|
on Experimental Economics |
|
Issue of 2018‒08‒27
thirty-six papers chosen by |
| By: | Tim Lohse; Salmai Qari |
| Abstract: | The use of video recordings in experimental economics has become increasingly popular. However, little attention is paid to how this might affect the composition of the participating subjects and the intended treatment effect. We make a first attempt to shed light on these issues and address them in an incentivized face-to-face tax compliance experiment. The experiment contains two dimensions; i) the level of the fine for non-compliance; and ii) the presence of a recording video camera. The 2x2 design frees the intended treatment effect of the fine from any effect resulting from the announced use of a camera. Our findings point in the direction that neither gender nor personality traits nor other individual characteristics seem to have the explanatory power to predict participation in sessions’ with or without a camera, respectively. Most importantly, the presence of a recording video camera does not affect subjects’ observed decision behavior in the actual experiment. |
| Keywords: | Laboratory experiments, subject pools, convenience samples, video recordings, face-to-face interaction, tax compliance, cheating |
| JEL: | C90 C91 H26 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1751&r=exp |
| By: | Mel Khaw (Columbia University); Luminita Stevens (University of Maryland); Michael Woodford (Columbia University) |
| Abstract: | We use a controlled laboratory experiment to test how decision makers form expectations in a simple strategic estimation task. We consider a probability estimation task in which individual payoffs depend on both a subject's individual forecast and the average forecast of the group. We provide subjects with all the information needed to compute the rational expectations forecast, and we test whether subjects converge to the rational expectations equilibrium. The RE model predicts that when the exogenous state changes, all subjects should adjust immediately to the new equilibrium and that there should be no further adjustment after this initial response. In contrast, in the experimental data, average forecasts are very noisy, frequently biased, and often respond incompletely and with a lag to changes in the exogenous state. Conditional on adjustment, there is a large amount of dispersion in the forecasts recorded by our subjects. We confirm prior findings that strategic considerations result in larger discrepancies between observed collective behavior and equilibrium predictions. Moreover, we find a large degree of heterogeneity in terms of both sensitivity of agents' forecasts to the exogenous state and their strategic sophistication, namely the extent to which they consider the behavior and beliefs of other subjects in their group. We connect our findings to recent work in inattention and level-k models of behavior. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1315&r=exp |
| By: | Iftekhar, M. S.; Tisdell, J. G. |
| Abstract: | The motivation of this paper is to understand trader behaviour and learning in a complex setting where finding a best strategy might not be intuitive. The assertion made is that feedback information can help in updating strategies through repeated bidding processes. The paper explores this assertion through the results of a series of repeated multiple unit combinatorial auction laboratory experiments where item and package traders interact under three information treatments: 1) basic information feedback on market prices and status of their own bids; 2) basic information feedback and all winning bids; and 3) market prices and the status of all bids. We compare bidding behavior with a local optimal package selection model. We then estimate an experience weighted attraction learning (EWA) model of bidding behavior. We observe that package traders follow price feedback information more closely than item traders, especially in the basic treatment information. With additional information package traders substantially deviate from best response bidding strategy resulting in a loss of efficiency. Finally, item traders tend to remember their past experiences more than package traders in low information environments. In high information environments the trend is reversed. The implications of this study could be significant for market design. The standard assumption that more information in combinatorial market design is better for traders may not hold in all cases. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2018–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:ags:uwauwp:267301&r=exp |
| By: | Friedrichsen, Jana (DIW Berlin and HU Berlin); König, Tobias (WZB Berlin and HU Berlin); Schmacker, Renke (DIW Berlin) |
| Abstract: | Using a laboratory experiment, we present first evidence that social image concerns causally reduce the take-up of an individually beneficial transfer. Our design manipulates the informativeness of the take-up decision by varying whether transfer eligibility is based on ability or luck, and how the transfer is financed. We find that subjects avoid the inference both of being low-skilled (ability stigma) and of being willing to live off others (free-rider stigma). Using a placebo treatment, we exclude other explanations for the observed stigma effects. Although stigma reduces take-up, elicitation of political preferences reveals that only a minority of \"taxpayers\" vote for the public transfer. |
| Keywords: | stigma; signaling; redistribution; non take-up; welfare program; |
| JEL: | C91 D03 H31 I38 |
| Date: | 2018–08–13 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:112&r=exp |
| By: | Lecoutere, Els |
| Abstract: | This study investigates the impact of participatory intrahousehold decision-making, introduced through a randomly encouraged intensive coaching package and less intensive awareness raising couple seminars, in agricultural households in Uganda on intrahousehold cooperation and sharing behaviour measured in a lab-in-the-field experiment. |
| Keywords: | Uganda; intrahousehold cooperation |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:iob:wpaper:201806&r=exp |
| By: | John Cawley; Alex Susskind; Barton Willage |
| Abstract: | The impact of information on consumer behavior is a classic topic in economics, and there has recently been particular interest in whether providing nutritional information leads consumers to choose healthier diets. For example, a nationwide requirement of calorie counts on the menus of chain restaurants took effect in the U.S. in May, 2018, and the results of such information disclosure are not well known. To estimate the impact of menu labeling, we conducted a randomized controlled field experiment in two full-service restaurants, in which the control group received the usual menus and the treatment group received the same menus but with calorie counts. We estimate that the labels resulted in a 3.0% reduction in calories ordered, with the reduction occurring in appetizers and entrees but not drinks or desserts. Exposure to the information also increases consumers’ support for requiring calorie labels by 9.6%. These results are informative about the impact of the new nationwide menu label requirement, and more generally contribute to the literature on the impact of information disclosure on consumer behavior. |
