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on Experimental Economics |
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Issue of 2024‒05‒20
thirty-one papers chosen by |
| By: | Snir, Avichai; Levy, Dudi; Wang, Dian; Chen, Haipeng (Allan); Levy, Daniel |
| Abstract: | Many experimental studies report that economics students tend to act more selfishly than students of other disciplines, a finding that received widespread public and professional attention. Two main explanations that the existing literature offers for the differences found in the behavior between economists and non-economists are: (i) the selection effect, and (ii) the indoctrination effect. We offer an alternative, novel explanation: we argue that these differences can be explained by differences in the interpretation of the context. We test this hypothesis by conducting two social dilemma experiments in the US and Israel with participants from both economics and non-economics majors. In the experiments, participants face a tradeoff between profit maximization (market norm) and workers’ welfare (social norm). We use priming to manipulate the cues that the participants receive before they make their decision. We find that when participants receive cues signaling that the decision has an economic context, both economics and non-economics students tend to maximize profits. When the participants receive cues emphasizing social norms, on the other hand, both economics and non-economics students are less likely to maximize profits. We conclude that some of the differences found between the decisions of economics and non-economics students can be explained by contextual cues. |
| Keywords: | Self-Selection, Indoctrination, Self-Interest, Market Norms, Social Norms, Economic Man, Rational Choice, Fairness, Experimental Economics, Laboratory Experiments, Priming, Economists vs Non-Economists, Behavioral Economics |
| JEL: | A11 A12 A13 A20 B40 C90 C91 D01 D63 D91 P10 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:294172&r=exp |
| By: | Avichai Snir (Department of Economics, Bar-Ilan University, Israel); Dudi Levy (Department of Economics, Bar-Ilan University, Israel); Dian Wang (Alvarez College of Business, University of Texas at San Antonio, USA); Haipeng (Allan) Chen (Tippie College of Business, University of Iowa, USA); Daniel Levy (Department of Economics, Bar-Ilan University, Israel; Department of Economics, Emory University, USA; ICEA; ISET, TSU; Rimini Centre for Economic Analysis) |
| Abstract: | Many experimental studies report that economics students tend to act more selfishly than students of other disciplines, a finding that received widespread public and professional attention. Two main explanations that the existing literature offers for the differences found in the behavior between economists and non-economists are: (i) the selection effect, and (ii) the indoctrination effect. We offer an alternative, novel explanation: we argue that these differences can be explained by differences in the interpretation of the context. We test this hypothesis by conducting two social dilemma experiments in the US and Israel with participants from both economics and non-economics majors. In the experiments, participants face a tradeoff between profit maximization (market norm) and workers’ welfare (social norm). We use priming to manipulate the cues that the participants receive before they make their decision. We find that when participants receive cues signaling that the decision has an economic context, both economics and non-economics students tend to maximize profits. When the participants receive cues emphasizing social norms, on the other hand, both economics and non-economics students are less likely to maximize profits. We conclude that some of the differences found between the decisions of economics and non-economics students can be explained by contextual cues. |
| Keywords: | Self-Selection, Indoctrination, Self-Interest, Market Norms, Social Norms, Economic Man, Rational Choice, Fairness, Experimental Economics, Laboratory Experiments, Priming, Economists vs. Non-Economists |
| JEL: | A11 A12 A13 A20 B40 C90 C91 D01 D63 D91 P10 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:rim:rimwps:24-06&r=exp |
| By: | Stanislao Maldonado; Deborah Martinez; Lina Diaz |
| Abstract: | We present the results of a large-scale field experiment designed to measure the effect of social norms on parents' decisions to vaccinate their daughters against the human papillomavirus (HPV) in Bogota, Colombia. Because low rates of HPV vaccine adoption are an issue in developed and underdeveloped countries alike, the use of standard social norm marketing strategies to foster vaccination can have the undesirable effect of reinforcing the status quo. In our experiment, parents were exposed to text messages that incorporated variations of static and dynamic social norms. We demonstrate that dynamic social norms and injunctive norms increased the vaccination rate by 23%. Interestingly, we also find that a version of static social norms that uses a loss frame is also effective in fostering vaccination, implying that policy-makers can also benefit from them. Against a common view among academics and practitioners, we found no evidence that static norms reinforce the status quo. Our results highlight the importance of crafting social norms interventions using dynamic and injunctive elements to foster vaccination in settings where the majority has not yet adopted the desired behavior. |
| Keywords: | Social norms, vaccines, human papillomavirus, field experiments |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:apc:wpaper:202&r=exp |
