferences, including pro-social behavior. Here, we assess the impact on pro-social behaviour of a governmental program to compensate victims of forced displacement. All our subjects have been officially recognized as victims of a conflict, and, as such, are eligible to apply for restitution of their land within the "Victims’ Law" (Ley de Víctimas, Bill 1448/2011). The key independent variable of our analysis is whether a subject has obtained land back within this or similar programs. Our dependent variables are a subject's trust and trustworthiness in unknown persons, as measured in a modified version of a Trust Game. We focus on inter-personal trust and trustworthiness because of their well-documented positive effect on economic development. Our design includes a treatment in which subjects vote on their most preferred outcomes to understand whether forms of consultative democracy can engender higher mutual trust. We find that land restitution significantly raises trustworthiness, while there is no effect on trust. This confirms previous insights that trust and trustworthiness tap into different aspects of pro-sociality. Voting does not improve either trust or trustworthiness. The results are robust to controlling for socio-economic status within regression analysis and to the omitted variable bias.
    Keywords: trust, trustworthiness, displacement, reparations.
    JEL: C93 I38 Q15
    Date: 2016–07–12
  19. By: Antoci, Angelo; Delfino, Alexia; Paglieri, Fabio; Panebianco, Fabrizio; Sabatini, Fabio
    Abstract: Evidence is growing that forms of incivility –e.g. aggressive and disrespectful behaviors, harassment, hate speech and outrageous claims– are spreading in the population of social networking sites’ (SNS) users. Online social networks such as Facebook allow users to regularly interact with known and unknown others, who can behave either politely or rudely. This leads individuals not only to learn and adopt successful strategies for using the site, but also to condition their own behavior on that of others. Using a mean field approach, we define an evolutionary game framework to analyse the dynamics of civil and uncivil ways of interaction in online social networks and their consequences for collective welfare. Agents can choose to interact with others –politely or rudely– in SNS, or to opt out from online social networks to protect themselves from incivility. We find that, when the initial share of the population of polite users reaches a critical level, civility becomes generalized if its payoff increases more than that of incivility with the spreading of politeness in online interactions. Otherwise, the spreading of self-protective behaviors to cope with online incivility can lead the economy to non-socially optimal stationary states.
    Keywords: online incivility; evolutionary dynamics; self-protective behavior; social networks; dynamics of social interaction; social networking sites; Internet.
    JEL: C61 C63 D85 O3 O33 Z13
    Date: 2016–07–01
  20. By: Klaus Wälde (Johannes Gutenberg-University Mainz)
    Abstract: Emotions were central to the development of economics, especially in utility theory in classical economics. While neoclassical utility theory basically abolished emotions, behavioural economics more recently reintroduced emotions in utility theory. Beyond utility theory, economic theorists use emotions to explain behaviour which otherwise could not be understood or they study emotions out of interest for the emotion itself. While some analyses display a strong overlap between psychological thinking and economic modelling, in most cases there is still a large gap between economic and psychological approaches to emotion research. Ways how to reduce this gap are discussed.
    Keywords: utility theory, ex-ante emotions, immediate emotions, ex-post emotions belief-based emotions, regret, desire, stress, anxiety, guilt
    Date: 2016–06
  21. By: Angie ANDRIKOGIANNOPOULOU (University of Geneva and Swiss Finance Institute); Filippos PAPAKONSTANTINOU (Imperial College London)
    Abstract: We use a unique panel dataset of individual activity in a soccer wagering market, to study the extent to which individuals’ betting behavior is affected by biases such as the representativeness bias, the limited-attention bias, and the home/local bias. Sports betting markets provide a real-world empirical setting with many similarities with traditional financial markets but with experimental-like features. The study of this alternative market enables us to test whether the documented biases are stable across markets, and to better disentangle rational versus behavioral explanations of observed behavior through direct tests of market efficiency and portfolio performance. In addition, our long panel dataset renders an individual-level analysis of behavior possible, hence enables us to study the prevalence of these biases in the cross-section. We find that participants in the soccer wagering market adhere to the same heuristics as investors in the stock market, as patterns in team past performance, team popularity, and team location significantly affect individual bet selection and portfolio weighting decisions. Furthermore, we find that none of the sentiment variables contains information about match outcomes that is not reflected in the quoted prices, and that individuals do not earn significantly higher returns from betting on teams on long winning streaks, on popular teams, or on domestic/local teams. This evidence indicates that the observed behavior is not driven by superior information but rather by sentiment, and could provide useful insights about the sources of analogous biases in the stock market, where tests of efficiency and superior performance are not as clean. The individual-level analysis shows that the local bias is less evident across individuals relative to the other biases, and that while these biases affect most individuals’ bet selection decision, they are not prevalent across individuals in the portfolio weighting decision. OR from SSRN: We use novel data on individual activity in a sports betting market to study the effect of past performance sequences on individual behavior in a real market. The revelation of fundamental values in this market enables us to disentangle whether behavior is caused by sentiment or by superior information about market mispricings, hence to cleanly test in a real setting two sentiment-based theories of momentum and reversals — the regime-shifting model of Barberis, Shleifer, and Vishny (1998) and the gambler's/hot-hand fallacy model of Rabin (2002). Furthermore, our long panel allows us to calculate the proportions of individuals who exhibit each type of behavior. We find that i) three quarters of individuals exhibit trend-chasing behavior; ii) seven times as many individuals exhibit behavior consistent with Barberis, Shleifer, and Vishny (1998) as exhibit behavior consistent with Rabin (2002); and iii) no individuals earn superior returns from momentum trading.
    Keywords: Behavioral Biases, Market Efficiency, Investor Sentiment, Sports Betting, Gambling, Individuals or from SSRN: Momentum, Individual Decision-making, Heterogeneity, Behavioral Biases, Information
    JEL: D12 D81 G00 D12 D81 G02 G11 G14
  22. By: Simone Righi; Karoly Takacs
    Abstract: It is not easy to rationalize how peer review, as the current grassroots of science, can work based on voluntary contributions of reviewers. There is no rationale to write impartial and thorough evaluations. Consequently, there is no risk in submitting lowquality work by authors. As a result, scientists face a social dilemma: if everyone acts according to his or her own self-interest, low scientific quality is produced. Still, in practice, reviewers as well as authors invest high effort in reviews and submissions. We examine how the increased relevance of public good benefits (journal impact factor), the editorial policy of handling incoming reviews, and the acceptance decisions that take into account reputational information can help the evolution of high-quality contributions from authors. High effort from the side of reviewers is problematic even if authors cooperate: reviewers are still best off by producing low-quality reviews, which does not hinder scientific development, just adds random noise and unnecessary costs to it. We show with agent-based simulations that tacit agreements between authors that are based on reciprocity might decrease these costs, but does not result in superior scientific quality. Our study underlines why certain self-emerged current practices, such as the increased importance of journal metrics, the reputation-based selection of reviewers, and the reputation bias in acceptance work efficiently for scientific development. Our results find no answers, however, how the system of peer review with impartial and thorough evaluations could be sustainable jointly with rapid scientifi9c development.
    Keywords: peer review; evolution of cooperation; reputation; agent based model.
    Date: 2016–07
  23. By: Romulus Breban
    Abstract: We consider a large community of individuals who mix strongly and meet in pairs to bet on a coin toss. We investigate the asset distribution of the players involved in this zero-sum repeated game. Our main result is that the asset distribution converges to the exponential distribution, irrespective of the size of the bet, as long as players can never go bankrupt. Analytical results suggests that the exponential distribution is a stable fixed point for this zero-sum repreated game. This is confirmed in numerical experiments.
    Date: 2016–06

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