nep-exp New Economics Papers
on Experimental Economics
Issue of 2018‒02‒26
thirty papers chosen by

  1. Endogenous institution formation in public good games: The effect of economic education By Altemeyer-Bartscher, Martin; Bershadskyy, Dmitri; Schreck, Philipp; Timme, Florian
  2. Team Incentives, Task Assignment, and Performance: A Field Experiment By Delfgaauw, Josse; Dur, Robert; Souverijn, Michiel
  3. "The good news about bad news": Feedback about past organisational failure and its impact on worker productivity By Jeworrek, Sabrina; Mertins, Vanessa; Vlassopoulos, Michael
  4. The Effects of Computers and Acquired Skills on Earnings, Employment and College Enrollment: Evidence from a Field Experiment and California UI Earnings Records By Robert W. Fairlie; Peter Riley Bahr
  5. Intertemporal Choice and Income Regularity: Non-Fungibility in a Lab-in-the-Field Experiment By Berber Kramer; David Kunst
  6. Scoring Rules in Experimental Procurement By Gian Luigi Albano; Angela Cipollone; Roberto Di Paolo; Giovanni Ponti; Marco Sparro
  7. The Dark Side of Personality: Anti-Sociality Increases Strategic Game Play By Jan (J.B.) Engelmann; Basil Schmid; Justin Chumbley; Ernst Fehr
  8. Framing Game Theory By Hitoshi Matsushima
  9. Measuring the Return to Online Advertising: Estimation and Inference of Endogenous Treatment Effects By Shakeeb Khan; Denis Nekipelov; Justin Rao
  10. The Effect of Education on Health and Mortality: A Review of Experimental and Quasi-Experimental Evidence. By Titus J. Galama; Adriana Lleras-Muney; Hans van Kippersluis
  11. The Effect of Initial Inequality on Meritocracy. A Voting Experiment on Tax Redistribution. By Natalia Jiménez Jiménez; Elena Molis; Ángel Solano García
  12. On the Limits of Incentive Design: Examining Medical Students' Misunderstanding of "the Match" By Alex Rees-Jones; Samuel Skowronek
  13. Neighborhood Signaling Effects, Commuting Time, and Employment: Evidence from a Field Experiment By Carlsson, Magnus; Abrar Reshid, Abdulaziz; Rooth, Dan-Olof
  14. The effect of financial compensation on the acceptance of power lines: Evidence from a randomized discrete choice experiment in Germany By Simora, Michael
  15. Reducing Discrimination through Norms or Information: Evidence from a Field Experiment on Student Evaluations of Teaching By Boring, Anne; Philippe, Arnaud
  16. Excessive Herding in the Laboratory: The Role of Intuitive Judgments By Christoph March; Anthony Ziegelmeyer
  17. Tax evasion, testosterone and personality traits By Arbex, Marcelo; Carré, Justin M.; Geniole, Shawn N.; Mattos, Enlinson
  18. Exclusion and Reintegration in a Social Dilemma By Solda, Alice; Villeval, Marie Claire
  19. Does financial compensation increase the acceptance of power lines? Evidence from Germany By Simora, Michael; Frondel, Manuel; Vance, Colin
  20. Monitoring and punishment networks in a common-pool resource dilemma: experimental evidence By Ganga Shreedhar, Alessandro Tavoni, Carmen Marchiori
  21. Civility and Trust in Social Media By Antoci, Angelo; Bonelli, Laura; Paglieri, Fabio; Reggiani, Tommaso G.; Sabatini, Fabio
  22. 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
  23. The Impact of Health on Labor Market Outcomes: Experimental Evidence from MRFIT By Melvin Stephens, Jr.; Desmond J. Toohey
  24. Prosociality Spillovers of Working with Others By Michalis Drouvelis; Benjamin Marx
  25. Skills, Signals, and Employability: An Experimental Investigation By Piopiunik, Marc; Schwerdt, Guido; Simon, Lisa; Woessmann, Ludger
  26. Empowering Women under Social Constraints: Evidence from a Field Intervention in Rural Egypt By Elsayed, Ahmed; Roushdy, Rania
  27. Uninvadable social behaviors and preferences in group-structured populations By Alger, Ingela; Lehmann, Laurent; Weibull, Jörgen W.
