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on Experimental Economics |
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Issue of 2018‒06‒11
28 papers chosen by |
| By: | Deniz Nebioglu (Bilgi Economics Lab of Istanbul (BELIS); Istanbul Bilgi University); Ayça Ebru Giritligil (Murat Sertel Center for Advanced Economic Studies; Istanbul Bilgi University) |
| Abstract: | This paper presents the results of a series of experiments which try to test the behavioral foundations of GHH preferences using the Ramsey framework in a controlled laboratory setting. The main objective is to elicit subjects’ innate preferences for income and leisure through an experimental design with real effort. To this end, we ran two experiments and we observed that subjects do not perceive leisure in the lab as real leisure, and hence they choose to work as much as they can even if the marginal revenue from extra work is very low. This result points out the methodological difficulty of creating labor/leisure choice environment in a laboratory setting. We concluded that an experiment which aims to investigate the effect of changed incentives on effort provision in a neoclassical labor supply model should not be designed as an individual decision making experiment but rather as a market experiment. |
| URL: | http://d.repec.org/n?u=RePEc:beb:wpbels:201802&r=exp |
| By: | Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University); Lampi, Elina (Department of Economics, School of Business, Economics and Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University); Tu, Qin (School of Economics and Resource Management, Beijing Normal University, Beijing, China); Yang, Xiaojun (School of Public Policy and Administration, Xi’an Jiaotong University, Xi’an, China) |
| Abstract: | We present lab-in-the-field experimental evidence of the effects of the Chinese one-child policy on individuals’ preferences and behavior as adults. The experiments were conducted in three different provinces because the policy was not strictly implemented at the same time in all provinces. We measure risk and time preferences, as well as subjects’ competitiveness, cooperation, and bargaining behavior, sampling individuals born both before and after the introduction of the policy. Overall, we do not find any sizeable or statistically significant effects of the one-child policy on preferences or behavior in any of the experiments. These results hold for heterogeneity in the timing of the implementation of the OCP in different provinces, for heterogeneity among individuals, and for various robustness checks. |
| Keywords: | one-child policy; lab-in-the-field experiment; China. |
| JEL: | C91 D03 D10 I31 P30 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0732&r=exp |
| By: | Crosetto, P.; Lacroix, A.; Muller, L.; Ruffieux, B. |
| Keywords: | NUTRITIONAL LABELS;EXPERIMENT;FRONT-OF-PACK |
| JEL: | C93 Q18 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:gbl:wpaper:2018-11&r=exp |
| By: | Artavia-Mora, Luis (ISS, Erasmus University Rotterdam); Bedi, Arjun S. (ISS, Erasmus University Rotterdam); Rieger, Matthias (ISS, Erasmus University Rotterdam) |
| Abstract: | This paper employs a natural field experiment in the Netherlands to test whether individuals intuitively help strangers with different group identities. We implement time manipulations in an everyday task to stimulate intuitive versus deliberate decision-making and thereafter examine helpfulness towards a female stranger with in-group (native) or out-group (Muslim) appearance. We find that time delay decreases helping rates. In contrast, regardless of time manipulation, out-group appearance does not influence helping rates. Overall, subjects are intuitively predisposed to help, independent of identity. We discuss our findings with respect to the literature on in-group favoritism and the cognitive origins of human cooperation. |
| Keywords: | help, cooperation, in-group favoritism, Muslim, dual-process of cognition, natural field experiment, The Netherlands |
| JEL: | D03 D63 D64 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11460&r=exp |
| By: | Afridi, Farzana (Indian Statistical Institute); Dhillon, Amrita (King's College London); Li, Sherry Xin (University of Texas at Dallas); Sharma, Swati (Indian Statistical Institute) |
| Abstract: | Production processes are often organised in teams, yet there is limited evidence on whether and how social connections and financial incentives affect productivity in tasks that require coordination among workers. We simulate assembly line production in a lab-in-the-field experiment in which workers exert real effort in a minimum-effort game in teams whose members are either socially connected or unconnected and are paid according to the group output. We find that group output increases by 15% and wasted individual output is lower by 30% when workers are socially connected with their co-workers. Unlike the findings of existing research, increasing the power of group-based financial incentives does not reduce the positive effect of social connections. Our results are driven by men whose average productivity is significantly lower than that of women. These findings can be explained by pro-social behavior of workers in socially connected teams. |
