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on Experimental Economics |
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Issue of 2023‒06‒19
33 papers chosen by |
| By: | Matthias Sutter; Michael Weyland; Anna Untertrifaller; Manuel Froitzheim; Sebastian O. Schneider |
| Abstract: | We present the results of a randomized intervention to study how teaching financial literacy to 16-year old high-school students affects their behavior in risk and time preference tasks. Compared to two different control treatments, we find that teaching financial literacy makes subjects behave more patiently, more time-consistent, and more risk-averse. These effects persist for up to almost 5 years after our intervention. Behavior in the risk and time preference tasks is related to financial behavior outside the lab, in particular spending patterns. This shows that teaching financial literacy affects economic decision-making which in turn is important for field behavior. |
| Keywords: | financial literacy, randomized intervention, risk preferences, time preferences, financial behaviour, field experiment |
| JEL: | C93 D14 I21 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10400&r=exp |
| By: | Duden, Christoph; Offermann, Frank; Mußhoff, Oliver |
| Abstract: | Extreme weather events pose an economic threat to farms. The risk management behaviour against such events is often studied using prospect theory as a framework, but empirically deriving corresponding parameters in the field involving farmers is challenging. To address this issue, we compare three methods of eliciting prospect theory parameters using a multiple price list design in Germany: a framed field experiment, a framed student experiment and an artefactual field experiment. The results show that these experiments generate different prospect theory parameters. The lower the probability the higher the differences, which is particularly important for managing risk from low-probability shocks. Despite these differences, the mean coefficients of the three experiments reveal a low willingness to pay for crop insurance. We find evidence that individual responses to the artefactual and student experiments correlate with the risk attitude self-assessment, whereas responses to the framed field experiment correlate with the purchase of crop insurance. |
| Keywords: | prospect theory, risk management, catastrophic risk, behavioural economics, decision analysis |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:daredp:2301&r=exp |
| By: | Landgrave, Michelangelo Geovanny (Princeton University) |
| Abstract: | This article is a comment on Cantoni et al. (2019) and subsequent research conducted as part of the “Demand for Democracy” project. In the aforementioned article, researchers report a field experiment where Hong Kong research subjects are nudged to participate in a protest against the People’s Republic of China using an informational treatment. I argue that the field experiment is unethical because, in addition to being deceptive, it was conducted in an authoritarian context where research subjects can be punished for protesting and because research subjects have no practical recourse for any harm suffered as part of the experiment. The Demand for Democracy experiment is not only unethical, but is illustrative of a larger systemic problem with conducting experiments in authoritarian contexts. I propose that field experiments in authoritarian contexts be banned, or that the experimental community should at minimum adopt safeguards to protect research subjects. |
| Date: | 2023–05–11 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:nvzt8&r=exp |
| By: | Goulão, Catarina (Toulouse School of Economics); Lacomba, Juan A. (Universidad de Granada); Lagos, Francisco (Universidad de Granada); Rooth, Dan-Olof (Stockholm University) |
| Abstract: | Being overweight or obese is associated with lower employment and earnings, possibly arising from employer discrimination. A few studies have used field experiments to show that obese job applicants are, in fact, discriminated against in the hiring process. However, whether overweight job applicants also face employer discrimination is still an open question. To this end, we have designed a correspondence testing experiment in which fictitious applications are sent to real job openings across twelve different occupations in the Spanish labor market. We compare the callback rate for applications with a facial photo of a normal weight person to the one for applications with a photo of the same person manipulated into looking overweight. Applications with a photo of the weight-manipulated male receive significantly fewer callbacks for a job interview compared to normal weight, and this differential treatment is especially pronounced in female-dominated occupations. For women, we find the opposite result. Weight-manipulated female applications receive slightly more callbacks, especially in female-dominated occupations. Our experimental design allows us to disentangle whether employers act on attractiveness or weight when hiring. For men, the weight manipulation effect is explained by an attractiveness premium, while for women we find evidence of an attractiveness penalty, as well as a weight penalty, in explaining the effect. |
| Keywords: | obesity, overweight, gender, attractiveness, hiring, correspondence testing |
| JEL: | J64 J71 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16119&r=exp |
| By: | Sutter, Matthias (Max Planck Institute for Research on Collective Goods); Weyland, Michael (Ludwigsburg University of Education); Untertrifaller, Anna (University of Cologne); Froitzheim, Manuel (University of Siegen); Schneider, Sebastian O. (Max Planck Institute for Research on Collective Goods) |