  28. Impatience as Selfishness By Jawwad Noor; Norio Takeoka
  29. Evaluating intergenerational persistence of economic preferences: A large scale experiment with families in Bangladesh By Chowdhury, Shyamal; Sutter, Matthias; Zimmermann, Klaus F.
  30. Does Labor Market Tightness Affect Ethnic Discrimination in Hiring? By Carlsson, Magnus; Fumarco, Luca; Rooth, Dan-Olof

  1. By: Altemeyer-Bartscher, Martin; Bershadskyy, Dmitri; Schreck, Philipp; Timme, Florian
    Abstract: In a public good experiment, the paper analyses to which extent individuals with economic education behave differently in a second-order dilemma. Second-order dilemmas may arise, when individuals endogenously build up costly institutions that help to overcome a public good problem (first-order dilemma). The specific institution used in the experiment is a communication platform allowing for group communication before the first-order public good game takes place. The experimental results confirm the finding of the literature that economists tend to free ride more intensively in public good games than non-economists. The difference is the strongest in the end-game phase, yielding in the conclusion that the magnitude of the end-game effect depends on the share of economists in the pool of participants. When it comes to the building-up of institutions, the individual efficiency gain of the institution and its inherent cost function constitute the driving forces for the contribution behaviour. Providing an investment friendly environment yields in economists contributing more to the institution than non-economists. Therefore, we make clear that first-order results of a simple public good game cannot be simply applied for second-order incentive problems.
    Keywords: voluntary contribution mechanism,endogenous formation of institutions,second-order incentive problem,economic education
    JEL: C91 C92 H41
    Date: 2017
  2. By: Delfgaauw, Josse (Erasmus University Rotterdam); Dur, Robert (Erasmus University Rotterdam); Souverijn, Michiel (Erasmus University Rotterdam)
    Abstract: The performance of a work team commonly depends on the effort exerted by the team members as well as on the division of tasks among them. However, when leaders assign tasks to team members, performance is usually not the only consideration. Favouritism, employees' seniority, employees' preferences over tasks, and fairness considerations often play a role as well. Team incentives have the potential to curtail the role of these factors in favor of performance – in particular when the incentive plan includes both the leader and the team members. This paper presents the results of a field experiment designed to study the effects of such team incentives on task assignment and performance. We introduce team incentives in a random subsets of 108 stores of a Dutch retail chain. We find no effect of the incentive, neither on task assignment nor on performance.
    Keywords: team incentives, task assignment, field experiment
    JEL: C93 M12 M52
    Date: 2017–12
  3. By: Jeworrek, Sabrina; Mertins, Vanessa; Vlassopoulos, Michael
    Abstract: Failure in organisations is a very common phenomenon. Little is known about whether past failure affects workers' subsequent performance. We conduct a field experiment in which we follow up a failed mail campaign to attract new volunteers with a phone campaign pursuing the same goal. We recruit temporary workers to carry out the phone campaign and randomly assign them to either receive or not receive information about the previous failure and measure their performance. We find that informed workers perform better - in terms of both numbers dialed (about 14% improvement) and completed interviews (about 20% improvement) - regardless of whether they had previously worked on the failed mail campaign. Evidence from a second experiment with student volunteers asked to support a campaign to reduce food waste suggests that the mechanism behind our finding relates to contextual inference: Informing workers/volunteers that they are pursuing a goal that is hard to attain seems to add meaning to the work involved, leading them to exert more effort.
    Keywords: contextual inference,feedback,failure,field experiment,meaning of work
    JEL: C93 J22 M50
    Date: 2018
  4. By: Robert W. Fairlie; Peter Riley Bahr
    Abstract: This paper provides the first evidence on the earnings, employment and college enrollment effects of computers and acquired skills from a randomized controlled trial providing computers to entering college students. We matched confidential administrative data from California Employment Development Department (EDD)/Unemployment Insurance (UI) system earnings records, the California Community College system, and the National Student Clearinghouse to all study participants for seven years after the random provision of computers. The experiment does not provide evidence that computer skills have short- or medium-run effects on earnings. These null effects are found along both the extensive and intensive margins of earnings (although the estimates are not precise). We also do not find evidence of positive or negative effects on college enrollment. A non-experimental analysis of CPS data reveals large, positive and statistically significant relationships between home computers, and earnings, employment and college enrollment, raising concerns about selection bias in non-experimental studies.
