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on Experimental Economics |
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Issue of 2016‒12‒18
twenty-two papers chosen by |
| By: | Uri Gneezy; Andreas Leibbrandt; John List |
| Abstract: | Competitiveness pervades life: plants compete for sunlight and water, animals for territory and food, and humans for mates and income. Here we investigate human competitiveness with a natural experiment and a set of behavioral experiments. We compare competitiveness in traditional fishing societies where local natural forces determine whether fishermen work in isolation or in collectives. We find sharp evidence that fishermen from individualistic societies are far more competitive than fishermen from collectivistic societies and that this difference emerges with work experience. These findings suggest that humans can evolve traits to specific needs, support the idea that socio-ecological factors play a decisive role for individual competitiveness, and provide evidence how individualistic and collectivistic societies shape economic behaviour. |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:feb:natura:00579&r=exp |
| By: | Simona Demel (School of Economics and Business, University of the Basque Country (UPV/EHU)); Abigail Barr (Department of Economics, University of Nottingham); Luis Miller (School of Economics and Business, University of the Basque Country (UPV/EHU)); Paloma Ubeda (School of Economics and Business, University of the Basque Country (UPV/EHU)) |
| Abstract: | Using a political-frame-free, lab-in-the-field experiment, we investigate the effects of employment status and political ideology on preferences for redistribution. The experiment consists of a real-effort task, followed by a four-player dictator game. In one treatment, initial endowments depend on participants’ performance in the real-effort task, i.e., they are earned, in the other, they are randomly determined.We find that being employed or unemployed affects revealed redistributive preferences, while the political ideology of the employed and unemployed does not. In contrast, the revealed redistributive preferences of students are strongly related to their political ideologies. The employed and right-leaning students redistribute earnings less than windfalls, the unemployed and left-leaning students make no such distinction. We conclude that, when people are not exposed to the sometimes harsh realities of the labor market, their redistributive preferences depend on their political ideology but, when they are exposed, the effect of those realities overrules their ideology. |
| Keywords: | economic status, lab-in-the-field experiments,left-right scale, redistribution |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2016-18&r=exp |
| By: | Joy A. Buchanan (Interdisciplinary Center for Economic Science and Department of Economics, George Mason University); Matthew K. McMahon (Interdisciplinary Center for Economic Science and Department of Economics, George Mason University); Matthew Simpson (Department of Statistics, University of Missouri - Columbia); Bart J. Wilson (Economic Science Institute, Chapman University) |
| Abstract: | We investigate the degree to which people in a shopping mall express other-regarding behavior in the dictator game. Whereas many studies have attempted to increase the social distance between the dictator and experimenter and between the dictator and dictatee, we attempt to minimize that social distance between random strangers by video recording the decisions with the permission of the dictators to display their image on the Internet. Offers made by dictators are high relative to other experiments and a nontrivial number give the entire experimental windfall away, however a nontrivial number of people keep everything as well. |
| Keywords: | experimental economics, social distance, dictator game |
| JEL: | A13 C70 C93 D63 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:gms:wpaper:1061&r=exp |
| By: | Friebel, Guido; Kosfeld, Michael; Thielmann, Gerd |
| Abstract: | We conduct experimental games with police applicants in Germany to investigate whether intrinsically motivated agents self-select into public service. Our focus is on trustworthiness and the willingness to enforce norms as key dimensions of intrinsic motivation in the police context. We find that police applicants are more trustworthy than non-applicants, i.e., they return higher shares as second-movers in a trust game. Furthermore, they invest more in rewards and punishment when they can enforce cooperation as a third party. Our results provide clear evidence for advantageous self-selection into the German police force, documenting an important mechanism by which the match between jobs and agents in public service can be improved. |
| Keywords: | intrinsic motivation; norm enforcement; Public Service; Self-selection; trustworthiness |
| JEL: | C9 D64 D73 J45 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11697&r=exp |
