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on Cognitive and Behavioural Economics |
| By: | Coenen, Michael; Jovanovic, Dragan |
| Abstract: | We analyze a constrained dictator game in which the dictator splits a pie which will be subsequently created through simultaneous investments by herself and the recipient. We consider two treatments by varying the maximum attainable size of the pie leading to either high or low investment incentives. We find that constrained dictators and recipients invest less than a model with self-interested players would predict. While the splitting decisions of constrained dictators correspond to the theoretical predictions when investment incentives are high, they are more selfish when investment incentives are low. Overall, team productivity is negatively affected by lower investment incentives. -- |
| Keywords: | Bargaining Game,Dictator Game,Investment Incentives,Team Production |
| JEL: | C72 C91 D01 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:dicedp:77&r=cbe |
| By: | Jiri, Mazurek |
| Abstract: | Many real-world decision making situation are associated with uncertainty regarding future state of the World. Traditionally, in such situation different (and discrete) scenarios – future states of nature – are considered. This domain of decision making is denoted as decision making under risk. However, limitation to some set of discrete scenarios is somewhat unnatural as future reality might not choose one of considered scenarios, but some other scenario or a scenario in between. The aim of this paper is to propose a more natural approach with continuum states of nature, where all scenarios expressed by their probability density function from some reasonable interval are taken into consideration. The approach is illustrated by a numerical example and is compared with the corresponding decision making under risk with discrete states of nature. |
| Keywords: | continuous states of nature; decision making under risk; scenario; utility function |
| JEL: | D81 |
| Date: | 2012–11–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:42856&r=cbe |
| By: | Bhirombhakdi, Kornpob; Potipiti, Tanapong |
| Abstract: | This study experimentally tests the performance in predicting decisions of a reciprocity model that was proposed by Dufwenberg et al. (2004). By applying a new approach, the study directly and individually predicts a subject's future decision from his past decision. The prediction performance is measured by the rate of correct predictions (accuracy) and the gain in the rate of the correct predictions (informativeness). Six scenarios of trust game are used to test the model's performance. Further, we compare the performance of the model with two other prediction methods; one method uses a decision in a dictator game to predict a decision in a trust game; the other uses personal information including IQ-test scores, personal attitudes and socio-economic factors. Seventy-nine undergraduate students participated in this hand-run experimental study. The results show that the reciprocity model has the best performance when compared with other prediction methods. |
| Keywords: | Reciprocity; Kindness; Performance; Trust Game |
| JEL: | C71 C91 |
| Date: | 2012–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:42326&r=cbe |
| By: | van den Berg, Gerard J. (University of Mannheim); Lundborg, Petter (Lund University); Vikström, Johan (IFAU) |
| Abstract: | We study the short-run and long-run economic impact of one of the largest losses that an individual can face; the death of a child. We utilize unique merged registers on the entire Swedish population, combining information on the date and cause of death with parents' labor market outcomes, health outcomes, marital status, and subsequent fertility. We exploit the longitudinal dimension of the data and deal with a range of selection issues. We distinguish between effects on labor and various non-labor income components and we consider patterns over time. We find that labor market effects are persistent. |
| Keywords: | sickness absenteeism, depression, child mortality, labor supply, bereavement, employment, marriage, death, divorce, mental health, fertility |
| JEL: | I12 I11 J14 J12 C41 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7010&r=cbe |
| By: | Vieider, Ferdinand M.; Chmura, Thorsten; Martinsson, Peter |
| Abstract: | We measure risk attitudes in 30 different countries in a controlled, incentivized experiment (N = 3025). At the macroeconomic level, we find a strong and highly significant negative correlation between the risk tolerance of a country and income per capita. This gives rise to a paradox, seen that risk tolerance has been found to be positively associated with personal income within countries. We show that this paradox can be explained by unified growth theory. These results are consistent with the prediction that risk attitudes act as a transmission mechanism for growth by encouraging entrepreneurship. Furthermore, our study shows that risk attitudes vary considerably between countries and that for typical experimental stakes, risk seeking or neutrality is just as frequent as risk aversion. -- |
| Keywords: | risk attitudes,cultural comparison,economic growth,comparative development |
| JEL: | D01 D03 D81 E02 O10 O11 O12 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbrad:spii2012401&r=cbe |
| By: | Cécile Bazart (LAMETA, University of Montpellier I, France); Aurélie Bonein (University of Rennes 1 - CREM UMR CNRS 6211, France) |
| Abstract: | Reciprocity considerations are important to the tax compliance problem as they may explain the global dynamics of tax evasion, beyond individual tax evasion decisions, toward a downward or upward spiral. To provide evidence on reciprocity in tax compliance decisions, we have conducted a laboratory experiment in which we introduced two types of inequities. The first type of inequity is called vertical, because it refers to inequities introduced by the government when it sets different fiscal parameters for identical taxpayers, while the second type of inequity is called horizontal because it refers to the fact that taxpayers may differ in tax compliance decisions. In this setting, taxpayers may react to a disadvantageous or advantageous inequity through negative or positive reciprocal behaviors, respectively. Our results support the existence of negative and positive reciprocity in both vertical and horizontal cases. When both inequities come into play and may induce reciprocal behaviors in opposite directions, the horizontal always dominates the vertical. |
| Keywords: | Behavioral economics; Experimental economics; Fairness; Tax evasion; Tax compliance |
| JEL: | H26 C91 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201239&r=cbe |