| Abstract: | We present the results of a randomized intervention to study how teaching financial literacy to 16-year old high-school students affects their behavior in risk and time preference tasks. Compared to two different control treatments, we find that teaching financial literacy makes subjects behave more patiently, more time-consistent, and more risk-averse. These effects persist for up to almost 5 years after our intervention. Behavior in the risk and time preference tasks is related to financial behavior outside the lab, in particular spending patterns. This shows that teaching financial literacy affects economic decision-making which in turn is important for field behavior. |
| Keywords: | financial behavior, time preferences, risk preferences, randomized intervention, financial literacy, field experiment |
| JEL: | C93 D14 I21 |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16102&r=exp |
| By: | Patrick Maus (University of Nottingham); Maria Montero (University of Nottingham); Martin Sefton (University of Nottingham) |
| Abstract: | We report a laboratory experiment testing whether social reference points impact effort provision. Subjects are randomly assigned the role of worker or peer and the worker observes the peer’s earnings before participating in a real-effort task. Between treatments, we exogenously manipulate peer earnings. We find that the workers recall the earnings of their peer and are less satisfied with their own earnings when their peer earns more. Despite this, we do not observe a treatment effect in effort choices. Thus, although our subjects appear to care about income differentials, this does not translate to a change in behavior in our incentivized environment. We relate our results to recent studies of inequality and effort provision. |
| Keywords: | social comparisons; reference-dependent preferences; real-effortprovision; inequity aversion; relative income concerns |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2023-03&r=exp |
| By: | Pascaline Dupas; Camille Falezan; Seema Jayachandran; Mark P. Walsh |
| Abstract: | Despite the well-established importance of verbal engagement for infant language and cognitive development, many parents in low-income contexts do not converse with their infants regularly. We report on a randomized field experiment evaluating a low-cost intervention that aims to raise verbal engagement with infants by showing recent or expectant mothers a 3-minute informational video and giving them a themed wall calendar. Six to eight months later, mothers selected for the intervention report greater belief in the benefits of verbally engaging with infants, more frequent parent-infant conversations, and that their infants have more advanced language and cognitive skills. We measure positive but noisy effects on parental verbal inputs in a day-long recording and on surveyor-observed infant cognitive skills. The intervention could be delivered to expectant mothers through existing health clinics at very low marginal cost so could be a highly cost-effective early childhood development policy in low-income contexts. |
| JEL: | D19 I25 O15 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31264&r=exp |
| By: | Liu, Zhaoyang; Banerjee, Simanti; Cason, Timothy N.; Hanley, Nick; Liu, Qi; Xu, Jintao; Kontoleon, Andreas |
| Abstract: | This paper presents a framed field experiment from China studying a spatially coordinated (SC) auction mechanism for the allocation of agri-environmental contracts, which pay farmers to change their agricultural practices to provide environmental benefits. The SC auction is designed to maximise a metric of environmental benefit that depends both on site-specific environmental values and benefits due to spatial coordination of conserved patches, subject to a budget constraint. We investigate whether auction performance can be improved by the introduction of agglomeration bonus (AB) and joint bidding (JB) mechanisms. The AB is a bonus payment awarded to neighbouring farmers who bid individually but receive agrienvironmental contracts simultaneously. The JB mechanism allows neighbouring farmers to bid jointly and provides a bonus payment for successful joint bids. We conducted experimental SC auctions with a total of 432 Chinese farmers randomly assigned to one of four treatments which differed in whether the AB and JB mechanisms were adopted, following a two-by-two full factorial experimental design. Our empirical results suggest that the SC auction has similar environmental performance regardless of whether an AB is provided, although cost-effectiveness is 1 slightly higher when AB is not provided. Moreover, introducing the JB mechanism into the SC auction leads to lower environmental performance and lower cost-effectiveness. Finally, the AB mechanism achieves higher environmental performance than the JB mechanism but has similar cost-effectiveness. |
| Keywords: | Environmental Economics and Policy, Land Economics/Use |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc23:334572&r=exp |
| By: | Guillermo Alves (Banco de Desarrollo de América Latina); Martín Leites (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Gonzalo Salas (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía) |
| Abstract: | We ran a field experiment in which 20-year-olds choose between a socially visible and a non-socially visible good after a friend randomly received one of these goods or an unknown good. We find no differences in choices when the friend received the non-socially visible good instead of the unknown one. However, we find differences when the friend received the socially visible good instead of the other two. Consistent with a status-consumption interpretation, the sign of those differences depends on the socioeconomic position of the decision maker compared to her friend. Those in a disadvantaged position consume more and those in an advantaged position consume less of the socially-visible good when their friend received that good instead of the other two. We further find that treatment effects vary by gender in a way that reinforces the status consumption interpretation of our results. Boys experience a worse subjective social position and consume more of the socially visible good after a friend received that good. On the contrary, girls improve their subjective position when a friend received the socially visible good, and this offsets any effect on their consumption decision. |
