nep-exp New Economics Papers
on Experimental Economics
Issue of 2021‒08‒23
thirty papers chosen by

  1. Experimental Persuasion By Ian Ball; Jose-Antonio Espin-Sanchez
  2. Viselkedéstudományi projektek az adóigazgatásban 2019 By Horváth, Katalin; Keresztély, Tibor; Svraka, András; Tóth, Péter; Ván, Bálint
  3. Estimating Time Preferences for Leisure By Bigoni, Maria; Dragone, Davide; Luchini, Stéphane; Prati, Alberto
  4. Shifting Punishment on Minorities: Experimental Evidence of Scapegoating By Michal Bauer; Jana Cahlíková; Julie Chytilová; Gérard Roland; Tomas Zelinsky
  5. Welfare versus Work under a Negative Income Tax: Evidence from the Gary, Seattle, Denver and Manitoba Income Maintenance Experiments By Riddell, Chris; Riddell, W. Craig
  6. Partial equilibrium mechanism and inter-sectoral coordination: an experiment By Nobuyuki Hanaki; Takashi Hayashi; Michele Lombardi; Kazuhito Ogawa
  7. How success breeds success By Descamps, Ambroise; Ke, Changxia; Page, Lionel
  8. Reputation and Market Structure in Experimental Platforms By Philip C. Solimine; R. Mark Isaac
  9. On the Persistence of Dishonesty By Stefania Bortolotti; Felix Kölle; Lukas Wenner
  10. Risk Preferences in Time Lotteries By Yonatan Berman; Mark Kirstein
  11. Preference for randomization and validity of random incentive system under ambiguity: An experiment By Tomohito Aoyama; Nobuyuki Hanaki
  12. The Damages and Distortions from Discrimination in the Rental Housing Market By Peter Christensen; Christopher Timmins
  13. Vertical integration as a source of hold-up: An experiment By Marie-Laure Allain; Claire Chambolle; Patrick Rey; Sabrina Teyssier
  14. Fishing for Good News: Motivated Information Acquisition By Si Chen; Carl Heese
  15. (Anticipated) Discrimination against Sexual Minorities in Prosocial Domains By Billur Aksoy; Ian Chadd; Boon Han Koh
  16. Costly Mistakes: Why and When Spelling Errors in Resumes Jeopardise Interview Chances By Sterkens, Philippe; Caers, Ralf; De Couck, Marijke; Geamanu, Michael; Van Driessche, Victor; Baert, Stijn
  17. Promoting Opportunity Demonstration: Effectiveness of Reminder Messages for Recruitment By Heinrich Hock; Michael Levere; David Wittenburg
  18. Feed the Children By Laurens Cherchye; Pierre-André Chiappori; Bram De Rock; Charlotte Ringdal; Frederic Vermeulen
  19. Telementoring and homeschooling during school closures: A randomized experiment in rural Bangladesh By Hashibul Hassan; Asad Islam; Abu Siddique; Liang Choon Wang
  20. Lessons from Pilot Tests of Recruitment for the Promoting Opportunity Demonstration By Heinrich Hock; Michael Levere; Kenneth Fortson; David Wittenburg
  21. Experimentally Validating Welfare Evaluation of School Vouchers: Part I By Peter Arcidiacono; Karthik Muralidharan; Eun-young Shim; John D. Singleton
  22. Why North Korean Refugees are Reluctant to Compete: The Roles of Cognitive Ability By Syngjoo Choi; Byung-Yeon Kim; Jungmin Lee; Sokbae Lee
  23. Systemic Discrimination Among Large U.S. Employers By Patrick M. Kline; Evan K. Rose; Christopher R. Walters
  24. Why Do (Some) Ordinary Americans Support Tax Cuts for the Rich? Evidence From a Randomized Survey Experiment By Hope, David; Limberg, Julian; Weber, Nina Sophie
