nep-neu New Economics Papers
on Neuroeconomics
Issue of 2016‒03‒23
four papers chosen by

  1. Cognitive Load Increases Risk Aversion By Holger Gerhardt; Guido P. Biele; Hauke R. Heekeren; Harald Uhlig
  2. On the ethics of public nudging: Autonomy and Agency By Christian Schubert
  3. Is investing in apprentices related to decision-makers' altruism and their high time preference? By Jansen A.
  4. Gender-specific Reference-dependent Preferences in an Experimental Trust Game By Hiromasa Takahashi; Junyi Shen; Kazuhito Ogawa

  1. By: Holger Gerhardt; Guido P. Biele; Hauke R. Heekeren; Harald Uhlig
    Abstract: We investigate how stable individuals’ risk attitudes are with respect to changes in cognitive load. In a laboratory experiment using pairwise lottery choice and a within-subject design, we showthat putting subjects under load via a concurrent working-memory task significantly increases their risk aversion. Subjects made significantly faster choices under load. Regardless of load, they responded faster when choosing the less risky option in safe–risky trials, but not in risky–risky trials. We discuss how these findings relate to both dual-system and unitarysystem theories of decision making.We observe that predictions of both recent dual-system and drift–diffusion models of the decision-making process are confirmed by our data and argue for a convergence of these to-date separate strands of the literature.
    Keywords: Risk aversion, cognitive load, working memory, dual-system approach, multiplesystem approach, dual-self model, drift–diffusion model, response times
    JEL: C91 D03 D81 D87
    Date: 2016–03
  2. By: Christian Schubert (University of Kassel)
    Abstract: Nudges, i.e., low-cost interventions that steer people’s behavior without compromising their freedom of choice, are the key contribution of ‘Libertarian Paternalism’ (LP) to public policy. They typically work through either harnessing or responding to people’s cognitive biases and heuristics – which is why they have been criticized for being manipulative and for compromising personal autonomy. We argue, though, that (i) nudging hardly compromises autonomy, properly understood, and that (ii) it rather risks undermining people’s agency, i.e., their ability to engage in creative self-constitution over time. This reorientation has farranging implications for the ethics of behavioral policies in general and LP in particular.
    Date: 2015
  3. By: Jansen A. (ROA)
    Abstract: In this article, the relation between firms engagement in apprenticeship trainingand two important economic preferences, i.e. the decision makers altruism and timepreference, is analyzed. Firstly, the relation between these two preferences and a firms decision to provide apprenticeship places extensive margin is examined. Secondly, for firms that train, the effect on the amount of investments in apprenticeship training intensive margin is analyzed. The results show that the degree of altruism of a decision maker is positively, albeit weakly significant, associated to the probability to provide apprenticeship places as well as substantially related to the amount of investments in apprenticeship training. Time preferences are not related to the training decision extensive margin but significantly related to the amount of investments in training.
    Keywords: Altruism; Philanthropy; Intertemporal Firm Choice and Growth, Financing, Investment, and Capacity; Human Capital; Skills; Occupational Choice; Labor Productivity; Personnel Economics: Training;
    JEL: J24 M53 D92 D64
    Date: 2016
  4. By: Hiromasa Takahashi (Faculty of International Studies, Hiroshima City University); Junyi Shen (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan); Kazuhito Ogawa (Faculty of Sociology and Center for Experimental Economics, Kansai University)
    Abstract: We examine gender-specific reference-dependent preferences in a trust game experiment. Different participation fees and one question eliciting subjects' reference points were used to categorize subjects into three frames: the gain frame, gain or loss frame, and loss frame. We find that (i) men are risk-seeking in both the gain and the loss frame; (ii) women are not always more risk-averse than men; and (iii) women display other-regarding preferences only when they are in the gain frame. These results demonstrate the importance of taking account of both gender differences and reference-dependent preferences when examining individuals' economic behavior.
    Keywords: Reference-dependent preference, Gender difference, Trust game experiment, Risk preference, Other-regarding preference
    JEL: C72 C91
    Date: 2016–09

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