| Keywords: | consumption, status goods, field experiment, inequality |
| JEL: | D12 C93 D62 D31 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-12-22&r=exp |
| By: | Anwar Adem; Richard Kneller; Cher Li |
| Abstract: | This study examines the influence of information constraints on firms’ efficiency in using digital technologies, focusing on business websites. Through two natural field experiments in the UK, we provide firms with benchmarked performance information on their websites. The experimental designs enable us to assess the salience of the information provided and heterogeneity linked to prior experience and catch-up potential. Our results indicate that performance gaps are not primarily driven by information constraints, as the treatment demonstrates a limited overall impact on motivating firms to improve, with a short-lived effect during the Covid-19 lockdowns. We further support these conclusions using data on website-building software and the number of page views. |
| Keywords: | ield experiment, digital technologies, information constraints, performance management, efficiency |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:not:notgep:2023-07&r=exp |
| By: | Valeria Fanghella (EESC-GEM Grenoble Ecole de Management); Lisette Ibanez (CEE-M - Centre d'Economie de l'Environnement - Montpellier - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - UM - Université de Montpellier); John Thøgersen (Aarhus University [Aarhus]) |
| Abstract: | Prosocial behavior is important for a well-functioning society, but many people try to avoid situations where they could act prosocially. This paper studies the avoidance of a prosocial request, how it is affected by social pressure, and whether request avoidance and social pressure generate spillover effects on following prosocial behaviors. To this aim, we conduct an incentivized online experiment (N=1400), where participants play two consecutive dictator games with a charity. In the first game, we vary the type of game and information provided in a 2 x 2 between-subject design: (i) standard dictator game or dictator game with costly opt-out; (ii) with or without social information (mean donation in a previous session). The second game is a standard dictator game for all and aims to capture spillover effects from the first decision. We find that the opt-out option leads to significantly lower donations, especially when social information is present (but this effect is not statistically significant). The negative effect of the opt-out option spills over to the second donation decision. We also observe a negative spillover effect after a standard dictator game. Social information reduces donations in a standard dictator game, but also allows to mitigate the negative spillover effect from the first to the second behavior. |
| Keywords: | prosocial behavior, opt-out option, social information, spillover, charitable giving, selfimage |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-04093001&r=exp |
| By: | Rodemeier, Matthias (Bocconi University); Löschel, Andreas (Ruhr University Bochum) |
| Abstract: | How can information substitute or complement financial incentives such as Pigouvian subsidies? We answer this question in a large-scale field experiment that cross-randomizes energy efficiency subsidies with information about the financial savings of LED lighting. Information has two effects: It shifts and rotates demand curves. The direction of the shift is ambiguous and highly dependent on the information design. Informing consumers that an LED saves 90% in annual energy costs increases LED demand, but showing them that 90% corresponds to an average of 11 euros raises demand for less efficient technologies. The rotation of the demand curve is unambiguous: information dramatically reduces both own-price and cross-price elasticities, which makes subsidies less effective. The uniform decrease in price elasticities suggests that consumers pay less attention to subsidies when information is provided. We structurally estimate that welfare-maximizing subsidies are up to 150% larger than the Pigouvian benchmark when combined with information. |
| Keywords: | information, nudges, optimal taxation, internality taxes, field experiments, energy efficiency, behavioral public economics |
| JEL: | D61 D83 H21 Q41 Q48 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16141&r=exp |
| By: | Zachary Wagner; Corrina Moucheraud; Manisha Shah; Alexandra Wollum; Willa H. Friedman; William H. Dow |
| Abstract: | Bias among health care providers can lead to poor-quality care and poor health outcomes, and it can exacerbate disparities. We use a randomized controlled trial to evaluate an intervention to reduce family planning provider bias towards young women in 227 clinics in Tanzania, Burkina Faso, and Pakistan. The intervention educated providers about bias towards young women, facilitated communication about bias with other providers, and offered non-financial public awards to clinics with the least biased care. After 12 months, the intervention led to less-biased attitudes and beliefs among providers and more comprehensive counseling. Clients also perceived better treatment at intervention clinics compared to control clinics. Despite reductions in reported bias, we find mixed evidence regarding changes in method dispensing |
| JEL: | D12 I11 I12 O12 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31269&r=exp |
