nep-neu New Economics Papers
on Neuroeconomics
Issue of 2019‒11‒25
four papers chosen by

  1. Child's Socio-Emotional Skills: Is There a Quantity-Quality Trade-off? By Simon Briole; Hélène Le Forner; Anthony Lepinteur
  2. The Intuitive Cooperation Hypothesis Revisited: A Meta-analytic Examination of Effect-size and Between-study Heterogeneity By Kvarven, Amanda; Strømland, Eirik; Wollbrant, Conny Ernst-Peter; Andersson, David; Johannesson, Magnus; Tinghög, Gustav; Västfjäll, Daniel; Myrseth, Kristian Ove R.
  3. Probability Weighting and Cognitive Ability By Syngjoo Choi; Jeongbin Kim; Eungik Lee; Jungmin Lee
  4. Double overreaction in beauty-contests with information acquisition: theory and experiment By Romain Baeriswyl; Kene Boun My; Camille Cornand

  1. By: Simon Briole (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Hélène Le Forner (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); Anthony Lepinteur (University of Luxembourg [Luxembourg])
    Abstract: Though it is largely admitted that non-cognitive skills matter for adult outcomes, little is known about how the family environment affects their formation. In this paper, we use a cohort study of children born in 2000-2001 in the U.K. (Millennium Cohort Study) to estimate the effect of family size on socio-emotional skills, measured by the Strengths and Difficulties Questionnaire. To account for the endogeneity of fertility decisions, we use a well-known instrumental approach that exploits parents' preference for children's gender diversity. We show that an increase in family size negatively affects the socioemotional skills of the two first children in a persistent manner. However, we show that this negative effect is entirely driven by girls. We provide evidence that this gender effect is partly driven by an unequal response of parents' time investment in favor of boys and, to a lesser extent, to an unequal demand for household chores.
    Keywords: Non-cognitive skills,Family Size,Birth Order,Child development
    Date: 2019–10
  2. By: Kvarven, Amanda; Strømland, Eirik; Wollbrant, Conny Ernst-Peter (University of Gothenburg); Andersson, David; Johannesson, Magnus; Tinghög, Gustav (Linköping University); Västfjäll, Daniel; Myrseth, Kristian Ove R. (Trinity College Dublin)
    Abstract: The hypothesis that intuition promotes cooperation has attracted considerable attention. We address the question with a meta-analysis of 82 cooperation experiments, spanning four different types of intuition manipulations—time pressure, cognitive load, depletion, and induction—including 29,087 participants in total. To our knowledge, this is the largest and most comprehensive data set to date. We obtain a positive overall effect of intuition on cooperation, though substantially weaker than that reported in prior meta-analyses, and between studies the effect exhibits a substantial degree of systematic variation. We find that this overall effect depends exclusively on the inclusion of six experiments featuring emotion-induction manipulations, which prompt participants to rely on emotion over reason when making allocation decisions. Upon excluding from the total data set experiments featuring this class of manipulations, between-study variation in the meta-analysis is reduced substantially—and we observed no statistically discernable effect of intuition on cooperation.
    Date: 2019–04–16
  3. By: Syngjoo Choi; Jeongbin Kim; Eungik Lee; Jungmin Lee
    Abstract: Probability weighting is a major concept for accommodating systemic departures from expected utility theory. We examine the relation between probability weighting and cognitive ability by conducting laboratory experiments with a pool of subjects with unusually large variation in cognitive ability; native-born South Koreans and North Korean refugees. We find that cognitive ability is related to two distinct features of probability weighting-likelihood insensitivity and optimism. Particularly, the negative association between likelihood insensitivity and cognitive ability is robust to potential confounders and stronger among lower cognitive-ability subjects. Our findings shed light on the sources of anomalous choices against expected utility theory.
    Keywords: probability weighting; cognitive ability; likelihood insensitivity; North Korean refugees
    JEL: C91 D01 D81 D91
    Date: 2018–05
  4. By: Romain Baeriswyl (Swiss National Bank, Boersenstrasse 15, 8001 Zurich, Switzerland); Kene Boun My (BETA-Strasbourg University, 61 Avenue de la Forêt Noire - 67085 Strasbourg Cedex, France); Camille Cornand (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69130 Ecully, France)
    Abstract: Central banks' disclosures, such as forward guidance, have a weaker effect on the economy in reality than in theoretical models. The present paper contributes to understanding how people pay attention and react to various sources of information. In a beauty-contest with information acquisition, we show that strategic complementarities give rise to a double overreaction to public disclosures by increasing agents equilibrium attention, which, in turn, increases the weight assigned to them in equilibrium action. A laboratory experiment provides evidence that the effect of strategic complementarities on the realised attention and the realised action is qualitatively consistent with theoretical predictions, though quantitatively weaker. Both the lack of attention to public disclosures and a limited level of reasoning by economic agents account for the weaker realised reaction. This suggests that it is just as important for a central bank to control reaction to public disclosures by swaying information acquisition by recipients as it is by shaping information disclosures themselves.
    Keywords: beauty-contest, information acquisition, overreaction, central bank communication
    JEL: D82 E52 E58
    Date: 2019

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