| By: | Kei Kawai; Jun Nakabayashi |
| Abstract: | We study the effectiveness of firms' compliance programs by conducting a field experiment in which we disclose to a subset of Japanese firms that the firm is potentially engaging in illegal bid-rigging. We find that the information that we disclose affects the bidding behavior of the treated firms: our test of bid-rigging is less able to reject the null of competition when applied to the bidding data of the treated firms after the intervention. We find evidence that this change is not the result of firms ceasing to collude, however. We find evidence suggesting that firms continue to collude even after our intervention and that the change in the bidding behavior we document is the result of active concealment of evidence by cartelizing firms. |
| JEL: | K21 L41 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32347&r=exp |
| By: | Jiaoying Pei |
| Abstract: | How do people form expectations about future prices in financial markets? One of the dominant learning rules that explains the forecasting behavior is the Adaptive Expectation Rule (ADA), which suggests that people adjust their predictions by adapting to the most recent prediction error at a constant weight. However, this rule also implies that they will continually learn and adapt until the prediction error is zero, which contradicts recent experimental evidence showing that people usually stop learning long before reaching zero prediction error. A more recent learning rule, Reference Model Based Learning (RMBL), extends and generalizes ADA, hypothesizing that: i) People apply ADA but dynamically adjust the adaptive coefficient with regards to the auto-correlation of the prediction error in the most recent two periods; ii) Meanwhile, they also utilize a satisficing rule so that people would only adjust their adaptive coefficient when the prediction error is higher than their anticipation. This paper utilizes a rich set of experimental data with observations of 41, 490 predictions from 801 subjects from the Learning-to-Forecast Experiments (LtFEs), i.e., the experiment that has been used to study expectation formation. Our results concludes that RMBL fits better than ADA in all the experiments. |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2404.08908&r=exp |
| By: | Li, Zhi (Xiamen University); Zhang, Da (Tsinghua University); Zhang, Xiliang (Tsinghua University) |
| Abstract: | With a unique opportunity of recruiting hundreds of emissions trading system (ETS) participants in a series of lab-in-the-field experiments, we compare a revenue-neutral consignment auction (CA) with free allocation (grandfathering, GF hereafter) and a uniform price auction (UPA) as alternative permit allocation designs. In our setup, firms first receive their permits for free. Then, under the two auction mechanisms, they need to buy back a share of the permits, either with auction revenues returned to the firms in the primary market (CA) or not returned (UPA), followed by a spot (secondary) market for all mechanisms with the continuous double auction. We find that enforced permit transactions in the primary market induce a higher price, facilitating price discovery with lower volatility and more effective trading in the spot market. Both auctions reduce non-compliance compared with GF, because the auctions reduce both permit hoarding and risky over-selling in the spot market. Both CA and UPA help smaller polluting firms lower their profit risks. CA also helps large, cleaner firms increase profits. Our results provide insights on permit allocation designs when introducing an ETS, especially for developing countries that are pondering the balance between market efficiency and firms’ cost burden. |
| Keywords: | emissions trading; consignment auction; uniform price auction; grandfathering; spot market; price collar |
| JEL: | C92 D44 Q52 Q54 Q58 |
| Date: | 2022–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunefd:2022_010&r=exp |
| By: | Max Thon (University of Cologne); Oliver Gürtler (University of Cologne); Matthias Heinz (University of Cologne); Kai Schäfer (University of Cologne); Dirk Sliwka (University of Cologne) |
| Abstract: | We investigate how to strategically motivate sales agents in intermediary markets. In collaboration with a large travel company, we run a field experiment with more than 1, 200 independently owned intermediaries that sell our study firm’s own products as well as products from competitors to end customers. The intermediaries employ sales agents responsible for customer interaction. We compare the impact of different forms of monetary incentives with non-monetary incentives provided through direct support to reduce the sales agents’ effort costs. We develop a conceptual formal model hypothesizing that incentives for intermediaries (i) generally increase sales, and are more effective when targeting (ii) sales agents rather than owners of the intermediaries, (iii) intermediaries with weaker monetary incentives prior to the intervention, and (iv) products where the firm has no competitive advantage. We find that providing sales-agent support increases sales, while higher commission payments to the agencies’ owners has no discernible effects. Directly incentivizing sales agents through vouchers raises sales for agencies with low prior commission rates. The incentive effects are driven by products where the firm has a weaker market position, while they have no discernible effects on product sales where the firm has a strong competitive advantage. We analyze underlying mechanisms using surveys and further administrative data. |
