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on Experimental Economics |
| By: | Aislinn Bohren (Department of Economics, University of Pennsylvania); Alex Imas (Department of Social and Decision Sciences, Carnegie Mellon University); Michael Rosenberg (Wayfair) |
| Abstract: | We model the dynamics of discrimination and show how its evolution can identify the underlying source. We test these theoretical predictions in a ï¬ eld 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 signiï¬ cant 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, Dynamic Behavior, Field Experiment |
| JEL: | J16 D83 D9 |
| Date: | 2018–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:18-016&r=exp |
| By: | Leonardo Bursztyn (University of Chicago and NBER); Stefano Fiorin (University of California, San Diego); Daniel Gottlieb (Washington University in St. Louis); Martin Kanz (World Bank and CEPR) |
| Abstract: | We study the role of morality in debt repayment, using an experiment with the credit card customers of a large Islamic bank in Indonesia. In our main treatment, clients receive a text message stating that “non-repayment of debts by someone who is able to repay is an injustice." This moral appeal decreases delinquency by 4.4 percentage points from a baseline of 66 percent, and reduces default among customers with the highest ex-ante credit risk. Additional treatments help benchmark the effects against direct financial incentives, and rule out competing explanations, such as reminder effects, priming religion, and provision of new information. |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:hku:wpaper:201855&r=exp |
| By: | Englmaier, Florian; Grimm, Stefan; Schindler, David; Schudy, Simeon |
| Abstract: | Despite the prevalence of non-routine analytical team tasks in modern economies, little is known about how incentives influence performance in these tasks. In a field experiment with more than 3000 participants, we document a positive effect of bonus incentives on the probability of completion of such a task. Bonus incentives increase performance due to the reward rather than the reference point (performance threshold) they provide. The framing of bonuses (as gains or losses) plays a minor role. Incentives improve performance also in an additional sample of presumably less motivated workers. However, incentives reduce these workers' willingness to "explore" original solutions. |
| Keywords: | bonus; exploration; gain; incentives; loss; non-routine; team work |
| JEL: | C92 C93 D03 J33 M52 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13226&r=exp |
| By: | Hahn, Youjin; Islam, Asadul; Patacchini, Eleonora; Zenou, Yves |
| Abstract: | We randomly assigned 150 primary schools in Bangladesh to one of three settings: children studying individually, children studying in groups with friends, and children studying in groups with peers. The groups consisted of four people with similar average cognitive abilities and household characteristics. While the achievement of male students was not affected by the group assignment, low-ability females in groups with friends outperformed low-ability females working with peers by roughly 0.4 standard deviations of the test score distribution. This is shown not to be due to the fact that friends tend to be of the same gender or to a higher frequency of interactions among friends. |
| Keywords: | education; Gender; learning; Social interactions |
| JEL: | I25 J16 O12 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13221&r=exp |
| By: | M. Martin Boyer; Claude Fluet; Marie-Louise Leroux; Pierre-Carl Michaud; Philippe De Donder |
| Abstract: | This paper reports survey evidence on long-term care (LTC) risk misperceptions and demand for long-term care insurance (LTCI) in Canada. LTC risk misperceptions is divided into three different risks: needing help for at least one activity of daily life, needing access to a nursing home, and living to be 85 years old. We contrast subjective (i.e. stated) probabilities with actual probabilities for these three dimensions. We first provide descriptive statistics of how objective and subjective probabilities differ and correlate to each other. Second, we study cross-correlations between different types of risks. We then study how risk misperceptions correlate with individual characteristics, and evaluate how misperceptions affect intentions and actual purchase of LTCI. Our conclusions are two-fold. First, we find that most subjects are not well informed about their individual LTC risks, making it difficult for them to take the correct LTCI decisions. Second, and even though misperceptions explain an individuals actual or his intentions to take-up LTCI, misperceptions are unlikely to explain the poor take-up rate of LTCI in our sample. |
| Keywords: | Long-term Care Insurance Puzzle,Disability,Misperceptions,Subjective Probability, |
| JEL: | D91 I13 |
| Date: | 2018–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-20&r=exp |
| By: | Lecoutere, E. |
