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on Cognitive and Behavioural Economics |
| By: | Andreas Blume |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:pit:wpaper:439&r=cbe |
| By: | Becker, Anke (University of Bonn); Deckers, Thomas (University of Bonn); Dohmen, Thomas (ROA, Maastricht University); Falk, Armin (University of Bonn); Kosse, Fabian (University of Bonn) |
| Abstract: | Although both economists and psychologists seek to identify determinants of heterogeneity in behavior, they use different concepts to capture them. In this review we first analyze the extent to which economic preferences and psychological concepts of personality – such as the Big Five and locus of control – are related. We analyze data from incentivized laboratory experiments and representative samples and find only low degrees of association between economic preferences and personality. We then regress life outcomes – such as labor market success, health status and life satisfaction – simultaneously on preference and personality measures. The analysis reveals that the two concepts are rather complementary when it comes to explaining heterogeneity in important life outcomes and behavior. |
| Keywords: | risk preference, time preference, social preferences, locus of control, Big Five |
| JEL: | C91 D01 D80 D90 I00 J30 J62 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6470&r=cbe |
| By: | James C. Cox |
| Abstract: | null |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:exc:wpaper:2012-06&r=cbe |
| By: | Christoph Engel (Max Planck Institute for Research on Collective Goods, Bonn) |
| Abstract: | Self-control theory is one of the best studied criminological paradigms. Since Gottfredson and Hirschi published their General Theory in 1990 the theory has been tested on more than a million subjects. This meta-study systematizes the evidence, reporting 717 results from 102 different publications that cover 966,364 original data points. The paper develops a methodology that makes it possible to standardize findings although the original papers have used widely varying statistical procedures, and have generated findings of very different precision. Overall, the theory is overwhelmingly supported, but the effect is relatively small, and is sensitive to adding a host of moderating variables. |
| Keywords: | meta-study, self-control, general theory of crime |
| JEL: | K42 D03 K14 C13 |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2012_04&r=cbe |
| By: | Hübler, Olaf (University of Hannover) |
| Abstract: | This paper examines the question of whether risk aversion of prime-age workers is negatively correlated with human height to a statistically significant degree. A variety of estimation methods, tests and specifications yield robust results that permit one to answer this question in the affirmative. Hausman-Taylor panel estimates, however, reveal that height effects disappear if personality traits and skills, parents' behaviour, and interactions between environment and individual abilities appear simultaneously. Height is a good proxy for these influences if they are not observable. Not only one factor but a combination of several traits and interaction effects can describe the time-invariant individual effect in a panel model of risk attitude. |
| Keywords: | height, risk preference |
| JEL: | D90 J13 J24 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6441&r=cbe |
| By: | John Duffy |
| Abstract: | This paper reports findings from an experiment that implements the Lagos-Wright (2005) model of monetary exchange. We find that subjects generally avoid the autarkic equilibrium of that model and make trading decisions consistent with the model`s monetary equilibrium. Aliprantis, Camera and Puzzello (ACP, 2007) show that providing periodic access to centralized markets as in the Lagos and Wright framework may facilitate the sustainability of social norms of gift exchange, thus rendering money inessential in decentralized exchange. We also explore this hypothesis by replacing the centralized market of the Lagos-Wright model with a version of the centralized market of ACP`s model. We find that the essentiality of money is not threatened by the presence of centralized meetings. Indeed, the efficiency of allocations is significantly higher in the environment with money than without money, suggesting that money plays a role as an efficiency enhancing coordination device. |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:pit:wpaper:449&r=cbe |
| By: | Delfgaauw, Josse (Erasmus University Rotterdam); Dur, Robert (Erasmus University Rotterdam); Non, Arjan (ROA, Maastricht University); Verbeke, Willem (Erasmus University Rotterdam) |
| Abstract: | We conduct a natural field experiment in a large retail chain to test basic predictions of tournament theory regarding prize spread and noise. A random subset of the 208 stores participates in two-stage elimination tournaments. Tournaments differ in the distribution of prize money across winners of the first and second round of the tournament. As predicted by theory, we find that a more convex prize spread increases performance in the second round at the expense of first-round performance, although the magnitude of these effects is small. Moreover, the treatment effect is significantly larger for stores that historically have relatively stable performance as compared to stores with more noisy performance. |
| Keywords: | elimination tournaments, incentives, prize spread, performance measurement, field experiment |
| JEL: | C93 M51 M52 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6480&r=cbe |
| By: | Fehrler, Sebastian (University of Zurich); Kosfeld, Michael (Goethe University Frankfurt) |