| Keywords: | Incentives, intermediaries, competitive advantage, strategy, productivity, field experiment |
| JEL: | C93 D23 L21 M52 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:297&r=exp |
| By: | John A. List; Lina M. Ramírez; Julia Seither; Jaime Unda; Beatriz Vallejo |
| Abstract: | Misinformation represents a vital threat to the societal fabric of modern economies. While the supply side of the misinformation market has begun to receive increased scrutiny, the demand side has received scant attention. We explore the demand for misinformation through the lens of augmenting critical thinking skills in a field experiment during the 2022 Presidential election in Colombia. Data from roughly 2.000 individuals suggest that our treatments enhance critical thinking, causing subjects to more carefully consider the truthfulness of potential misinformation. We furthermore provide evidence that reducing the demand of fake news can deliver on the dual goal of reducing the spread of fake news by encouraging reporting of misinformation. |
| JEL: | C93 D9 D91 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32367&r=exp |
| By: | Malte Baader (University of Zurich); Simon Gächter (University of Nottingham); Kyeongtae Lee (Bank of Korea); Martin Sefton (University of Nottingham) |
| Abstract: | We experimentally examine how incentives affect conditional cooperation (i.e., cooperating in response to cooperation and defecting in response to defection) in social dilemmas. In our first study, subjects play eight Sequential Prisoner’s Dilemma games with varying payoffs. We elicit second mover strategies and find that most second movers conditionally cooperate in some games and free ride in others. The rate of conditional cooperation is higher when the own gain from defecting is lower and when the loss imposed on the first mover by defecting is higher. This pattern is consistent with both social preference models and stochastic choice models. In a second study subjects play 64 social dilemma games, and we jointly estimate noise and social preference parameters at the individual level. Most of our subjects place significantly positive weight on others’ payoffs, supporting the underlying role of social preferences in conditional cooperation. Our results suggest that conditional cooperation is not a fixed trait but rather a symptom of the interaction between game incentives and underlying social preferences. |
| Keywords: | sequential prisoner’s dilemma; conditional cooperation; social preferences |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2024-04&r=exp |
| By: | Karlsson, Niklas; Garling, Tommy; Selart, Marcus |
| Abstract: | Two experiments with undergraduates as subjects were carried out with the aim of replicating and extending previous results showing that the implication of the behavioral life-cycle hypothesis (H. M. Shefrin & R. H. Thaler, 1988) that people classify assets in different mental accounts (current income, current assets, and future income) may explain how consumption choices are influenced by temporary income changes. In both experiments subjects made fictitious choices between paying for a good in cash or according to a more expensive installment plan after they had received an income which was either less, the same, or larger than usual. In Experiment 1 subjects were supposed to have savings so that the total assets were equal, whereas in Experiment 2 the total assets varied. The results of both experiments supported the role of mental accounts in demonstrating that subjects were unwilling to pay in cash after an income decrease even though they had access to saved money. Thus, in effect they chose to pay more for the good than they had to. Indicating a need for further refinement of the concept of mental account, choices to pay in cash after an income decrease tended to be more frequent when the consumption and savings motives were compatible than when they were incompatible. Furthermore, increasing the total assets made subjects more willing to pay in cash after an income decrease. |
| Date: | 2024–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:2gne9&r=exp |
| By: | Matej Lorko; Tomas Miklanek; Maros Servatka |
| Abstract: | While nudges have recently gained popularity, many nudging interventions fail, and the effects of successful ones are often short-lived. We conjecture that the success of a nudge depends on how it interacts with the underlying economic incentives that determine the payoffmaximizing behavior of the decision-maker. For example, in the domain of tax compliance, a nudge is likely to be effective only if it is financially optimal for the taxpayer to pay the tax. To test our conjecture, we run a multi-period experiment in which we manipulate tax audit probability, and nudge participants to report their income. In addition, we vary how often the nudge appears, to test whether more frequent nudging increases long-run compliance. We observe that the first application of a nudge has a positive immediate effect on income reporting irrespective of whether it is optimal to comply or not. However, subsequent nudges increase income reporting only if the nudge is aligned with the taxpayer’s incentives. More frequent nudging in the direction opposite to incentives yields no effects on long-run compliance. Policy implications are discussed. |
| Keywords: | nudge, incentives, tax compliance, experiment |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp777&r=exp |
| By: | Hajdu, Gergely |