| Abstract: | This study investigates the impact of participatory household decision-making, introduced through a randomly encouraged intensive coaching package and less intensive couple seminars, in agricultural households in Uganda on intrahousehold cooperation and sharing behaviour measured in a lab-in-the-field experiment. The effects on the likelihood of playing the most cooperative strategies in two sequential voluntary contribution mechanism (VCM) games and on average fractions contributed by couples, husbands and wives are limited and not clear-cut. Allowing a selection of couples to communicate before the second VCM game did not reinforce treatment effects even if they mimicked the treatment. The same applies for the impact on sharing behaviour in dictator games simultaneously played by husband and wife, following either the second VCM game with or without communication. There are however distributional treatment effects. The coaching made husbands and wives who are already cooperative more cooperative in the second VCM game and more generous in the sharing game specifically when communication is allowed. The couple seminars had similar effects among husbands. At the lower end of the distribution, the coaching and couple seminars negatively affected husbands and wives contributed shares in the second VCM game with communication; and wives offers in the subsequent sharing game. Acknowledgement : This project has received funding from the European Union s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 702964. The project received funding from the Hanns R. Neumann Stiftung and from the International Institute of Tropical Agriculture, Uganda research station, as well. We would like to thank Dr. Ben D'Exelle, Dr. Arjan Verschoor and Dr. Bereket Kebede for valuable advice for the design of the lab-in-the-field experiments. |
| Keywords: | Consumer/Household Economics |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:277160&r=exp |
| By: | Qinxin Guo (Graduate School of Economics, Kobe University, Japan); Enci Wang (School of Economics, Shanghai University, China); Yongyou Nie (School of Economics, Shanghai University, China); Junyi Shen (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan) |
| Abstract: | In this study, we implemented a dictator game experiment to examine how the increase of the public characteristic in an impure public good affects individuals’ prosocial behavior. A within-subject design was used in the experiment. The dictator game was repeated six times with an impure public good introduced in four of them. We observe that the increase of the public characteristic in an impure public good partly crowds out individuals’ subsequent donations, which could be explained by a seemingly “mental accounting” mental process. In addition, we also find that the selfish behavior of individuals in dictator games with impure public goods, to some extent, has an inertia influence on their subsequent donations when the impure public good is removed. |
| Keywords: | Impure public goods, Dictator game, Multiple dictators, Mental accounting |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:dp2018-22&r=exp |
| By: | Takahashi, R.; Todo, Y. |
| Abstract: | By conducting a social experiment, we investigate the appropriate marketing strategies to stimulate the purchase of environmentally friendly product (certified coffee). We contribute to the literature in the following three ways. First, our experimental scale is large, targeting more than 10,000 vending machines installed in the throughout Japan. Second, we distinguish the observations by the location of vending machines, such as open- and closed-spaces, and capture the actual purchase of certified coffee. Third, to rigorously identify the factors affecting the purchase of certified coffee, we use the prescreening regression approach to reduce the bias due to endogeneity and check the sensitivity of our results. The results show that the vending machines installed in the closed-space, such as factory, company and university, significantly increase the number of sales of certified coffee by providing the information regarding the certification system. Additionally, the information provision significantly increases the total sales of vending machines. These results suggest that the information provision in closed-space enhances users purchase behavior for the certified coffee and successfully acquires the new customers. In contrast, none of the interventions have significant impact on the vending machines installed in the open-space, such as station and shopping mall. Acknowledgement : This work was supported by JSPS KAKENHI Grant-in-Aid for Young Scientists (B) Number 15K21001 and Grant-in-Aid for Scientific Research on Innovative Areas Number 25101003. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:277507&r=exp |
| By: | Gideon Yaniv (Ariel University); Doron Greenberg (Ariel University); Erez Siniver (COMAS) |
| Abstract: | Dishonesty is abundant in modern economic life. Over the past two decades, behavioral economists and social psychologists have been designing numerous lab and field experiments with the purpose of deriving insights on people?s tendency to cheat. A popular cheating experiment is the Fischbacher and Föllmi-Heusi (2013) die-under-the-cup paradigm, where subjects are asked to roll a six-sided fair die in private (under a cup or at a remote corner of the room) and are promised a payoff according to the outcome of the roll (e.g., 1, 2, 3, 4, 5 or 6 dollars for the corresponding die number rolled) which they report to the experimenter. While the die-under-the-cup task provides incentives for dishonest overreporting of the actual die outcome, there is no way to identify dishonesty on the individual level. It is only possible to elucidate the aggregate level of dishonesty among subjects as a group by comparing the average reported outcome to the expected outcome of 3.5 in a fair die roll or the percentage of higher reported outcomes, such as 5 and 6, to their expected outcome of 16.7 percent. The present paper reports the results of running a variant of the standard die-under-the-cup experiment which enables to