nep-exp New Economics Papers
on Experimental Economics
Issue of 2018‒02‒05
twenty papers chosen by

  1. Does Focality Depend on the Mode of Cognition? Experimental Evidence on Pure Coordination Games By Ennio Bilancini; Leonardo Boncinelli; Luigi Luini
  2. Fairness in Markets and Market Experiments By Engelmann, Dirk; Friedrichsen, Jana; Kübler, Dorothea
  3. Deadlines, Procrastination, and Forgetting in Charitable Tasks: A Field Experiment By Knowles, Stephen; Servátka, Maroš; Sullivan, Trudy; Genç, Murat
  4. The Economic Value of Habits in Household Production – A Field Experiment By Ioana Bejan; Carsten Lynge Jensen; Laura M. Andersen; Lars Gårn Hansen
  5. Do Children Cooperate Conditionally? Adapting the Strategy Method for First-Graders By Florian Hett; Mario Mechtel; Henning Müller; Felix Schmidt; Daniel Schunk; Valentin Wagner
  6. Experiments on cooperation, institutions, and social preferences By Xu, Xue
  7. Voting and Peer Effects: Experimental Evidence from Mozambique By Fafchamps, Marcel; Vaz, Ana; Vicente, Pedro C
  8. Does upward mobility harm trust? By Rémi Suchon; Marie Claire Villeval
  9. Mistrust and Opposition to Large-Scale Projects : An Experiment on the Role of Uncertainty By Ghidoni, Riccardo
  10. On the empirical validity of axioms in unconstrained bargaining By Noemí Navarro; Róbert Veszteg
  11. Urbanization Patterns, Information Diffusion and Female Voting in Rural Paraguay By Chong, Alberto; Le�n, Gianmarco; Roza, Vivian; Valdivia, Martin; Vega, Gabriela
  12. Does decentralization of decisions increase the stability of large groups? By Tjaša Bjedov; Simon Lapointe; Thierry Madiès; Marie Claire Villeval
  13. Social tenants’ health: evaluating the effectiveness of landlord interventions By Cheshire, Paul; Gibbons, Stephen; Mouland, Jemma
  14. Do Women Socialize Better? Evidence from a Study on Sociality Effects on Gender Differences in Cooperative Behavior By Peshkovskaya, Anastasia; Myagkov, Mikhail; Babkina, Tatiana; Lukinova, Evgeniya
  15. Does moderate weight loss affect subjective health perception in obese individuals? Evidence from field experimental data By Hafner, Lucas; Tauchmann, Harald; Wübker, Ansgar
  16. Gender Differences in Alternating-Offer Bargaining: An Experimental Study By Hernandez-Arenaz,; Iriberri, Nagore
  17. Sociality is Not Lost with Monetary Transactions within Social Groups By Lukinova, Evgeniya; Babkina, Tatiana; Sedush, Anna; Menshikov, Ivan; Menshikova, Olga; Myagkov, Mikhail
  18. How voters use grade scales in evaluative voting By Antoinette Baujard; Frédéric Gavrel; Herrade Igersheim; Jean-François Laslier; Isabelle Lebon
  19. When Income Depends on Performance and Luck: The Effects of Culture and Information on Giving By Rey-Biel, Pedro; Sheremeta, Roman; Uler, Neslihan
  20. The Impact of High School Financial Education on Financial Knowledge and Choices: Evidence from a Randomized Trial in Spain By Bover, Olympia; Hospido, Laura; Villanueva, Ernesto

  1. By: Ennio Bilancini; Leonardo Boncinelli; Luigi Luini
    Abstract: We conduct a laboratory experiment to study how the mode of reasoning affects pure coordination in problems with and without an exogenous anchor that can serve as a focal point. The mode of reasoning is manipulated in the lab by requiring subjects to decide quickly (time pressure treatment) and, alternatively, by requiring subjects to motivate their decisions in a few lines of text (motivation treatment). This is meant to induce, respectively, a fast and intuitive mode of reasoning as opposed to a slow and deliberative one. Experimental data suggest that: (i) subjects take to the lab preexisting focalities that may have a common cultural root; (ii) the anchor is strongly focal and crowds out pre-existing focalities; (iii) such crowding out only happens for deliberative subjects. As a result, the anchor has an ambiguous effect on the overall ability of subjects to coordinate, making its desirability heavily dependent on the likelihood that subjects follow a slow and deliberative mode of reasoning.
