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on Experimental Economics |
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Issue of 2021‒08‒16
thirty-two papers chosen by |
| By: | Bauer, Michal (Charles University, Prague); Cahlíková, Jana (Max Planck Institute for Tax Law and Public Finance); Chytilová, Julie (Charles University, Prague); Roland, Gerald (University of California, Berkeley) |
| Abstract: | This paper provides experimental evidence showing that members of a majority group systematically shift punishment on innocent members of an ethnic minority. We develop a new incentivized task, the Punishing the Scapegoat Game, to measure how injustice affecting a member of one's own group shapes punishment of an unrelated bystander ("a scapegoat"). We manipulate the ethnic identity of the scapegoats and study interactions between the majority group and the Roma minority in Slovakia. We find that when no harm is done, there is no evidence of discrimination against the ethnic minority. In contrast, when a member of one's own group is harmed, the punishment "passed" on innocent individuals more than doubles when they are from the minority, as compared to when they are from the dominant group. These results illuminate how individualized tensions can be transformed into a group conflict, dragging minorities into conflicts in a way that is completely unrelated to their behavior. |
| Keywords: | punishment, minority groups, inter-group conflict, discrimination, scapegoating, lab-in-field experiments |
| JEL: | C93 D74 D91 J15 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14608&r= |
| By: | Michal Bauer; Jana Cahlikova; Julie Chytilova; Gerard Roland; Tomas Zelinsky |
| Abstract: | This paper provides experimental evidence showing that members of a majority group systematically shift punishment on innocent members of an ethnic minority. We develop a new incentivized task, the Punishing the Scapegoat Game, to measure how injustice affecting a member of one’s own group shapes punishment of an unrelated bystander (“a scapegoat”). We manipulate the ethnic identity of the scapegoats and study interactions between the majority group and the Roma minority in Slovakia. We find that when no harm is done, there is no evidence of discrimination against the ethnic minority. In contrast, when a member of one’s own group is harmed, the punishment ”passed” on innocent individuals more than doubles when they are from the minority, as compared to when they are from the dominant group. These results illuminate how individualized tensions can be transformed into a group conflict, dragging minorities into conflicts in a way that is completely unrelated to their behavior. |
| Keywords: | punishment; minority groups; inter-group conflict; discrimination; scapegoating; lab-in-field experiments; |
| JEL: | C93 D74 D91 J15 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp697&r= |
| By: | Javier Aliaga Lordemann (Senior Associate Researcher at INESAD) |
| Abstract: | Common pool resources (CPRs) are usually exploited one generation after another – often overexploited - meaning there is an intergenerational link between the consumers – e.g., water for farming activities. This key dimension is often not considered in theoretical or field experiments, due to the difficultly in approaching it. We want to overcome this barrier introducing the hypothesis of ‘’intergenerational altruism” for CPRs. The implication is that altruism reduce the exploitation of the natural resources, since the agents recognize that the exploitation not only creates negative externalities for their own generation, but also for all future generations. An alternative hypothesis is the ‘’intergenerational equity’’ where the agents restrain their consumption to equalize their income over time. To prove these hypotheses, we conducted a field experiment in four farming communities located in the Bolivian Department of Chuquisaca during the third quarter of 2019. We consider common water for farming activities as a CPRs, since these communities use this resource for several decades, the intergenerational link is evident. Our intergenerational field experiment includes four treatments based on the replacement rate of the resources – i.e., FAST, SLOW, RESTART or normal replacement, under one-shot non-cooperative game without feedback. We also introduce two variations, the possibility to accumulate water in a dam, which modify the availability of CPRs. Second, the possibility to manage the common farming water through the traditional social arrangement of the Water Judge, which is a representative member of the community delegated to solve problems related with water management, named SAT treatment. The results showed that our hypothesis was not probed since the intergenerational link does not mitigate the overexploitation of CPRs. Nevertheless, we also found that the “Water Judge” could be a cost-effective treatment in small farming communities. |
| Keywords: | Common pool resources, intergenerational altruism and equity, free riders . |
| JEL: | C72 C92 D62 Q20 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:adv:wpaper:202101&r= |
| By: | Alberto Abadie; Jinglong Zhao |
| Abstract: | This article studies experimental design in settings where the experimental units are large aggregate entities (e.g., markets), and only one or a small number of units can be exposed to the treatment. In such settings, randomization of the treatment may induce large estimation biases under many or all possible treatment assignments. We propose a variety of synthetic control designs as experimental designs to select treated units in non-randomized experiments with large aggregate units, as well as the untreated units to be used as a control group. Average potential outcomes are estimated as weighted averages of treated units for potential outcomes with treatment, and control units for potential outcomes without treatment. We analyze the properties of such estimators and propose inferential techniques. |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2108.02196&r= |