detect dishonesty on the individual level. Individual dishonesty is detected when one reports an outcome which is practically impossible. Subjects are uncertain about the possible outcomes (other than the one they actually rolled) and may rationally refrain from telling a lie which, if impossible, might result in embarrassment and denial of any payoff. Would they be tempted to tell such a lie when faced with a proper incentive? Applying two payoff levels, we find that about 55 percent of subjects opted to tell an impossible lie even when the payoff was relatively low and about 70 percent did so when the payoff was doubled. Furthermore, about 30 percent and 50 percent lied to (what seemed to be) the maximum extent possible under the low and high payoff, respectively. These findings are in sharp contrast with Fischbacher and Föllmi-Heusi (2013) where the possible outcomes were known to subjects yet the reported outcomes remained stable even when the payoffs were tripled, or with Mazar et al (2008) who concluded, under a different riskless paradigm, that subjects cheated just a little bit and that the modest level of cheating was insensitive to the reward from cheating. |
| Keywords: | Dishonesty, Cheating, Impossible Lie, Die-under-the-Cup |
| JEL: | K42 C91 C92 |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:8109850&r=exp |
| By: | Tristan Roger; Wael Bousselmi; Patrick Roger; Patrick Roger; Marc Willinger |
| Abstract: | Conventional finance models indicate that the magnitude of stock prices should not influence portfolio choices or future returns. This view is contradicted, however, by empirical evidence. In this paper, we report the results of an experiment showing that trading prices, in experimental markets, are processed differently by participants, depending on their magnitude. Our experiment has two consecutive treatments. One where the fundamental value is a small number (the small price market) and a second one where the fundamental value is a large number (the large price market). Small price markets exhibit greater mispricing than large price markets. We obtain this result both between-participants and within-participants. Our findings show that price magnitude influences the way people perceive the distribution of future returns. This result is at odds with standard finance theory but is consistent with: (1) a number of observations in the empirical finance and accounting literature; and (2) evidence in neuropsychology on the use of different mental scales for small and large numbers. |
| Keywords: | experimental markets, number perception, behavioral bias, stock price magnitude,mental scales |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:lam:wpceem:18-21&r=exp |
| By: | Claudia Keser; Stephan Müller; Emmanuel Peterlé; Holger A. Rau |
| Abstract: | This paper experimentally tests the relation between subjects’ competitiveness and bargaining behavior. Bargaining is investigated in a demand-ultimatum game, where the responder can request a share of the pie from the proposer. The re-sults show that highly competitive proposers earn less, since they make lower offers, which are more often rejected. Similarly, highly competitive responders achieve lower payoffs, since they request excessive amounts which induces lower proposals. These findings establish a link between competitiveness and bargaining as suggested by social and evolutionary psychology. Thus, we identify one driver of the empirical heterogeneity of bargaining behavior and outcomes. From a management perspec-tive our findings highlight that giving thought to employees’ competitiveness before delegating them to participate in negotiations may pay off. |
| Keywords: | Bargaining,Competitiveness,Experiment, |
| JEL: | C91 M54 |
| Date: | 2018–04–05 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-08&r=exp |
| By: | Bastek, Christian; Klaus, Bettina; Kübler, Dorothea |
| Abstract: | The use of lotteries is advocated to desegregate schools. We study lottery quotas embedded in the two most common school choice mechanisms, namely deferred and immediate acceptance mechanisms. Some seats are allocated based on merit (e.g., grades) and some based on lottery draws. We focus on the effect of the lottery quota on truth-telling, the utility of students, and the student composition at schools, using theory and experiments. We find that the lottery quota strengthens truth-telling in equilibrium when the deferred acceptance mechanism is used while it has no clear effect on truth-telling in equilibrium for the immediate acceptance mechanism. This finds support in the experiment. Moreover, the lottery quota leads to more diverse school populations in the experiments, as predicted. Comparing the two mechanisms, students with the lowest grades profit more from the introduction of the lottery under immediate than under deferred acceptance. |
| Keywords: | school choice,immediate acceptance mechanism,deferred acceptance mechanism,lotteries,experiment,market design |
| JEL: | C78 C91 D82 I24 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbmbh:spii2018205&r=exp |
| By: | Dina Tasneem; Audrey Azerot; Marine de Montaignac; Jim Engle-Warnick |
| Abstract: | We report results from an economics experiment that examines the role of financial literacy in retirement savings. In the experiments, participants make decisions in a retirement savings game, in which income during working years is uncertain. Participants are nudged to varying degrees with automatic savings in each period of the game. Some participants receive financial literacy training in the form of training to compute the expected savings needed at retirement to smooth consumption over the entire life cycle. We find ev-idence that literacy increases savings and improves efficiency. Our finding has implications for choice architecture for retirement savings. |