  25. Persuading Investors: A Video-Based Study By Allen Hu; Song Ma
  26. The case for default point-H1-hypotheses: a theory-construction perspective By Zenker, Frank; Witte, Erich H.
  27. Poor peer work does not boost student confidence By Kappes, Heather Barry; Fasolo, Barbara; Han, Wenjie; Barnes, Jessica; Ter Meer, Janna
  28. Psychological Effects of Poverty on Time Preferences By Bartos, Vojtech; Bauer, Michal; Chytilová, Julie; Levely, Ian
  29. An experimental methodology for studying household financial governance and coping mechanisms in Goma, DRC By Stys, Pat; Kirk, Thomas; Muhindo, Samuel; Balume, Bauma; Mazuri, Papy; Tchumisi, Ishara; N'simire, Sandrine; Green, Duncan
  30. The Lasting Effects of Early Childhood Education on Promoting the Skills and Social Mobility of Disadvantaged African Americans By Jorge Luis García; James J. Heckman; Victor Ronda

  1. By: Ian Ball (Department of Economics, MIT); Jose-Antonio Espin-Sanchez (Cowles Foundation, Yale University)
    Abstract: We introduce experimental persuasion between Sender and Receiver. Sender chooses an experiment to perform from a feasible set of experiments. Receiver observes the realization of this experiment and chooses an action. We characterize optimal persuasion in this baseline regime and in an alternative regime in which Sender can commit to garble the outcome of the experiment. Our model includes Bayesian persuasion as the special case in which every experiment is feasible; however, our analysis does not require concaviï¬ cation. Since we focus on experiments rather than beliefs, we can accommodate general preferences including costly experiments and non-Bayesian inference.
    Keywords: Experiments, Beliefs, Decision Making, Information, Bayesian
    JEL: D81 D82 D83
    Date: 2021–08
  2. By: Horváth, Katalin (Tax Policy and Research Unit, Ministry of Finance); Keresztély, Tibor (Tax Policy and Research Unit, Ministry of Finance); Svraka, András (Tax Policy and Research Unit, Ministry of Finance); Tóth, Péter (Tax Policy and Research Unit, Ministry of Finance); Ván, Bálint (Tax Policy and Research Unit, Ministry of Finance)
    Abstract: This report describes the results of sevaral field experiments using randomized controlled trials undertaken in cooperation by the Hungarian National Tax and Customs Office and the Ministry of Finance during 2019. The projects focused on improving tax compliance, and uptake tax incentives using nudges, or information provision.
    JEL: C93 D91
    Date: 2020–05
  3. By: Bigoni, Maria (University of Bologna); Dragone, Davide (University of Bologna); Luchini, Stéphane (Aix-Marseille University); Prati, Alberto (Aix-Marseille University)
    Abstract: We study time preferences by means of a longitudinal lab experiment involving both monetary and non-monetary rewards (leisure). Our novel design allows to measure whether participants prefer to anticipate or delay gratification, without imposing any structural assumption on the instantaneous utility, intertemporal utility or the discounting functions. We find that most people prefer to anticipate monetary rewards (positive time preferences for money), but they delay non-monetary rewards (negative time preferences for leisure). These results cannot be explained by personal timetables and heterogeneous preferences only. They invite to reconsider the psychological interpretation of the discount factor, and suggest that the assumption that discounting is consistent across domains can lead to non-negligible prediction errors in models involving non-monetary decisions, such as labor supply models.
    Keywords: consistency across domains, negative discounting, laboratory experiment, non-monetary rewards
    JEL: C91 D01 D91 J22
    Date: 2021–07
  4. By: Michal Bauer; Jana Cahlíková; Julie Chytilová; Gérard 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.
    JEL: C93 D74 D91 J15
    Date: 2021–08
  5. By: Riddell, Chris (University of Waterloo); Riddell, W. Craig (University of British Columbia, Vancouver)
    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 re-assess 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.