    Keywords: focal points, intuition, deliberation, time pressure, motivation
    JEL: C91 D01
    Date: 2017–01
  2. By: Engelmann, Dirk (Humboldt University Berlin); Friedrichsen, Jana (Humboldt University Berlin and DIW); Kübler, Dorothea (WZB and TU Berlin)
    Abstract: Whether pro-social preferences identified in economic laboratories survive in natural market contexts is an important and contested issue. We investigate how fairness in a laboratory experiment framed explicitly as a market exchange relates to preferences for fair trade products before and after the market experiment. We find that the willingness to buy at a higher price when higher wages are paid to the worker correlates both with the choice for a fair trade product before the laboratory experiment and with whether the participants are willing to pay a positive fair trade premium, elicited at the end of the experiment. These results support the notion that fairness preferences as assessed in laboratory experiments capture preferences for fair behavior in comparable situations outside the laboratory.
    Keywords: fairness; market experiments; external validity; fair trade;
    JEL: C91 D01 D91
    Date: 2018–01–18
  3. By: Knowles, Stephen; Servátka, Maroš; Sullivan, Trudy; Genç, Murat
    Abstract: We conduct a field experiment to test theoretical predictions regarding the effect of deadline length on task completion. We place our test in a charitable task setting in which participants are invited to complete an online survey, with a donation going to charity if they do so. Participants are given either one week, one month or no deadline by which to respond. Completions are lowest for the one month deadline and highest when no deadline is specified. Our results point out that a short deadline, and not specifying a deadline, signals urgency. By contrast, providing a longer (one month) deadline gives people permission to procrastinate, with people ultimately forgetting to complete the task.
    Keywords: charitable tasks; charitable giving; deadline; procrastination; forgetting; imperfect memory; inattention; field experiment
    JEL: C93 D64
    Date: 2017–12–05
  4. By: Ioana Bejan (Department of Food and Resource Economics, University of Copenhagen); Carsten Lynge Jensen (Department of Food and Resource Economics, University of Copenhagen); Laura M. Andersen (Department of Food and Resource Economics, University of Copenhagen); Lars Gårn Hansen (Department of Food and Resource Economics, University of Copenhagen)
    Abstract: People are prone to habits but how important are they for economic outcomes? In a randomized field experiment we compare two treatments with identical economic incentives to adjust a range of household production activities. Treatments only differ in the extent to which they allow households to adjust habits relevant for these activities. We utilize smart-metered hourly power consumption to unobtrusively measure treatment effects. We find that preventing habits from being adjusted reduces consumer surplus by 76% suggesting a substantial economic value of habits.
    Keywords: habits, field experiment, household behavior, text messages, electricity use
    JEL: C93 D12 D90
    Date: 2018–01
  5. By: Florian Hett (Goethe-University Frankfurt am Main); Mario Mechtel (Leuphana University Lüneburg); Henning Müller (NHH Bergen); Felix Schmidt (Johannes Gutenberg University Mainz); Daniel Schunk (Johannes Gutenberg University Mainz); Valentin Wagner (Düsseldorf Institute for Competition Economics)
    Abstract: We develop a public goods game (PGG) to measure cooperation and conditional cooperation in young children. Our design addresses several obstacles in adapting simultaneous and sequential PGGs to children who are not yet able to read or write, do not possess advanced abilities to calculate payo s, and only have a very limited attention span at their disposal. It features the combination of haptic online explanation, fully standardized audiovisual instructions, computerized choices based on touchscreens, and a suitable incentive scheme. Applying our experimental protocol to a sample of German first-graders, we find that already 6-year-olds cooperate conditionally and that the relative frequency of di erent cooperation types matches the findings for adult subjects. We also find that neither survey items from teachers nor from parents predict unconditional or conditional cooperation behavior; this underlines the value of incentivized experimental protocols for measuring cooperation in children.
    Keywords: Conditional cooperation, strategy method, public goods game, revealed preferences, measurement, children, ingroup bias, group identity
    JEL: H41 C71 C91
    Date: 2018–01–31
  6. By: Xu, Xue (Tilburg University, School of Economics and Management)
    Abstract: This thesis consists of three chapters in experimental economics. It involves various dimensions in which laboratory experiments can play a role: testing the validity of a game theory, helping understand institutions, and measuring (the change in) social preferences. It relates to the effects of different institutions on cooperation and social preferences. Chapter 2 studies to what extent an overlapping membership structure, which in theory affects the incentives of short-lived players, is conducive to cooperation. Chapter 3 examines whether the presence of decentralized punishment, especially the possibility of retaliating a centralized enforcer, has an impact on the decisions of the enforcer and group cooperation. Chapter 4 studies whether interactions with out-group members matter for in-group-out-group differences in altruism and whether the nature of these interactions matters for in-group-out-group differences.