| By: | Julia Müller (Institute for Organisational Economics, University of Münster); Christiane Schwieren (Alfred-Weber-Institute for Economics, University of Heidelberg); Florian Spitzer (Department of Strategy and Innovation, Vienna University of Economics and Business) |
| Abstract: | Many recent experimental studies have shown that some subjects destroy other subjects’ incomes without receiving any material benefit, and that they even incur costs to do so. In this paper, we study the boundary conditions of this phenomenon, which is referred to as anti-social behavior. We introduce a four-player destruction game, in which we vary the framing and the presence of another activity, running in parallel to the destruction game. We observe a substantial amount of destruction in the baseline condition without the parallel activity, and with a framing in the spirit of previous destruction experiments. Our results indicate that a parallel activity as well as a framing emphasizing joint ownership of the item that can be destroyed reduces destruction almost to zero. We therefore argue that the emergence of anti-social behavior is highly contingent on the contextual environment. |
| Keywords: | anti-social behavior, joy of destruction, experiment, framing, boredom |
| JEL: | A13 C72 C91 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp238&r=exp |
| By: | Ayelet Gneezy; Uri Gneezy; Joan Llull; Pedro Rey-Biel |
| Abstract: | Understanding what affects satisfaction from consumption is fundamental to studying economic behavior. However, measuring subjective hedonic experiences is not trivial, in particular when studying experience goods in which quality is difficult to observe prior to consumption. We report the results of a field experiment with a theater show in which the audience pays at the end of the show under pay-what-you-want pricing. Using questionnaires, we measure expected enjoyment before the show, as well as the realized enjoyment after. Correlating the amounts paid with the expected and realized enjoyment, we find that individuals with a larger gap between reported expectations and enjoyment pay significantly more. Once we account for the satisfaction gap, the level of expected enjoyment or realized enjoyment has no significant effect in predicting payments. |
| Keywords: | experience goods; pay-what-you-want; expectations |
| JEL: | C72 C91 D81 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:944&r=exp |
| By: | Katharina Laske (University of Cologne); Marina Schroeder (University of Cologne) |
| Abstract: | We introduce a novel experimental design in which creativity is incentivized and measured along three dimensions: quantity, quality and originality of ideas. We implement piece rate incentives for quantity alone, quantity in combination with quality and quantity in combination with originality and compare the results to a baseline with a fixed wage. We find that incentives significantly affect the quantity and average quality of ideas, but not the average originality. Incentives for both quantity and originality perform best in fostering innovative ideas. |
| Keywords: | creativity, multitasking, laboratory experiment, real-effort, incentives |
| JEL: | C91 J33 M52 O30 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cgr:cgsser:07-01&r=exp |
| By: | Morone, Andrea; Temerario, Tiziana |
| Abstract: | We analysed dyads strategies in one-shot public goods game. By means of a laboratory experiment, using a variant of the strategy-method, we found that more than one third of the dyads are conditional cooperators, whereas 18% can be categorised as free riders. |
| Keywords: | Voluntary contributions,Conditional cooperation,Free riding,Strategy-method |
| JEL: | H41 C91 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:148356&r=exp |
| By: | M. Bigoni; S. Bortolotti; F. Parisi; A. Porat |
| Abstract: | Current law and economics scholarship analyzes efficient breach cases monolithically. The standard analysis holds that breach is efficient when performance of a contract generates a negative total surplus for the parties. However, by simplistically grouping efficient breach cases as of a single kind, the prior literature overlooks that gainseeking breaches might be different from loss-avoiding breaches. To capture these different motives, we designed a novel game called Contract-Breach Game where we exogenously varied the reasons for the breach — pursuing a gain or avoiding a loss — under a specific performance remedy. Results from an incentivized laboratory experiment indicate that the motives behind the breach induce sizable differences in behavior; subjects are less willing to renegotiate when facing gain-seeking than loss-avoiding breaches, and the compensation premium obtained by the promisee is higher. Our analysis suggests that inequality aversion is an important driver of our results; indeed, inequality-averse subjects accept low offers more often in cases of loss-avoiding breaches than gain-seeking breaches. These results give us insight into the preferences and expectations of ordinary people in a case of a breach. |