    Keywords: negative income tax, welfare, income maintenance experiments, labour supply
    JEL: C9 I38 J2
    Date: 2021–07
  6. By: Nobuyuki Hanaki; Takashi Hayashi; Michele Lombardi; Kazuhito Ogawa
    Abstract: This study experimentally evaluates the performance of partial equilibrium mechanisms when different sectors run their mechanisms separately, despite the existence of complementarity between them. In our simple laboratory experiment setting that includes two sectors, each sector runs the top-trading-cycle mechanism. There is a Pareto-dominant equilibrium, but it requires coordination across sectors. Our results show that coordination failure occurs more frequently when there is asymmetry between the two sectors compared with the one-sector benchmark, even without inter-sectoral complementarity. When mechanisms are run sequentially across the two sectors, such failure is substantially reduced, compared with when they are run simultaneously.
    Date: 2021–08
  7. By: Descamps, Ambroise; Ke, Changxia; Page, Lionel
    Abstract: We investigate if, and why, an initial success can trigger a string of successes. Using random variations in success in a real-effort laboratory experiment, we cleanly identify the causal effect of an early success in a competition. We confirm that an early success indeed leads to increased chances of a later success. By alternatively eliminating strategic features of the competition, we turn on and off possible mechanisms driving the effect of an early success. Standard models of dynamic contest predict a strategic effect due to asymmetric incentives between initial winners and losers. Surprisingly, we find no evidence that they can explain the positive effect of winning. Instead, we find that the effect of winning seems driven by an information revelation effect, whereby players update their beliefs about their relative strength after experiencing an initial success.
    Date: 2021–07–15
  8. By: Philip C. Solimine (Department of Economics and Department of Scientific Computing, Florida State University); R. Mark Isaac (Department of Economics, Florida State University)
    Abstract: In this paper we conduct a market experiment with the opportunity for sellers to send a nonbinding advertisement of their product quality. We examine the effects of including a reputation aggregation system for sellers in these markets. In order to closely match the setting of real-life markets, we conduct a laboratory experiment designed to emulate an online marketplace. In some sessions, we prompt buyers to respond to their purchases with a canonical "five-star" rating, and display the average rating to buyers in each round. We find substantial efficiency gains from the addition of the ratings system, but not enough to obtain fully efficient market outcomes. These efficiency gains come primarily through a decrease in false advertising behavior by the sellers, as they compete to build reputations. We structurally examine the formation of reputations by the sellers (with and without ratings) and the effect of these reputations on the decisions of buyers and sellers in the market. Using a bipartite network of transaction data, we will quantify the effects of ratings in promoting trust and supporting diverse, connected, and high quality markets.
    Keywords: Product Quality, Seller Reputation, Ratings, Experimental Market Design, Plat- forms, Adverse Selection
    JEL: L1 L2 D4 D8
    Date: 2021–08
  9. By: Stefania Bortolotti (Economics Department, University of Bologna & IZA); Felix Kölle (Department of Economics, University of Cologne, Albertus MagnusPlatz, 50923 Cologne, Germany); Lukas Wenner (Department of Economics, University of Cologne)
    Abstract: In social and economic interactions, individuals often exploit informational asymmetries and behave dishonestly to pursue private ends. In many of these situations the costs and benefits from dishonest behavior do not accrue immediately and at the same time. In this paper, we experimentally investigate the role of time on dishonesty. Contrary to our predictions, we find that neither delaying the gains from cheating, nor increasing temporal engagement with one's own unethical behavior reduces the likelihood of cheating. Furthermore, allowing for a delay between the time when private information is obtained and when it is reported does not affect cheating in our experiment.
    Keywords: Dishonesty, cheating, delay, discounting, experiment
    JEL: C91 D82 D91
    Date: 2021–08
  10. By: Yonatan Berman; Mark Kirstein
    Abstract: An important but understudied question in economics is how people choose when facing uncertainty in the timing of events. Here we study preferences over time lotteries, in which the payment amount is certain but the payment time is uncertain. Expected discounted utility theory (EDUT) predicts decision makers to be risk-seeking over time lotteries. We explore a normative model of growth-optimality, in which decision makers maximise the long-term growth rate of their wealth. Revisiting experimental evidence on time lotteries, we find that growth-optimality accords better with the evidence than EDUT. We outline future experiments to scrutinise further the plausibility of growth-optimality.