| Keywords: | caste-based networks, social incentives, financial incentives, minimum effort game, coordination, trust |
| JEL: | C93 D20 D22 D24 J33 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11521&r=exp |
| By: | Filomena Garcia; Luca David Opromolla; Andrea Vezzulli; Rafael Marques |
| Abstract: | The administration of tax policy has shifted its focus from enforcement to complementary instruments aimed at creating a social norm of tax compliance. In this paper we provide an analysis of the effects of the dissemination of information regarding the past degree of tax evasion at the social level on the current individual tax compliance behavior. We build an experiment where, for given levels of audit probabilities, fines and tax rates, subjects have to declare their income after receiving either a communication of the official average tax evasion rate or a private message from a group of randomly matched peers about their tax behavior. We use the experimental data to estimate a dynamic econometric model of tax evasion. The econometric model extends the Allingham-Sandmo-Yitzhaki tax evasion model to include self-consistency and endogenous social interactions among taxpayers. We find four main results. First, tax compliance is very persistent. Second, the higher the official past tax evasion rate the higher the degree of persistence: evaders are more likely to evade again, and compliant individuals are more likely to comply again. Third, when all peers communicate to have evaded (complied) in the past, both evaders and compliant individuals are more likely to evade (comply). Fourth, while both treatments, and especially the unofficial information treatment, are associated, in the context of our experiment, with a significantly larger growth in evasion intensity, the aggregate effect depends on the characteristics of the population. In countries with inherently low levels of tax evasion, official information can have beneficial effects by consolidating the behavior of compliant individuals. However, in countries with inherently high levels of tax evasion, official information can have detrimental effects by intensifying the behavior of evaders. In both cases, the impact of official information is magnified in the presence of strong peer effects. |
| Keywords: | tax morale, information, tax evasion, experiment, peer effects |
| JEL: | H26 D63 C24 C92 Z13 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7020&r=exp |
| By: | Alex Possajennikov (University of Nottingham); Rene Saran (University of Cincinnati) |
| Abstract: | The paper reports on an experiment on two-player double-auction bargaining with private values. We consider a setting with discrete two-point overlapping distributions of traders' valuations, in which there exists a fully efficient equilibrium. We show that if there are traders that behave naively, i.e., set bid or ask equal to their valuation, then there is no equilibrium achieving full efficiency. In the experiment, we vary the proportion of naive traders by introducing computerized players. We find that full efficiency is not achieved in the experiment with or without naive traders, and efficiency is not lower in the presence of naive traders. Subjects mostly set bid/ask prices strategically but the extent of strategic behavior is not larger in the presence of naive players. We can explain these results by a learning model of noisy strategy adjustment. We also find that framing the double auction as a direct mechanism leads to more naive behavior by experiment participants, and that allowing face-to-face pre-play communication increases efficiency although still not to the full level. |
| Keywords: | bargaining with private values, double auction, efficiency, honesty |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcdx:2018-03&r=exp |
| By: | Shukkri AHMED (FERDI); Craig MCINTOSH (University of California at San Diego); Alexandros SARRIS (University of Athens) |
| Abstract: | We present the results of an experiment introducing commercial rainfall index insurance into drought-plagued farming cooperatives in Amhara State, Ethiopia. We introduce a market-priced rainfall deficit insurance product through producer cooperatives, and test a number of potential ways to kick-start private demand. Takeup of the insurance at market prices is very low, between .5% and 3% across seasons, but a low-cost promotion at baseline increases willingness to pay for multiple seasons. When we use a randomized experiment to distribute small free insurance contracts to farmers, 39% of subsidized individuals enroll but this fails to stimulate input use, yields, or income, and nor does it enhance demand in subsequent seasons. Our experience in interlinking credit with insurance shows that while serious logistical challenges need to be overcome, real demand can exist for state-contingent credit in this context. |