| Abstract: | I investigate whether people distort beliefs about third parties – such as the ability of scientists to offset one’s environmental impact – to excuse self interested behavior. In a laboratory experiment, participants choose how much money to take. The money is either taken from passive participants or comes from another source. Which one it is depends on the success of a third party in solving a riddle. I use a between-subject design with two treatment conditions that only differ in whether it is the success or the failure that results in taking the chosen amount from passive participants. After choosing the amount, participants report beliefs about the success of the third party. Indeed, beliefs are 13 percentage points higher when it is the failure that results in taking the chosen amount from passive participants. With monetary incentives for correct guesses the inference is inconclusive. Nevertheless, the difference in beliefs decreases to 6 percentage points and becomes statistically insignifiant. The results suggest that people use belief-based excuses about third-party success. |
| Keywords: | motivated beliefs; excuse; prosociality |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus005:62095604&r=exp |
| By: | Hajdu, Gergely; Frollová, Nikola |
| Abstract: | Choosing between payment based on one’s own performance or others’ is inherent in most delegation decisions. We propose and test that such self-reliance dilemma could result in motivated reasoning about own and others’ performances. Participants in an experiment face this dilemma and learn about it either before or after reporting their beliefs. We find that learning about the dilemma decreases participants’ beliefs about their counterpart’s performance advantage (CPA) by an average of 17%. Furthermore, it causes an average overestimation of one’s own performance and increases the fraction of participants who falsely believe they outperformed their counterpart. Organizations should, therefore, carefully manage delegation decisions and implement measures to curb overconfidence. |
| Keywords: | overconfidence; self-reliance; motivated reasoning |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus005:62095709&r=exp |
| By: | Abatemarco, Antonio (CELPE - CEnter for Labor and Political Economics, University of Salerno, Italy); Cascavilla, Alessandro (UnitelmaSapienza Università degli Studi di Roma); Dell'Anno, Roberto (CELPE - CEnter for Labor and Political Economics, University of Salerno, Italy); Morone, Andrea (Università degli Studi di Bari Aldo Moro) |
| Abstract: | Corruption is known to be one of the real life situations which may jeopardize the effectiveness of fines in deterring crime. We present a model of ‘crime with corruption’ by which both the dilution of crime deterrence due to corruption, as well as the possibility of crime encouraging fines are formally highlighted. More importantly, by running an experiment on a subject pool of students for the case of illegal waste disposal, we provide experimental evidence on the validity of our theoretical predictions. We find that increasing fine rate may become crime encouraging or at least ineffective, beyond a context-specific fine threshold. In a policy perspective, we suggest that the optimal design of a crime-deterring sanctioning system must simultaneously account for both corruption practices and anti-corruption policies. |
| Keywords: | corruption; crime; fine; waste |
| JEL: | C91 H10 K14 K42 Q50 |
| Date: | 2023–12–24 |
| URL: | http://d.repec.org/n?u=RePEc:sal:celpdp:0166&r=exp |
| By: | Gabriele Camera, Rod Garratt, Cyril Monnet |
| Abstract: | Truthful reporting about the realization of a publicly observed event cannot be guaranteed by a consensus process. This fact, which we establish theoretically and verify empirically, holds true even if some individuals are compelled to tell the truth, regardless of economic incentives. We document results from an experiment where subjects routinely misreported a commonly known event when they could monetarily gain from it. Relying on majority consensus did not help uncover the truth, especially if complying with the majority granted small personal monetary gains. This highlights the difficulties in relying on shared consensus protocols to agree on specific events, and the importance of institutions with trusted, impartial observers |
| Keywords: | DeFi, digital currency, dishonesty, trust |
| JEL: | C70 C90 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:ube:dpvwib:dp2404&r=exp |
| By: | Jan Behringer (Macroeconomic Policy Institute (IMK)); Lena Draeger (Leibniz University Hannover (LUH)); Sebastian Dullien (Macroeconomic Policy Institute (IMK)); Sebastian Gechert (Chemnitz University of Technology (TUC)) |
| Abstract: | We use novel German survey data to investigate how perceptions and information about public finances influence attitudes towards public debt and fiscal rules. On average, people strongly underestimate the debt-to-GDP ratio, overestimate the interest-to-tax-revenue ratio and favor a tighter German debt brake. In an information treatment experiment, people consider public debt to be a more (less) severe problem once they learn the actual debt-to-GDP or interest-to-tax-revenue ratio is higher (lower) than their estimate. However, the treatment effects partly vanish when anchoring respondents' beliefs with historical public debt figures. We find no treatment effects on attitudes towards the debt brake. |
| Keywords: | public debt, fiscal rules, information treatment, expectations |
| JEL: | D83 E60 H31 H60 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:imk:wpaper:223-2024&r=exp |
| By: | Oschwald, Patrick; Jacob, Eva; Kamanzi, Adalbertus; Kaufmann, Gudrun |