| By: | Björn Bartling; Alexander W. Cappelen; Henning Hermes; Marit Skivenes; Bertil Tungodden |
| Abstract: | We study paternalistic preferences in two large-scale experiments with participants from the general population in the United States. Spectators decide whether to intervene to prevent a stakeholder, who is mistaken about the choice set, from making a choice that is not aligned with the stakeholders’ own preferences. We find causal evidence for the nature of the intervention being of great importance for the spectators’ willingness to intervene. Only a minority of the spectators implement a hard intervention that removes the stakeholder’s freedom to choose, while a large majority implement a soft intervention that provides information without restricting the choice set. This finding holds regardless of the stakeholder’s responsibility for being mistaken about the choice set – whether the source of mistake is internal or external – and in different subgroups of the population. We introduce a theoretical framework with two paternalistic types – libertarian paternalists and welfarists – and show that the two types can account for most of the spectator behavior. We estimate that about half of the spectators are welfarists and that about a third are libertarian paternalists. Our results shed light on attitudes toward paternalistic policies and the broad support for soft interventions. |
| Keywords: | Paternalism, libertarian paternalism, welfarism, freedom to choose |
| JEL: | C91 C93 D69 D91 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:436&r=exp |
| By: | Daniela Di Cagno; Werner Güth; Tim Lohse; Francesca Marazzi; Lorenzo Spadoni |
| Abstract: | We modify the Acquiring-a-Company game to study lying in ultimatum bargaining. Privately informed sellers send messages about the alleged value of their company to potential buyers. Via random information leaks, buyers can learn the true value before proposing a price which the seller finally accepts or not. Two-thirds of all sellers exaggerate the company’s value to persuade buyers to offer more, especially when the true value is small. Surprisingly, a higher leak probability does not increase truthtelling. However, it decreases overreporting and increases underreporting. Buyers who found out value misreporting anchor their price proposals on the true value but do not explicitly discriminate against liars. Sellers are fully opportunistic and make their acceptances dependent on the resulting positive payoff. Even if morality concerns do not seem to matter much, probabilistic leaks enhance welfare. That suggests to politically facilitate and encourage e.g. whistle blowing. |
| Keywords: | acquiring-a-company experiments, information leaks, cheap talk (not) lying, ultimatum bargaining |
| JEL: | C78 C91 D83 D91 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10406&r=exp |
| By: | Eric Giannella; Tatiana Homonoff; Gwen Rino; Jason Somerville |
| Abstract: | Many government program applications result in procedural denials due to administrative burdens associated with applying. We identify the intake interview as a key barrier to take-up of the Supplemental Nutrition Assistance Program and study the effect of an alternative application process designed to reduce burdens. Using a field experiment involving 65, 000 Los Angeles applicants, we find that access to flexible interviews initiated by the applicant increases approvals by six percentage points, doubles early approvals, and increases long-term participation by over two percentage points. Our findings highlight the importance of incorporating flexibility when designing program integrity policies to minimize procedural denials. |
| JEL: | H53 I38 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31239&r=exp |
| By: | Jasmina Arifovic (Simon Fraser University); Isabelle Salle (University of Ottawa); Hung Truong (Simon Fraser University) |
| Abstract: | Price-level targeting (PLT) is optimal under the fully-informed rational expectations (FIRE) benchmark but lacks empirical support. Given the hurdles to the implementation of macroeconomic field experiments, we utilize a laboratory group experiment – where expectations are elicited from human subjects – to collect data on expectations, inflation and output dynamics under a traditional inflation targeting (IT) framework and a PLT regime with both deflationary and cost-push shocks. We then emulate the subjects’ expectations with a micro-founded heterogeneous-expectation New Keynesian (HENK) model and reproduce the macroeconomic dynamics observed in the lab. Both in the lab and in the HENK model, the benefits of PLT over an IT regime obtained under the FIRE assumption are not observed: both human subjects and HENK agents are unable to learn the underlying implications of PLT, which results in excess macroeconomic volatility. However, once augmented with an inflation guidance from the CB consistent with closing the price gap, the stabilizing benefits of PLT materialize both in the lab and in the model. |
| Keywords: | heterogeneous expectations, learning, central bank communication, lab experiments |
| JEL: | E7 E52 E42 C92 |
| Date: | 2023–05–12 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20230028&r=exp |
| By: | Benedict Guttman-Kenney; Jesse Leary; Neil Stewart |
