nep-exp New Economics Papers
on Experimental Economics
Issue of 2018‒09‒24
forty-two papers chosen by
Daniel Houser
George Mason University

  1. The Limits of Simple Implementation Intentions: Evidence from a Field Experiment on Making Plans to Exercise By Mariana Carrera; Heather Royer; Mark F. Stehr; Justin R. Sydnor; Dmitry Taubinsky
  2. Intrahousehold Consumption Allocation and Demand for Agency: A Triple Experimental Investigation By Uzma Afzal; Giovanna D'Adda; Marcel Fafchamps; Farah Said
  3. Social capital and conservation under collective and individual incentive schemes: a framed field experiment in Indonesia By Wollni, M.; Lanza, G.; Ibanez, M.
  4. Crowding out effect and traders' overreliance on public information in financial markets: a lesson from the lab By Ruiz-Buforn, Alba; Alfarano, Simone; Camacho-Cuena, Eva; Morone, Andrea
  5. Is an intergenerational retrospective viewpoint effective in forming policy preferences for financial sustainability in local and national economies? A deliberative experimental approach By Yoshinori Nakagawa; Real Arai; Koji Katani; Masanobu Nagano; Tatsuyoshi Saijo
  6. Ordered Leniency: An Experimental Study of Law Enforcement with Self-Reporting By Landeo, Claudia; Spier, Kathryn
  7. Do image spillovers deter rule breaking? By Rémi Suchon; Daniel Houser
  8. An experimental test of the validity of survey-measured political ideology By Maité Laméris; Richard Jong-A-Pin; Rasmus Wiese
  9. Yes, I'll do it: a large-scale experiment on the volunteer's dilemma By Anita (A.G.) Kopanyi-Peuker
  10. Sharing Responsibility with a Machine By Oliver Kirchkamp; Christina Strobel
  11. The Allais Paradox: What It Became, What It Really Was, What It Now Suggests to Us By Mongin, Philippe
  12. Farmers’ preference and willingness to pay for Ecosystem Services from Small-scale Agricultural Management Intervention Options in Burkina Faso: A Discrete Choice Experiment Approach By Houessionon, P.
  13. Middle managers, personnel turnover and performance: A long-term field experiment in a retail chain By Friebel, Guido; Heinz, Matthias; Zubanov, Nick
  14. Cognitive Imprecision and Small-Stakes Risk Aversion By Mel Win Khaw; Ziang Li; Michael Woodford
  15. Promises, Expectations & Causation By Gioavnni Di Bartolomeo; Martin Dufwenberg; Stefano Papa; Francesco Passarelli
  16. Expectations of Reciprocity and Feedback when Competitors Share Information: Experimental Evidence By Bernhard Ganglmair; Alex Holcomb; Noah Myung
  17. Other-Regarding Preferences and Giving Decision in Risky Environments: Experimental Evidence By Mickael Beaud; Mathieu Lefebvre; Julie Rosaz
  18. Effects of Poverty on Impatience: Preferences or Inattention? By Bartoš,; Bauer, Michal; Chytilova, Julie; Levely, Ian
  19. Other-Regarding Preferences and Giving Decision in Risky Environments: Experimental Evidence. By MICKAEL BEAUD; MATHIEU LEFEBVRE; JULIE ROSAZ
  20. Educational Inequality and Public Policy Preferences: Evidence from Representative Survey Experiments By Lergetporer, Philipp; Werner, Katharina; Woessmann, Ludger
  21. The Discrete Charm of Nominal Illusion By Fatas, E; Morales, A.J.
  22. Cognitive Ability and Bidding Behavior in Experimental Auction By Lee, Ji Yong; Nayga, Rodolfo M.; Deck, Cary; Drichoutis, Andreas
  23. Formulating and Testing a New Conservation Auction Mechanism in an Experimental Setting By Otto, Steven; Poe, Gregory L.; Just, David R.
  24. Design-based Analysis in Difference-In-Differences Settings with Staggered Adoption By Susan Athey; Guido W. Imbens
  25. The Dynamics of Discrimination: Theory and Evidence By Bohren, Aislinn; Imas, Alex; Rosenberg, Michael
  26. The Psychology of Inequality in Allocation Decisions: The Effect of the Number of Recipients (N) By Avishalom Tor
  27. Impact of pre– and post-harvest training reminders on crop losses and food poverty in Mali By Dzanku, F.M.; Osei, R.D.
  28. Assurance Payments for Threshold Public Goods Provision: Theory and Lab Experiment By Liu, Pengfei; Swallow, Stephen K.; Li, Zhi
  29. Bargaining and Contract Choice: Evidence from Informal Groundwater Contracts By Yashodha, Y.
  30. Farmer participation in nutrient management practices in Delaware: A field experiment By Janusch, Nicholas R.; Messer, Kent D.; Ferraro, Paul J.; Allen, William
  31. Understanding how risk preferences and social capital affect farmers’ behavior to anticipatory and reactive adaptation options to climate change: the case of vineyard farmers in central Chile By Alvarado, E.; Ibanez, M.; Brummer, B.
  32. Do Stakeholder Comments Influence Regulator Behavior? Evidence from a Public Goods Experiment By Morgan, Stephen N.; Mason, Nicole M.; Shupp, Robert S.