| Keywords: | Precautionary Savings,Retirement Savings,Life-cycle Model,Dynamic Optimization,Nudge,Financial Literacy,Decision Heuristics, |
| JEL: | C90 |
| Date: | 2018–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-24&r=exp |
| By: | Dina Tasneem; Audrey Azerot; Marine de Montaignac; Jim Engle-Warnick |
| Abstract: | We report results from an on-line economics experiment that examines the effect of nudging retirement savings decisions. In the experiments, participants make decisions in a finitely repeated retirement savings game, in which income during working years is uncertain, and retire-ment age is known. Participants, who are household financial decision-makers, are nudged with automatic savings in each period of the game. We find that that the nudge simply replaced nat-ural decision-making observed in the absence of a nudge in this experiment, even to the extent that it resulted in nearly identical inferred decision rules. This surprising result highlights the unpredictability of the effect of nudging human behavior. |
| Keywords: | Precautionary Savings,Retirement Savings,Life-cycle Models,Dynamic Optimization,Decision Heuristics,Nudge,Choice Architecture, |
| JEL: | C91 E21 C61 |
| Date: | 2018–07–23 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-23&r=exp |
| By: | Meloso, Debrah; Nunnari, Salvatore; Ottaviani, Marco |
| Abstract: | We experimentally study cheap talk by reporters motivated by their reputation for being well informed. Reputation is assessed by evaluators who see the report and the realized state of the world. In the laboratory, we manipulate the key drivers of misreporting incentives: uncertainty about the phenomenon to forecast and evaluators' beliefs. As predicted by theory, reporters are more likely to report truthfully when the state of the world is more uncertain and when evaluators conjecture that reporters always report truthfully. However, evaluators have difficulty learning reporters' strategies and tend to overreact to message accuracy, exacerbating reporters' incentives to misreport. |
| Keywords: | cheap talk; experts; Forecasting; Laboratory experiments; reputation |
| JEL: | C91 D83 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13231&r=exp |
| By: | James Andreoni; Christina Gravert; Michael A. Kuhn; Silvia Saccardo; Yang Yang |
| Abstract: | If experimental subjects arbitrage against market interest rates when making intertemporal allocations of cash, the data will reveal nothing about subjects' discount rates, only uncovering subjects' market interest rates. If they frame choices narrowly, market rates will not be salient and the experiment will uncover subjects' utility discount rates. We test arbitrage directly by forcing all transactions with subjects to be instant electronic bank transfers, thus making arbitrage easy and salient. We also employ four decision frames to test alternative hypotheses. Our evidence contradicts arbitrage, supports money as a valid reward, and suggests framing as a correlate with present bias. |
| JEL: | C18 C91 D87 D9 |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25232&r=exp |
| By: | Charles Bellemare; Marion Goussé; Guy Lacroix; Steeve Marchand |
| Abstract: | We investigate the determinants and extent of labor market discrimination to-ward people with physical disabilities using a large scale field experiment. Appli-cations were randomly sent to 1477 private firms advertising open positions. We find that average callback rates of disabled and non-disabled applicants are respec-tively 14.4% and 7.2%. We find this differential does not result from accessibility constraints related to firm infrastructures. We also find that mentioning eligibility to a government subsidy to cover the cost of workplace adaptation does not in-crease callback rates. Finally, we estimate that a lower bound of the proportion of discriminating firms is 49.7%. |
| Keywords: | Discrimination,Disabilities,Partial identification, |
| JEL: | J71 J68 |
| Date: | 2018–04–27 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-15&r=exp |
| By: | Canavari, Maurizio; Drichoutis, Andreas C.; Lusk, Jayson L.; Nayga, Rodolfo |
| Abstract: | In this paper, we review the recent advances in the literature of experimental auctions and provide practical advice and guidelines for researchers. We focus on issues related to randomization to treatment and causal identification of treatment effects, on design issues such as selection between different elicitation formats, multiple auction groups in a single session, and house money effects. We also discuss sample size issues related to recent trends about pre-registration and pre-analysis plans. We then present the pros and cons of moving auction studies from the lab to the field and review the recent literature on behavioral factors that have been identified as important for auction outcomes. |
| Keywords: | auctions; randomization; sample size; pre-registration; field experiments; behavioral factors |
| JEL: | C90 D44 |
| Date: | 2018–10–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89715&r=exp |
| By: | Zhang, Peilu; Zhang, Yinjunjie; Palma, Marco |
