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on Experimental Economics |
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Issue of 2024‒06‒10
fifteen papers chosen by |
| By: | Silvia Angerer (UMIT TIROL - Private University for Health Sciences and Health Technology); Hanna Brosch (Technical University of Munich, TUM School of Management, Heilbronn Campus); Daniela Glätzle-Rützler (University of Innsbruck); Philipp Lergetporer (Technical University of Munich, TUM School of Management, Heilbronn & ifo Institute); Thomas Rittmansberger (Technical University of Munich, TUM School of Management) |
| Abstract: | We present representative evidence of discrimination against migrants through an incentivized choice experiment with over 2, 000 participants. Decision makers allocate a fixed endowment between two receivers. To measure discrimination, we randomly vary receivers’ migration background and other attributes, including education, gender, and age. We find that discrimination against migrants by the general population is both widespread and substantial. Our causal moderation analysis shows that migrants with higher education and female migrants experience significantly less discrimination. Discrimination is more pronounced among decision makers who are male, non-migrants, have right-wing political preferences, and live in regions with lower migrant shares. |
| Keywords: | discrimination, representative sample, migration, experiment |
| JEL: | C91 C93 J15 D90 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:aiw:wpaper:35&r= |
| By: | Aur\'elien Bibaut; Nathan Kallus |
| Abstract: | Adaptive experiments such as multi-arm bandits adapt the treatment-allocation policy and/or the decision to stop the experiment to the data observed so far. This has the potential to improve outcomes for study participants within the experiment, to improve the chance of identifying best treatments after the experiment, and to avoid wasting data. Seen as an experiment (rather than just a continually optimizing system) it is still desirable to draw statistical inferences with frequentist guarantees. The concentration inequalities and union bounds that generally underlie adaptive experimentation algorithms can yield overly conservative inferences, but at the same time the asymptotic normality we would usually appeal to in non-adaptive settings can be imperiled by adaptivity. In this article we aim to explain why, how, and when adaptivity is in fact an issue for inference and, when it is, understand the various ways to fix it: reweighting to stabilize variances and recover asymptotic normality, always-valid inference based on joint normality of an asymptotic limiting sequence, and characterizing and inverting the non-normal distributions induced by adaptivity. |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2405.01281&r= |
| By: | Homrighausen, Pia (Federal Office for Migration and Refugees (BAMF)); Oberfichtner, Michael (Institute for Employment Research (IAB), Nuremberg) |
| Abstract: | Caseworker meetings have been shown to accelerate exit from unemployment. We explore whether they are also effectual before entering unemployment. In a natural field experiment, we offer caseworker meetings to workers at risk of losing their jobs while they are still employed. We find that the offer induces additional meetings and substantially shifts the first meeting forward but has no effect on entry into unemployment or on labour market outcomes within one year. The intervention does not alter jobseekers' search behaviour, which likely explains its inefficacy. |
| Keywords: | job search assistance, caseworker meetings, job search, field experiment |
| JEL: | J68 J63 J62 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16923&r= |
| By: | Gergely Hajdu (Department of Economics, Vienna University of Economics and Business) |
| 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 |
| JEL: | D91 C91 D83 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp362&r= |
| By: | Omar Al-Ubaydli; Faith Fatchen; John List |
| Abstract: | Field experiments are a useful empirical tool that can be deployed in any sub-discipline - including institutional economics - to enhance the sub-discipline's empirical insights. However, we here argue that there exist fundamental barriers to the use of field experiments in understanding the impact of institutions on economic growth. Despite these obstacles, we present some significant scholarly contributions that merit exposition, while also proposing some future methods for using field experiments within institutional economics. While field experiments may be limited in answering questions in institutional economics with macroeconomic outcomes, there is great potential in employing field experiments to answer micro founded questions. |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:feb:natura:00787&r= |
| By: | Barron, Kai; Fries, Tilman |
| Abstract: | We study how one person may shape the way another person interprets objective information. They do this by proposing a sense-making explanation (or narrative). Using a theory-driven experiment, we investigate the mechanics of such narrative persuasion. Our results reveal several insights. First, narratives are persuasive: We find that they systematically shift beliefs. Second, narrative fit (coherence with the facts) is a key determinant of persuasiveness. Third, this fit-heuristic is anticipated by narrative-senders, who systematically tailor their narratives to the facts. Fourth, the features of a competing narrative predictably influence both narrative construction and adoption. |