  33. Intention-based reciprocity and signaling of intentions By Toussaert, Séverine
  34. Norm Sensitivity and Preferences for Credence Attributes Elicited in Experimental Auctions: The Case of Animal Welfare Information and WTP for Ice Cream By Sackett, Hillary M.; Kelley, Lindsey
  35. Early Stimulation and Nutrition: The Impacts of a Scalable Intervention By Orazio P. Attanasio; Helen Baker-Henningham; Raquel Bernal; Costas Meghir; Diana Pineda; Marta Rubio-Codina
  36. Employment Adjustments Following Rises and Reductions in Minimum Wages: New Insights from a Survey Experiment By Bossler, Mario; Oberfichtner, Michael; Schnabel, Claus
  37. An Opportunity Overlooked: A Choice Experiment to Estimate Consumers’ Willingness to Pay for Locally Grown Fruits in Cusco, Peru By Donovan, Jason; Blare, Trent D.; Del Pozo, Cesar
  38. Psychological Mindedness as a mediatior between MBSR and perceived stress By Renée Zonneveld; Ivan Nyklí?ek; Johan Denollet
  39. Experimental Measures of the Effect of Food Fraud Education on Demand for Local Honey By Jones Ritten, Chian A.; Ehmke, Mariah D.; Thunstrom, Linda; Beiermann, Jenny; Mcleod, Donald
  40. A Method to Estimate Mean Lying Rates and Their Full Distribution By Ellen Garbarino; Robert Slonim; Marie Claire Villeval
  41. Motivating Energy Conservation among Non-rate Paying Households with Feedback and Social Nudges: A Cautionary Tale By Crago, Christine L.; Spraggon, John; Hunter, Elizabeth
  42. Fine-Tuning Willingness-To-Pay Estimates in Second Price Auctions By Kassas, Bachir; Palma, Marco A.; Anderson, David P.

  1. By: Mariana Carrera; Heather Royer; Mark F. Stehr; Justin R. Sydnor; Dmitry Taubinsky
    Abstract: Recent large-scale randomized experiments find that helping people form implementation intentions by asking when and where they plan to act increases one-time actions, such as vaccinations, preventative screenings and voting. We investigate the effect of a simple scalable planning intervention on a repeated behavior using a randomized design involving 877 subjects at a private gym. Subjects were randomized into i) a treatment group who selected the days and times they intended to attend the gym over the next two weeks or ii) a control group who instead recorded their days of exercise in the prior two weeks. In contrast to recent studies, we find that the planning intervention did not have a positive effect on behavior and observe a tightly estimated null effect. This lack of effect is despite the fact that the majority of subjects believe that planning is helpful and despite clear evidence that they engaged with the planning process.
    JEL: C93 D91 I12
    Date: 2018–08
  2. By: Uzma Afzal; Giovanna D'Adda; Marcel Fafchamps; Farah Said
    Abstract: We conduct two lab experiments and one field experiment to investigate demand for consumption agency in married couples. The evidence we uncover is consistent across all three experiments. Subjects are often no better at guessing their spouse's preferences than those of a stranger, and many subjects disregard what they believe or know about others' preferences when assigning them a consumption bundle. This confers instrumental value to individual executive agency within the household. We indeed find significant evidence of demand for agency in all three experiments, and this demand varies with the cost and anticipated instrumental benefit of agency. But subjects often make choices incompatible with pure instrumental motives – e.g., paying for agency even when they know their partner assigned them their preferred choice. We also find female subjects to be quite willing to exert agency even though, based on survey responses, they have little executive agency within their household. We interpret this as suggestive of pent-up demand for agency, and indeed we find that female demand for agency falls as a result of an empowerment intervention.
    JEL: D13 D91 O12
    Date: 2018–08
  3. By: Wollni, M.; Lanza, G.; Ibanez, M.
    Abstract: In this study, we explore the effects of payments for environmental services on land use decisions among farmers living in Jambi province in Indonesia. Using a framed field experiment we compare land use decisions in a baseline with no payment with two alternative payments for environmental services (PES): an individual incentive scheme, where each participant receives a flat rate payment for each experimental land unit conserved, and a collective incentive scheme that offers individual payments only if an aggregate pre-determined conservation threshold is passed by the group. We find that individual and collective PES are equally effective on the average to increase environmentally friendly behavior associated with the cultivation of rubber agroforestry. Yet we find that whereas individual incentives work equally well for small and large farmers, collective incentives only work for large farmers. In addition, collective incentives generate an increase in conservation even at low payment levels whereas individual incentives only work when payments are high. Participants with a larger social network cultivating oil palm invest a lower share of their endowment in conservation. These findings highlight how land heterogeneity and social capital influence the success of a PES scheme.
    Keywords: Agricultural and Food Policy, International Development
    Date: 2018–07
  4. By: Ruiz-Buforn, Alba; Alfarano, Simone; Camacho-Cuena, Eva; Morone, Andrea
    Abstract: In this paper, we study experimentally the information aggregation process in a market as a function of the access to different sources of information, namely an imperfect, public and costless signal into a market where the participants have access to costly and imperfect private information. Our results show that the release of public information provokes a crowding out effect on the traders' information demand while it keeps constant market informativeness, but significantly reduces price informativeness. Traders overrely on public information, which has a significant negative impact on the overall market performance. We detect the emergence of the overrelying phenomenon, despite the absence of an explicit incentive to the subjects to coordinate, demonstrating, therefore, that the adverse effects of releasing public information in a financial market are more relevant than generally assumed, based on the results of previous experiments inspired by simple coordination models. Our results pose new questions when a regulatory institution has to decide the appropriate level of transparency of its communication strategy.