| Keywords: | Index Insurance, Randomized Experiments, Ethiopian Agriculture |
| JEL: | O13 G22 C93 |
| Date: | 2017–08 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:4289&r=exp |
| By: | Shukkri AHMED (FERDI); Craig MCINTOSH (University of California at San Diego); Alexandros SARRIS (Université d'Athènes) |
| Abstract: | We present the results of an experiment introducing commercial rainfall index insurance into drought-plagued farming cooperatives in Amhara State, Ethiopia. We introduce a market-priced rainfall deficit insurance product through producer cooperatives, and test a number of potential ways to kick-start private demand. Takeup of the insurance at market prices is very low, between .5% and 3% across seasons, but a low-cost promotion at baseline increases willingness to pay for multiple seasons. When we use a randomized experiment to distribute small free insurance contracts to farmers, 39% of subsidized individuals enroll but this fails to stimulate input use, yields, or income, and nor does it enhance demand in subsequent seasons. Our experience in interlinking credit with insurance shows that while serious logistical challenges need to be overcome, real demand can exist for state-contingent credit in this context. |
| Keywords: | Index Insurance, Randomized Experiments, Ethiopian Agriculture |
| JEL: | O13 G22 C93 |
| Date: | 2017–08 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:4288&r=exp |
| By: | Marion Krämer (Department of Economics, University of Goettingen, Germany); Santosh Kumar (Department of Economics and International Business, Sam Houston State University); Sebastian Vollmer (Department of Economics & Centre for Modern Indian Studies, University of Goettingen, Germany) |
| Abstract: | We present experimental evidence on the impact of delivering double-fortified salt (DFS), salt fortified with iron and iodine, through the Indian school-feeding program called “mid-day meal” on anemia, cognition, and math and reading outcomes of primary school children. We conducted a field experiment that randomly provided a one-year supply of DFS at a subsidized price to public primary schools in one of the poorest regions of India. The DFS treatment had significantly positive impacts on hemoglobin levels and reduced the prevalence of any form of anemia by 20 percent but these health gains did not translate into statistically significant impacts on cognition and test scores. While exploring the heterogeneity in effects, we find that treatment had statistically significant gains in anemia and test scores among children with higher treatment compliance. We further estimate that the intervention was very cost effective and can potentially be scaled up rather easily. |
| Keywords: | Double-fortified salt, education, anemia, school feeding, India, and randomized controlled trial |
| JEL: | C93 I15 O11 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:shs:wpaper:1803&r=exp |
| By: | Shinichi Hirota (School of Commerce, Waseda University); Juergen Huber (Dept. of Finance, University of Innsbruck); Thomas Stock (Dept. of Banking and Finance, University of Innsbruck); Shyam Sunder (School of Management and Cowles Foundation, Yale University) |
| Abstract: | To explore how speculative trading influences prices in ?nancial markets we conduct a laboratory market experiment with speculating investors (who do not collect dividends and trade only for capital gains) as well as dividend-collecting investors. We ?nd that in markets with only speculating investors (i) price deviations from fundamentals are larger; (ii) prices are more volatile; (iii) the “mispricing” is likely to be strategic and not irrational; (iv) mispricing increases with the number of transfers until maturity; and (v) speculative trading pushes prices upward (downward) when liquidity is high (low). |
| Keywords: | Experimental finance, Speculation, Rational expectations, Price efficiency, Price bubbles, Overlapping generations, Backward and forward induction |
| JEL: | C91 G11 G12 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:cwl:cwldpp:2134&r=exp |
| By: | Sandro Ambuehl; Axel Ockenfels; Colin Stewart |
| Abstract: | Who participates in transactions when information about the consequences must be learned? We show theoretically that decision makers for whom acquiring and processing information is more costly not only respond more strongly to changes in incentive payments for participating but also decide to participate based on worse information. With higher payments, the pool of participants consists of a larger proportion of individuals who have a worse understanding of the consequences of their decision. We conduct a behavioral experiment that confirms these predictions, both for experimental variation in the costs of information acquisition and for various measures of information costs, including school grades and cognitive ability. These findings are relevant for any transaction combining a payment for participation with uncertain yet learnable consequences. |