| By: | Belzil, Christian (Ecole Polytechnique, Paris); Pernaudet, Julie (University of Chicago); Poinas, François (Toulouse School of Economics) |
| Abstract: | Imagine the situation in which an econometrician can infer the distribution of welfare gains induced by the provision of higher education financial aid using survey data obtained from a set of individuals, and can estimate the same distribution using a highly incentivized field experiment in which the same set of individuals participated. In the experimental setting relying on incentivized choices, making the wrong decision can be costly. In the survey, the stakes are null and reporting false intentions and expectations is costless. In this paper, we evaluate the extent to which the decomposition of the two welfare gain distributions into latent factors are coherent. We find that individuals often put a much different weight to a specific set of determinants in the experiment and in the survey and that the valuations of financial aid are rank incoherent. About 66% of Biased Incoherency (defined as the tendency to have a higher valuation rank in the experiment than in the survey) is explained by individual heterogeneity in subjective benefits, costs and other factors and about half of these factors affect the welfare gains of financial aid in the survey and in the experiment in opposite directions. Ex-ante policy evaluation of a potential expansion of the Canadian higher education financial aid system may therefore depend heavily on whether or not the data have been obtained in an "incentivized" context. |
| Keywords: | field experiment, survey data, coherency, incentives |
| JEL: | I2 C91 C93 D12 D9 D91 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14594&r= |
| By: | Hernan Bejarano (Center of Economics Research and Teaching, Economics Division (CIDE), Mexico.); Joris Gillet (Middlesex University, Business School.); Ismael Rodriguez-Lara (Department of Economic Theory and Economic History, University of Granada.) |
| Abstract: | We experimentally investigate the effect of a negative endowment shock that can cause inequality in a trust game. Our goal is to assess whether different causes of inequality have different effects on trust and trustworthiness. In our trust game, we vary whether there is inequality (in favor of the second mover) or not and whether the inequality results from a random negative shock (i.e., the outcome of a die roll) or exists from the outset. Our findings suggest that inequality causes firstmovers to send more of their endowment and second-movers to return more. However, we do not find support for the hypothesis that the cause of the inequality matters. Behavior after the occurrence of a random shock is not significantly different from the behavior in treatments where the inequality exists from the outset. Our results highlight the need to be cautious when interpreting the effects on trust and trustworthiness of negative random shocks in the field (such as natural disasters). Our results suggest that these effects are primarily driven by the inequality caused by the shock and not by any of the additional characteristics of the shock, like saliency or uncertainty. |
| Keywords: | Trust game, endowment heterogeneity, random shocks, inequality aversion, experimental economics. |
| JEL: | C91 D02 D03 D69 |
| Date: | 2021–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:gra:wpaper:21/06&r= |
| By: | Riddell, Chris; Riddell, William Craig |
| Abstract: | The Income Maintenance Experiments have received renewed attention due to growing international interest in a Basic Income. Proponents viewed a Negative Income Tax as a replacement for traditional welfare with stronger work incentives and reduced poverty. However, existing labor supply estimates for single parents are uniformly negative. We reassess the experimental evidence and find randomization failure in two NITs (Gary and Seattle). In Denver and Manitoba, we find a positive labor supply response for those on welfare prior to random assignment. Our results provide strong evidence that a NIT can increase work activity among single parents on welfare. |
| JEL: | C9 I38 J22 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:clefwp:36&r= |
| By: | Lia Q. Flores (School of Economics and Management, University of Porto); Miguel A. Fonseca (Department of Economics, University of Exeter) |
| Abstract: | Psychologists have long identified the tendency of humans to overestimate their skill relative to their peers (overplacement). We investigate whether this phenomenon is exacerbated by group affiliation: social identity theory predicts people evaluate in-group members more positively than out-group members, and we hypothesized that this differential treatment may result in greater overplacement when interacting with an out-group member. We tested this hypothesis with 301 US voters affiliated with either the Republican or Democratic party in the run-up to the 2020 Presidential election, a time when political identities were salient and highly polarized. We found there is a higher tendency for overplacement when faced with an out-group opponent than with an in-group opponent. Decomposition analysis suggests this difference is due to underestimating the opponent, as opposed to overestimating one's own performance to a higher degree. Moreover, any tendency to incur in overplacement is mitigated when faced with an opponent with the same political-identity relative to one with a neutral one. While group affiliation biases initial priors, such effect is unchanged when participants are asked to update their beliefs. |