    Keywords: Experiments, financial markets, private and public information, overrelying, crowding out
    JEL: C92 D82 G14
    Date: 2018–09–05
  5. By: Yoshinori Nakagawa (School of Economics and Management, Kochi University of Technology); Real Arai (School of Economics and Management, Kochi University of Technology); Koji Katani (School of Economics and Management, Kochi University of Technology); Masanobu Nagano (Regional Research Institute, Kochi University of Technology); Tatsuyoshi Saijo (School of Economics and Management, Kochi University of Technology)
    Abstract: Several previous studies have suggested potential benefits of intergenerational retrospective viewpoints to both promote individuals’ policy preferences and resolve intergenerational sustainability issues. This study extends this line of research by conducting a deliberation experiment on the challenging issue of determining financial policy at the municipal and national levels, and assessing the versatility of this process. A total of 353 participants were allocated into retrospective and non-retrospective treatment groups. In each group, participants were asked to read the case-method material created for the study and each individual expressed his or her most preferred options, both before and after experiencing deliberation among a group of four participants. By doing so, the relationships between the roles of the retrospective treatment, individual psychological/behavioral characteristics, and deliberation were clarified. The results confirm that a retrospective assessment influences individuals’ policy preferences at the municipal level but not at the national level. Specifically, with regard to the former, it was found that, for those who are strong in generativity and critical thinking, the retrospective treatment was effective in changing their policy preferences towards more sustainable choices. For those who are average with respect to these traits, the retrospective treatment was effective when coupled with deliberation. For those who are below average in terms of these characteristics, the retrospective treatment was ineffective even when coupled with deliberation. Overall, deliberation and retrospective treatment complemented each other as way to induce more subjects to choose sustainable options. We also discuss implications for the practice of stakeholder workshops such as scenario development, where the difficulty and importance of participants’ disengagement from the present has been recognized (Vergragt and Quist 2011).
    Keywords: Future design, intergenerational retrospective viewpoint, financial sustainability, fiscal sustainability, generativity
    Date: 2018–09
  6. By: Landeo, Claudia (University of Alberta, Department of Economics); Spier, Kathryn (Harvard Law School)
    Abstract: This paper reports the results of an experiment designed to assess the ability of an enforcement agency to detect and deter harmful short-term activities committed by groups of injurers. With ordered-leniency policies, early cooperators receive reduced sanctions. We replicate the strategic environment described by Landeo and Spier (2018). In theory, the optimal ordered leniency policy depends on the refinement criterion applied in case of multiplicity of equilibria. Our findings are as follows. First, we provide empirical evidence of a "race-to-the-courthouse" effect of ordered leniency: Mild and Strong Leniency induce the injurers to self-report promptly. These findings suggest that the injurers' behaviors are aligned with the risk-dominance refinement. Second, Mild and Strong Leniency significantly increase the likelihood of detection of harmful activities. This fundamental finding is explained by the high self-reporting rates under ordered-leniency policies. Third, as a result of the increase in the detection rates, the averages fines are significantly higher under Mild and Strong Leniency. As expected when the risk-dominance refinement is applied, Mild Leniency exhibits the highest average fine.
    Keywords: Law Enforcement; Ordered Leniency; Self-Reporting; Experiments; Leniency; Co-ordination Game; Prisoners Dilemma Game; Risk Dominance; Pareto Dominance; Equilibrium Selection; Non-Cooperative Games; Harmful Externalities; Corporate Misconduct; White-Collar Crime; Securities Fraud; Insider Trading; Market Manipulation; Whistleblowers; Plea Bargaining; Tax Evasion; Environmental Policy Enforcement
    JEL: C72 C90 D86 K10 L23
    Date: 2018–09–19
  7. By: Rémi Suchon (Univ Lyon, ENS de Lyon, GATE UMR 5824, F-69342 Lyon, France); Daniel Houser (yDepartment of Economics and the Interdisciplinary Center for Economic Science, George Mason University, Fairfax, VA, United States.)
    Abstract: We test whether individuals internalize the effects that their behavior may have on the social image of their group. In our experiment, we recruit pairs of real-life friends and study whether rule breaking in the form of misreporting decreases when misreporting may have negative spillovers on the image of the friend. We find that participants hurt their friends' social image by misreporting because external observers update their beliefs: they rightfully expect that a participant whose friend misreported is likely to misreport himself. However, participants misreport as often when their behavior can hurt the friend's image as when it cannot, even though hurting their friends' image reduces their own monetary gains. Our interpretation is that they underestimate the impact of their behavior on external observers' beliefs about their friends. Our results cast doubts on the capacity of groups to sustain a good image absent the possibility of punishment, which is bad news. The good news is that external observers may use image spillovers to update their beliefs and interact with members of social groups more efficiently.