| Abstract: | Women often respond less favorably to competition than men. In this paper, we test for the effects of social norms on willingness to compete. Subjects compete in two-person teams. In the treatment, one team member is randomly assigned the role of “breadwinner”, and the other person is randomly assigned as the “supporter”. There are no real differences between the roles in our experiment, except for the framing. These two roles have opposite social norms for competitiveness, reminiscent of gender roles in western society. In the baseline, subjects compete in two-person teams without role assignment. We find women’s willingness to compete significantly increases when they are assigned as breadwinners compared to women in the base- line or female supporters. We also find that there is no gender gap in willingness to compete between female breadwinners and males in the baseline. The increase in willingness to compete is mainly contributed by high-ability women. Males are also affected by the role assignment; male supporters are less likely to enter the tournament than male breadwinners. We argue that the changes in willingness to compete are mainly driven by the social norms implied by the two roles. |
| Keywords: | gender gap, gender stereotypes, tournament entry |
| JEL: | A14 B54 C90 |
| Date: | 2018–10–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89727&r=exp |
| By: | Daviti Jibuti |
| Abstract: | We use a correspondence testing approach to study discrimination against applicants with visible tattoos in the German labor market. The method has been widely employed in discrimination literature; however, the majority of papers examine objects of discrimination that are exogenously given (gender, race, ethnicity, etc.). The design of our experiment allows us to study the extent of discrimination against choice-based characteristics. We send fictitious applications to online job postings in the banking sector. Otherwise identical applications differ only in the picture attached: in the treatment group the applicants have a visible tattoo. The extent of discrimination is measured by the difference in callback rates. We find that candidates without visible tattoos have, on average, a 13 percentage point higher callback rate, or an increase in the callback rate of 54%. Following Akerlof and Kranton (2000), our results once more highlight the centrality of identity. |
| Keywords: | labor market discrimination; field experiment; visible tattoo; |
| JEL: | C93 J71 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp628&r=exp |
| By: | Moldovanu, Benny |
| Abstract: | We study the revenue maximizing allocation of m units among n symmetric agents that have unit demand and convex preferences over the probability of receiving an object. Such preferences are naturally induced by a game where the agents take costly actions that affect their values before participating in the mechanism. Both the uniform m + 1 price auction and the discriminatory pay-your-bid auction with reserve prices constitute symmetric revenue maximizing mechanisms. Contrasting the case with linear preferences, the optimal reserve price reacts to both demand and supply, i.e., it depends both on the number of objects m and on number of agents n. The main tool in our analysis is an integral inequality involving majorization, super-modularity and convexity due to Fan and Lorentz (1954). |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13259&r=exp |
| By: | Jeannette Brosig-Koch; Timo Heinrich; Heike Hennig-Schmidt; Claudia Keser; Joachim Weimann |
| Abstract: | Since Mancur Olson's "Logic of collective action" it is common conviction in social sciences that in large groups the prospects of a successful organization of collective actions are rather bad. Following Olson’s logic, the impact of an individual’s costly contribution becomes smaller if the group gets larger and, consequently, the incentive to cooperate decreases with group size. Conducting a series of laboratory experiments with large groups of up to 100 subjects, we demonstrate that Olson's logic does not generally account for observed behavior. Large groups in which the impact of an individual contribution is almost negligible are still able to provide a public good in the same way as small groups in which the impact of an individual contribution is much higher. Nevertheless, we find that small variations of the MPCR in large groups have a strong effect on contributions. We develop a hypothesis concerning the interplay of MPCR and group size, which is based on the assumption that the salience of the advantages of mutual cooperation plays a decisive role. This hypothesis is successfully tested in a second series of experiments. Our result raises hopes that the chance to organize collective action of large groups is much higher than expected so far. Since Mancur Olson's "Logic of collective action" it is common conviction in social sciences that in large groups the prospects of a successful organization of collective actions are rather bad. Following Olson’s logic, the impact of an individual’s costly contribution becomes smaller if the group gets larger and, consequently, the incentive to cooperate decreases with group size. Conducting a series of laboratory experiments with large groups of up to 100 subjects, we demonstrate that Olson's logic does not generally account for observed behavior. Large groups in which the impact of an individual contribution is almost negligible are still able to provide a public good in the same way as small groups in which the impact of an individual contribution is much higher. Nevertheless, we find that small variations of the MPCR in large groups have a strong effect on contributions. We develop a hypothesis concerning the interplay of MPCR and group size, which is based on the assumption that the salience of the advantages of mutual cooperation plays a decisive role. This hypothesis is successfully tested in a second series of experiments. Our result raises hopes that the chance to organize collective action of large groups is much higher than expected so far. |