| Abstract: | We find it is common for consumers who are not in financial distress to make credit card payments at or close to the minimum. This pattern is difficult to reconcile with economic factors but can be explained by minimum payment information presented to consumers acting as an anchor that weighs payments down. Building on Stewart (2009), we conduct a hypothetical credit card payment experiment to test an intervention to de-anchor payment choices. This intervention effectively stops consumers selecting payments at the contractual minimum. It also increases their average payments, as well as shifting the distribution of payments. By de-anchoring choices from the minimum, consumers increasingly choose the full payment amount - which potentially seems to act as a target payment for consumers. We innovate by linking the experimental responses to survey responses on financial distress and to actual credit card payment behaviours. We find that the intervention largely increases payments made by less financially-distressed consumers. We are also able to evaluate the potential external validity of our experiment and find that hypothetical responses are closely related to consumers' actual credit card payments. |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2305.11375&r=exp |
| By: | Thomas Chambon (L3I - Laboratoire Informatique, Image et Interaction - EA 2118 - ULR - La Rochelle Université); Ulysse Soulat (NUDD - Usages du Numérique pour le Développement Durable - ULR - La Rochelle Université); Jeanne Lallement (NUDD - Usages du Numérique pour le Développement Durable - ULR - La Rochelle Université); Jean-Loup Guillaume (L3I - Laboratoire Informatique, Image et Interaction - EA 2118 - ULR - La Rochelle Université) |
| Abstract: | Encouraging soft mobility practices is a central issue for the ecological transition. Green information systems and more specifically self-tracking applications are tools that can be used to raise awareness and changing behavior. Based on the theoretical framework of visual complexity, this paper examines how the level of visual complexity of a mobile application influences users' urban mobility intentions and behaviors. We conducted two experimental studies. The first one investigated how the visual complexity of homepages affects mobility intentions with an application to measure one's carbon footprint in a situational setting. The first result of our research is that moderate information visual complexity positively influences the acceptability of a mobile application as well as mobility intentions. A second experimental research is divided into two parts, firstly, participants responded to our questionnaire, secondly, in a longitudinal approach, 51 subjects used the application over a 3-month period. The conceptual framework was tested using regression analyses. We find that intention to change behavior influences responsible urban mobility behavior. However, our experiment shows that the visual complexity of information does not have a significant influence on behavior. We then propose theoretical implications. |
| Keywords: | Green Information System, responsible behavior, urban mobility, visual complexity, self-tracking |
| Date: | 2023–05–23 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04089291&r=exp |
| By: | Koch, Alexander K. (Aarhus University); Monster, Dan (Aarhus University); Nafziger, Julia (Aarhus University) |
| Abstract: | To study the effects of reminder nudges in complex environments, we apply a novel experimental approach based on a computer game in which decision makers have to pay attention to and perform multiple actions within a short period of time. The set-up allows us, first, to test the effect of reminders both on reminded and non-reminded actions and thus to observe whether reminders have (positive or negative) spillovers. Second, we investigate spillovers between multiple nudges by testing the effect of scaling up the number of reminded actions. Third, we study intertemporal spillovers by investigating whether the effects of having been exposed to reminders persist after reminders are withdrawn. We observe that reminders have positive effects in the short run – multiple reminders more so than single reminders: while reminders lead to crowding-out of non-reminded actions, the positive effect on the reminded actions dominates. Yet, after withdrawal of the reminders, the negative spillover effect persists, while the positive effect partially fades out so that, overall, reminders have no effect. |
| Keywords: | nudging, spillover effects, attention, reminders, persistence, game-based experiments |
| JEL: | C9 D91 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16137&r=exp |
| By: | Steve Phelps; Yvan I. Russell |
| Abstract: | In this study, we investigate the capacity of large language models (LLMs), specifically GPT-3.5, to operationalise natural language descriptions of cooperative, competitive, altruistic, and self-interested behavior in social dilemmas. Our focus is on the iterated Prisoner's Dilemma, a classic example of a non-zero-sum interaction, but our broader research program encompasses a range of experimental economics scenarios, including the ultimatum game, dictator game, and public goods game. Using a within-subject experimental design, we instantiated LLM-generated agents with various prompts that conveyed different cooperative and competitive stances. We then assessed the agents' level of cooperation in the iterated Prisoner's Dilemma, taking into account their responsiveness to the cooperative or defection actions of their partners. Our results provide evidence that LLMs can translate natural language descriptions of altruism and selfishness into appropriate behaviour to some extent, but exhibit limitations in adapting their behavior based on conditioned reciprocity. The observed pattern of increased cooperation with defectors and decreased cooperation with cooperators highlights potential constraints in the LLM's ability to generalize its knowledge about human behavior in social dilemmas. We call upon the research community to further explore the factors contributing to the emergent behavior of LLM-generated agents in a wider array of social dilemmas, examining the impact of model architecture, training parameters, and various partner strategies on agent behavior. As more advanced LLMs like GPT-4 become available, it is crucial to investigate whether they exhibit similar limitations or are capable of more nuanced cooperative behaviors, ultimately fostering the development of AI systems that better align with human values and social norms. |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2305.07970&r=exp |