    Keywords: Social image, Group image, Misreporting, Experiment
    JEL: C92 D91
    Date: 2018
  8. By: Maité Laméris; Richard Jong-A-Pin; Rasmus Wiese
    Abstract: We examine the predictive validity of survey-measured left-right politicalideology by testing whether this measure is able to explain observed choices regarding equality versus efficiency. We study this in a real-effort distributionexperiment, in which decision-makers allocate money equally or efficiently. Wedistinguish between decision-makers that receive ‘manna-from-heaven’ and decision-makers that have earned the money to be distributed in a real effort task. We find that, conditional on entitlement concerns, self-reported right-wing ideology significantly predicts preferences for efficiency. Reported left-wing ideology does not have predictive value in explaining preferences for equality.
    Keywords: Political ideology; Survey measurement; Predictive validity; Distribution experiment; Real effort
    JEL: C91 D31
  9. By: Anita (A.G.) Kopanyi-Peuker (University of Amsterdam)
    Abstract: In many real-life situations people face a simple decision whether to volunteer or not to provide some benefit for themselves and also for others. This research investigates the effects of the group size and the magnitude of the volunteering cost in a controlled large-scale laboratory experiment, where subjects play the volunteer’s dilemma only once. The experiment varies group sizes ranging from groups of 3 to about 100, and 2 different cost/benefit ratios. Results show that high cost reduces volunteering probability only in the smallest groups, but not for other group sizes. Furthermore, non-monotonic group size effect is found on the individual volunteering decisions. These findings are not in line with the mixed-strategy Nash equilibrium prediction. Subjects volunteer more often in most treatments than the Nash prediction which benefits them on average compared to the Nash prediction.
    Keywords: Volunteer's dilemma; coordination; group size; large-scale experiment
    JEL: C72 C92
    Date: 2018–07–04
  10. By: Oliver Kirchkamp (FSU Jena, School of Economics); Christina Strobel (FSU Jena, School of Economics)
    Abstract: Humans make decisions jointly with others. They share responsibility for the outcome with their interaction partners. Today, more and more often the partner in a decision is not another human but, instead, a machine. Here we ask whether the type of the partner, machine or human, affects our responsibility, our perception of the choice and the choice itself. As a workhorse we use a modified dictator game with two joint decision makers: either two humans or one human and one machine. We find no treatment effect on perceived responsibility or guilt. We also find only a small and insignificant effect on actual choices.
    Keywords: Human-computer interaction, Experiment, Shared responsibility, Moral wiggle room
    JEL: C91 D63 D80
    Date: 2018–09–12
  11. By: Mongin, Philippe (GREGHEC; CNRS & HEC Paris - Economics & Decision Sciences)
    Abstract: Whereas many others have scrutinized the Allais paradox from a theoretical angle, we study the paradox from an historical perspective and link our findings to a suggestion as to how decision theory could make use of it today. We emphasize that Allais proposed the paradox as a normative argument, concerned with "the rational man" and not the "real man", to use his words. Moreover, and more subtly, we argue that Allais had an unusual sense of the normative, being concerned not so much with the rationality of choices as with the rationality of the agent as a person. These two claims are buttressed by a detailed investigation – the first of its kind – of the 1952 Paris conference on risk, which set the context for the invention of the paradox, and a detailed reconstruction – also the first of its kind – of Allais's specific normative argument from his numerous but allusive writings. The paper contrasts these interpretations of what the paradox historically represented, with how it generally came to function within decision theory from the late 1970s onwards: that is, as an empirical refutation of the expected utility hypothesis, and more specifically of the condition of von Neumann-Morgenstern independence that underlies that hypothesis. While not denying that this use of the paradox was fruitful in many ways, we propose another use that turns out also to be compatible with an experimental perspective. Following Allais's hints on "the experimental definition of rationality", this new use consists in letting the experiment itself speak of the rationality or otherwise of the subjects. In the 1970s, a short sequence of papers inspired by Allais implemented original ways of eliciting the reasons guiding the subjects' choices, and claimed to be able to draw relevant normative consequences from this information. We end by reviewing this forgotten experimental avenue not simply historically, but with a view to recommending it for possible use by decision theorists today.
    Keywords: Allais Paradox; Decision Theory; Expected Utility Theory; Experimental Economics; Positive vs Normative; Rationality; 1952 Paris Conference; Allais; Von Neumann and Morgenstern; Samuelson; Savage
    JEL: B21 B31 B41 C91 D80
    Date: 2018–06–01
  12. By: Houessionon, P.
    Abstract: The main purpose of this paper is to estimate farmers’ preferences and their willingness to pay (WTP) for ecosystem services derived from four agricultural water management (AWM) and resource recovery and reuse (RRR) intervention options in Burkina Faso, using choice experiment (CE). These include; small water infrastructures, drip irrigation, organic matter recovery from waste, and treated wastewater. The design decisions relating to attribute selection, the level of attributes, alternatives and choice tasks were guided by literature, field visit, focus group discussions, experts input and an iterative process of STATA to generate an orthogonal main effects CE design. The data used was generated from a random sample of 300 farm households in the Dano and Ouagadougou municipalities in Burkina Faso. Results from conditional logit, latent class logit and mixt logit models show that farmers have positive and significant preferences for drip irrigation, treated waste water and organic matter. However, they are WTP on average, more for drip irrigation and organic matter for agricultural sustainability. In line with economic theory, the cost of an intervention reduces demand for a given intervention. These findings can provide policy makers with evidence for agricultural policy design to build farmers’ resilience in the Sahel.