    Date: 2021–08
  11. By: Tomohito Aoyama; Nobuyuki Hanaki
    Abstract: The random Incentive System (RIS) is a standard method to incentivize participants in economic experiments. However, recent theoretical studies point out the possibility of its failure under ambiguity. We propose a modification of RIS, named independent RIS (I-RIS), to improve its reliability. We conducted an experiment to evaluate the performances of the standard RIS and I-RIS in direct and indirect manners. Whereas a nonnegligible fraction of participants are not consistent with the reversal-of-order axiom, a majority of ambiguity averse and seeking participants are. This implies that participants with nonneutral ambiguity attitudes may not report truthful preferences when RIS is used. However, randomization attitudes do not explain inconsistent choices under RIS. In addition, we did not find significant differences in performance between RIS and I-RIS. These results suggest that preferences for randomization, which is driven by nonneutral ambiguity attitudes, do not cause the failure of RIS.
    Date: 2021–08
  12. By: Peter Christensen; Christopher Timmins
    Abstract: By constraining an individual’s choice during a search, housing discrimination dis- torts sorting decisions away from true preferences and results in a ceteris paribus reduction in welfare. This study combines a large-scale field experiment with a residential sorting model to derive utility-theoretic measures of renter welfare loss associated with the constraints imposed by discrimination in the rental housing market. Results from experiments conducted in five cities show that key neighbor- hood amenities are associated with higher levels of discrimination. Results from the structural model indicate that discrimination imposes costs equivalent to 4.7% of annual income for renters of color, and that search behavior results in greater welfare costs for African Americans as their incomes rise. Renters of color must make substantial investments in additional search to mitigate the costs of these constraints. We find that a naive model ignoring discrimination constraints yields significantly biased estimates of willingness to pay.
    JEL: Q51 Q53 R31
    Date: 2021–07
  13. By: Marie-Laure Allain (CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - CNRS - Centre National de la Recherche Scientifique); Claire Chambolle (ALISS - Alimentation et sciences sociales - INRA - Institut National de la Recherche Agronomique, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - CNRS - Centre National de la Recherche Scientifique); Patrick Rey (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - Université Fédérale Toulouse Midi-Pyrénées - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Sabrina Teyssier (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)
    Abstract: In a vertical chain in which two rivals invest before contracting with one of two competing suppliers, vertical integration can create holdup problems for the rival. We develop an experiment to test this theoretical prediction in a setup in which suppliers can either precommit ex ante to being greedy or degrade ex post the input they provide to their customer. Our experimental results confirm that vertical integration creates holdup problems. However, vertical integration also generates more departures from theory, which can be explained by bounded rationality and social preferences.
    Keywords: Vertical integration,Hold-up,Experimental economics,Bounded rationality,Social preferences
    Date: 2021–06–08
  14. By: Si Chen; Carl Heese
    Abstract: The literature on motivated reasoning argues that people skew their beliefs to feel moral when acting selfishly. We study information acquisition of decision-makers with a motive to form positive moral self-views and a motive to act selfishly. Theoretically and experimentally, we find that a motive to act selfishly makes individuals 'fish for good news': they are more likely to continue (stop) acquiring information, having received mostly information suggesting that acting selfishly is harmful (harmless) to others. We find that fishing for good news may improve social welfare. Finally, more intelligent individuals have a higher tendency to fish for good news.