| Keywords: | overconfidence, belief updating, motivated beliefs, overplacement, social identity, political affiliation, competition |
| JEL: | D18 D91 Z1 C9 |
| Date: | 2021–08–03 |
| URL: | http://d.repec.org/n?u=RePEc:exe:wpaper:2103&r= |
| By: | Christoph Siemroth; Lars Hornuf |
| Abstract: | Are investors willing to give up a higher return if the investment generates positive environmental impact? We investigate this question with a decision experiment among crowdfunders, where they choose between a higher return or environmental impact. Overall, 65% of investors choose environmental impact at the expense of a higher return for sufficiently large impact, 14% choose impact independent of the magnitude of impact, while 21% choose the higher return independent of impact. Combining the experimental data with historical investments, we find that investors allocate a larger share of funds to green projects if they value environmental impact more, and if they expect green projects to be more profitable. These findings suggest that investors have a preference for positive environmental impact, and satisfy it by investing in green projects. We further show that the preference for environmental impact is distinct from a preference for positive social impact. Finally, we introduce new survey measures of impact for future use, which are experimentally validated and predict field behavior. |
| Keywords: | debt crowdfunding, environmental impact, ESG, green investments, social impact, sustainable finance |
| JEL: | C93 D14 D90 G32 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9197&r= |
| By: | Kevin Bauer; Michael Kosfeld; Ferdinand von Siemens |
| Abstract: | We study, theoretically and empirically, the effects of incentives on the self-selection and coordination of motivated agents to produce a social good. Agents join teams where they allocate effort to either generate individual monetary rewards (selfish effort) or contribute to the production of a social good with positive effort complementarities (social effort). Agents differ in their motivation to exert social effort. Our model predicts that lowering incentives for selfish effort in one team increases social good production by selectively attracting and coordinating motivated agents. We test this prediction in a lab experiment allowing us to cleanly separate the selection effect from other effects of low incentives. Results show that social good production more than doubles in the low-incentive team, but only if self-selection is possible. Our analysis highlights the important role of incentives in the matching of motivated agents engaged in social good production. |
| Keywords: | incentives, intrinsic motivation, self-selection, public service |
| JEL: | C91 D90 J24 J31 M52 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9207&r= |
| By: | Lucile Marty (CSGA - Centre des Sciences du Goût et de l'Alimentation [Dijon] - UB - Université de Bourgogne - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Laura Arrazat (CSGA - Centre des Sciences du Goût et de l'Alimentation [Dijon] - UB - Université de Bourgogne - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Gaëlle Arvisenet (CSGA - Centre des Sciences du Goût et de l'Alimentation [Dijon] - UB - Université de Bourgogne - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Sophie Nicklaus (CSGA - Centre des Sciences du Goût et de l'Alimentation [Dijon] - UB - Université de Bourgogne - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Stephanie Chambaron (CSGA - Centre des Sciences du Goût et de l'Alimentation [Dijon] - UB - Université de Bourgogne - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | A 2-arm randomised control trial (with and without labels) will be conducted to test the effects of an environmental label on food choices in a virtual supermarket. A sample of 130 participants will take part in two shopping tasks: 1/ selection of 3 products to prepare a home-made dish, and 2/ selection of a ready-to-eat dish. These two tasks will be repeated for two scenarios: 1/ participants will be asked to select the foods for usual meals, and 2/ participants will be asked to select the foods for environmentally-friendly meals. This experimental design will allow to compare food choices in the presence vs. the absence of an environmental label and to investigate whether the label is informative and likely to help individuals to choose more environmental-friendly food options when explicitly asked to do so. |
| Keywords: | labelling,food choice |
| Date: | 2021–05–24 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03270668&r= |