| Keywords: | Experiment, rational inattention, repugnant transactions, incentives |
| JEL: | D83 D91 C91 |
| Date: | 2018–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-607&r=exp |
| By: | Michał Krawczyk (Faculty of Economic Sciences, University of Warsaw) |
| Abstract: | I conduct a laboratory experiment aimed at verifying the drift-diffusion model. The subjects are shown a sequence of noisy signals of the difference in cash value of two options. Every realization of the signal was costly and the subjects could stop observing it and make their decision at any point. As the cost of the signal, the expected value of each option, the standard deviation of these values and the actual values were systematically varied across 200 rounds, several predictions of the model could be put to a test. In all but one case these predictions were correct. |
| Keywords: | drift-diffusion model, sequential sampling |
| JEL: | C9 D8 D9 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:war:wpaper:2018-12&r=exp |
| By: | Andreas Bergh; Philipp Christoph Wichardt |
| Abstract: | This paper reports results from a classroom dictator game comparing the effects of three different sets of standard instructions. The results show that seemingly small differences in instructions induce fundamentally different perceptions regarding entitlement. Behavior is affected accordingly, i.e. instructions inducing subjects to perceive the task as distributive rather than a task of generosity lead to higher allocations to receivers (average 52% vs. 35%). A theoretical explanation integrating monetary as well as social incentives and emphasizing potential effects of uncertainty about the latter is discussed (cf. Bergh and Wichardt, 2018). |
| Keywords: | dictator games, framing effects, property rights, social preferences |
| JEL: | C70 C91 D63 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7049&r=exp |
| By: | Björn Bartling; Alexander W. Cappelen; Mathias Ekström; Erik Ø. Sørensen; Bertil Tungodden |
| Abstract: | The paper reports the first experimental study on people’s fairness views on extreme income inequalities arising from winner-take-all reward structures. We find that the majority of participants consider extreme income inequality generated in winner-take-all situations as fair, independent of the winning margin. Spectators appear to endorse a “factual merit” fairness argument for no redistribution: the winner deserves all the earnings because these earnings were determined by his or her performance. Our findings shed light on the present political debate on redistribution, by suggesting that people may object less to certain types of extreme income inequality than commonly assumed. |
| Keywords: | winner-take-all reward structures, fairness, income inequality |
| JEL: | C91 D63 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7045&r=exp |
| By: | James Berry; Greg Fischer; Raymond Guiteras |
| Abstract: | Using the Becker-DeGroot-Marschak (BDM) mechanism, we estimate the willingness-to-pay (WTP) for and impact of clean water technology through a field experiment in Ghana. Although WTP is low relative to the cost, demand is relatively inelastic at low prices. In the short-run, treatment effects are positive—the incidence of children's diarrhea falls by one third—and consistent throughout the WTP distribution. After a year, usage has fallen, particularly for those with relatively low valuations. Strikingly, the long-run average treatment effect is negative for those with valuations below the median. Combining estimated treatment effects with individual willingness-to pay measures implies households' valuations of health benefits are much smaller than those typically used by policymakers. Finally, we explore differences between BDM and take-it-or-leave-it valuations and make recommendations for effectively implementing BDM in the field. |
| Keywords: | price mechanism, heterogeneous treatment effects, health behaviour, Becker-DeGroot-Marschak, field experiments |
| JEL: | C26 C93 D12 L11 L31 O12 Q51 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:cep:stieop:066&r=exp |
| By: | Yayan Hernuryadin (School of Economics and Management, Kochi University of Technology); Koji Kotani (School of Economics and Management, Kochi University of Technology); Yoshio Kamijo (School of Economics and Management, Kochi University of Technology) |