| By: | Gall, Thomas (University of Southampton); Hu, Xiaocheng (University of Exeter); Vlassopoulos, Michael (University of Southampton) |
| Abstract: | In teamwork settings, providing effective leadership can be challenging for team leaders due to multitasking and the difficulty in measuring and rewarding leadership input. These challenges might lead to underprovision of leadership activities, which can ultimately impede the productivity of the team. To address this problem, we conduct a field experiment at a manufacturing firm, introducing a relative subjective performance evaluation of team leaders' leadership activities by their managers, coupled with bonuses based on their leadership rank among all leaders. Our intervention increased worker productivity by approximately 7%, while leaving team leaders' productivity unchanged, and was profitable for the firm. During the intervention, we observe a positive correlation between the evaluations of team leaders and the productivity of team members, suggesting that the subjective evaluation indeed increased leadership activities and thus productivity. |
| Keywords: | multitasking, subjective evaluation, teamwork, incentive schemes, productivity, leadership |
| JEL: | J24 J33 M52 C93 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16123&r=exp |
| By: | Lingbo Huang (Nanjing Audit University); Tracy Xiao Liu (Tsinghua University); Jun Zhang (Nanjing Audit University) |
| Abstract: | Many goods and services are allocated through various booking systems. Queuebased booking systems are often thought to allocate goods more efficiently than random allocation because the time spent queuing signals an agent’s valuation. This paper demonstrates that the opportunity cost of queuing time can be a significant efficiency loss in queue-based systems. To quantify different sources of efficiency loss, we first develop an experimental framework where agents participate in both a booking system and a production activity. Using a queue-based booking system, our lab experiments confirm that the efficiency loss due to the opportunity cost of queuing time dominates other sources of efficiency loss. However, a lottery-based booking system almost eliminates this efficiency loss. We further develop a novel dual-track booking system that allows participants to choose their preferred booking track, and find that most prefer the lottery track to the queue track. |
| Keywords: | market design; booking system; queue; lottery; opportunity cost of time |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2023-04&r=exp |
| By: | Matthew Robson (Erasmus University Rotterdam); Owen O’Donnell (Erasmus University Rotterdam); Tom Van Ourti (Erasmus University Rotterdam) |
| Abstract: | We design a novel experiment to identify aversion to pure (univariate) health inequality separately from aversion to income-related and income-caused health inequality. Participants allocate resources to determine health of individuals. Identification comes from random variation in resource productivity and in information on income and its causal effect. We gather data (26, 286 observations) from a UK representative sample (n=337) and estimate pooled and participant-specific social preferences while accounting for noise. The median person has strong aversion to pure health inequality, challenging the health maximisation objective of economic evaluation. Aversion to health inequality is even stronger when it is related to income. However, the median person prioritises health of poorer individuals less than is assumed in the standard measure of income-related health inequality. On average, aversion to that inequality does not become stronger when low income is known to cause ill-health. There is substantial heterogeneity in all three types of inequality aversion |
| Keywords: | Inequality Aversion, Social Preferences, Health, Income, Experiment |
| JEL: | C90 D30 D63 I14 |
| Date: | 2023–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20230019&r=exp |
| By: | Jakub Sokołowski; Piotr Lewandowski; Jan Frankowski |
| Abstract: | Increasing climate policy ambitions create tensions in societies with low trust and social divisions, as shown by the Yellow Vests movement that successfully opposed a carbon tax in France. We study preferences for policies to achieve energy security and climate change mitigation goals in the context of the energy crisis caused by the Russian invasion of Ukraine. We conducted a discrete choice experiment on a representative sample of 10, 000 people in Poland, a country heavily dependent on fossil fuels. Using a willingness-to-pay approach, we find a strong aversion to a carbon tax that is only moderately alleviated by redistribution policies. Income and age matter for preferences regarding climate and energy. People with low incomes (bottom quartile) value achieving climate change (15%) and energy security (10%) goals less than the general population (17% and 14% willingness to pay, respectively). Younger people (aged 18-34) are willing to sacrifice more income to mitigate climate change than people aged 55 or more (28% vs. 12%) but are less willing to forego income (11% vs. 16%) to reduce fuel imports from Russia. Consequently, we quantify the heterogeneity of preferences regarding redistribution measures and evaluate their efficiency, providing an example of using discrete choice experiments to mitigate the risks of social tensions due to introducing a carbon tax. |
| Keywords: | carbon tax, redistribution, climate change, discrete choice experiment, willingness to pay |
| JEL: | H23 D74 Q41 Q54 |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:ibt:wpaper:wp032023&r=exp |