    Keywords: Agricultural and Food Policy
    Date: 2018–07
  13. By: Friebel, Guido; Heinz, Matthias; Zubanov, Nick
    Abstract: In a field experiment, a large retail chain's CEO asked managers of treated stores "to do what they can" to reduce personnel turnover. Turnover decreases by a quarter for nine months; a reminder treatment triggers a similar decrease for a shorter period. Treated managers report shifting their time toward HR; their employees report more managerial attention and support. Store sales are unaffected, indicating that the possible performance increases related to managers spending more time on HR are neutralized by the effects of managers spending less time on customers and goods. The discernible efficiency gains occur at the firm, rather than at the store level.
    Keywords: communication; hierarchy; HR; insider econometrics; Managers; organizations; personnel turnover; randomized controlled trial (RCT)
    JEL: L2 M1 M12 M5
    Date: 2018–08
  14. By: Mel Win Khaw; Ziang Li; Michael Woodford
    Abstract: Observed choices between risky lotteries are difficult to reconcile with expected utility maximization, both because subjects appear to be too risk averse with regard to small gambles for this to be explained by diminishing marginal utility of wealth, as stressed by Rabin (2000), and because subjects' responses involve a random element. We propose a unified explanation for both anomalies, similar to the explanation given for related phenomena in the case of perceptual judgments: they result from judgments based on imprecise (and noisy) mental representations of the decision situation. In this model, risk aversion results from a sort of perceptual bias — but one that represents an optimal decision rule, given the imprecision of the mental representation of the situation. We propose a quantitative model of the noisy mental representation of simple lotteries, based on other evidence regarding numerical cognition, and test its ability to explain the choice frequencies that we observe in a laboratory experiment. Our model is more consistent with the laboratory data than random versions of expected utility theory or prospect theory, using both in-sample and out-of-sample tests of model fit.
    JEL: C91 D03 D81 D87
    Date: 2018–08
  15. By: Gioavnni Di Bartolomeo; Martin Dufwenberg; Stefano Papa; Francesco Passarelli
    Abstract: Why do people keep their promises? Vanberg (2008) and Ederer & Stremitzer (2017) provide causal evidence in favor of, respectively, an intrinsic preference for keeping one’s word and Charness & Dufwenberg’s (2006) expectations-based account based on guilt aversion. The overall picture is incomplete though, as no study disentangles effects in a design that provides exogenous variation of both (the key features of) promises and beliefs. We present an experimental design that does so.
    Keywords: Promises, expectations, guilt aversion, moral commitment, causation
    JEL: A13 C91 D03 D64
    Date: 2018
  16. By: Bernhard Ganglmair; Alex Holcomb; Noah Myung
    Abstract: Informal know-how trading and exchange of information among competitors has been well-documented for a variety of industries, including in science and R&D, and an individual’s expectations of reciprocity is understood to be a key determinant of such flow of information. We establish a feedback loop (as a representation of information trading) in the laboratory and show that an individual’s expectations of the recipient’s intentions to reciprocate matter more than a recipient’s ability to do so. This implies that reducing strategic uncertainty about competitors’ behavior has a bigger effect on the flow of information than reducing environmental uncertainty (about their ability to generate new information). We also show that the formation of beliefs about a recipient’s intentions to reciprocate are heavily influenced by past experience, where prior experience lingers and can have negative effects on the sustainability of productive and fruitful information exchange.
    Keywords: knowledge diffusion; information sharing; reciprocity; collective innovation; R&D; conversation; experimental economics; centipede game
    JEL: O33 D8 C72 C91
    Date: 2018–09
  17. By: Mickael Beaud (CEE-M, Univ. Montpellier, CNRS, INRA, SupAgro, Montpellier, France); Mathieu Lefebvre (BETA, University of Strasbourg, University of Lorraine, CNRS, BETA UMR 7522); Julie Rosaz (Univ. Lyon, Université Lumière Lyon 2, GATE UMR 5824, F-69130 Ecully, France)
    Abstract: This paper investigates if and how other-regarding preferences governing giving decisions in dictator games are affected in risky environments in which the payoff of the recipient is random. We demonstrate that, whenever the risk is actuarially neutral, the donation of dictators with a purely ex post view of fairness should, in general, be affected by the riskyness of the recipient’s payoff, while dictators with a purely ex ante view should not be. Our experimental data give weak empirical support to the purely ex post view of fairness.
    Keywords: Laboratory experiments dictator games, background risk, other-regarding preferences, inequality aversion, impure altruism, ex ante and ex post views of fairness
    JEL: C91 D64 D81
    Date: 2018
  18. By: Bartoš,; Bauer, Michal; Chytilova, Julie; Levely, Ian
    Abstract: We study two psychological channels how poverty may increase impatient behavior - an effect on time preference and reduced attention. We measured discount rates among Ugandan farmers who made decisions about when to enjoy entertainment instead of working. We find that experimentally induced thoughts about poverty-related problems increase the preference to consume entertainment early and delay work. The effect is equivalent to a 27 p.p. increase in the intertemporal rate of substitution. Using monitoring tools similar to eye tracking, a novel feature for this subject pool, we show this effect is not due to a lower ability to sustain attention.