| By: | Stéphane Robin (GAEL - Laboratoire d'Economie Appliquée de Grenoble - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes); Katerina Straznicka (CleRMa - Clermont Recherche Management - ESC Clermont-Ferrand - École Supérieure de Commerce (ESC) - Clermont-Ferrand - UCA [2017-2020] - Université Clermont Auvergne [2017-2020]); Marie Claire Villeval (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We explore the effects of competitive incentives and of their time horizon on the evolution of both asset prices and trading activity in experimental asset markets. We compare (i) a no-bonus treatment; (ii) a short-term bonus treatment in which bonuses are assigned to the best performers at the end of each trading period; (iii) a long-term bonus treatment in which bonuses are assigned to the best performers at the end of the 15 periods of the market. We find that the existence of bonus contracts does not increase the likelihood of bubbles but it affects their severity, depending on the time horizon of bonuses. Markets with long-term bonus contracts experience lower price deviations and a lower turnover of assets than markets with either no bonuses or long-term bonus contracts. Short-term bonus contracts increase price deviations but only when markets include a higher share of male traders. At the individual level, the introduction of bonus contracts increases the trading activity of males, probably due to their higher competitiveness. |
| Keywords: | experiment,risk attitudes,asset market,bubbles,incentives,bonuses |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-03033454&r= |
| By: | Maria Laura Di Tommaso; Dalit Contini; Dalila De Rosa; Francesca Ferrara; Daniela Piazzalunga; Ornella Robutti |
| Abstract: | We implement a teaching methodology aimed at improving primary school children’s mathematical skills. The methodology, grounded in active and cooperative learning, focuses on peer interaction, sharing of ideas, learning from mistakes, and problem solving. We evaluate the causal effect of the intervention on the gender gap in mathematics in Italy with a randomized controlled trial. The treatment significantly improves girls’ math performance (0.14 s.d.), with no impact on boys, and reduces the math gender gap by more than 40%. The effect is stronger for girls with high pre-test scores. |
| Keywords: | Gender gap, Mathematics, School achievement, Primary school, Active learning, Teaching methodologies, Randomized controlled trial |
| JEL: | I21 I24 J16 C93 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wpaper:657&r= |
| By: | Eric Schniter (Economic Science Institute, Chapman University and Division of Anthropology, California State University, Fullerton); J. Dustin Tracy (Economic Science Institute, Chapman University); Vojtech Zika (Economics Science Institute, Chapman University and Evangelista Purkyne University) |
| Abstract: | Credence-goods experiments have thus far have focused on stylized setting in which experts can perfectly identify the consumers’ best option and that option works without fail. However, naturally these situa-tions are as much art as science, with uncertainties that complicate assessing the quality of service and advice. We introduce two sources of uncertainty into a credence good experiment. The first is diagnostic uncertainty; experts receive a noisy signal of consumer type so might make an ‘honest’ mistake when advising what is in consumers’ best interests. The second is service uncertainty; the services available to the consumer do not always work. Both sources of uncertainty make detection of expert dishonesty more diÿcult, so are expected increase dishonesty by experts and decrease consumer trust (willingness to consult experts for advice and to follow expert advice) – decreasing eÿciency of the interactions. We also test how consumers use ratings and whether ratings restrain both dishonesty and distrust by creating reliable reputations. In contrast to predictions, we find that uncertainty decreases dishonesty and increases trust. Also in contrast to predictions, ratings do not improve eÿciency of the transactions under uncertainty – in part due to buyers’ tendency to “shoot the messenger†(give low ratings) when they buy service that does not work due to bad luck, and to give experts the “benefit of the doubt†(high ratings) when they buy service that may have been intentionally over-provided (not in the consumer’s best interest). |
| Keywords: | Credence Goods, Uncertainty, Principal Agent, Ratings |
| JEL: | D82 L14 L15 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:21-15&r= |
| By: | Sébastien Duchêne (CEE-M - Centre d'Economie de l'Environnement - Montpellier - UMR 5211 - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Adrien Nguyen-Huu (CEE-M - Centre d'Economie de l'Environnement - Montpellier - UMR 5211 - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, Chaire Energie & Prospérité - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - X - École polytechnique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - Institut Louis Bachelier); Dimitri Dubois (CEE-M - Centre d'Economie de l'Environnement - Montpellier - UMR 5211 - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Marc Willinger (CEE-M - Centre d'Economie de l'Environnement - Montpellier - UMR 5211 - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | We assess the impact of environmental externalities on portfolio decisions in a lab-inthe-field experiment on finance professionals and students. Subjects show pro-environmental preferences, with a strong asymmetry because of the sign of the externality. They are prone to accept lower return for positive environmental impact, but not to bear increased risk. Finance professionals are more pro-environmental than students, particularly regarding negative externalities, and less influenced by a ranking signal about environmental performance. Additional control tasks show that pro-social and pro-environmental preferences have much less influence on portfolio composition than market practices for finance professionals, but they are significant predictors for students. |