| Abstract: | Societal structures play a crucial role when evaluating distributional outcomes. While social stratification may be more or less pronounced, most societies show some form of it. Being in a so-called "lower" social class often comes with economic uncertainty and is closely associated with a low household income (Western et al., 2012). The question is, if a redistribution scheme is chosen ex-ante via a social contract, or, redistributive measures are taken ex-post, how does the societal position play a role in this choice? As an outcome of the FRIBIS summer school 2023 on "Empirical methods of UBI investigations - Part II: The Social Contract: A Behavioral Economics Approach with Lab Experiments" we present here our extension for the experiment conducted by Faillo et al. (2015). The original experiment is based on contract theory in line with the tradition of Rawls A Theory of Justice (1971). Our extension, in a sense, lifts his proposed veil of ignorance and informs the disadvantaged of their societal position after a first round of the experiment. We begin with briefly describing the original experiment. Afterwards our proposed extension is described and contrasted against the outcomes of Faillo et al. (2015). We still have some reservations/doubts how far an approach with the "veil of ignorance" makes sense and what kind of (policy) implication could follow as logical outcome with respect to "terms of reality and power relations", which we will therefore discuss at the end. |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fribpd:290358&r=exp |
| By: | Selart, Marcus |
| Abstract: | According to normative decision theory there exists a principle of procedure invariance which states that a decision maker's preference order should remain the same, independently of which response mode is used. For example, the decision maker should express the same preference independently of whether he or she has to judge or decide. Nevertheless, previous research in behavioral decision making has suggested that judgments and choices yield different preference orders in both the risky and the riskless domain. In the latter, the prominence effect has been demonstrated. The main purpose of the present series of experiments was to test cognitive explanations which account for the prominence effect. One of the explanations provided a psychological account based primarily on decision-strategy compatibility. Two other explanations built on information structuring approaches. In the first one, the general idea was that decision makers differentiate between alternatives by value and belief restructuring. In the second approach, violations of invariance were assumed to be attributed to the information structure of the task which in many cases demand problem simplification. A prominence effect was in most experiments found for both choices and preference ratings. This finding spoke against the strategy compatibility explanation. Instead, the different forms of cognitive restructuring provided a better account. However, none of these provided a single explanation. Yet, the structure compatibility explanation appeared to be the more viable one, in particular of the relation between experimental manipulations and response mode outcomes. The predictions of the value-belief restructuring explanation, on the other hand, seemed to be more valid for the prominence effect found in choice than for preference ratings. |
| Date: | 2024–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:kyvtq&r=exp |
| By: | Benjamin S. Manning; Kehang Zhu; John J. Horton |
| Abstract: | We present an approach for automatically generating and testing, in silico, social scientific hypotheses. This automation is made possible by recent advances in large language models (LLM), but the key feature of the approach is the use of structural causal models. Structural causal models provide a language to state hypotheses, a blueprint for constructing LLM-based agents, an experimental design, and a plan for data analysis. The fitted structural causal model becomes an object available for prediction or the planning of follow-on experiments. We demonstrate the approach with several scenarios: a negotiation, a bail hearing, a job interview, and an auction. In each case, causal relationships are both proposed and tested by the system, finding evidence for some and not others. We provide evidence that the insights from these simulations of social interactions are not available to the LLM purely through direct elicitation. When given its proposed structural causal model for each scenario, the LLM is good at predicting the signs of estimated effects, but it cannot reliably predict the magnitudes of those estimates. In the auction experiment, the in silico simulation results closely match the predictions of auction theory, but elicited predictions of the clearing prices from the LLM are inaccurate. However, the LLM's predictions are dramatically improved if the model can condition on the fitted structural causal model. In short, the LLM knows more than it can (immediately) tell. |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2404.11794&r=exp |
| By: | Stefan C. Wolter; Thea Zoellner |