    Keywords: Decision-making Process; inattention; poverty; preferences; Scarcity; Time Discounting
    Date: 2018–08
    Abstract: This paper investigates if and how other-regarding preferences governing giving decisions in dictator games are affected in risky environments in which the payoff of the recipient is random. We demonstrate that, whenever the risk is actuarially neutral, the donation of dictators with a purely ex post view of fairness should, in general, be affected by the riskyness of the recipient’s payoff, while dictators with a purely ex ante view should not be. Our experimental data give weak empirical support to the purely ex post view of fairness.
    Keywords: Laboratory experiments dictator games, background risk, otherregarding preferences, inequality aversion, impure altruism, ex ante and ex post views of fairness.
    JEL: C91 D64 D81
    Date: 2018
  20. By: Lergetporer, Philipp (Ifo Institute for Economic Research); Werner, Katharina (Ifo Institute for Economic Research); Woessmann, Ludger (Ifo Institute for Economic Research)
    Abstract: To study how information about educational inequality affects public concerns and policy preferences, we devise survey experiments in representative samples of the German population. Providing information about the extent of educational inequality strongly increases concerns about educational inequality but only slightly affects support for equity-oriented education policies, which is generally high. The small treatment effects are not due to respondents' failure to connect policies with educational inequality or aversion against government interventions. Support for compulsory preschool is the one policy with a strong positive information treatment effect, which is increased further by informing about policy effectiveness.
    Keywords: inequality, education, information, survey experiment
    JEL: D30 H52 I24 H11 D63 D83 D72 P16
    Date: 2018–08
  21. By: Fatas, E; Morales, A.J.
    Abstract: We investigate the emergence and persistence of nominal illusion in an experimental entry game where firms must choose which local market to enter, then compete in prices. All local markets are equivalent in real terms and they only differ in the currency the price competition is run under. Our experimental results show a positive, persistent and monotone effect of the nominal exchange rate on (real) posted prices. We provide an explanation in terms of players simplifying the choice set using discrete grids.
    Keywords: Price competition, money illusion, experiments, nominal representation
    JEL: C72 C9 D43 L13
    Date: 2018–09–14
  22. By: Lee, Ji Yong; Nayga, Rodolfo M.; Deck, Cary; Drichoutis, Andreas
    Keywords: Institutional and Behavioral Economics, Research Methods/Statistical Methods
    Date: 2017–07–03
  23. By: Otto, Steven; Poe, Gregory L.; Just, David R.
    Keywords: Research and Development/Tech Change/Emerging Technologies, Institutional and Behavioral Economics, Land Economics/Use
    Date: 2017–07–03
  24. By: Susan Athey; Guido W. Imbens
    Abstract: In this paper we study estimation of and inference for average treatment effects in a setting with panel data. We focus on the setting where units, e.g., individuals, firms, or states, adopt the policy or treatment of interest at a particular point in time, and then remain exposed to this treatment at all times afterwards. We take a design perspective where we investigate the properties of estimators and procedures given assumptions on the assignment process. We show that under random assignment of the adoption date the standard Difference-In-Differences estimator is an unbiased estimator of a particular weighted average causal effect. We characterize the properties of this estimand, and show that the standard variance estimator is conservative.
    JEL: C01 C23 C31
    Date: 2018–08
  25. By: Bohren, Aislinn; Imas, Alex; Rosenberg, Michael
    Abstract: We model the dynamics of discrimination and show how its evolution can identify the underlying source. We test these theoretical predictions in a field experiment on a large online platform where users post content that is evaluated by other users on the platform. We assign posts to accounts that exogenously vary by gender and evaluation histories. With no prior evaluations, women face significant discrimination. However, following a sequence of positive evaluations, the direction of discrimination reverses: women's posts are favored over men's. Interpreting these results through the lens of our model, this dynamic reversal implies discrimination driven by biased beliefs.
    Keywords: discrimination
    Date: 2018–08
  26. By: Avishalom Tor (Notre Dame Law School)
    Abstract: The present series of studies examines individuals? preferences for equality in the distribution of resources in the organization. In particular, we identify a ubiquitous factor in the organization that affects concerns about inequality?namely, the number of allocation recipients. More specifically, we tested the hypothesis that third-party decision makers who allocate resources become less concerned about inequality in the allocation as the number of recipients increases. We expected decision makers faced with a tradeoff between equality and other considerations, such as efficiency (in the sense of maximizing the overall value of the allocation) or equity (in the sense of rewarding recipients differently based on their inputs), to show a stronger preference for equality in allocations to a smaller number of recipients than in allocations to a larger number of recipients. Studies 1a and 1b provide experimental evidence for the basic effect in a simple equality-efficiency tradeoff among participants in behavioral choice paradigms, while Study 2 provides further support for the effect in questionnaire responses concerning tradeoffs between equality and either efficiency or equity, and Study 3 further substantiates our findings using a large, representative cross-national sample of employed and unemployed individuals. Studies 4a and 4b, respectively, examine possible mechanisms underlying the effect, showing, first, that social comparison?but not fairness considerations?appear to mediate the effect; and, second, that the effect holds even allocators know that recipients will not have information regarding others? allocations. Finally, Studies 5a and 5b offer some manifestations of the effect in naturally-occurring data, in both faculty salary distributions at a large public university and in attitudes towards inequality in an extant, large-scale national survey.