| Abstract: | Nous évaluons l'impact d'externalités environnementales sur les décisions de portefeuille dans le cadre d'une expérience en laboratoire sur des professionnels de la finance et des étudiants. Les sujets exhibent des préférences pro-environnementales, avec une forte asymétrie due au signe de l'externalité. Ils sont enclins à accepter un rendement inférieur pour un impact environnemental positif, mais pas à supporter un risque accru. Les professionnels de la finance sont plus pro-environnementaux que les étudiants, notamment en ce qui concerne les externalités négatives, et moins influencés par un signal de rang concernant la performance environnementale. Des tâches de contrôle supplémentaires montrent que les préférences pro-sociales et pro-environnementales ont beaucoup moins d'influence sur la composition du portefeuille que les pratiques de marché pour les professionnels de la finance, mais qu'elles sont des prédicteurs significatifs pour les étudiants. |
| Date: | 2021–07–13 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03285376&r= |
| By: | Emily Breza; Fatima Cody Stanford; Marcella Alsan; Burak Alsan; Abhijit Banerjee; Arun G. Chandrasekhar; Sarah Eichmeyer; Traci Glushko; Paul Goldsmith-Pinkham; Kelly Holland; Emily Hoppe; Mohit Karnani; Sarah Liegl; Tristan Loisel; Lucy Ogbu-Nwobodo; Benjamin A. Olken; Carlos Torres; Pierre-Luc Vautrey; Erica Warner; Susan Wootton; Esther Duflo |
| Abstract: | During the COVID-19 epidemic, many health professionals started using mass communication on social media to relay critical information and persuade individuals to adopt preventative health behaviors. Our group of clinicians and nurses developed and recorded short video messages to encourage viewers to stay home for the Thanksgiving and Christmas Holidays. We then conducted a two-stage clustered randomized controlled trial in 820 counties (covering 13 States) in the United States of a large-scale Facebook ad campaign disseminating these messages. In the first level of randomization, we randomly divided the counties into two groups: high intensity and low intensity. In the second level, we randomly assigned zip codes to either treatment or control such that 75% of zip codes in high intensity counties received the treatment, while 25% of zip codes in low intensity counties received the treatment. In each treated zip code, we sent the ad to as many Facebook subscribers as possible (11,954,109 users received at least one ad at Thanksgiving and 23,302,290 users received at least one ad at Christmas). The first primary outcome was aggregate holiday travel, measured using mobile phone location data, available at the county level: we find that average distance travelled in high-intensity counties changed by -0.993 percentage points (95% CI -1.616, -0.371, p-value 0.002) the three days before each holiday. The second primary outcome was COVID-19 infection at the zip-code level: COVID-19 infections recorded in the two-week period starting five days post-holiday declined by 3.5 percent (adjusted 95% CI [-6.2 percent, -0.7 percent], p-value 0.013) in intervention zip codes compared to control zip codes. |
| JEL: | D83 I12 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29021&r= |
| By: | Nina Buchmann; Erica M. Field; Rachel Glennerster; Shahana Nazneen; Xiao Yu Wang |
| Abstract: | Child marriage remains common even where female schooling and employment opportunities have grown. We introduce a signaling model in which bride type is imperfectly observed but preferred types have lower returns to delaying marriage. We show that in this environment the market might pool on early marriage even when everyone would benefit from delay. In this setting, offering a small incentive can delay marriage of all treated types and untreated non-preferred types, while programs that act directly on norms can unintentionally encourage early marriage. We test these theoretical predictions by experimentally evaluating a financial incentive to delay marriage alongside a girls’ empowerment program designed to shift norms. As predicted, girls eligible for the incentive are 19% less likely to marry underage, as are nonpreferred type women ineligible for the incentive. Meanwhile, the empowerment program was successful in promoting more progressive gender norms but failed to decrease adolescent marriage and increased dowry payments. |
| JEL: | D03 D9 O1 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29052&r= |
| By: | Haering, Alexander |
| Abstract: | In this study I analyze how lottery framing and lottery display type affect the degree of higher-order risk preferences. I explore differences by comparing reduced and compound lottery framing, and by comparing lotteries in an urn-style and in a spinner-style display format. Overall, my findings show that individual behavior is influenced by lottery framing but not by display format. |
| Keywords: | Risk aversion,prudence,temperance,higher-order risk preferences,lottery framing |
| JEL: | C91 D81 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:913&r= |
| By: | Antonio Palestrini; Domenico Delli Gatti; Mauro Gallegati; Bruce C. Greenwald |
| Abstract: | Agents forming adaptive expectations generally make systematic mistakes. This characterization has fostered the rejection of adaptive expectations in macroeconomics. Experimental evidence, however, shows that in complex environments human subjects frequently rely on adaptive heuristics – model-consistent expectations being simply too difficult or impossible to implement – but their forecasting performance is not as inadequate as assumed in the characterization above. In this paper we show that adaptive agents may not be as gullible as we used to think. In a model with adaptive expectations augmented with a Belief Correction term (which takes into account the drift of the macroeconomic variable of interest) the average forecasting error is frequently close to zero, hence (belief amended) adaptive expectations are close to unbiasedness. |