| By: | Leight, Jessica; Mvukiyehe, Eric |
| Abstract: | While a growing literature analyzes the economic effects of cash for work programs in developing countries, there remains little evidence about the longer-term effects of these interventions. This paper presents findings from a randomized controlled trial evaluating a three month intervention providing public works em ployment in rural Tunisia. The evaluation design incorporates two dimensions of randomization — community-level randomization to treatment and control, and individual-level randomization among eligible individuals — and a sample of 2, 718 individuals was tracked over five years. The findings suggest that cash for work leads to significant increases in labor market engagement, assets, consumption, financial inclusion, civic engagement, psychological well being, and women’s em powerment one-year post-treatment; however, these effects have largely attenuated to zero five years post-treatment, with the exception of a positive effect on assets. There is also evidence of positive spillover effects within treatment communities, but these effects similarly attenuate over time. |
| Keywords: | TUNISIA; NORTH AFRICA; AFRICA; economics; public works; employment; rural areas; cash flow; cash transfers; labour market; public participation; assets; developing countries; finance; gender equity; women; randomized controlled trial |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:2184&r=exp |
| By: | Kettlewell, Nathan (University of Technology, Sydney); Levy, Jonathan (University of Sydney); Tymula, Agnieszka (University of Sydney); Wang, Xueting (Royal Melbourne Institute of Technology) |
| Abstract: | Studies have frequently found that women are more risk averse than men. In this paper, we depart from usual practice in economics that treats risk attitude as a primitive, and instead adopt a neuroeconomic approach where risk attitude is determined by the reference point which can be easily estimated using standard econometric methods. We then evaluate whether there is a gender difference in the reference point, explaining the gender difference in risk aversion observed using traditional approaches. In our study, women make riskier choices less frequently than men. Compared to men, we find that women on average have a significantly lower reference point. By acknowledging the reference point as a potential source of gender inequality, we can begin a new discussion on how to address this important issue. |
| Keywords: | reference point, risk attitude, neuroeconomics, gender, inequality, experiment |
| JEL: | C90 D87 D91 J16 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16138&r=exp |
| By: | Ahnaf Rafi |
| Abstract: | Experiments that use covariate adaptive randomization (CAR) are commonplace in applied economics and other fields. In such experiments, the experimenter first stratifies the sample according to observed baseline covariates and then assigns treatment randomly within these strata so as to achieve balance according to pre-specified stratum-specific target assignment proportions. In this paper, we compute the semiparametric efficiency bound for estimating the average treatment effect (ATE) in such experiments with binary treatments allowing for the class of CAR procedures considered in Bugni, Canay, and Shaikh (2018, 2019). This is a broad class of procedures and is motivated by those used in practice. The stratum-specific target proportions play the role of the propensity score conditional on all baseline covariates (and not just the strata) in these experiments. Thus, the efficiency bound is a special case of the bound in Hahn (1998), but conditional on all baseline covariates. Additionally, this efficiency bound is shown to be achievable under the same conditions as those used to derive the bound by using a cross-fitted Nadaraya-Watson kernel estimator to form nonparametric regression adjustments. |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2305.08340&r=exp |
| By: | Sugata Marjit; Krishnendu Ghosh Dastidar; Abhilasha Pandey |
| Abstract: | This paper explores the reluctance of men (women) to acknowledge or recognise the work, comments, and claims of new ideas by other men (women) via widespread and intense demonstrations of indifference. Instances like desk rejections by journals by not allowing papers to reach a review stage, deliberately ignoring responses to respectful and cordial emails, or not referring to relevant papers in references may be related to a kind of status-seeking behaviour beyond what is projected as the real reason for such actions. Against this backdrop, this paper draws from the contemporary experimental psychology and economic theory literature on the causes and consequences of status-seeking behaviour. It integrates the idea in a simple two-player non-cooperative game theoretic framework to explain why even in a world where “Recognition” is a socially optimal strategy, “Indifference” will persist at an equilibrium. We also look at the formation of self-pampering clusters in social media as a resistance to indifference. |
| Keywords: | experimental psychology, status-seeking behaviour, indifference, recognition, non-cooperative games, repeated games |
| JEL: | D91 C72 C73 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10409&r=exp |
| By: | Ying Chen (University of Nottingham Ningbo China); Tom Lane (University of Nottingham Ningbo China); Stuart McDonald (University of Nottingham Ningbo China) |
| Abstract: | We experimentally explore public good production levels, and the endogenous formation of network structures to facilitate output sharing, among agents with heterogeneous production costs or valuations. Results corroborate the key theoretical insights of Kinateder & Merlino (2017) characterizing how agents form core-periphery networks. However, subjects often produce more and form denser networks than predicted, which sometimes reduces efficiency. There is some tendency for behaviour to converge towards the theoretical equilibrium over repeated play. Our results help us understand the emergence of the ‘law of the few’ in realworld networks, and suggest it is driven by endogenous sorting of heterogeneous agents. |
