nep-neu New Economics Papers
on Neuroeconomics
Issue of 2023‒05‒08
three papers chosen by

  1. Parental Investment, School Choice, and the Persistent Benefits of Intervention in Early Childhood By Lei Wang; Yiwei Qian; Nele Warrinnier; Orazio Attanasio; Scott Rozelle; Sean Sylvia
  2. Locus of Control and Economic Decision-Making: A Field Experiment in Odisha, India By Ahsan Jansson, Cecilia; Patil, Vikram; Vecci, Joe; Chellattan Veettil , Prakashan; Yashodha, Yashodha
  3. The Effects of Incentives on Choices and Beliefs in Games: An Experiment By Teresa Esteban-Casanelles; Duarte Gon\c{c}alves

  1. By: Lei Wang (Shaanxi Normal University); Yiwei Qian (Stanford University); Nele Warrinnier (Queen Mary University of London and LICOS, KU Leuven); Orazio Attanasio (Yale University, the Institute of Fiscal Studies (IFS)); Scott Rozelle (Stanford University); Sean Sylvia (University of North Carolina at Chapel Hill)
    Abstract: We present evidence from a randomized experiment testing the impacts of a six-month early childhood home-visiting program on child outcomes at school entry. Two and a half years after completion of the program, we find persistent effects on child working memory - a key skill of executive functioning that plays a central role in children’s development of cognitive and socio-emotional skills. We also find that the program had persistent effects on parental time investments and preschool enrolment decisions. Children were enrolled earlier and in higher quality preschools, the latter reflecting a shift in preferences over preschool attributes toward quality. Our findings imply an important role for the availability of high-quality subsequent schooling in sustaining the impacts of early intervention programs.
    Keywords: Early Childhood Development, Parenting, China, Poverty
    JEL: J13 I21 I28 H11
  2. By: Ahsan Jansson, Cecilia (Department of Economics, School of Business, Economics and Law, Göteborg University); Patil, Vikram (International Rice Research Institute (IRRI), India); Vecci, Joe (Department of Economics, School of Business, Economics and Law, Göteborg University); Chellattan Veettil , Prakashan (International Rice Research Institute (IRRI), India.); Yashodha, Yashodha (International Water Management Institute (IWMI), India)
    Abstract: We study psychological impediments that make it difficult to change be- haviour. In particular, we evaluate the impact of a randomised psychological intervention designed to target locus of control–an individual’s belief in their own ability to influence their outcomes – on the adoption of climate resilient technologies. In the control farmers receive a standard agricultural education. Treatment farmers are assigned to one of three treatments where they receive agricultural training and either: a psychological information treatment providing tools to change belief about one’s sense of control, a crop simulation app – al- lowing farmers to simulate their agricultural decisions and a treatment with both combined. Our sample consists of 1674 farmers from 252 villages in Odisha, India. We find that at baseline, the majority do not believe they can influence their agri- cultural outcomes. However, the interventions have little impact on agricultural behaviour, locus of control or aspirations. We then study explanations.
    Keywords: Psychological Impediments; Locus of Control; Agriculture
    JEL: D01 D91 O13
    Date: 2023–04
  3. By: Teresa Esteban-Casanelles; Duarte Gon\c{c}alves
    Abstract: How and why do incentive levels affect strategic behavior? This paper examines an experiment designed to identify the causal effect of scaling up incentives on choices and beliefs in strategic settings by holding fixed opponents' actions. In dominance-solvable games, higher incentives increase action sophistication and best-response rates and decrease mistake propensity. Beliefs tend to become more accurate with higher own incentives in simple games. However, opponents with higher incentive levels are harder to predict: while beliefs track opponents' behavior when they have higher incentive levels, beliefs about opponents also become more biased. We provide evidence that incentives affect cognitive effort and that greater effort increases performance and predicts choice and belief sophistication. Overall, the data lends support to combining both payoff-dependent mistakes and costly reasoning.
    Date: 2023–04

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