| Abstract: | Three societies of the hunter-gatherer, the agrarian and the industrial represent the course of human history for cultural and economic development. In this course, each society exhibits distinct cultures and daily life practices that shape human behaviors and preferences, characterizing temporal actions and consequences at individual and group levels. We examine individual and group time preferences as well as their relation across the three societies. To this end, we conduct a field experiment of eliciting individual and group discount factors in the societies of Indonesia: (i) the fisheries, (ii) the farming and (iii) the urban ones as a proxy of the hunter-gatherer, the agrarian and the industrial, respectively. We find that both individual and group discount factors are the lowest (highest) in the fisheries (agrarian) society among the three, while those in the urban are in the middle. We identify that the determinants of group discount factors differ across societies; members of the lowest and middle discount factors in a group play an important role in forming a group discount factor in fisheries societies, while only the member with the middle discount factor is a key in agrarian and urban societies. Overall, our results suggest that individual and group discount factors non-monotonically change as societies transition from fisheries to agrarian and from agrarian to urban ones, and comparatively shortsighted people (the lowest and middle) are more influential than farsighted people in forming group time preferences. |
| Keywords: | discount factors, individual and group time preferences, fisheries, farming, urban |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:kch:wpaper:sdes-2018-1&r=exp |
| By: | Andrea Essl; Frauke von Bieberstein; Michael Kosfeld; Markus Kröll |
| Abstract: | We use an incentivized experimental game to uncover heterogeneity in other-regarding preferences among salespeople in a large Austrian retail chain. Our results show that the majority of agents take the welfare of others into account but a significant fraction reveals self-regarding behavior. Matching individual behavior in the game with firm data on sales performance shows that higher concern for others is significantly associated with higher revenue per customer. At the same time, it is also associated with fewer sales per day. Both effects offset each other, so that the overall association with total sales revenue becomes insignificant. Our findings highlight the nuanced role of self- vs. other-regarding concerns in sales contexts with important implications for management and marketing research. |
| Keywords: | other-regarding preferences, sales performance, experimental games |
| JEL: | C91 D91 M31 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7030&r=exp |
| By: | Castro, M.F.;; Ferrara, P.;; Guccio, C.;; Lisi, D.; |
| Abstract: | Medical liability systems have been accused of increasing health expenditure insofar as they induce the practice of defensive medicine. Despite the large evidence on the role of medical malpractice liability, the identification of its causal effect on physicians’ treatment decisions is a difficult task. In this paper we study for the first time in a controlled laboratory setting the effect of introducing the risk of being sued for medical malpractice on the provision of physicians’ medical services. In our experimental sessions both medical and non-medical students choose how many medical services to provide for heterogeneous patients. We implement exogenous variations in the presence of medical malpractice liability and expected probability of being sued, and thus we exploit the within-subject variation in the provision of medical services to infer the causal effect of malpractice liability. Furthermore, we analyze the impact of malpractice liability under different physicians’ payment methods, which allows us to discuss the interplay between medical liability and payment systems. Our behavioral data show that introducing malpractice liability pressure does lead physicians to choose a higher amount of medical services, regardless of the physicians’ payment system. However, we also find that the payment system in which malpractice liability is implemented makes the difference under the societal perspective, with relevant implications for health policy. |
| Keywords: | medical liability; defensive medicine; payment systems; physicians’behavior; laboratory experiment; |
| JEL: | I12 K13 C91 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:yor:hectdg:18/11&r=exp |
| By: | Emeric Henry (ECON - Département d'économie - Sciences Po); Nicolas Jacquemet (PSE - Paris School of Economics, CES - Centre d'économie de la Sorbonne - CNRS - Centre National de la Recherche Scientifique - UP1 - Université Panthéon-Sorbonne); Roberto Galbiati (ECON - Département d'économie - Sciences Po) |
| Abstract: | We study how cooperation-enforcing institutions dynamically affect values and behavior using a lab experiment designed to create individual specific histories of past institutional exposure. We show that the effect of past institutions is mostly due to " indirect " behavioral spillovers: facing penalties in the past increases partners' cooperation in the past, which in turn positively affects ones' own current behavior. We demonstrate that such indirect spillovers induce persistent effects of institutions. However, for interactions that occur early on, we find a negative effect of past enforcement due to differential learning under different enforcement institutions. |