    Keywords: Motivated Beliefs, Social Preferences, Information Preferences, Bayesian Persuasion, Belief Utility
    JEL: D90 D91
    Date: 2021–08
  15. By: Billur Aksoy (Rensselaer Polytechnic Institute); Ian Chadd (Rensselaer Polytechnic Institute); Boon Han Koh (University of East Anglia)
    Abstract: We study discrimination in prosocial domains against sexual minorities using a sharing (dictator) game in an online experiment, where these individuals have the opportunity to signal their identity. We find that political affiliations matter: Republican heterosexual individuals are less generous to others who are perceived to be sexual minorities, while their Democratic counterparts are slightly more generous. This is robust to alternative specifications and cannot be explained by perceptions about the recipient’s political leaning. Moreover, women, but not men, are less likely to signal their sexual minority status when they are aware of the potential payoff implications of their decisions.
    Keywords: taste-based discrimination, identity, LGBTQ+, political preferences, gender.
    JEL: C90 D90 J16
    Date: 2021–08–16
  16. By: Sterkens, Philippe (Ghent University); Caers, Ralf (KU Leuven); De Couck, Marijke (Free University of Brussels); Geamanu, Michael (Ghent University); Van Driessche, Victor (Ghent University); Baert, Stijn (Ghent University)
    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: resumes, signalling, hiring experiments, spelling errors
    JEL: C91 I21 J24
    Date: 2021–07
  17. By: Heinrich Hock; Michael Levere; David Wittenburg
    Abstract: This brief summarizes findings from an experiment to assess messaging strategies for final reminder postcards sent to 146,548 beneficiaries.
    Keywords: Social Security Disability Insurance (SSDI), demonstration project, study recruitment, outreach methods, randomized controlled trial, rapid-cycle test, effectiveness, efficiency
  18. By: Laurens Cherchye; Pierre-André Chiappori; Bram De Rock; Charlotte Ringdal; Frederic Vermeulen
    Abstract: To understand the household decision-making process regarding food expenditures for children in poor households in Nairobi, we conduct an experiment with 424 married couples. In the experiment, the spouses (individually and jointly) allocated money between themselves and nutritious meals for one of their children. First, we find strong empirical support for individual rationality and cooperative behavior. Second, our results suggest that women do not have stronger preferences for children’s meals than men. Third, the spouses’respective bargaining positions derived from consumption patterns strongly correlate with more traditional indicators. Finally, we document significant heterogeneity both betweenindividuals and intra-household decision processes.
    Keywords: collective model, intra-household allocation, experiment, Kenya, children
    Date: 2021–08
  19. By: Hashibul Hassan (Department of Economics, Monash University, Australia); Asad Islam (Centre for Development Economics and Sustainability (CDES) and Department of Economics, Monash University); Abu Siddique (Economics Group, Technical University of Munich); Liang Choon Wang (Department of Economics, Monash University, Australia)
    Abstract: Prolonged school closures due to political unrests, teacher strikes, natural disasters, and public health crises can be detrimental to student learning in developing countries. Using a randomized controlled experiment in 200 Bangladeshi villages, we evaluate the impact of over-the-phone mentoring and homeschooling support delivered by volunteers on the learning outcomes of primary school children during school closures caused by the coronavirus pandemic. The telementoring program improved the learning outcomes of treated children by 0.75 SD and increased homeschooling involvement of treated mothers by 0.64 SD. The impacts on learning are driven primarily by the direct mentoring of children and to some extent also by the increased homeschooling involvement of mothers. Academically weaker children and households from relatively lower socioeconomic backgrounds benefitted the most from telementoring. These findings suggest that learning crises in low-resource settings can be addressed by simple and very low-cost technology solutions.
    Keywords: Telementoring, homeschooling, school closure, primary education, randomized experiment, rural areas.
    JEL: C93 I21 I24 P46
    Date: 2021–08
  20. By: Heinrich Hock; Michael Levere; Kenneth Fortson; David Wittenburg
    Abstract: This brief summarizes findings from a rapid-cycle experiment conducted during the recruitment pilot, which included mailings to 31,296 beneficiaries.