    Keywords: Equality, distributive justice, efficiency, equity, social comparison
    Date: 2018–06
  27. By: Dzanku, F.M.; Osei, R.D.
    Abstract: We carried out a randomized controlled experiment in the Sikasso Region of Mali to test the hypotheses that (a) pre– and post-harvest training lowers the probability of crop losses and reduces household food insecurity; (b) post-training reminders have an even greater impact on reducing crop losses and lowering food insecurity; and (c) post-training reminders during specific times when such information needs to be applied reduced the probability of crop losses and lowers food insecurity over and above what could be achieved through training only. Aside post-harvest losses for which we could not reject the null hypothesis that post-training reminders have no impact, we easily reject the null that farmers who received only faceto- face training and those who received post-training reminders have identical outcomes. The null hypothesis that farmers who received only training are not different (with respect to our outcomes of interest) from those who received neither training nor reminders could not be rejected, except in the case of timely harvesting. These results suggest that going beyond training to providing timely reminders through voice messages could boost adoption and improve household welfare. Besides, the reminders intervention is relatively inexpensive, compared with traditional extension approaches.
    Keywords: Crop Production/Industries, International Development
    Date: 2018–07
  28. By: Liu, Pengfei; Swallow, Stephen K.; Li, Zhi
    Keywords: Demand and Price Analysis, Environmental Economics and Policy, Resource/Energy Economics and Policy
    Date: 2017–06–30
  29. By: Yashodha, Y.
    Abstract: Informal market arrangements are often in place when formal institutions are too weak to establish a formal mechanism for resource allocation. In this paper, we study informal groundwater contracts in India, in particular, the bargaining power of sellers and buyers. We conduct an economic experiment with actual buyers and sellers of groundwater contracts, where agents make a series of choices between output-shared and fixed-price contracts, first individually and then jointly. Output-shared contracts are chosen more often when the decision is joint. Further, the likelihood of choosing an output-shared contract depends on the relative risk preferences of sellers and buyers. Sellers have a strong influence in deciding the joint contract. However, buyers’ bargaining power increases when they share interpersonal relationships with sellers, such as kinship ties, or have a long contractual history together.
    Keywords: Agricultural and Food Policy, Labor and Human Capital
    Date: 2018–07
  30. By: Janusch, Nicholas R.; Messer, Kent D.; Ferraro, Paul J.; Allen, William
    Keywords: Farm Management, Institutional and Behavioral Economics, Agricultural and Food Policy
    Date: 2017–07–03
  31. By: Alvarado, E.; Ibanez, M.; Brummer, B.
    Abstract: The effects of climate change on agriculture have been widely studied. However, it is necessary to keep studying the responses that farmers could have to climate change. One of these responses is the adaptation. We have used anticipatory and reactive adaptation because we wanted to know if farmers prefer options to avoid or to face negative effects. The objective of this research was to understand how risk preferences along with social capital affect the decision to implement anticipatory or reactive adaptation options to climate change. This study took place in central Chile, data were collected through a field experiment from September to December 2016 with 163 vineyard farmers; we used the structural and midpoint methods to estimate the Cumulative Prospect Theory (CPT) parameters. Finally, we identify 5 anticipatory and 4 reactive adaptation options. The parameters indicate vineyard farmers are strongly risk averse and sensitive to losses, and their determinants are grape area, membership and subjective norms for risk aversion, and age, household size, and education for loss aversion. The main drivers for anticipatory adaptation are network, trust, time to market and area, and the main drivers for reactive adaptation are risk aversion, institutional trust, age and time to market.
    Keywords: Agricultural and Food Policy, Farm Management, International Development
    Date: 2018–07
  32. By: Morgan, Stephen N.; Mason, Nicole M.; Shupp, Robert S.
    Keywords: Institutional and Behavioral Economics, Resource/Energy Economics and Policy, Marketing
    Date: 2017–07–03
  33. By: Toussaert, Séverine
    Abstract: Many experiments find that trust intentions are a key determinant of prosociality. If intentions matter, then prosociality should depend on whether trust intentions can be credibly conveyed. This conjecture is formalized and tested in a noisy trust game where I vary the extent to which trust can be credibly signaled. I find that the introduction of noise threatens the onset of trust relations and induces players to form more pessimistic beliefs. Therefore policies that increase transparency of the decision-making environment may foster prosociality. However, the potential impact of such policies could be limited by a large heterogeneity in how individuals respond to changes in their information environment.