    JEL: I23
    Date: 2018–02
  5. By: Berber Kramer (International Food Policy Research Institute (IFPRI)); David Kunst (VU Amsterdam; Tinbergen Institute, The Netherlands)
    Abstract: This paper tests whether the choice of when to be paid depends on the income type. A lab-in-the-field experiment in Kenya asked dairy cooperative members to allocate both an irregular windfall and their regular milk payments between two dates. Participants allocated the windfall to the earlier of the two dates, in line with theory, but allocated milk payments to the later date. Survey evidence suggests that allocations of regular dairy income were significantly more patient because farmers earmarked milk payments, but not the irregular windfall, for bulky expenditures. Given that compliance with informal contracts depends on whether the timing of payment aligns with recipient preferences, these findings have implications for contract design in rural value chains.
    Keywords: time preferences; mental accounting; fungibility; collective marketing
    JEL: D03 Q13 O12
    Date: 2018–02–03
  6. By: Gian Luigi Albano (Department of Economics and Finance); Angela Cipollone (Department of Economics and Finance); Roberto Di Paolo (Universidad de Alicante); Giovanni Ponti (Universidad de Alicante); Marco Sparro (Consip S.p.A.)
    Abstract: We report the results of a procurement experiments where subjects compete for procurement contracts to be awarded by means of a scoring auction. Two experimental conditions are considered, depending on the relative quality-price weight in the scoring rule. We show that different quality-price weights in the scoring rule dramatically alter the strategic environment and affect the extent to which the competitive mechanism leads to an efficient allocation of the contract. Our evidence suggests that, in spite of inducing significantly higher deviations from equilibrium, the scoring rule that gives more weight to quality over price is far more efficient (52% overall). We propose a “mediation analysis” to explain how the quality-price ratio determines the likelihood that an efficient allocation is realized, disentangling a “direct effect” (due to the equilibrium different properties of the induced game-forms) from an “indirect” one (how the different game-forms affect out-of-equilibrium behaviour).
    Keywords: Scoring Auctions, Mechanism Design, Experimental Economics.
    JEL: C91 D70 D81 D91
    Date: 2018–02
  7. By: Jan (J.B.) Engelmann (University of Amsterdam; Tinbergen Institute, The Netherlands); Basil Schmid (ETH Zurich); Justin Chumbley (ETH Zurich); Ernst Fehr (University of Zurich)
    Abstract: We assess the role of anti-social personality traits in explaining heterogeneity in commonly observed social preferences. We identified a personality profile that clearly reflects anti-social personality characteristics, with high positive loadings on Machiavellianism and high negative loadings on empathy, trustworthiness and agreeableness. Anti-sociality predicts decision strategies in a manner that is consistent with its name: significantly lower levels of trust and decreased trustworthiness. To identify the strategic nature of anti-social behavior in changing environments, we assessed the moderating role of personality on investor trust and trustee reciprocity in the presence relative to the absence of the investor’s option to punish. Our results show that only the anti-social personality profile is associated with specific payoff maximizing strategy shifts induced by these environmental changes: when punishment was not available to investors, we observe significantly lower levels of investor trust and trustee reciprocity, while there is a significant increase in both behaviors when punishment was available. These effects were specific for anti-sociality, as no other personality factor was associated with such a strong adjustment of decision strategies in the presence of punishment. These results demonstrate that anti-social personality characteristics are associated with strategic behavioral shifts aimed at maximizing the extraction of resources from their counterparts. The reliability of the strategic effects of anti-social personality during trust, reciprocity and punishment strongly supports the notion that self-projection underlies anti-social decision-making.