    Keywords: Social Security Disability Insurance (SSDI), demonstration project, study recruitment, outreach methods, randomized controlled trial, rapid-cycle test, effectiveness, efficiency
  21. By: Peter Arcidiacono; Karthik Muralidharan; Eun-young Shim; John D. Singleton
    Abstract: In this paper, we use a unique two-stage experiment that randomized access to school vouchers across both markets and students in rural India to estimate the revealed preference value of school choice. In the first step of the research design, we develop an empirical model of school choice subject to liquidity and credit constraints that is estimated using data from only the control markets. Based on this exercise, we estimate that the voucher generated welfare gains exceeding four times the average private school's annual tuition on average to the students induced into private schooling. The second step of the research design will validate the estimated welfare impacts by comparing model predictions for a simulated voucher program in control markets with the data from the treatment group. The results in this paper are based on the first step (using only control data) and this draft serves as a pre-commitment to the model estimates and predictions before examining the experimental data.
    JEL: D12 H42 I21 I28 O15
    Date: 2021–07
  22. By: Syngjoo Choi; Byung-Yeon Kim; Jungmin Lee; Sokbae Lee
    Abstract: This paper investigates the development of competitiveness by comparing three Korean groups in South Korea, born and raised in three countries with distinct institutional environments: South Korea, North Korea, and China. Results based on laboratory experiments show that North Korean refugees are significantly less competitive than South Koreans or Korean-Chinese immigrants. Furthermore, analyses through the lens of a choice model with probability weighting suggest that lower cognitive ability may be associated with lower levels of expected performance, more pessimistic subject beliefs and greater aversion to competition.
    Date: 2021–08
  23. By: Patrick M. Kline; Evan K. Rose; Christopher R. Walters
    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.
    JEL: C11 C9 C93 J7 J71 J78 K31 K42
    Date: 2021–07
  24. By: Hope, David; Limberg, Julian; Weber, Nina Sophie
    Abstract: Why do (some) ordinary citizens support tax cuts for the rich? A prominent explanation in the political economy literature stresses the role of unenlightened self-interest. According to this view, citizens consistently fail to gauge whether they are directly affected by tax policy reforms. We use a randomized survey experiment in the US to identify the drivers of preferences for cutting taxes on the rich. The results show that informing individuals of whether they are directly affected by a cut in the top federal income tax rate has no impact on preferences. We therefore find no support for the unenlightened self-interest explanation. In contrast, we find preferences for taxing the rich are fundamentally affected by information that shifts citizens' core fairness beliefs, as well as information on the past trajectory of top tax rates. Our results therefore align with explanations of tax policy preferences that emphasize the importance of fairness perceptions and reference points.
    Date: 2021–08–17
  25. By: Allen Hu; Song Ma
    Abstract: Persuasive communication functions not only through content but also delivery, e.g., facial expression, tone of voice, and diction. This paper examines the persuasiveness of delivery in start-up pitches. Using machine learning (ML) algorithms to process full pitch videos, we quantify persuasion in visual, vocal, and verbal dimensions. Positive (i.e., passionate, warm) pitches increase funding probability. Yet conditional on funding, high-positivity startups underperform. Women are more heavily judged on delivery when evaluating single-gender teams, but they are neglected when co-pitching with men in mixed-gender teams. Using an experiment, we show persuasion delivery works mainly through leading investors to form inaccurate beliefs.
    JEL: C55 D91 G24 G4 G41
    Date: 2021–07
  26. By: Zenker, Frank (Lund University); Witte, Erich H.
    Abstract: The development of an empirically adequate theoretical construct for a given phenomenon of interest requires an estimate of the population effect size, aka the true effect. Arriving at this estimate in evidence-based ways presupposes access to robust experimental or observational findings, defined as statistically significant test-results with high statistical power. In the behavioral sciences, however, even the best journals typically publish statistically significant test-results with insufficient statistical power, entailing that such findings have insufficient replication probability. Whereas a robust finding formally requires that an empirical study engage with point-specific H0- and H1-hypotheses, behavioral scientists today typically point-specify only the H0, and instead engage a composite (directional) H1. This mismatch renders the prospects for theory-construction poor, because the population effect size—the very parameter that is to be modelled—regularly remains unknown. This can only keep from developing empirically adequate theoretical constructs. Based on the research program strategy (RPS), a sophisticated integration of Frequentist and Bayesian statistical inference elements, here we claim that theoretical progress requires engaging with point-H1-hypotheses by default.