    Date: 2018
  7. By: Fafchamps, Marcel; Vaz, Ana; Vicente, Pedro C
    Abstract: Voter education campaigns often aim to increase voter participation and political accountability. Randomized interventions were implemented nationwide during the 2009 Mozambican elections using leaflets, text messaging, and a free newspaper. We study the local peer effecs triggered by the campaign. We investigate whether treatment effects are transmitted through social networks and geographical proximity at the village level. For individuals personally targeted by the campaign, we estimate the reinforcement effect of proximity to other individuals in our sample. For untargeted individuals, we estimate how the campaign diffuses as a function of proximity to others in the sample. We find evidence for both effects, similar across treatments and proximity measures. The campaign raises the level of interest in the election through networks, in line with the average treatment effect. However, we find a negative network effect of the treatment on voter participation, implying that the positive effect of treatment on more central individuals is smaller. We interpret this result as consistent with free-riding through pivotal reasoning and we provide additional evidence to support this claim.
    Date: 2018–01
  8. By: Rémi Suchon (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69131 Ecully, France); Marie Claire Villeval (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69131 Ecully, France)
    Abstract: While considered as appealing for positive and normative reasons, anecdotal evidence suggests that upward social mobility may harm interpersonal interactions. We report on an experiment testing the effect of upward social mobility on interpersonal trust. Individuals are characterized both by a natural group identity and by a status awarded by means of relative performance in a task in which natural identities strongly predict performance. Upward mobility is characterized by the access to the high status of individuals belonging to the natural group associated with a lower expected performance. We find that socially mobile individuals trust less than those who are not socially mobile, especially when the trustee belongs to the same natural group. In contrast, upward mobility does not affect trustworthiness. We find no evidence that interacting with an upwardly mobile individual impacts trust or trustworthiness.
    Keywords: Trust, trustworthiness, social mobility, social identity, experiment
    JEL: C92 J62
    Date: 2018
  9. By: Ghidoni, Riccardo (Tilburg University, Center For Economic Research)
    Abstract: The realization of large-scale projects such as landfills, power plants, etc. is often hindered by the opposition of the possible host community. I study the case in which the opposition emerges from the mistrust of the host community toward the proposer of the project due to an informational asymmetry on the project's returns. In a novel laboratory experiment, I compare a baseline opposition game to treatments including the possibility to endogenously disclose information about the project or to offer compensatory transfers to the host. Both tools are more effective than expected in mitigating oppositions, but have heterogeneous impacts on the creation of social surplus and its allocation among the stakeholders.
    Keywords: trust; NIMBY; Information disclosure; Compensatory transfers
    JEL: C70 C90 D03 Q53
    Date: 2017
  10. By: Noemí Navarro; Róbert Veszteg
    Abstract: We report experimental results and test cooperative models of unstructured bargaining by checking the empirical relevance of underlying axioms. Our data support strong efficiency, symmetry, independence of irrelevant alternatives and monotonicity, and reject scale invariance. Individual rationality is violated by a significant fraction of agreements when in conflict to implement the equal split. The three well-known bargaining solutions that satisfy the confirmed properties explain the observed agreements reasonably well. The most frequent agreement in our sample is the egalitarian solution. In terms of the average Euclidean distance, the theoretical solution that best explains the data is the deal-me-out solution (Binmore et al., 1989; Binmore et al., 1991), followed very closely by the equal-gains solution (Roth and Malouf, 1979). Popular solutions that satisfy scale invariance and individual rationality, as the well-known Nash or Kalai-Smorodinsky bargaining solutions, perform poorly in the laboratory.
    Keywords: bilateral bargaining, experiments, Nash bargaining solution, egalitarian solution, deal-me-out solution, individual rationality, scale invariance
    JEL: C78 C91 D63
    Date: 2017
  11. By: Chong, Alberto; Le�n, Gianmarco; Roza, Vivian; Valdivia, Martin; Vega, Gabriela
    Abstract: We use a field experiment to evaluate the impact of two informational get-out-the-vote (GOTV) campaigns to boost female electoral participation in Paraguay. We find that public rallies have no effect either on registration or on voter turnout in the 2013 presidential elections. However, households that received door-to-door (D2D) treatment are 4.6 percentage points more likely to vote. Experimental variation on the intensity of the treatment at the locality level allows us to estimate spillover effects, which are present in localities that are geographically more concentrated, and thus may favor social interactions. Reinforcement effects to the already treated population are twice as large as diffusion to the untreated. Our results underscore the importance of taking into account urbanization patterns when designing informational campaigns.