    Keywords: trust; reciprocity; punishment; anti-social; personality; individual differences
    JEL: C71 D87 D91
    Date: 2018–01–26
  8. By: Hitoshi Matsushima (Department of Economics, University of Tokyo)
    Abstract: A real player sometimes fails to practice hypothetical thinking, which increases the occurrence of anomalies in various situations. This study incorporates psychology into game theory and demonstrates a cognitive method to encourage bounded-rational players to practice correct hypothetical thinking in strategic interactions with imperfect information. We introduce a concept termed “frame†as a description of a synchronized cognitive procedure through which each player decides multiple actions in a step-by-step manner, shaping his (or her) strategy selection. We could regard a frame as the supposedly irrelevant factors from the viewpoint of full rationality. However, this paper theoretically shows that in a multi-unit trading with private values, the ascending proxy auction has a significant advantage over the second-price auction in terms of the bounded-rational players' incentive to practice hypothetical thinking, because of the difference, not in physical rule, but in background frame. By designing a frame appropriately, we generally show that any static game that is solvable in iteratively undominated strategies is also solvable, even if players cannot practice hypothetical thinking without the help of a well-designed frame. We further investigate the possibility that even a detail-free frame design serves to overcome the difficulty of hypothetical thinking. We extend this investigation to the Bayesian environments.
  9. By: Shakeeb Khan (Boston College); Denis Nekipelov (University of Virginia); Justin Rao (Microsoft Research)
    Abstract: In this paper we aim to conduct inference on the “lift” effect generated by an online advertisement display: specifically we want to analyze if the presence of the brand ad among the advertisements on the page increases the overall number of consumer clicks on that page. A distinctive feature of online advertising is that the ad displays are highly targeted- the advertising platform evaluates the (unconditional) probability of each consumer clicking on a given ad which leads to a higher probability of displaying the ads that have a higher a priori estimated probability of click. As a result, inferring the causal effect of the ad display on the page clicks by a given consumer from typical observational data is difficult. To address this we use the large scale of our dataset and propose a multi-step estimator that focuses on the tails of the consumer distribution to estimate the true causal effect of an ad display. This “identification at infinity” (Chamberlain (1986)) approach alleviates the need for independent experimental randomization but results in nonstandard asymptotics. To validate our estimates, we use a set of large scale randomized controlled experiments that Microsoft has run on its advertising platform. Our dataset has a large number of observations and a large number of variables and we employ LASSO to perform variable selection. Our non-experimental estimates turn out to be quite close to the results of the randomized controlled trials.
    Keywords: Endogenous treatment effects, randomized control trials, online advertising, lift effect
    JEL: C14 C31 C90 M37
    Date: 2018–02–01
  10. By: Titus J. Galama; Adriana Lleras-Muney; Hans van Kippersluis
    Abstract: Education is strongly associated with better health and longer lives. However, the extent to which education causes health and longevity is widely debated. We develop a human capital framework to structure the interpretation of the empirical evidence. We then review evidence on the causal effects of education on mortality and its two most common preventable causes: smoking and obesity. We focus attention on evidence from Randomized Controlled Trials, twin studies, and quasi-experiments. There is no convincing evidence of an effect of education on obesity, and the effects on smoking are only apparent when schooling reforms affect individuals’ track or their peer group, but not when they simply increase the duration of schooling. An effect of education on mortality exists in some contexts but not in others, and seems to depend on (i) gender; (ii) the labor market returns to education; (iii) the quality of education; and (iv) whether education affects the quality of individuals’ peers.
    Date: 2018–01
  11. By: Natalia Jiménez Jiménez (Departamento de Economía, Métodos Cuantitativos e Historia Económica, University Pablo de Olavide.); Elena Molis (Department of Economic Theory and Economic History, University of Granada.); Ángel Solano García (Department of Economic Theory and Economic History, University of Granada.)
    Abstract: According to Alesina and Angeletos (2005), societies are less redistributive but more efficient when the median voter believes that effort and talent are much more important than luck to determine income. We test these results through a lab experiment in which participants vote over the tax rate and their pre-tax income is determined according to their performance in a real effort task with leisure time. Subjects receive either a high or a low wage and this condition is either obtained through their talent in a tournament or randomly assigned. We compare subjects' decisions in these two different scenarios considering different levels of wage inequality. In our framework, this initial income inequality turns out to be crucial to support the theoretical hypothesis of Alesina and Angeletos (2005). Overall, we find that, only if the wage inequality is high, subjects choose a lower level of income redistribution and they provide a higher effort level in the scenario in which high-wage subjects are selected based on their talent through a tournament (than when it is randomly). Thus, we confirm almost all theoretical results in Alesina and Angeletos (2005) when the wage inequality is high enough. The big exception is for efficiency (measured as the sum of total payoffs), since theoretical results only hold for the scenario in which wage inequality is low.