| Abstract: | Despite numerous measures intended to enhance gender equality, gender-specific study and career choices remain a persistent concern for policymakers and academics globally. We contribute to the literature on gendered career choices by focusing on explicitly stated parental preferences for their children's occupations, using a large-scale randomized survey experiment with adults (N=5940) in Switzerland. The focus on parents (and hypothetical parents) is motivated by the observation that adolescents consistently mention their parents as the single most important factor influencing their career choices. The surveyed adults are presented with a realistic choice situation, in which their hypothetical daughter or son has been proposed two different training occupations. The pair of occupations presented to the adults is drawn from a random sample of 105 pairs of occupations, and the respondents are not informed about the gender distribution of the two occupations. Results show that adults are gender-neutral when advising a daughter but have a pronounced preference for male- dominated occupations when advising sons. Preferences are almost identical for parents and non-parents and across age cohorts of adults. |
| Keywords: | Gender, Occupational choice, Career advice, Vocational Education |
| JEL: | J24 J16 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0216&r=exp |
| By: | Martina Zanella (Department of Economics, Trinity College Dublin) |
| Abstract: | Women are still under-represented and struggling to establish careers in traditionally male-dominated fields. Does minority status in and of itself create a barrier to women's success? Experiments suggest that under-representation exacerbates the detrimental effect of the negative stereotypes that often characterize women's ability in these fields. However, in real-world environments, these results might not hold. While lab experiments typically shut down the selection channel altogether, the choice to enter male-dominated fields is endogenous, and may in part be motivated by challenging these stereotypes. This paper assesses how minority status affects performance when selection is endogenous by studying the performance of 14, 000 students at an elite university across 16 departments, in a real-world setting that combines a choice with well-defined stereotypes - university major - with exogenous variation in peer identity - quasi-random allocation of students across class groups within the same course. The evidence indicates that those who go against stereotypes (e.g. women in math) do not suffer from being in the minority, but they impose negative externalities on those who select on stereotypes (e.g. men in math). In line with social identity considerations being incorporated into educational choices, the evidence points towards ex-ante "sensitivity" to social norms and preferences to engage with same-gender peers inducing students to select different majors and then reacting to the composition of the environment in a self-fulfilling way. |
| Keywords: | Occupational choices; gender stereotypes; minority status; peer effects in education |
| JEL: | D91 I24 J15 J16 J24 |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep0224&r=exp |
| By: | Jean N. Lee (World Bank); Jonathan Morduch (Robert F. Wagner Graduate School of Public Service, New York University); Saravana Ravindran (Lee Kuan Yew School of Public Policy, National University of Singapore); Abu S. Shonchoy (Department of Economics, Florida International University) |
| Abstract: | Behavioral household finance shows that people are often more willing to spend when using less tangible forms of money like debit cards or digital payments than when spending in cash. We show that this “payment effect†cannot be generalized to mobile money. We surveyed families in rural Northwest Bangladesh, where mobile money is mainly received from relatives working in factories. The surveys were embedded within an experiment that allows us to control for the relationships between senders and receivers of mobile money. The finding suggests that the source of funds matters, and mobile money is earmarked for particular purposes and thus less fungible than cash. In contrast to the expectation of greater spending, the willingness to spend in the rural sample was lower by 24 to 31 percent. In urban areas, where the sample does not receive remittances on net, there are no payment effects associated with mobile money. |
| Keywords: | payment effect, digital finance, willingness to pay, social meaning of money, earmarks |
| JEL: | O15 G41 G50 D91 D14 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:fiu:wpaper:2402&r=exp |
| By: | Toygar T. Kerman; Anastas P. Tenev |
| Abstract: | We study a multiple-receiver Bayesian persuasion model in which the sender wants to achieve an outcome and commits to an experiment which sends correlated messages to homogeneous receivers. Receivers are connected in a network and can perfectly observe their immediate neighbors’ messages. After updating their beliefs, receivers choose an action to match the true state of the world. Surprisingly, the sender’s gain from persuasion does not change monotonically with network density. We characterize a class of networks in which increased communication among the receivers is strictly better for the sender and hence strictly worse for the receivers. |
| Keywords: | Bayesian Persuasion, Networks, Critical Mass, Voting |
| JEL: | C72 D72 D82 D85 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp772&r=exp |
| By: | Velez, Maria (Los Andes University); Rueda, Ximena (University of Los Andes); Henao, Juan Pablo (Chair group of Agricultural Production and Resource Economics, Technical Un); Monroy, Dayron (Los Andes University); Tobin, Danny (Duke University); Maldonado, Jorge Higinio (Universidad de los Andes); Pfaff, Alexander (Duke University) |