| Keywords: | heterogeneous adaptive expectations, belief correction, agent based models |
| JEL: | C63 D83 D84 E71 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9205&r= |
| By: | Yansong Li; Elise Météreau; Ignacio Obeso; Luigi Butera; Marie Claire Villeval (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Jean-Claude Dreher (CNC - Institut des sciences cognitives Marc Jeannerod - Centre de neuroscience cognitive - UMR5229 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | The role of testosterone on cognitive functions in humans remains controversial. One recent hypothesis suggests that this steroid hormone advances social status. As being observed by others is known to modulate a range of behaviors because of image concerns, we hypothesized that such an audience effect might be an important component of status seeking that is under the control of testosterone. Thus, we investigated to which extent testosterone levels are associated with the effect of being observed during prosocial choices and the neural mechanisms underlying this effect. We enrolled twenty-four male participants, aged 22.47 ± 2.62 years, in an fMRI experiment to examine the relationship between testosterone levels and brain activity engaged in deciding whether to accept or reject monetary transfers to two types of organizations (a positively evaluated organization and a negatively evaluated organization) in presence or absence of an audience. When comparing the public to the private condition, the rate of acceptance increased for the positively evaluated organization, while the rate of rejection increased for the negatively evaluated one. Higher testosterone levels were linked to greater activation in the striatum in the public compared to the private condition, regardless of the organization type. These results indicate a relationship between testosterone levels and striatal activity induced by the audience effect. These findings provide new insights on the role of testosterone in human social behavior. |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02990573&r= |
| By: | Joshua S. Gans |
| Abstract: | This paper examines how a firm's choice of the type of experiment impacts on its potential exploitation of new technological opportunities. It does so in the context of the failure of successful firms (or disruption) where the literature has informally suggested that firms undertake errors in experimental choice (in particular, choosing experiments that involved biased signals). It is shown that firms will generically choose biased over unbiased experiments even when there are no differences in their relative costs. This is done to better inform decisions regarding the exploitation of technological opportunities. It is shown that these choices can differ between incumbents and entrants based on their fundamentals as well as because of the anticipation of competition between them. |
| JEL: | L26 O32 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29091&r= |
| By: | Michalis Drouvelis; Graeme Pearce |
| Abstract: | Standard economic theory suggests that the decision to lie requires careful weighting of the associated economic costs and benefits, raising the question of whether intelligence matters for misbehaviour. Using the die roll paradigm, we compare behaviour between individuals who score either low or high on a Raven test when lying only benefits the subject who lies (Selfish treatment) or a charitable cause (Charity treatment). We find that high Raven individuals are honest in the Selfish treatment; however, their aversion to lying vanishes in the Charity treatment. Our results have important implications for the rapidly growing lying literature, indicating that intelligence is a key characteristic of misbehaviour. |
| Keywords: | intelligence levels, die roll paradigm, honesty |
| JEL: | C90 Z13 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9223&r= |
| By: | Duk Gyoo Kim |
| Abstract: | Ohio announced a Vax-a-Million Lottery in May 2021 to encourage people vaccinated. If people may avoid vaccination because (1) they worry about rare but critical side effects or (2) they want to free ride on herd immunity, the vaccination lottery may work better or worse than a lump-sum transfer to the contributors for herd immunity. I experimentally compare the effectiveness of the vaccination lottery over a lump-sum transfer. Overall, vaccination lottery works better, and it particularly incentivizes probability-weighting subjects. |
| Keywords: | vaccination incentives, lottery, Covid-19, laboratory experiments |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9225&r= |
| By: | Sterkens, Philippe; Caers, Ralf; De Couck, Marijke; Geamanu, Michael; Van Driessche, Victor; Baert, Stijn |
| Abstract: | Earlier research has associated spelling errors in resumes with reduced hiring chances. However, the analysis of hiring penalties due to spelling errors has thus far been restricted to white-collar occupations and relatively high numbers of errors per resume. Moreover, the mechanisms underlying the spelling error penalty have remained unclear. To fill these gaps in the peerreviewed literature, we conducted a scenario experiment with 445 genuine recruiters. Results show that, compared to error-free resumes, hiring penalties are being inflicted for both error-laden resumes (18.5 percent points lower interview probability) and resumes with fewer errors (7.3 percent points lower interview probability). Furthermore, we find substantial heterogeneity in penalties inflicted based on various applicant, job and participant characteristics. About half of the spelling error penalty can be explained by the perception that applicants who make spelling errors have lower interpersonal skills (9.0%), conscientiousness (12.1%) and mental abilities (32.2%). |