    Keywords: income redistribution, voting, taxation, real-effort task, leisure.
    JEL: C92 D72 H30 J41
  12. By: Alex Rees-Jones; Samuel Skowronek
    Abstract: How prevalent is preference misrepresentation in matching procedures that incentivize truth-telling, and who pursues it? To address these questions, we administered an online experiment to 1,714 medical students immediately after their participation in the medical residency match. When placed in an analogous matching task, we find that 23% of match participants act on an incorrect belief that the algorithm can be gamed. Better students are less likely to make these mistakes, due to both higher cognitive ability and a reduced propensity to game when in a strategically advantageous position. We explore additional determinants of gaming attempts, including overconfidence, expectations, advice, and trust. We discuss the implications of this behavior for the design of allocation mechanisms and the social welfare in markets that use them.
    Date: 2018–02
  13. By: Carlsson, Magnus (Linnaeus University); Abrar Reshid, Abdulaziz (Linnaeus University); Rooth, Dan-Olof (Stockholm University)
    Abstract: The question of whether and how living in a deprived neighborhood affects the labor market outcomes of its residents has been a subject of great interest for both policy makers and researchers. Despite this interest, empirical evidence of causal neighborhood effects on labor market outcomes is scant, and causal evidence on the mechanisms involved is even more scant. The mechanism that this study investigates is neighborhood signaling effects. Specifically, we ask whether there is unequal treatment in hiring depending on whether a job applicant signals living in a bad (deprived) neighborhood or in a good (affluent) neighborhood. To this end, we conducted a field experiment where fictitious job applications were sent to employers with an advertised vacancy. Each job application was randomly assigned a residential address in either a bad or a good neighborhood. The measured outcome is the fraction of invitations for a job interview (the callback rate). We find no evidence of general neighborhood signaling effects. However, job applicants with a foreign background have callback rates that are 42 percent lower if they signal living in a bad neighborhood rather than in a good neighborhood. In addition, we find that applicants with commuting times longer than 90 minutes have lower callback rates, and this is unrelated to the neighborhood signaling effect. Apparently, employers view information about residential addresses as important for employment decisions.
    Keywords: neighborhood signaling effects, neighborhood stigma, commuting time, discrimination, field experiment, correspondence study
    JEL: C93 J15 J21 J71
    Date: 2018–01
  14. By: Simora, Michael
    Abstract: Despite general support for the transition towards renewable energies, local opposition may hamper the required power line construction. This paper evaluates a large randomized one shot binary choice experiment with about 10,000 observations to examine the effect of annual community compensations based on current legislation as well as the effect of household compensations on the willingness to accept new power line construction. Results reveal that community compensations have no bearing on the acceptance level, whereas personal compensations have a negative effect via crowding out intrinsic motivation to support the construction project or via signaling negative impacts for residents. Thus, policy makers should refrain from financial payments as an instrument to decrease local opposition.
    Keywords: not-in-my-backyard,compensation payment,willingness to accept,motivation crowding out
    JEL: M52 C93 Q40
    Date: 2017
  15. By: Boring, Anne; Philippe, Arnaud
    Abstract: We conduct a field experiment to assess the impact of two different interventions designed to reduce gender biases in student evaluations of teaching (SET). In the first intervention, students received a normative statement by email, essentially reminding them that they should not discriminate in SETs. In the second intervention, the normative statement was augmented with precise information on how other students in the exact same situation had discriminated against female teachers in the past. While the pure normative statement had no significant impact on SETs, the informative statement appears to have reduced gender biases against female teachers. This effect mainly comes from a change in male students’ evaluation of female teachers.