| Abstract: | Artisanal and small-scale gold mining employs millions of poor people, globally, yet also significantly degrades the environment. Support from conscientious buyers, based on the information within certifications, could lower environmental impacts and raise incomes, leading miners to be willing to incur costs to participate in sustainable supply chains. As supply-chain certification may require formalization, we explore miners’ motivations for and the barriers to formalization within a choice experiment in two Community Councils in Afro-descendent areas of Colombia’s Pacific Region: Yurumangui, in Valle del Cauca and San Juan, in Choco. Community Councils have collective land rights—which might make them more willing to engage in collective action often required for formalization. We find that, while all miners prefer to leave the status quo, views of miners in the two Councils differed with regard to formalization. Yurumangui expressed more interest overall in the options we offered, perhaps due to past formalization experiences in San Juan. Yurumangui miners were also more willing to form or join an association to formalize, very likely due to positive past outcomes from organization. We find no consistent effect of gender regarding preferences, though prior voluntary restoration correlates with individual miners’ willingness to restore sites, one requisite of formalization. Our results inform interventions to support formalization in small-scale gold mining communities, as we find miners are willing to try formalization but raise issues related to costs that can hinder adoption and in ways that vary with the past legacies of each Council. |
| Keywords: | sustainability; supply chains; mercury; mining; Afro-descendant communities; formalization; common property resources; motivations; choice experiment; Colombia |
| JEL: | C25 D04 D71 Q31 Q32 Q38 |
| Date: | 2024–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunefd:2024_005&r=exp |
| By: | Karun Adusumilli; Francesco Agostinelli; Emilio Borghesan |
| Abstract: | This paper examines the scalability of the results from the Tennessee Student-Teacher Achievement Ratio (STAR) Project, a prominent educational experiment. We explore how the misalignment between the experimental design and the econometric model affects researchers' ability to learn about the intervention's scalability. We document heterogeneity in compliance with class-size reduction that is more extensive than previously acknowledged and discuss its consequences for the evaluation of the experiment. Guided by this finding, we implement a new econometric framework incorporating heterogeneous treatment effects and endogenous class size determination. We find that the effect of class size on test scores differs considerably across schools, with only a small fraction of schools having significant benefits from reduced class sizes. We discuss the challenges this poses for the intervention's scalability and conclude by analyzing targeted class-size interventions. |
| JEL: | C51 H52 I2 J13 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32338&r=exp |
| By: | Yoichiro Tsuji (Graduate School of Economics, Kobe University, JAPAN); Junyi Shen (Research Institute of Economics and Business Administration, Kobe University, JAPAN) |
| Abstract: | Although policy choices can impact not only the present but future generations, only the present generation can make such choices. If a policy imposes a burden on future generations, will the present generation consider the policy's impact on future generations when making a choice? In response to this intergenerational social dilemma, numerous empirical studies have shown that when asked to imagine themselves as a future generation, the present generation's participation in resource distribution decision-making is significantly impacted for decisions that consider future generations; moreover, local governments in Japan have made efforts that use this methodology as a social practice (Saijo, 2022). In this study, we aim to clarify what is needed for future generations to be considered by analyzing the respondents' policy preferences using an online stated choice experiment survey. The respondents were assigned different generational standpoints and were asked to choose their favorite of three policy packages, each of which comprised several policies. The results show that, in general, respondents tended to avoid placing direct burdens on the present generation, regardless of the generation they represented. However, respondents who took their children and grandchildren's standpoints tended to prefer policies that would not burden future generations. In addition, respondents with prosocial tendencies made choices that focused on future generations. |
| Keywords: | Generational standpoint; Policy preferences; Stated choice experiment; Present generation; Future generation |
| JEL: | C25 D64 H50 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:dp2024-17&r=exp |
| By: | Moros, Lina (Universidad de los Andes, School of Management, Bogotá, Colombia.); Vélez, María Alejandro (Los Andes University); Pfaff, Alexander (Duke University); Quintero, Daniela (Los Andes University) |
| Abstract: | Payment for ecosystem services (PES) programs are proliferating globally but not always with significant impact. Unlike protected areas (PAs), PES compensate suppliers of ecoservices, increasing local acceptance. Yet, some worry that PES could reduce conservation in the long run, if the introduction of financial incentives “crowds out” or diminishes prior conservation behavior. We implemented a decision experiment with farmers in rural Colombia to study the effects of temporary PES. We find no crowding out if a PES is introduced then ended. Contributions after PES fall back to pre-PES levels, at worst, and if anything, they are higher. Comparisons to controls without PES strengthen these findings, which can inform policy design. |
| Keywords: | lab-in-the field experiment; pro-environmental behavior; payment for ecosystem services; incentives; Colombia |