| Keywords: | Narratives, beliefs, explanations, mental models, experiment, financial advice |
| JEL: | D83 G40 G50 C90 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbeoc:295066&r= |
| By: | Jan Behringer; Lena Draeger; Sebastian Dullien; Sebastian Gechert |
| 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:fmmpap:97-2024&r= |
| By: | Olivier Armantier; Charles Holt |
| Abstract: | A core responsibility of a central bank is to ensure financial stability by acting as the “lender of last resort” through its Discount Window. The Discount Window, however, has not been effective because its usage is stigmatized. In this paper, we study experimentally how such stigma can be cured. We find that, once a Discount Window facility is stigmatized, removing stigma is difficult. This result is consistent with the Federal Reserve’s experiences which have been unsuccessful at removing the stigma associated with its Discount Window. |
| Keywords: | lender-of-last-resort (LOLR); Lender of last resort; discount window; stigma; laboratory experiments |
| JEL: | E58 G01 C92 |
| Date: | 2024–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:98224&r= |
| By: | Alpízar, Francisco (Wageningen University and Research, Wageningen, Netherlands); Carlsson, Fredrik (Göteborg University); Lanza, Gracia (CATIE) |
| Abstract: | Environmentally friendly alternatives are touted as a key component of a transition towards lowering the impact of human activity on the environment. The environmental costs of these technologies are seldom null; they are simply less environmentally damaging than existing options. In this paper, we investigate consumer behavior when an environmentally friendly alternative is introduced under different decision contexts. Using a carefully constructed field experimental design, we look at the use of plastic bags vis-a-vis biodegradable (bio) bags, when the latter are offered for free versus at a price. Moreover, we explore offering costly biodegradable bags as part of the default choice. We find that giving away the bio bags for free results in a large behavioral rebound effect, resulting in a large increase in the total number of bags. Setting a small, rather symbolic price offsets this rebound effect completely. Interestingly, when the bio bag is offered as a default, the behavioral rebound remains. The large behavioral rebound effect leads us to conclude against providing these environmentally friendly alternatives for free, and to caution against the use of subsidies to promote their uptake. |
| Keywords: | biodegradable; plastic bags; behavioral; rebound |
| JEL: | C93 D91 Q53 |
| Date: | 2022–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunefd:2022_013&r= |
| By: | Bryce McLaughlin; Jann Spiess |
| Abstract: | Algorithms frequently assist, rather than replace, human decision-makers. However, the design and analysis of algorithms often focus on predicting outcomes and do not explicitly model their effect on human decisions. This discrepancy between the design and role of algorithmic assistants becomes of particular concern in light of empirical evidence that suggests that algorithmic assistants again and again fail to improve human decisions. In this article, we formalize the design of recommendation algorithms that assist human decision-makers without making restrictive ex-ante assumptions about how recommendations affect decisions. We formulate an algorithmic-design problem that leverages the potential-outcomes framework from causal inference to model the effect of recommendations on a human decision-maker's binary treatment choice. Within this model, we introduce a monotonicity assumption that leads to an intuitive classification of human responses to the algorithm. Under this monotonicity assumption, we can express the human's response to algorithmic recommendations in terms of their compliance with the algorithm and the decision they would take if the algorithm sends no recommendation. We showcase the utility of our framework using an online experiment that simulates a hiring task. We argue that our approach explains the relative performance of different recommendation algorithms in the experiment, and can help design solutions that realize human-AI complementarity. |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2405.01484&r= |
| By: | De Vera, Micole (University College London); Garcia-Brazales, Javier (CEMFI); Rello, Luz (IE University) |
| Abstract: | We evaluate a reading intervention involving 600 third-grade students in Chilean schools catering to disadvantaged populations. The intervention features an adaptive computer game designed to identify and improve weaknesses in literacy and cognitive skills, and is complemented by a mobile library and advice to parents to increase student's interest and parental involvement. We first quantify the impact on non-cognitive skills and academic perceptions. We find that, after just three months of intervention, treated students are 20–30 percent of a standard deviation more likely to believe that their performance is better than that of their peers, to like school, to have stronger grit, and to have a more internal locus-of-control. Gains in aspirations and self-confidence are particularly large for students that we identify as at-risk-of-dyslexia. These improvements are reflected in better performance on a nation-wide, standardized language test. Our results show that non-cognitive skills, particularly of at-risk-of-dyslexia students, can be changed through a short, light-touch, and cost-effective education technology intervention. |