| JEL: | K12 D86 C9 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp1088&r=exp |
| By: | Carina Cavalcanti; Andreas Leibbrandt |
| Abstract: | This paper investigates the role of dry promotions for community participation in eight Brazilian fishing villages. We randomly promoted some fishermen to assistants before the start of an environmental program, increasing their responsibilities but not providing any monetary compensation. Thereafter, we study whether they engage more in conservation behavior during this program. The data shows that promoted fishermen provide substantially more effort, which suggests that such promotions my be a cost-effective tool to stimulate cooperation and community participation. |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:feb:natura:00580&r=exp |
| By: | John Duffy; Frank Heinemann |
| Abstract: | We implement a repeated version of the Barro-Gordon monetary policy game in the laboratory and ask whether reputation serves as a substitute for commitment, enabling the central bank to achieve the efficient Ramsey equilibrium and avoid the inefficient, time-inconsistent one-shot Nash equilibrium. We find that reputation is a poor substitute for commitment. We then explore whether central bank cheap talk, policy transparency, both cheap talk and policy transparency or economic transparency yield improvements in the direction of the Ramsey equilibrium under the discretionary policy regime. Our findings suggest that these mechanisms have only small or transitory effects on welfare. Surprisingly, the real effects of supply shocks are better mitigated by a commitment regime than by any discretionary policy. Thus, we find that there is no trade-off between flexibility and credibility. |
| JEL: | C92 D83 E52 E58 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:hum:wpaper:sfb649dp2016-053&r=exp |
| By: | Andreas Leibbrandt; Redzo Mujcic |
| Abstract: | Some of the greatest human achievements are difficult to imagine without pro-sociality. This paper employs a natural field experiment to investigate indirect reciprocity in natural social interactions. We find strong evidence of indirect reciprocity in one-shot interactions among drivers. Subjects for whom other drivers stopped were more than twice as likely to extend a similar act to a third party. This result is robust to a number of factors including age, gender, social status, presence of onlookers, and the opportunity cost of time. We provide novel evidence for the power of indirect reciprocity to promote prosocial behavior in the field. |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:feb:natura:00581&r=exp |
| By: | John Duffy (Department of Economics, University of California-Irvine); Frank Heinemann (Department of Economics, Technische Universitat Berlin) |
| Abstract: | We implement a repeated version of the Barro-Gordon monetary policy game in the laboratory and ask whether reputation serves as a substitute for commitment, enabling the central bank to achieve the efficient Ramsey equilibrium and avoid the inefficient, time-inconsistent one-shot Nash equilibrium. We find that reputation is a poor substitute for commitment. We then explore whether central bank cheap talk, policy transparency, both cheap talk and policy transparency or economic transparency yield improvements in the direction of the Ramsey equilibrium under the discretionary policy regime. Our findings suggest that these mechanisms have only small or transitory effects on welfare. Surprisingly, the real effects of supply shocks are better mitigated by a commitment regime than by any discretionary policy. Thus, we find that there is no trade-off between flexibility and credibility. |
| Keywords: | Monetary policy; Repeated games; Central banking; Commitment; Discretion; Cheap talk; Transparency; Experimental economics |
| JEL: | C92 D83 E52 E58 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:irv:wpaper:161703&r=exp |
| By: | Doris Weichselbaumer |
| Abstract: | Germany is currently experiencing a high influx of Muslim migrants. From a policy perspective, integration of migrants into the labor market is crucial. Hence, a field experiment was conducted that examined the employment chances of females with backgrounds of migration from Muslim countries, and especially of those wearing headscarves. It focused on Turkish migrants, who have constituted a large demographic group in Germany since the 1970s. In the field experiment presented here, job applications for three fictitious female characters with identical qualifications were sent out in response to job advertisements: one applicant had a German name, one a Turkish name, and one had a Turkish name and was wearing a headscarf in the photograph included in the application material. Germany was the ideal location for the experiment as job seekers typically attach their picture to their résumé. High levels of discrimination were found particularly against the migrant wearing a headscarf. |
| Keywords: | Discrimination, Muslim religion, Headscarf, Hiring, Experiment |