    JEL: C93 I23 J71
    Date: 2017–11
  16. By: Christoph March; Anthony Ziegelmeyer
    Abstract: We designed four observational learning experiments to identify the key channels that, along with Bayes-rational inferences, drive herd behavior. In Experiment 1, unobserved, whose actions remain private, learn from the public actions made in turn by subjects endowed with private signals of medium quality. We find that when unobserved face a handful of identical actions that contradict their high quality signals they herd more extensively than predicted by Bayes-rational herding. Deviations from the normative solution result in severe expected losses and unobserved would be better off without the chance to learn from others. When unobserved are endowed with medium quality signals they learn rather successfully from public actions, but they overweight their low quality signals relative to public information. Experiments 2-4 reveal that non-Bayesian updating and informational misinferences are the two channels that drive excessive herding, while the strong (resp. mild) overemphasis on low (resp. medium) quality signals is caused by wrong expectations about others’ strategy. A model of intuitive observational learning accounts for the phenomenon of excessive herding, it captures well herd behavior with medium quality signals, but it fails to predict that the reluctance to contradict private signals is stronger for low than for medium quality.
    Keywords: observational learning, herd behavior, intuitive judgments, experiments
    JEL: C92 D82 D83 D84
    Date: 2018
  17. By: Arbex, Marcelo; Carré, Justin M.; Geniole, Shawn N.; Mattos, Enlinson
    Abstract: High testosterone levels in men may inhibit tax evasion. From a laboratory experiment with 121 young men, we present suggestive evidence that putative markers of prenatal and pubertal testosterone exposure and some personality traits predict the decision of evading taxes. We also observe a sizable and negative, although weakly signi cant (at 10%), treatment e ect, controlling for individual characteristics, testosterone exposure markers, medication and drugs use. Reinforced by permutation tests for the treatment variable, a lower prevalence of tax evasion in the treated group is in line with recent results that suggest testosterone may increase prosocial or less sel sh behavior.
    Date: 2018–02
  18. By: Solda, Alice (GATE, University of Lyon); Villeval, Marie Claire (CNRS, GATE)
    Abstract: Using a negatively framed public good game, we study the cooperative behavior of individuals who reintegrate their group after being excluded by their peers. We manipulate the length of exclusion and whether this length is imposed exogenously or results from a vote. We show that people are willing to exclude the least cooperators although it is not an equilibrium strategy. Exclusion has a positive impact on cooperation when it is followed by a quick rather than a slow reintegration and that the length of exclusion is chosen by the group. In this environment, a quicker reintegration also limits retaliation. Post-exclusion cooperation and forgiveness depend not only on the length of exclusion but also on the perceived intentions of others when they punish.
    Keywords: ostracism, exclusion, reintegration, social dilemma, cooperation, experiment
    JEL: C92 H41 D23
    Date: 2017–12
  19. By: Simora, Michael; Frondel, Manuel; Vance, Colin
    Abstract: Although public support for renewable energy promotion in Germany is strong, the required power line construction has incited a groundswell of opposition from residents concerned about the impacts on their neighborhoods. This paper evaluates a large randomized one-shot binary-choice experiment to examine the effect of different compensation schemes on the acceptance of new power line construction. Results reveal that community compensations have no bearing on the acceptance level, whereas personal compensations have a negative effect. Two possible channels through which financial compensation reduces the willingness-to-accept are (1) crowding out of intrinsic motivation to support the construction project and (2) a signaling effect that alerts residents to potential negative impacts of the power lines. Both explanations call into question the efficacy of financial payments to decrease local opposition.
    Keywords: not-in-my-backyard,willingness to accept,motivation crowding out,randomized discrete choice experiment
    JEL: M52 C93 Q40
    Date: 2018
  20. By: Ganga Shreedhar, Alessandro Tavoni, Carmen Marchiori
    Abstract: In an experimental study, we explore how imperfect monitoring and punishment network architectures impacts cooperation, punishment and beliefs, in a non-linear common pool resource appropriation dilemma. We find that complete networks (with perfect monitoring and punishment), are the least efficient due to higher punishment, relative to incomplete networks. In addition, high appropriators are sanctioned in all networks, but well-connected and undirected networks elicit higher anti-social punishment. Lastly, although subject’s underestimate other’s appropriation in all networks, the difference between beliefs and other’s appropriation declines with time. This decline occurs faster in complete networks, relative to incomplete but connected networks.