| Keywords: | spelling errors,resumes,signalling,hiring experiments |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:899&r= |
| By: | Kline, Patrick (University of California, Berkeley); Rose, Evan K. (University of Chicago); Walters, Christopher R. (University of California, Berkeley) |
| Abstract: | We study the results of a massive nationwide correspondence experiment sending more than 83,000 fictitious applications with randomized characteristics to geographically dispersed jobs posted by 108 of the largest U.S. employers. Distinctively Black names reduce the probability of employer contact by 2.1 percentage points relative to distinctively white names. The magnitude of this racial gap in contact rates differs substantially across firms, exhibiting a between-company standard deviation of 1.9 percentage points. Despite an insignificant average gap in contact rates between male and female applicants, we find a between-company standard deviation in gender contact gaps of 2.7 percentage points, revealing that some firms favor male applicants while others favor women. Company-specific racial contact gaps are temporally and spatially persistent, and negatively correlated with firm profitability, federal contractor status, and a measure of recruiting centralization. Discrimination exhibits little geographical dispersion, but two digit industry explains roughly half of the cross-firm variation in both racial and gender contact gaps. Contact gaps are highly concentrated in particular companies, with firms in the top quintile of racial discrimination responsible for nearly half of lost contacts to Black applicants in the experiment. Controlling false discovery rates to the 5% level, 23 individual companies are found to discriminate against Black applicants. Our findings establish that systemic illegal discrimination is concentrated among a select set of large employers, many of which can be identified with high confidence using large scale inference methods. |
| Keywords: | discrimination, audit studies, empirical bayes, q-values |
| JEL: | C11 C9 C93 J7 J71 J78 K31 K42 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14634&r= |
| By: | Eyring, Henry; Ferguson, Patrick J.; Koppers, Sebastian |
| Abstract: | We use a field experiment in professional sports to compare effects of providing absolute, relative, or both absolute and relative measures in performance reports for employees. Although studies have documented that the provision of these types of measures can benefit performance, theory from economic and accounting literature suggests that it may be optimal for firms to direct employees’ attention to some types of measures by omitting others. In line with this theory, we find that relative performance information alone yields the best performance effects in our setting—that is, that a subset of information (relative performance information) dominates the full information set (absolute and relative performance information together) in boosting performance. In cross-sectional and survey-data analyses, we do not find that restricting the number of measures shown per se benefits performance. Rather, we find that restricting the type of measures shown to convey only relative information increases involvement in peer-performance comparison, benefitting performance. Our findings extend research on weighting of and responses to measures in performance reports. |
| Keywords: | Wiley deal |
| JEL: | M40 |
| Date: | 2021–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:111032&r= |
| By: | Ek, Simon (Department of Economics, Uppsala University, and); Hammarstedt, Mats (Department of Economics and Statistics, Linnaeus University, and); Skedinger, Per (Research Institute of Industrial Economics (IFN)) |
| Abstract: | We study the causal effects of previous experience and language skills when newly arrived refugees in Sweden apply for job openings by means of a field experiment. Applications were sent from randomly assigned fictitious Syrian refugees with experience in jobs with low skill requirements and completed language training in Swedish to employers advertising low-skilled job vacancies. We find no evidence of sizeable effects from previous experience or completed language classes on the probability of receiving callback from employers. However, female applicants were more likely than males to receive a positive response. We conclude that previous experience and completed language training seem to provide at best a small positive signaling value when refugees apply for low-skilled jobs through formal channels. |
| Keywords: | Integration of immigrants; Language skills; Job mobility |
| JEL: | J15 J24 J61 |
| Date: | 2021–08–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1398&r= |
| By: | Fang Liu |