| JEL: | C93 J15 J71 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2016_09&r=exp |
| By: | Wilson, Norbert L.W.; Rickard, Bradley J.; Saputo, Rachel; Ho, Shuay-Tsyr |
| Abstract: | The presence of food waste, and ways to reduce food waste, has generated significant debate among industry stakeholders, policy makers, and consumer groups in the United States and elsewhere. Many have argued that the variety of date labels used by food manufacturers leads to confusion about food quality and food safety among consumers. Here we develop a laboratory experiment with treatments that expose subjects to different date labels (Sell by, Best by, Use by, and Fresh by) for six food products; we include both small and large-sized ready-to-eat cereal, salad greens, and yogurt. Our results show that, holding other observed factors constant, that date labels do influence subjects’ value of food waste. We find that subjects will waste food across all date labels, but that the value of waste is greatest in the “Use by” treatment, the date label suggestive of food safety, and lowest for the “Sell by” treatment. Two-way ANOVA tests provide evidence that subjects respond differentially to date labels by product. Pair-wise comparison indicate that the “Sell by” treatment generates a waste value that is different than other date labels. We see subjects have different values of waste depending on date label and product. The value of waste for cereal is more responsive to “Fresh by”; for salad, the value of waste is more responsive to all date labels except for “Fresh by”; for yogurt, subjects adjusted their value of waste the most to the “Sell by” treatment. Date labels influence food waste despite the limited information provided by the labels. |
| Keywords: | Consumer preferences, Date labels, Experimental economics, Food quality, Food safety, Public policy analysis, Agricultural and Food Policy, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Q13, Q18, |
| Date: | 2015–05 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cudawp:250016&r=exp |
| By: | Pietro Battiston; Simona Gamba |
| Abstract: | We study the behavior of individuals coming from different geographic regions of Italy, in a same public good game. We confirm previous findings according to which, faced with the same incentives and experimental conditions, Southern citizens exhibit a lower propensity to cooperate than Northern ones. This difference is mainly explained by a gap in the impact of coordination devices available to participants, as we show by manipulating them. Most importantly, when subjects with different geographic origins are teamed up together, their contributions decrease with respect to homogeneous groups, again because of a reduced effect of coordination devices. These findings reinforce the interpretation of the Italian South-North divide as related to trust, prejudice and a consequent path-dependence in levels of social capital, rather than due to the mere effect of differences in institutions and economic opportunities. |
| Keywords: | public good, cooperation, social capital, cultural differences, laboratory experiment |
| Date: | 2016–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2016/41&r=exp |
| By: | Amadou Boly; Robert Gillanders; Topi Miettinen |
| Abstract: | In our framed laboratory experiment, two Public Officials, A and B, make consecutive decisions regarding embezzlement from separate funds. Official B observes Official A’s decision before making their own. There are four treatments: three with deterrence and one without. We find a peer effect in embezzlement in that facing an honest Official A reduces embezzlement by Official B. Likewise, deterrence matters in that higher detection probabilities significantly decrease embezzlement. Crucially, detection is more effective in curbing embezzlement when chosen by an honest Official A compared to a corrupt Official A at almost all individual detection levels. This ‘legitimacy’ effect may help explain why anti-corruption policies can fail in countries where the government itself is believed to be corrupt. |
| Keywords: | corruption, deterrence, embezzlement, laboratory experiment, legitimacy, peer effect |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2016-137&r=exp |
| By: | Eva M. Berger (Johannes Gutenberg University Mainz); Guenther Koenig; Henning Mueller (Johannes Gutenberg University Mainz); Felix Schmidt (Johannes Gutenberg University Mainz); Daniel Schunk (Johannes Gutenberg University Mainz) |
| Abstract: | Recent evidence suggests that self-regulation plays an important role for labor market success. We conduct a randomized ?eld experiment embedded in an existing labor market reactivation program to examine the effect of a self-regulation training on long-term unemployed individuals. First, we ?nd a positive treatment effect on the quality of submitted CVs. Second,there is no overall treatment effect on (short-term) labor market reintegration, but heterogeneous effects with respect to participants’ Locus of Control that are consistent with psychological theory. The low costs of our intervention suggest high individual and social rates of return from a roll-out to other programs. |