    Date: 2018–01
  21. By: Antoci, Angelo (University of Sassari); Bonelli, Laura (Sapienza University of Rome); Paglieri, Fabio (Institute of Cognitive Sciences and Technology); Reggiani, Tommaso G. (Masaryk University); Sabatini, Fabio (Sapienza University of Rome)
    Abstract: Social media have been credited with the potential of reinvigorating trust by offering new opportunities for social and political participation. This view has been recently challenged by the rising phenomenon of online incivility, which has made the environment of social networking sites hostile to many users. We conduct a novel experiment in a Facebook setting to study how the effect of social media on trust varies depending on the civility or incivility of online interaction. We find that participants exposed to civil Facebook interaction are significantly more trusting. In contrast, when the use of Facebook is accompanied by the experience of online incivility, no significant changes occur in users' behavior. These results are robust to alternative configurations of the treatments.
    Keywords: social media, Facebook, online incivility, trust, social networks, cooperation, trust game
    JEL: C91 D9 D91 Z1
    Date: 2018–01
  22. By: Bover, Olympia; Hospido, Laura; Villanueva, Ernesto
    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
  23. By: Melvin Stephens, Jr.; Desmond J. Toohey
    Abstract: While economists have posited that health investments increase earnings, isolating the causal effect of health is challenging due both to reverse causality and unobserved heterogeneity. We examine the labor market effects of a randomized controlled trial, the Multiple Risk Factor Intervention Trial (MRFIT), which monitored nearly 13,000 men for over six years. We find that this intervention, which provided a bundle of treatments to reduce coronary heart disease mortality, increased earnings and family income. We find few differences in estimated gains by baseline health and occupation characteristics. Reductions in serious illnesses and work-limiting disabilities likely contributed to the observed gains.
    JEL: I12 J24
    Date: 2018–01
  24. By: Michalis Drouvelis; Benjamin Marx
    Abstract: Group compensation and public announcement of performance are two common aspects of working with other people. We randomly assign these aspects to real-effort tasks. Following task completion and payment, subjects are given an unexpected opportunity to donate to a local charity. Group compensation and public announcement of performance have little effect on work performance but striking spillover effects on subsequent donations. Public announcement of performance doubles the amount donated to charity, and group compensation significantly increases the share donating. The results suggest that interpersonal interactions in the workplace environment may have important spillover effects on prosocial behavior outside of work.
    Keywords: prosocial, spillover, charitable, group, experiment
    JEL: D01 D64 A13
    Date: 2018
  25. By: Piopiunik, Marc (Ifo Institute for Economic Research); Schwerdt, Guido (University of Konstanz); Simon, Lisa (CESifo); Woessmann, Ludger (Ifo Institute for Economic Research)
    Abstract: As skills of labor-market entrants are usually not directly observed by employers, individuals acquire skill signals. To study which signals are valued by employers, we simultaneously and independently randomize a broad range of skill signals on pairs of resumes of fictitious applicants among which we ask a large representative sample of German human-resource managers to choose. We find that signals in all three studied domains – cognitive skills, social skills, and maturity – have a significant effect on being invited for a job interview. Consistent with the relevance, expectedness, and credibility of different signals, the specific signal that is effective in each domain differs between apprenticeship applicants and college graduates. While GPAs and social skills are significant for both genders, males are particularly rewarded for maturity and females for IT and language skills. Older HR managers value school grades less and other signals more, whereas HR managers in larger firms value college grades more.
    Keywords: signals, cognitive skills, social skills, resume, hiring, labor market
    JEL: J24 J21
    Date: 2018–01
  26. By: Elsayed, Ahmed (IZA); Roushdy, Rania (American University of Cairo)
    Abstract: Women in the MENA region are economically and socially disempowered. High youth unemployment rates together with discriminatory social norms drive them to limit their investment in human capital. We evaluate a large-scale intervention attempting to relax human capital constraints for women by offering vocational, business and life skills training in 30 villages in rural Egypt. Relative to women in the control villages, the intervention increased the likelihood of treated women engaging in income-generating activities, driven by an increase in self-employment. Treated women also became more likely to have future business aspirations. However, their intra-household decision-making and gender equality attitudes were not affected by the intervention. We show that these results mask heterogeneous effects in terms of background characteristics and initial levels of social empowerment. We find no evidence of positive spillover effects for the program within treated villages and, more importantly, no evidence of different pre-trends in employment between the treated and control groups prior to the intervention.