| Abstract: | It is common to encounter the situation with uncertainty for decision makers (DMs) in dealing with a complex decision making problem. The existing evidence shows that people usually fear the extreme uncertainty named as the unknown. This paper reports the modified version of the typical regret theory by considering the fear experienced by DMs for the unknown. Based on the responses of undergraduate students to the hypothetical choice problems with an unknown outcome, some experimental evidences are observed and analyzed. The framework of the modified regret theory is established by considering the effects of an unknown outcome. A fear function is equipped and some implications are proved. The behavioral foundation of the modified regret theory is further developed by modifying the axiomatic properties of the existing one as those based on the utility function; and it is recalled as the utility-based behavioral foundation for convenience. The application to the medical decision making with an unknown risk is studied and the effects of the fear function are investigated. The observations reveal that the existence of an unknown outcome could enhance, impede or reverse the preference relation of people in a choice problem, which can be predicted by the developed regret theory. |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2108.01825&r= |
| By: | Kazunori Miwa (Graduate School of Economics, Osaka University) |
| Abstract: | This study experimentally investigates the interaction between firms f information acquisition decisions and disclosure. In particular, I focus on a Cournot duopoly market under industry-wide demand uncertainty. The results demonstrate that acquiring industry-wide demand information improves firms f production decisions in that firms can adjust their quantity levels depending on the market demand. However, disclosure diminishes a firm fs incentive to acquire such information. This is because once the information, which a firm acquired at a cost, is subsequently disclosed, a rival firm can take a free ride on the disclosed information and make a more informed decision. Hence, disclosure decreases the benefit of acquiring information for the disclosing firm. Taken together, although acquiring information improves production decisions, disclosure decreases the incentive to do so and thus, deteriorates a firm fs internal information environment. This leads to inefficient production, which in turn might have a substantial impact on market outcomes. |
| Keywords: | Information acquisition; Disclosure; Duopoly; Experiment |
| JEL: | L13 M41 M48 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1301r&r= |
| By: | Eiji Yamamura |
| Abstract: | A tailor-made internet survey experiment provides individuals with information on their income positions to examine their effects on subjective well-being. In the first survey, respondents were asked about their household income and subjective well-being. Based on the data collected, three different respondents' income positions within the residential locality, within a group of the same educational background, and cohort were obtained. In the follow-up survey for the treatment group, respondents are informed of their income positions and then asked for subjective well-being. Key findings are that, after obtaining information, a higher individual's income position improves their subjective well-being. The effects varied according to individual characteristics and proxies. |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2107.11185&r= |
| By: | García, Jorge Luis (Clemson University); Heckman, James J. (University of Chicago); Ronda, Victor (Aarhus University) |
| Abstract: | This paper demonstrates multiple beneficial impacts of a program promoting inter-generational mobility for disadvantaged African-American children and their children. The program improves outcomes of the first-generation treatment group across the life cycle, which translates into better family environments for the second generation leading to positive intergenerational gains. There are long-lasting beneficial program effects on cognition through age 54, contradicting claims of fadeout that have dominated popular discussions of early childhood programs. Children of the first-generation treatment group have higher levels of education and employment, lower levels of criminal activity, and better health than children of the first-generation control group. |
| Keywords: | early childhood education, intergenerational mobility, racial inequality, social mobility |
| JEL: | J13 I28 C93 H43 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14575&r= |
| By: | Henning, Christian H. C. A.; Petri, Svetlana; Diaz, Daniel |
| Abstract: | Electoral competition is considered a control mechanism to guarantee a good performance of the government. However, in real life it often leads to a distorted policy implementation due to Government Capture and low Government Accountability. Therefore, the analysis of voter behavior is a key factor to understand government performance. More specifically, if voters choose more policy and retrospectively oriented, the government has greater incentives to implement efficient policies. In this sense, if voters have more information on politics, they are more likely to base their decision on policy issues. To assess changes in voter behavior, we carried out a political experiment, where information about the performance of the Senegalese government was delivered to a randomly selected group of voters. Then, based on election surveys data collected before and after the information signal, a probabilistic voter model with latent class using a panel data set was developed. Additionally, to evaluate changes in the relative importance of the three voting motives (policy, non-policy and retrospective), marginal effects and relative marginal effects were estimated. As expected, after the information signal, the relative importance of the policy and the retrospective components increased significantly. [...] |
| Keywords: | probabilistic voter model,capture,accountability,agricultural policy,Senegal,Africa |
| JEL: | Q18 C33 C35 C38 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cauapw:wp202011&r= |