| Keywords: | Active Labor Market Policy, Natural Field Experiment, Germany, Labor Market Reintegration, Unemployment, Reemployment, Self-Regulation, Locus of Control, Non-Cognitive Skills |
| JEL: | C93 J24 J64 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:jgu:wpaper:1622&r=exp |
| By: | Morone, Andrea; Temerario, Tiziana |
| Abstract: | The recent literature on individual and group choices over risk has led to different results. In some studies under unanimity, groups were found to be less risk averse than individuals, while those under majority did not highlight significant differences. However, both the types of studies impose the decision rule to the group. In the present work we elicited groups’ preference under risk using a consensus rule, i.e. groups are free to solve disagreement endogenously, just as in the real life. Results from our pairwise choices experiment shows that when group members are free to use any rule they want in order to reach unanimity, there is no statistical difference between individuals’ and groups’ risk aversion. |
| Keywords: | Group Preferences,Risk,Individual Preferences,Lab |
| JEL: | C9 C90 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:148357&r=exp |
| By: | van Veldhuizen, Roel |
| Abstract: | A large number of recent experimental studies show that women are less likely to sort into competitive environments. While part of this effect may be explained by gender differences in risk attitudes and overconfidence, previous studies have attributed the majority of the gender gap to gender differences in a separate 'competitiveness' trait. We re-examine this result using a powerful novel experimental technique that allows us to separate competitiveness from alternative explanations by experimental design. In contrast to the literature, the results from our experiment imply that the whole gender gap is driven by risk attitudes and overconfidence. We show that our results are due to our experimental approach, which circumvents concerns raised against the regression-based method used by previous studies. Our results have important implications for policy and future research. |
| Keywords: | Tournament,Experimental Design,Gender,Competitiveness,Lab Experiment |
| JEL: | C90 J16 J24 J31 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbmbh:spii2016207&r=exp |
| By: | M. Fabbri; P. N. Barbieri; M. Bigoni |
| Abstract: | We designed a natural-field experiment in the context of local public transportation to test whether rewards in the form of lottery prizes coupled with traditional sanctions efficiently reduce free-riding. We organized a lottery in a medium-size Italian city the participation in which is linked to purchasing an on-board bus ticket. The lottery was then implemented in half of otherwise identical buses operating in the municipality. Our theoretical model shows that the introduction of the lottery generates an increase in the number of tickets sold and that it is possible to design a self-financing lottery. To estimate the effect of the lottery's introduction on the amount of tickets sold, we matched and compared treated and control buses operating on the same day on the exact same route. The results show that buses participating in the lottery sold significantly more tickets than the control buses. The increase in revenue from the tickets sold was more than the lottery prize amount. |
| JEL: | D04 H42 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp1089&r=exp |
| By: | Damian Clarke (Universidad de Santiago de Chile); Sonia Oreffice (University of Surrey); Climent Quintana-Domeque (University of Oxford and St Edmund Hall) |
| Abstract: | We study the determinants of season of birth, for white married women aged 20-45 in the US, using birth certificate and Census data. We also elicit the willingness to pay for season of birth through discrete choice experiments implemented on the Amazon Mechanical Turk platform. We document that the probability of a spring first birth is significantly related to mother's age, education, smoking status during pregnancy, and the mother working in "education, training, and library" occupations, whereas a summer first birth does not depend on socio-demographic characteristics. We find consistent but stronger correlates when focusing on second births, while all our findings are muted among unmarried women. We estimate the average willingness to pay for a spring birth to be 600 USD, which is about 18% of the most valued birth in our Amazon Mechanical Turk experimental sample or 15% of the mean charges for a normal birth in 2013 according to the Agency for Healthcare Research and Quality. |
| Keywords: | quarter of birth, willingness to pay, NVSS, ACS-IPUMS, Amazon Mechanical Turk, discrete choice experiments, fertility timing |
| JEL: | I10 J01 J13 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2016-032&r=exp |