| JEL: | Q01 Q52 Q57 Q58 |
| Date: | 2022–05–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunefd:2022_007&r=exp |
| By: | Mendonca, Hedvig; Kuang, Lida; März, Simon; Walter, Larissa |
| Abstract: | The following paper emerged from the interactive sessions and lectures of the second part of the Summer School, with the topic "Social Contract Lab Experiments". It took place from June 11 to June 14, 2023 and was conducted in collaboration with Prof. Bernhard Neumärker, the FRIBIS SoCoBis Team, the leader of the SoCoLab in Freiburg, Dr. Marcel Franke and Prof. Lorenzo Sacconi, Prof. Marco Faillo, Laura Marcon (PhD.) and Dr. Viginia Cecchini Manara from Italy. The policy paper is a draft of an adapted social contracting experiment that can be seen following the various lectures and workshops, in particular the presentations by Prof. Lorenzo Sacconi, Prof. Virginia Cecchini Manara, Prof. Marco Faillo, and Laura Marcon (PhD.). |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fribpd:290357&r=exp |
| By: | Heidi Reed (Audencia Business School) |
| Abstract: | This study examines how individual members of the public make moral sense of the potentially conflicting "economic problem" or "public health problem" representations of the COVID-19 crisis when judging responsible business behavior. The data are based on a qualitative survey involving a thought experiment with 119 participants in the United States conducted at the initial stage of the pandemic. This article proposes a typology matrix using the theories of cognitive polyphasia and cognitive dissonance to understand better individual moral sensemaking of responsible business behavior in the context of a societal paradox in which there are contradictory and interdependent demands between important social objectives. The typology, referred to as the 4R Model of Moral Sensemaking of Competing Social Problems, provides insights for how companies may be perceived when responding to competing social problems, expanding the micro-CSR (corporate social responsibility) and paradox literatures. |
| Keywords: | cognitive dissonance cognitive polyphasia COVID-19 micro-CSR paradox, cognitive dissonance, cognitive polyphasia, COVID-19, micro-CSR, paradox |
| Date: | 2022–07–31 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04531082&r=exp |
| By: | Pedro Gonzalez-Fernandez |
| Abstract: | This paper proposes a unified theoretical model to identify and test a comprehensive set of probabilistic updating biases within a single framework. The model achieves separate identification by focusing on the updating of belief distributions, rather than classic point-belief measurements. Testing the model in a laboratory experiment reveals significant heterogeneity at the individual level: All tested biases are present, and each participant exhibits at least one identifiable bias. Notably, motivated-belief biases (optimism and pessimism) and sequence-related biases (gambler's fallacy and hot hand fallacy) are identified as key drivers of biased inference. Moreover, at the population level, base rate neglect emerges as a persistent influence. This study contributes to the belief-updating literature by providing a methodological toolkit for researchers examining links between different conflicting biases, or exploring connections between updating biases and other behavioural phenomena. |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2404.09297&r=exp |
| By: | Janis Zickfeld (Aarhus University [Aarhus]); Karolina Scigala (Aarhus University [Aarhus]); Christian Elbaek (Aarhus University [Aarhus]); John Michael; Mathilde Tønning Tønnesen (Aarhus University [Aarhus]); Gabriel Levy; Shahar Ayal; Isabel Thielmann; Laila Nockur; Eyal Peer; Valerio Capraro; Rachel Barkan; Simen Bø; Štěpán Bahník; Daniele Nosenzo (Aarhus University [Aarhus]); Ralph Hertwig; Nina Mazar; Alexa Weiss; Ann-Kathrin Koessler; Ronit Montal-Rosenberg; Sebastian Hafenbrädl; Yngwie Asbjørn Nielsen (Aarhus University [Aarhus]); Patricia Kanngiesser; Simon Schindler; Philipp Gerlach; Nils Köbis; Nicolas Jacquemet (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Marek Albert Vranka; Dan Ariely; Jareef Martuza; Yuval Feldman; Michal Bialek; Jan Kristian Woike; Zoe Rahwan; Alicia Seidl; Eileen Chou; Agne Kajackaite; Simeon Schudy; Ulrich Glogowsky; Anna Czarna; Stefan Pfattheicher (Aarhus University [Aarhus]); Panagiotis Mitkidis (Aarhus University [Aarhus]) |
| Abstract: | Dishonest behaviors such as tax evasion impose significant societal costs. Ex-ante honesty oaths—commitments to honesty before action—have been proposed as useful interventions to counteract dishonest behavior, but the heterogeneity in findings across operationalizations calls their effectiveness into question. We tested 21 honesty oaths (including a baseline oath)—proposed, evaluated, and selected by 44 expert researchers—and a no-oath condition in a megastudy in which 21, 506 UK and US participants played an incentivized tax evasion game. Of the 21 interventions, 10 significantly improved tax compliance by 4.5 to 8.5 percentage points, with the most successful nearly halving tax evasion. Limited evidence for moderators was found. Experts and laypeople failed to predict the most effective interventions, but experts' predictions were more accurate. In conclusion, honesty oaths can be effective in curbing dishonesty but their effectiveness varies depending on content. These findings can help design impactful interventions to curb dishonesty. |
| Keywords: | honesty oath, dishonesty, tax compliance, nudging, unethical behavior |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-04555561&r=exp |