    Keywords: empowerment of women, field intervention, Egypt
    JEL: I25 J24 O12
    Date: 2017–12
  27. By: Alger, Ingela; Lehmann, Laurent; Weibull, Jörgen W.
    Abstract: Humans have evolved in populations structured in groups that extended beyond the nuclear family. Individuals interacted with each other within these groups and there was limited migration and sometimes conáicts between these groups. Suppose that during this evolution, individuals transmitted their behaviors or preferences to their (genetic or cultural) o§spring, and that material outcomes resulting from the interaction determined which parents were more successful than others in producing (genetic or cultural) o§spring. Should one then expect pure material self-interest to prevail? Some degree of altruism, spite, inequity aversion or morality? By building on established models in population biology we analyze the role that di§erent aspects of population structureó such as group size, migration rates, probability of group conáicts, cultural loyalty towards parentsó play in shaping behaviors and preferences which, once established, cannot be displaced by any other preference. In particular, we establish that uninvadable preferences under limited migration between groups will consist of a materially self-interested, a moral, and an other-regarding component, and we show how the strength of each component depends on population structure.
    Keywords: Strategic interactions; Preference evolution; Evolution by natural selection; Cultural transmission; Pro-sociality; Altruism; Morality; Spite
    JEL: A12 A13 B52 C73 D01 D63 D64 D91
    Date: 2018–02
  28. By: Jawwad Noor (Department of Economics, Boston University); Norio Takeoka (
    Abstract: Time preference is modelled as a current self that overcomes selfishness by incurring a cognitive cost of empathizing with her future selves. Such a model unifies disparate well-known experimental findings. Behavioral foundations are provided by exploiting the idea that higher stakes provide an incentive for the exertion of higher effort, so that changes in the agent's impatience with respect to the scale of outcomes pin down the underlying process. The behavioral content of limited cognitive resources is shown to lie in violations of Separability.
  29. By: Chowdhury, Shyamal; Sutter, Matthias; Zimmermann, Klaus F.
    Abstract: Economic preferences – like time, risk and social preferences – have been shown to be very influential for real-life outcomes, such as educational achievements, labor market outcomes, or health status. We contribute to the recent literature that has examined how and when economic preferences are formed, putting particular emphasis on the role of intergenerational transmission of economic preferences within families. Our paper is the first to run incentivized experiments with fathers and mothers and their children by drawing on a unique dataset of 1,999 members of Bangladeshi families, including 911 children, aged 6-17 years, and 544 pairs of mothers and fathers. We find a large degree of intergenerational persistence as the economic preferences of mothers and fathers are significantly positively related to their children’s economic preferences. Importantly, we find that socio-economic status of a family has no explanatory power as soon as we control for parents’ economic preferences. A series of robustness checks deals with the role of older siblings, the similarity of parental preferences, and the average preferences within a child’s village.
    Keywords: Intergenerational transmission of preferences,time preferences,risk preferences,social preferences,children,parents,Bangladesh,socio-economic status,experiment
    JEL: C90 D1 D90 D81 D64 J13 J24 J62
    Date: 2018
  30. By: Carlsson, Magnus (Linnaeus University); Fumarco, Luca (Linnaeus University); Rooth, Dan-Olof (Stockholm University)
    Abstract: Several studies using observational data suggest that ethnic discrimination increases in downturns of the economy. We investigate whether ethnic discrimination depends on labor market tightness using data from correspondence studies. We utilize three correspondence studies of the Swedish labor market and two different measures of labor market tightness. These two measures produce qualitatively similar results, and, opposite to the observational studies, suggests that ethnic discrimination in hiring decreases in downturns of the economy.
    Keywords: hiring discrimination, ethnic discrimination, labor market tightness, the business cycle, correspondence studies, field experiments, ranking models, screening models
    JEL: C93 J15 J21 J71
    Date: 2018–01

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NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.