| Keywords: | Local public goods; Network formation; Experiment; Heterogeneity |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2023-02&r=exp |
| By: | María Ángeles García-Valiñas (Universidad de Oviedo [Oviedo]); Sara Suárez-Fernández (Universidad de Oviedo [Oviedo]) |
| Abstract: | The analysis of residential water demand has long attracted attention from researchers. However, the central topics at issue have evolved considerably, transitioning from estimating price and income elasticities to using experimental techniques that assess how to motivate households towards water conservation. In this literature review, we contribute to the existing literature by giving an updated overview of the state of the art in the central topics regarding residential water demand. Moreover, we present some interesting lines of research to be explored in the future. Thus, we first review some traditional key drivers of residential water demand. Second, we discuss the role of public policies when managing residential water demand, paying special attention to pricing tools. Next, we briefly review some of the methodological issues with respect to traditional econometrics and discuss related modeling. We then discuss the role of experimental designs and nudging on residential water use. Finally, we include a summary of the main literature findings, and close the discussion introducing some emerging and promising research topics. |
| Keywords: | residential water demand, price perceptions, pricing policies, non-pricing policies, stone-geary, field experiment |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04067487&r=exp |
| By: | Laura Alfaro; Maggie Chen; Davin Chor |
| Abstract: | We investigate the role of evidence-based information in shaping individuals' preferences for trade policies through a series of survey experiments that contain randomized information treatments. Each treatment provides a concise statement of economics research findings on how openness to trade has affected labor market outcomes or goods prices. Across annual surveys from 2018-2022, each administered to a representative sample of the U.S. general population, we find that information influences trade policy preferences in complex ways. Information highlighting the link between trade and manufacturing job losses significantly raises expressed preferences for more limits on trade. Strikingly, information on the price benefits of trade (or the cost of tariffs) also induces protectionist policy choices, indicating that these preferences do not respond symmetrically to information on the gains versus losses from trade. We find evidence that these expressed preferences are driven in part by how the received information interacts with one's political identity, resulting in prior-biased belief updating, as well as by pre-existing concerns over the impact on American jobs and over trade with China. Information that solely communicates the benefits of trade is thus unlikely to succeed unless it addresses these prior beliefs and concerns. |
| JEL: | D8 F1 F6 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31240&r=exp |
| By: | Andrés Ham; Juanita Ruiz; Oscar Iván Pineda-Diaz; Natalia Iriarte-Tovar; Juan Sebastián Cifuentes; María Fernanda Rodríguez-Camacho; Laura Feliza Vélez |
| Abstract: | This paper investigates whether text messages can encourage caregivers of young children to increase their intention to use in-person early childhood services and subsequently, actual attendance. We randomly assign 15, 100 beneficiaries in 719 educational centers into one control and two treatment groups, the first in which caregivers receive four text messages designed to target risk and loss aversion for three weeks, while the second group receives the same number of messages reinforcing social norms that early childhood education is a civic duty. Results show greater reported intent from caregivers who receive text messages for their children to attend but no significant differences by the type of message. However, this increased willingness to attend does not translate into greater effective attendance. These findings suggest that while text messages may be useful to provide information to caregivers, these nudges require additional and complementary efforts to turn their reported intentions into actions. ****** This paper investigates whether text messages can encourage caregivers of young children to increase their intention to use in-person early childhood services and subsequently, actual attendance. We randomly assign 15, 100 beneficiaries in 719 educational centers into one control and two treatment groups, the first in which caregivers receive four text messages designed to target risk and loss aversion for three weeks, while the second group receives the same number of messages reinforcing social norms that early childhood education is a civic duty. Results show greater reported intent from caregivers who receive text messages for their children to attend but no significant differences by the type of message. However, this increased willingness to attend does not translate into greater effective attendance. These findings suggest that while text messages may be useful to provide information to caregivers, these nudges require additional and complementary efforts to turn their reported intentions into actions. |
| Keywords: | Early childhood education, text messages, intention to attend, attendance, nudges. |
| JEL: | C93 D90 E70 I12 I20 |
| Date: | 2022–10–03 |
| URL: | http://d.repec.org/n?u=RePEc:col:000547:020773&r=exp |