    Keywords: Electoral Politics; Paraguay; spillover effects; Urbanization; Voter Behavior
    JEL: D71 D72 O10 O53
    Date: 2017–12
  12. By: Tjaša Bjedov (Distance Learning University of Switzerland Ueberlandstrasse 12 CH-3900 Brig, Switzerland); Simon Lapointe (VATT Institute for Economic Research, Arkadiankatu 7, 00100 Helsinki, Finland); Thierry Madiès (University of Fribourg, Bd. de Pérolles 90, 1700 Fribourg, Switzerland); Marie Claire Villeval (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69131 Ecully, France; IZA, Bonn, Germany)
    Abstract: Using a laboratory experiment with nested local and global public goods, we analyze the stability of global groups when individuals have the option to separate, according to the degree of decentralization of decision-making. We show that increasing the number of decisions made at the local level within a smaller group reduces the likelihood that individuals vote in favor of a break-up of the global group. Voting for a break-up of the global group is more likely when global group members are less cooperative and local group members are more cooperative. Reinforcing local group identity has no impact on votes.
    Keywords: Break-up of groups; decision rights, voting behavior, public goods, experiment
    JEL: C91 D72 H77
    Date: 2018
  13. By: Cheshire, Paul; Gibbons, Stephen; Mouland, Jemma
    Abstract: Objectives: To test whether a social landlord can improve health outcomes for older tenants and reduce their NHS usage by simple interventions. Design: Randomised controlled trial. Setting: Social housing in five London Boroughs. Participants: 547 individuals over 50 years of age. Intervention: Baseline and two follow-up assessments of individual’s health and use of medical services undertaken by health professionals. In the treated groups, individuals were given health care and support at two different levels. 25 individuals had to be removed from the trial because early assessments revealed critical and untreated health issues. Main outcome measures: Self-reported health and wellbeing ratings and NHS usage. Conclusions: Even simple interventions to a targeted group (older and poorer people), can produce significant reductions in NHS usage. Significant reductions were found for 1) planned hospital usage; 2) nights in hospital; and 3) for emergency GP usage. Well-being scores improved in the most strongly treated group but these were not statistically significant. Perhaps the single most important finding was that the early health evaluations revealed that 4.5% of the total sample – not in the most deprived section of the population – had such severe health problems that significant and immediate intervention was required
    Keywords: randomised control trial; social housing; health interventions
    JEL: C93 I18 R29
    Date: 2017–08–01
  14. By: Peshkovskaya, Anastasia; Myagkov, Mikhail; Babkina, Tatiana; Lukinova, Evgeniya
    Abstract: Human behavior is greatly influenced by the social context. The currrent study on men’ and women’s cooperative behavior investigated the influence of long-term and short-term effects of socializing in group. The repeated Prisoner’s dilemma carried out in groups of 6 participants was used as the main experimental situation. The differences were found in changes in the level of cooperation, taking in to account the effects of mixing social and gender variables. Socialization made cooperation of group members strength and sustainable. However, men’ and women’s cooperative behavior in groups differed. Women were initially more inclined to cooperate in interaction with strangers. Men showed greater sensitivity to sociality effects. They tended to make cooperative decisions more often if there are friends in the group. Furthermore, men cooperated with previously unknown people after socializing with them significantly more than women.
    Keywords: cooperation, social dilemma, Prisoner’s Dilemma, sociality, gender differences, group, experiment
    JEL: C7 J16
    Date: 2017–09–17
  15. By: Hafner, Lucas; Tauchmann, Harald; Wübker, Ansgar
    Abstract: This paper analyzes whether moderate weight reduction improves subjective health perception in obese individuals. To cure possible endogeneity bias in the regression analysis, we use randomized monetary weight loss incentives as instrument for weight change. In contrast to related earlier work that also employed instrumental variables estimation, identification does not rely on long-term, between-individuals weight variation, but on short-term, within-individual weight variation. This allows for identifying short-term effects of moderate reductions in body weight on subjective health. In qualitative terms, our results are in line with previous findings pointing to weight loss in obese individuals resulting in improved subjective health. Yet, in contrast to these, we establish genuine short-term effects. This finding may encourage obese individuals in their weight loss attempts, since they are likely to be immediately rewarded for their efforts by subjective health improvements.