| Abstract: | Do employees work harder if their job has the right mission? In a laboratory labor market experiment, we test whether subjects provide higher effort if they can choose the mission of their job. We observe that subjects do not provide higher effort than in a control treatment. Surprised by this finding, we run a second experiment in which subjects can choose whether they want to work on a job with their preferred mission or not. A subgroup of agents (roughly one third) is willing to do so even if this option is more costly than choosing the alternative job. Moreover, we find that these subjects provide substantially higher effort. These results suggest that relatively few workers can be motivated by missions and that selection into mission-oriented organizations is important to explain empirical findings of lower wages and high motivation in the latter. |
| Keywords: | motivation, effort provision, contract choice, sorting, lab experiment |
| JEL: | C92 J33 M52 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6460&r=cbe |
| By: | Todd Cherry (Department of Economics, Appalachian State University); E. Lance Howe (Department of Economics, University of Alaska Anchorage); James J. Murphy (Department of Economics, University of Alaska Anchorage) |
| JEL: | C92 D81 O13 Q20 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ala:wpaper:2012-01&r=cbe |
| By: | Englmaier, Florian (University of Würzburg); Roider, Andreas (University of Heidelberg); Sunde, Uwe (University of St. Gallen) |
| Abstract: | Incentive schemes affect performance and priorities of agents but, in reality, they can be complicated even for simple tasks. We analyze the effects of the salience of incentives in a team production setting where the principal has an interest in quantity and quality of output. We use data from a controlled field experiment that changed the communication of the incentive system without changing the incentive system. The results indicate that salience of incentives itself is statistically and economically important for performance. We find that higher salience of incentives for quantity increases quantity, reduces quality, and increases in-pocket income of team managers. |
| Keywords: | incentives, attention, salience, communication, field experiments |
| JEL: | M52 J30 D03 D80 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6448&r=cbe |
| By: | Marco Casari; Timothy N. Cason |
| Abstract: | Experimental evidence has accumulated highlighting the limitations of formal and explicit contracts in certain situations, and has identified environments in which informal and implicit contracts are more efficient. This paper documents the superior performance of explicit over implicit contracts in a new partnership environment in which both contracting parties must incur effort to generate a joint surplus, and one (“strong”) agent controls the surplus division. In the treatment in which the strong agent makes a non-binding, cheap talk “bonus” offer to the weak agent, this unenforceable promise doubles the rate of joint high effort compared to a baseline with no promise. The strong agents most frequently offered to split the gains of the high effort equally, but actually delivered this amount only about onequarter of the time. An explicit and enforceable contract offer performs substantially better, increasing the frequency of the most efficient outcome by over 200 percent relative to the baseline. |
| Keywords: | Experiments; laboratory; social preferences; inequity aversion; reciprocity; trust. |
| JEL: | C70 D03 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:pur:prukra:1270&r=cbe |
| By: | Besedes, Tibor; Deck, Cary; Sarangi, Sudipta; Shor, Mikhael |
| Abstract: | Previous studies have demonstrated that a multitude of options can lead to choice overload, reducing decision quality. Through controlled experiments, we examine sequential choice architectures that enable the choice set to remain large while potentially reducing the effect of choice overload. A specific tournament-style architecture achieves this goal. An alternate architecture in which subjects compare each subset of options to the most preferred option encountered thus far fails to improve performance due to the status quo bias. Subject preferences over different choice architectures are negatively correlated with performance, suggesting that providing choice over architectures might reduce the quality of decisions. |
| Keywords: | choice architecture; choice overload; status quo bias; self-sorting; decision making; experiments |
| JEL: | D03 C91 |
| Date: | 2012–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:38173&r=cbe |
| By: | Dietrich, Franz; List, Christian |
| Abstract: | Behaviourism is the view that preferences, beliefs, and other mental states in social-scienti c theories are auxiliary constructs re-describing people's behav- ioural dispositions. Mentalism is the view that they capture real phenomena, no less existent than the unobservable entities and properties in the natural sciences, such as electrons and electromagnetic elds. While behaviourism has long gone out of fashion in psychology and linguistics, it remains the dominant orthodoxy in economics, especially in the form of revealed preferencetheory. We aim to (i) clear up some common conceptual confusions about the two views in economics, (ii) situate the debate in a broader historical and philosophical context, and (iii) defend a mentalist approach to economics. Setting aside normative concerns about behaviourism, we show that mentalism is in line with best scienti c practice even if economics is treated as a purely positive science of human social behaviour. We distinguish mentalism from, and reject, the radical neuroeconomic view that social behaviour should be explained in terms of people's brain processes, as distinct from their mental states. |
| Keywords: | behaviourism; mentalism; realism; economic models; preferences; beliefs; rationalization; philosophy of science; neuroeconomics |
| JEL: | B0 C0 A11 D03 D0 N0 A12 D01 A14 B41 |
| Date: | 2012–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:37813&r=cbe |