| Date: | 2018–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-02&r=exp |
| By: | Veettil, P. Chellattan; Yashodha, Y.; Johny, J. |
| Abstract: | Contract farming in seed production has played an instrumental role in bringing private investment into seed research and production. However, inefficiencies in the institutional mechanism hinder the seed producers from realizing the full potential benefits of seed contracts. The present study attempts to analyze the producer's preference for group contracts and its impact on the welfare of actors in the seed value chain. We propose two types of group contracts, viz, contract B (company-organizer-seed producers group (SPG)) and C (company-SPG). We carried out an economic experiment using real producers and organizers currently engaged in seed production. Producers face a choice between an existing contract and either of the proposed group contracts. The experiment consists of two treatments, i) concealed and revealed price information and ii) presence and absence of local organizer while making the choice decision. We find that preference for contract B is higher than contract C and the existing contract. Contract B shows higher price bargaining under the concealed price information compared to revealed treatment. Average group life of SPGs is 3.78 periods and more than half of the groups (53%) survived throughout the five rounds indicating a very high sustainability. Acknowledgement : We Acknowledge Dr. Jannaiah, for helping us in coordinating the experiment. We are truly glad for Vikram Patil and Prabhakaran, International Rice Research Institute for assisting and rolling out the experiment. |
| Keywords: | Crop Production/Industries |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:277563&r=exp |
| By: | Morgan, S.; Mason, N.; Shupp, R. |
| Abstract: | Motivating individual contributions to and compliance with policies designed to provide and protect public goods is a major challenge for agri-environmental program administrators. This article investigates whether and to what extent stakeholder participation via anonymous, open-ended comments in the design and formulation of agri-environmental policy may motivate individual contributions to public goods and compliance with final rules and policies. We introduce a comment mechanism into a public goods experiment both with and without an exogenous enforcement mechanism to analyze the impacts on individual behavior. Stakeholder comments are found to have a large positive effect on both individual contributions to a public good and compliance with regulatory policies conditional on the presence of complementary enforcement. Stakeholder comments also significantly impact the behavior of policymakers, leading to higher contribution rules. We link our findings to the relevance of stakeholder inclusion for agri-environmental policymaking and potential to approach Pareto Optimal outcomes. Acknowledgement : We would like to thank Rachel Croson and Robert Myers for helpful comments on earlier drafts of this paper. We would also like to thank seminar participants at Michigan State University, and conference participants at AAEA 2017 and AERE 2017 for helpful comments. We gratefully acknowledge financial support for this project from the USDA-Economic Research Service and the Center for Behavioral and Experimental Agri-Environmental Research under grant 42734. SM also gratefully acknowledges support from the Global Center for Food Systems Innovation. |
| Keywords: | Public Economics |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:277122&r=exp |
| By: | Matteo M. Marini (LEE & Economics Department, Universitat Jaume I, Castellón, Spain; Economics Department, Università degli Studi dell’Insubria, Italy) |
| Abstract: | The paper is a meta-analysis of experimental studies dealing with the impact of incidental emotions on risky choices, so as to explain traditional heterogeneity of outcomes in the field. After performing an advanced search in Google Scholar and filtering out studies that do not match a list of selection criteria, I include 16 manuscripts from which 46 observations are drawn at the treatment level. At this point, I code a set of moderator variables representing experimental protocols and calculate Cohen (1988)’s d effect size as dependent variable of a weighted least squares (WLS) regression where larger studies are given more weight. Among the results, which are robust to different techniques for computing standard errors, I find that emotions induce higher risk aversion when a multiple price list à la Holt and Laury (2002) is used in place of revealed preferences methods, as well as in case the risk elicitation task is framed as an investment decision instead of an abstract choice. Given the variety of procedures employed in this type of experiments and in the absence of a tailor-made game to answer such research questions, I recommend faithful study replication as preferential path in order to investigate the influence of emotions on risky decision making and ensure comparability. |
| Keywords: | meta-analysis, experimental design, emotions, risky decision-making, effect size |
| JEL: | C90 D81 D91 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:jau:wpaper:2018/14&r=exp |