| Keywords: | repeated games,persistence of institutions,Laws,social values,cooperation,learning,spillovers,experiments |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-01613850&r=exp |
| By: | Sanjit Dhami; Mengxing Wei; Ali al-Nowaihi |
| Abstract: | We consider a theoretical model of a public goods game that incorporates reciprocity, guilt-aversion/surprise-seeking, and the attribution of intentions behind these emotions. In order to test our predictions, we implement the ‘induced beliefs method’ and a within-subjects design, using the strategy method. We find that all our psychological variables contribute towards the explanation of contributions. Guilt-aversion is pervasive at the individual-level and the aggregate-level and it is relatively more important than surprise-seeking. Our between-subjects analysis confirms the results of the within-subjects design. |
| Keywords: | public goods games, psychological game theory, reciprocity, surprise-seeking/guilt-aversion, attribution of intentions, induced beliefs method, within and between subjects designs |
| JEL: | D01 D03 H41 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7014&r=exp |
| By: | Charles Bellemare (Laval University); Marion Goussé (Laval University); Guy Lacroix (Laval University); Steeve Marchand (Laval University) |
| Abstract: | We investigate the determinants and extent of labor market discrimination toward people with physical disabilities using a large scale field experiment. Applications were randomly sent to 1477 private firms advertising open positions. We find that average callback rates of disabled and non-disabled applicants are respectively 14.4% and 7.2%. We find this differential does not result from accessibility constraints related to firm infrastructures. We also find that mentioning eligibility to a government subsidy to cover the cost of workplace adaptation does not increase callback rates. Finally, we estimate that a lower bound of the proportion of discriminating firms is 49.7%. |
| Keywords: | discrimination, disability, partial identification |
| JEL: | J71 J68 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2018-027&r=exp |
| By: | Hagenbach, Jeanne; Perez-Richet, Eduardo |
| Abstract: | We study a class of sender-receiver disclosure games in the lab. Our experiment relies on a graphical representation of sender's incentives in these games, and permits partial disclosure. We use local and global properties of the incentive graph to explain behavior and performance of players across different games. Sender types whose interests are aligned with those of the receiver fully disclose, while other types use vague messages. Receivers take the evidence disclosed by senders into account, and perform better in games with an acyclic graph. Senders perform better in games with a cyclic graph. The data is largely consistent with a non-equilibrium model of strategic thinking based on the iterated elimination of obviously dominated strategies. |
| Keywords: | hard evidence; information disclosure; masquerade relation; obvious dominance; Sender-receiver game; skepticism |
| JEL: | C72 C91 D82 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12927&r=exp |
| By: | Imbens, Guido W. (Stanford University) |
| Abstract: | Deaton and Cartwright (DC2017 from hereon) view the increasing popularity of randomized experiments in social sciences with some skepticism. They are concerned about the quality of the inferences in practice, and fear that researchers may not fully appreciate the pitfalls and limitations of such experiments. I am more sanguine about the recent developments in empirical practice in economics and other social sciences, and am optimistic about the ongoing research in this area, both empirical and theoretical. I see the surge in use of randomized experiments as part of what Angrist and Pischke [2010] call the credibility revolution, where, starting in the late eighties and early nineties a group of researchers associated with the labor economics group at Princeton University, including Orley Ashenfelter, David Card, Alan Krueger and Joshua Angrist, led empirical researchers to pay more attention to the identification strategies underlying empirical work. This has led to important methodological developments in causal inference, including new approaches to instrumental variables, difference-in-differences, regression discontinuity designs, and, most recently, synthetic control methods (Abadie et al. [2010]). I view the increased focus on randomized experiments in particular in development economics, led by researchers such as Michael Kremer, Abhijit Banerjee, Esther Duflo, and their many coauthors and students, as taking this development