    Keywords: self-rated health,BMI,obesity,randomized experiment,short-term effect,instrumental variable
    JEL: I12 C26 C93
    Date: 2017
  16. By: Hernandez-Arenaz,; Iriberri, Nagore
    Abstract: A laboratory study is carried out to study gender differences and gender interaction effects in structured alternating-offer bargaining. In a symmetric environment, where the 50:50 split is the expected sharing norm, we find no gender differences. In asymmetric environments, where there is no clear sharing norm, but one bargaining party is expected to get more than the other (due to empowerment, entitlement and informational asymmetries), we find that men are less likely to reach an agreement, and that when they do, they bargain for longer and obtain a larger share of the pie. When gender differences are compared between symmetric and asymmetric bargaining environments, gender is not an effect-modifying factor.
    Date: 2018–01
  17. By: Lukinova, Evgeniya; Babkina, Tatiana; Sedush, Anna; Menshikov, Ivan; Menshikova, Olga; Myagkov, Mikhail
    Abstract: This paper investigates how the group membership fee influences the cooperation rate within the groups formed through the socialization. Our previous findings suggest that socialization, or social interactions in groups, create sociality and, therefore, establish a society with sustained cooperation and fairness. In line with Social Identity Theory, we assert some esteem or value to be gained through group differentiation. What will happen with this additional value once we try to quantify it? For this purpose, we observed two cases: socialized participants should pay the fee to stay in-group; participants should pay the fee to join the group, socialize and stay there. We find that monetary transactions are not determinative on their own; rather the consequences of these transactions can hurt collective action through a forced division of participants into those who paid enough (in-group) and those who did not (out-group). More over, despite the fact that being in-group and out-group is an economically equal situation, participants are willing to pay the fee to stay in their socialized group or pay the fee to join the group before socialization.
    Keywords: Prisoner’s Dilemma, Socialization, Cooperation, Auction, Group Formation, Membership Fee, Experimental Economics
    JEL: C1 C71
    Date: 2017–09–17
  18. By: Antoinette Baujard (GATE - CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - CNRS - Centre National de la Recherche Scientifique); Frédéric Gavrel (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - CNRS - Centre National de la Recherche Scientifique); Herrade Igersheim (CEPERC - Centre d'EPistémologie et d'ERgologie Comparatives - UMR 7304 - AMU - Aix Marseille Université - CNRS - Centre National de la Recherche Scientifique); Jean-François Laslier (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Isabelle Lebon (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - CNRS - Centre National de la Recherche Scientifique)
    Abstract: During the first round of the 2012 French presidential election, participants in an in situ experiment were invited to vote according to " evaluative voting " , which involves rating the candidates using a numerical scale. Various scales were used: (0,1), (-1,0,1), (0,1,2), and (0,1,...,20). The paper studies scale calibration effects, i.e., how individual voters adapt to the scale, leading to possibly different election outcomes. The data show that scales are not linearly equivalent, even if individual ordinal preferences are not inconsistent. Scale matters, notably because of the symbolic power of negative grades, which does not affect all candidates uniformly.
    Keywords: Range voting,Evaluative Voting, In Situ Experiment, Approval voting, Calibration
    Date: 2017
  19. By: Rey-Biel, Pedro; Sheremeta, Roman; Uler, Neslihan
    Abstract: We study how giving depends on income and luck, and how culture and information about the determinants of others’ income affect this relationship. Our data come from an experiment conducted in two countries, the US and Spain – each of which have different beliefs about how income inequality arises. We find that when individuals are informed about the determinants of income, there are no cross-cultural differences in giving. When uninformed, however, Americans give less than the Spanish. This difference persists even after controlling for beliefs, personal characteristics, and values.
    Keywords: individual giving; information; culture; beliefs; laboratory experiment
    JEL: C91 D64 D83
    Date: 2018–01–15
  20. By: Bover, Olympia (Bank of Spain); Hospido, Laura (Bank of Spain); Villanueva, Ernesto (Bank of Spain)
    Abstract: We conducted a randomized controlled trial where 3,000 9th grade students coming from 78 high schools received a financial education course at different points of the year. Right after the treatment, test performance increased by 16% of one standard deviation, treated youths were more likely to become involved in financial matters at home and showed more patience in hypothetical saving choices. In an incentivized saving task conducted three months after, treated students made more patient choices than a control group of 10th graders. Within randomization strata, the main impacts are also statistically significant in public schools, which over-represent disadvantaged students.
    Keywords: financial education, impact evaluation
    JEL: D14 D91 I22 J24
    Date: 2018–01

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