    Date: 2021–08–08
  27. By: Kappes, Heather Barry; Fasolo, Barbara; Han, Wenjie; Barnes, Jessica; Ter Meer, Janna
    Abstract: Students' low confidence, particularly in numerical topics, is thought to be a barrier to keeping them engaged with education. We studied the effects on confidence of exposure to a peer's work of varying quality (very good or bad) and neatness (messy or neat). Previous research underpinned our hypothesis that a peer's bad-quality work—which students rarely see—might boost student confidence more than very good work. We also predicted that a peer's very good work—which students are often shown—might be less discouraging if it were messy, suggesting it required effort and struggle. However, in experiments with university students and low-educated adults, these hypotheses were not supported, and all participants decreased in confidence after seeing any peer work. The failure to find support for these hypotheses can inform future research into social comparison effects on self-confidence in numerical topics. These results also have practical implications for teachers and managers who are expected to provide examples of peer work.
    Keywords: confidence; learning; social comparison; peer comparison; self-concept of ability; numeracy
    JEL: J50
    Date: 2020–04–01
  28. By: Bartos, Vojtech (University of Munich); Bauer, Michal (Charles University, Prague); Chytilová, Julie (Charles University, Prague); Levely, Ian (King's College London)
    Abstract: We test whether an environment of poverty affects time preferences through purely psychological channels. We measured discount rates among farmers in Uganda who made decisions about when to enjoy entertainment instead of working. To circumvent the role of economic constraints, we experimentally induced thoughts about poverty-related problems, using priming techniques. We find that thinking about poverty increases the preference to consume entertainment early and to delay work. Using monitoring tools similar to eye tracking, a novel feature for this subject pool, we show that this effect is unlikely to be driven by less careful decision-making processes.
    Keywords: poverty, scarcity, time preferences, self-control, inattention
    JEL: C93 D91 O12
    Date: 2021–07
  29. By: Stys, Pat; Kirk, Thomas; Muhindo, Samuel; Balume, Bauma; Mazuri, Papy; Tchumisi, Ishara; N'simire, Sandrine; Green, Duncan
    Abstract: This paper examines our experiences designing and implementing an experimental methodology to study households’ socioeconomic coping mechanisms in insecure, unstable, or conflict-affected contexts. Our method combined longitudinal household diaries with social network research to collect data on how 24 households living in Goma, the Democratic Republic of the Congo, use their financial and social resources to overcome daily struggles and unexpected shocks like bereavement and theft. Before outlining how the methods complement one another in this study, we overview how each has been employed separately for similar aims. We then turn to the realities of combining them in Goma, reflecting on foreseen and unanticipated challenges and how we addressed them – both successfully and not. Money matters are generally sensitive subjects, and particularly so in such environments. The threads that run through this assessment are those of forging and maintaining trust; translating across languages and cultures; and navigating an insecure and fast-changing environment. To contextualise a discussion of how these factors may have affected the research, data collected, and our conclusions, we provide two vignettes of households that participated in the study. Throughout, we also explore the potential effects of a water provision programme implemented by Mercy Corps that benefited some of the studied households. We conclude with recommendations for those wishing to build upon our method and for development programmes keen to use it to complement their own monitoring, evaluation, and learning.
    Keywords: Centre for Public Authority and International Development (CPAID) (ES/P008038/1); IMAGINE programme
    JEL: N0
    Date: 2021–07
  30. By: Jorge Luis García; James J. Heckman; Victor Ronda
    Abstract: This paper demonstrates multiple beneficial impacts of a program promoting intergenerational 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.
    JEL: C93 H43 I28 J13
    Date: 2021–07

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