even further.1 Nothwithstanding the limitations of experimentation in answering some questions, and the difficulties in implementation, these developments have greatly improved the credibility of empirical work in economics compared to the standards prior to the mid-eighties, and I view this as a major achievement by these researchers. It would be disappointing if DC2017 takes away from this, and were to move empirical practice away from the attention paid to identification and the use of randomized experiments. In the remainder of this comment I will discuss four specific issues. Some of these elaborate on points I raised in a previous discussion of D2010, Imbens [2010]. |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:stabus:3648&r=exp |
| By: | Xu, Yilong (University of Heidelberg); Xu, Xiaogeng (Dept. of Economics, Norwegian School of Economics and Business Administration); Tucker, Steven (Waikato Management School, University of Waikato) |
| Abstract: | We study whether people’s ambiguity attitudes differ when deciding for themselves or for others in the loss domain. We find no systematic differences in ambiguity attitudes between self- and other-regarding decision-making. Our results are consistent with the loss part of the fourfold pattern of ambiguity attitudes. |
| Keywords: | Ambiguity attitudes; Decision-making for others; Losses and uncertainty |
| JEL: | C91 D81 |
| Date: | 2018–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2018_011&r=exp |
| By: | Maximilian Baltrusch; Philipp Christoph Wichardt |
| Abstract: | Allowing for a free choice of the recipient’s gender in a dictator game (N = 508), we find that women show a substantial gender biased towards females. Adding a charity recipient to the possible choices, the charity becomes the primary recipient and overall transfers increase. Yet, conditioning on transfers to fellow students the gender bias of women remains. Moreover, we find that women tend more towards giving half the endowment while men tend more towards “all or nothing.” The literature on cognitive dissonance (the feeling of distress once we act against our internalised values) emphasises the importance of voluntary choice for dissonance effects to take hold. Accordingly, we interpret our results as hinting at an important detail regarding the ongoing debate about gender differences in altruistic giving: primary differences may not be found in the amount of transfers made but rather in the choice of the beneficiary’s gender. |
| Keywords: | dictator game, gender differences, voluntary choice, charitable giving |
| JEL: | C91 D64 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7022&r=exp |
| By: | Jeffrey A. Flory; Andreas Leibbrandt; Christina Rott; Olga Stoddard |
| Abstract: | The persistent lack of workplace diversity in management and leadership may lead to organizational vulnerabilities. White males occupy most high-profile positions in the largest U.S. corporations whereas African Americans, Hispanics, and women are clearly underrepresented in leadership roles. While many firms and other organizations have set ambitious goals to increase demographic diversity, there is a dearth of empirical evidence on effective ways to reach them. We use a natural field experiment to test several hypotheses on effective means to attract minority candidates for top professional careers. By randomly varying the content in recruiting materials of a major financial services corporation with over 10,000 employees, we test different types of signals regarding the extent and manner in which the employer values diversity among its workers. We find that signaling explicit interest in employee diversity can reverse the ethnicity gap in rates of interest and applications, and that it has a strong positive effect on interest in openings among racial minority candidates, the likelihood that they apply, and the probability that they are selected. These results uncover an effective method for disrupting monocultures in management through a minor intervention that influences sorting among job-seekers into high-profile careers. |
| Keywords: | diversity, experiment, field experiment, gender, race |
| JEL: | J15 J16 C93 D22 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7025&r=exp |
| By: | Charles F. Mason |
| Abstract: | I study an indefinitely repeated game where firms differ in size. Attempts to form cartels in such an environment, for example by rationing outputs in a manner linked to firm size differences, have generally struggled. Any successful cartel has to set production shares in a manner that ensures no firm will defect. But this can require allocating sellers disproportionate shares, which in turn makes these tacit agreements difficult to create and enforce. I analyze some experimental evidence in support of this last proposition. |
| Keywords: | asymmetric cartel, repeated game, experiments |
| JEL: | D80 L15 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7047&r=exp |