    Keywords: Trust; Intentions; Reciprocity; Noise; Signaling; Experimental economics
    JEL: C91 D63 D64
    Date: 2017–05–01
  34. By: Sackett, Hillary M.; Kelley, Lindsey
    Keywords: Institutional and Behavioral Economics, Livestock Production/Industries, Marketing
    Date: 2017–07–03
  35. By: Orazio P. Attanasio (University College in London); Helen Baker-Henningham (Bangor University); Raquel Bernal (Universidad de los Andes); Costas Meghir (Cowles Foundation, Yale University); Diana Pineda (Fundación Éxito); Marta Rubio-Codina (Inter-American Development Bank)
    Abstract: This paper evaluates the effects of the implementation of a structured early stimulation curriculum combined with a nutritional intervention through public large-scale parenting support services for vulnerable families in rural Colombia, known as FAMI, using a clustered randomized controlled trial. We randomly assigned 87 towns in rural areas to treatment and control and 1,460 children younger than 1 year of age were assessed at baseline. The interventions were also complemented with training, supervision and coaching of FAMI program facilitators. We assessed program effects on children’s nutritional status, and on cognitive and socio-emotional development; as well as on parental practices. The interventions had a positive and significant effect on a cognitive development factor based on the Bayley-III of 0.15 standard deviations. We also report a reduction of 5.8 percentage points in the fraction of children whose height-for-age is below -1 standard deviation. We do not find any effects on socio-emotional development. We report positive and statistically significant effects on the quality of the home environment (0.34 SD).
    Keywords: Early childhood development, Parenting, Early stimulation, Program scale-up
    JEL: J13 I10 I20 H43
    Date: 2018–08
  36. By: Bossler, Mario (Institute for Employment Research (IAB), Nuremberg); Oberfichtner, Michael (Institute for Employment Research (IAB), Nuremberg); Schnabel, Claus (University of Erlangen-Nuremberg)
    Abstract: The effects of large minimum wage increases, like those planned in the UK and in some US states, are still unknown. We conduct a survey experiment that randomly assigns increases or decreases in minimum wages to about 6,000 establishments in Germany and asks the personnel managers about their expectations concerning employment adjustments. We find that employment reacts asymmetrically to positive and negative changes in minimum wages. The larger the increase in the minimum wage is, the larger the expected reduction in employment. Employment adjustments are more pronounced in those industries and plants which are more strongly affected by the current minimum wage and in those plants that have neither collective agreements nor a works council. In contrast, employment is not found to increase if the minimum wage is reduced by about 10 percent. This mainly reflects that plants with works councils and collective agreements would not cut wages.
    Keywords: minimum wage, wage cuts, establishment survey, Germany
    JEL: J31 J23 D22
    Date: 2018–08
  37. By: Donovan, Jason; Blare, Trent D.; Del Pozo, Cesar
    Keywords: Consumer/Household Economics, Institutional and Behavioral Economics, Community/Rural/Urban Development
    Date: 2017–06–30
  38. By: Renée Zonneveld (TIlburg University); Ivan Nyklí?ek (Tilburg University); Johan Denollet (Tilburg University)
    Abstract: Psychological Mindedness (PM) or the ability and motivation to describe and understand psychological processes has long been suspected to play a critical role in the effectiveness of psychological interventions. However, empirical research on the subject is scarce. This study thus set out to investigate how change in PM mediates the effect of Mindfulness Based Stress Reduction (MBSR) on perceived stress. The participants in this study (N = 147) were recruited via a newspaper advertisement for a intervention to reduce stress. They were randomized over a waiting list condition or a treatment condition where they received an eight week MBSR intervention. Participants filled in questionnaires regarding their trait mindfulness, PM and perceived stress before and after the eight weeks. Results indicated that change in PM fully mediated the relationship between condition and perceived stress. Those in the treatment condition showed a larger increase in PM which was also related to a larger decrease of perceived stress compared to the waiting list condition. We thus conclude that increasing insight in one?s own psychological processes is an important factor for the effectiveness of mindfulness based interventions.
    Keywords: psychological mindedness, mindfulness, perceived stress, insight, MBSR, well-being
    Date: 2018–06
  39. By: Jones Ritten, Chian A.; Ehmke, Mariah D.; Thunstrom, Linda; Beiermann, Jenny; Mcleod, Donald
    Keywords: Demand and Price Analysis, Marketing, Crop Production/Industries
    Date: 2017–07–03
  40. By: Ellen Garbarino (University of Sydney Business School, Department of Marketing, Abercrombie building, Sydney, NSW 2006, Australia); Robert Slonim (University of Sydney, Department of Economics, Merewether building, Sydney, NSW 2006, Australia; IZA, Bonn, Germany); Marie Claire Villeval (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69131 Ecully, France)
    Abstract: Studying the likelihood that individuals cheat requires a valid statistical measure of dishonesty. We develop an easy empirical method to measure and compare lying behavior within and across studies to correct for sampling errors. This method estimates the full distribution of lying when agents privately observe the outcome of a random process (e.g., die roll) and can misreport what they observed. It provides a precise estimate of the mean and confidence interval (offering lower and upper bounds on the proportion of people lying) over the full distribution, allowing for a vast range of statistical inferences not generally available with existing methods.
    Keywords: Dishonesty, lying, econometric estimation, sampling errors, experimental economics
    JEL: C91 C81 D03
    Date: 2018
  41. By: Crago, Christine L.; Spraggon, John; Hunter, Elizabeth
    Keywords: Institutional and Behavioral Economics, Resource/Energy Economics and Policy, Consumer/Household Economics
    Date: 2017–07–03
  42. By: Kassas, Bachir; Palma, Marco A.; Anderson, David P.
    Keywords: Institutional and Behavioral Economics, Research Methods/Statistical Methods, Risk and Uncertainty
    Date: 2017–07–03

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