| Keywords: | field experiment, computer-based reading intervention, non-cognitive skills, Chile, dyslexia |
| JEL: | I24 I31 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16937&r= |
| By: | Yuehao Bai; Azeem M. Shaikh; Max Tabord-Meehan |
| Abstract: | The past two decades have witnessed a surge of new research in the analysis of randomized experiments. The emergence of this literature may seem surprising given the widespread use and long history of experiments as the "gold standard" in program evaluation, but this body of work has revealed many subtle aspects of randomized experiments that may have been previously unappreciated. This article provides an overview of some of these topics, primarily focused on stratification, regression adjustment, and cluster randomization. |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2405.03910&r= |
| By: | Arian Henning (Max Planck Institute for Research on Collective Goods, Bonn); Pascal Langenbach (Max Planck Institute for Research on Collective Goods, Bonn) |
| Abstract: | Automated decision-making in legal contexts is often perceived as less fair than its human counterpart. This human-automation fairness gap poses practical challenges for implementing automated systems in the public sector. Drawing on experimental data from 4, 250 participants in three public decision-making scenarios, this study examines how different reasoning models influence the perceived fairness of automated and human decision-making. The results show that providing reasons enhances the perceived fairness of decision-making, regardless of whether decisions are made by humans or machines. Moreover, the study demonstrates that sufficiently individualized reasoning largely mitigates the human-automation fairness gap. The study thus contributes to the understanding of how procedural elements like giving reasons for decisions shape perceptions of automated government and suggests that well-designed reason giving can improve the acceptability of automated decision systems. |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2024_11&r= |
| By: | Liu, Chuanjun (Sichuan University); Zou, Lemei; Wu, Junhong; Wang, Taolin; Abbas, Syed Zain |
| Abstract: | Existing UPB scales lack context and ethical considerations, which make it hard to capture real-life scenarios. This study presents a behavioral decision-based measure for unethical pro-organizational behavior (UPB). It uses scenarios to simulate daily work situations in order that individuals’ choice preferences are more ecologically valid as compared to existing scales. Study 1 involved the development and initial validation of UPB decision scenarios, resulting in a seven-scenario version exhibiting content and ecological validity. Study 2 indicated that the simulated behavioral decision-based measure had good internal consistency reliability and construct validity. Additionally, the consistency of measure across gender and position was established. Study 3 showed a high association between the UPB scale and the behavioral decision-based measure, confirming the measure’s criterion validity. The test-retest reliability was also high, indicating that the behavioral decision-based measure is stable across time. The final study showed that individuals under the cognitive load conditions made UPB choices faster but with lower frequency, supporting the dual process theory of moral dilemma decision-making. The measure proves reliable, valid, and responsive to external factors, broadening our understanding of UPB. It offers a valuable tool to be applied to organizational ethics evaluations and interventions for both scholars and practitioners. |
| Date: | 2024–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:uamxy&r= |
| By: | Leight, Jessica; Hirvonen, Kalle; Karachiwalla, Naureen; Rakshit, Deboleena |
| Abstract: | Somalia is one of the poorest countries in the world, and severe poverty, ongoing armed conflict, and recurring droughts and floodings have created a humanitarian crisis characterized by a high level of internal displacement. Baidoa city – the site of this evaluation – hosts 517 internally displaced persons (IDP) sites with almost 600, 000 households, and 64 percent of the individuals living in these sites are women and girls. According to the 2nd Somali High Frequency Survey (Pape and Karamba 2019), poverty is particularly high in IDP settlements (along with rural areas), exacerbated by high unemployment rates and an absence of income-generating opportunities. This brief reports on midline findings from a randomized controlled trial (RCT) evaluating the project Building Pathways Out of Poverty for Ultra-poor IDPs and Vulnerable Host Communities in Baidoa, an ultra-poor graduation (UPG) intervention implemented by World Vision and funded by the U.S. Agency for International Development (USAID)’s Bureau for Humanitarian Assistance (BHA). The project seeks to enable ultra-poor internally displaced households to graduate from extreme poverty and begin an upward trajectory to self-reliance for displacement-affected communities by enabling gender-sensitive, context-appropriate, and sustainable livelihoods in an urban setting. IFPRI is collaborating with World Vision to conduct the trial. |
| Keywords: | armed conflicts; displacement; households; poverty; randomized controlled trials; Somalia; Africa; Eastern Africa |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:othbrf:140604&r= |