| JEL: | D8 I12 I18 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24889&r=exp |
| By: | Vollmer, Elisabeth; Hermann, Daniel; Mußhoff, Oliver |
| Abstract: | The identification of the optimal selling time of stored goods is among the most essential eco- nomic decisions on a farm. Beyond monetary aspects, behavioral factors may influence farm- ers’ selling behavior. In financial economics, the disposition effect is a commonly observed phenomenon. It indicates that investors hold losing stocks too long, while they sell stocks that have increased in value too early. In the context of agriculture, this behavioral bias has not been analyzed thoroughly yet. To close this research gap, we conducted an incentivized online experiment with 112 farmers in Germany. The experimental design was based on well-proven experiments from financial economics and adapted to an agricultural decision context where stored goods must be sold. Farmers were provided information on the uncertain price devel- opments. In addition, lotteries were conducted to elicit farmers’ risk attitude, probability weighting, and loss aversion. Results indicate that there is a robust disposition effect in farm- ers’ selling behavior. Furthermore, more loss-averse farmers exhibited a higher disposition effect. |
| Keywords: | Farm Management, Financial Economics |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gadadp:260767&r=exp |
| By: | Isaac Mbiti; Karthik Muralidharan; Mauricio Romero; Youdi Schipper; Constantine Manda; Rakesh Rajani |
| Abstract: | The idea that complementarities across policies can yield increasing returns from joint implementation has been posited in several economic settings. Yet there is limited, well-identified evidence of such complementarities in practice. We present results from a randomized experiment across a representative sample of 350 schools in Tanzania that studied the impact of providing schools with (a) unconditional school grants, (b) bonus payments to teachers based on student performance, and (c) both of the above. At the end of two years, we find (a) no impact on student test scores from providing school grants, (b) some evidence of positive effects from offering performance-linked bonuses to teachers, and (c) significant positive effects on learning from providing both programs. Most importantly, we find strong evidence of complementarities between the two programs, with the effect of joint provision being significantly greater than the sum of the individual effects. Our results suggest that accounting for complementarities between inputs and incentives could substantially improve the effectiveness of public spending on education. |
| JEL: | C93 H52 I21 M52 O15 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24876&r=exp |
| By: | Mikhail Anufriev (The University of Technology Sydney); Te Bao (Division of Economics, Nanyang Technological University, Singapore); Angela Sutan (Burgundy School of Business, University Bourgogne Franche-Comte CEREN, Dijon, France); Jan Tuinstra (CeNDEF, Amsterdam School of Economics, University of Amsterdam) |
| Abstract: | We present a laboratory experiment which is designed to investigate the effect of the fee structure on mutual fund choice. We find that subjects tend to ignore periodic and small operating expenses fees and base their decisions on gross, instead of net, returns. A fee in the form of a, much larger, front-end load leads to lock-in into one of the funds. It is used by some subjects as a commitment device, but exacerbates the decision errors of other subjects. Although past returns do not convey information about future returns, return chasing helps explain subjects' behavior. |
| Keywords: | Mutual fund choice; fee structure; experimental economics; return chasing; learning |
| JEL: | C91 G02 G11 |
| Date: | 2018–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:uts:ecowps:45&r=exp |
| By: | Bonan, Jacopo; Battiston, Pietro; Bleck, Jaimie; LeMay-Boucher, Philippe; Pareglio, Stefano; Sarr, Bassirou; Tavoni, Massimo |
| Abstract: | We investigate the role of social interaction in technology adoption by conducting a field experiment in neighborhoods of Bamako. We invited women to attend a training/marketing session, where information on a more efficient cooking stove was provided and the chance to purchase the product at market price was offered. We randomly provided an information nudge on a peer’s willingness to buy an improved cookstove. We find that women purchase and use the product more when they receive information on a peer who purchased (or previously owned) the product, particularly if she is viewed as respected. In general, we find positive direct and spillover effects of attending the session. We also investigate whether social interaction plays a role in technology diffusion. We find that women who participated in the session, but did not buy during the intervention, are more likely to adopt the product when more women living around them own it. We investigate the mechanisms and provide evidence supporting imitation effects, rather than social learning or constraint interaction. |
| Keywords: | Research and Development/Tech Change/Emerging Technologies |
| Date: | 2017–09–25 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemmi:263486&r=exp |
| By: | Obloj, Tomasz; Gutierrez, Cédric; Douglas, Frank |
| Abstract: | In this paper, we develop a theoretical model and offer a first empirical test of how competitive dethronement affects managerial risk taking. Drawing on the mechanism of endowment effect and reference-dependent utility theory, we predict that former market leaders take more risks compared to, otherwise identical, competitors. We empirically test this prediction using two contexts allowing us to use different methods to operationalize risk. The first setting draws on field data from a two-month banking sales contest. The second, quasi-laboratory, data comes from an educational game. Consistent with model’s prediction, we find that dethronement is associated with increased risk taking but that the endowment effect leading to such response decays over time. In contrast, a mere decline in performance ranking does not have the same effect. |
| Keywords: | Competitive Dethronement; Endowment Effect; Risk Taking |
| JEL: | D81 |
| Date: | 2017–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:1240&r=exp |
| By: | Bracha, Anat; Fershtman, Chaim |
| Abstract: | Almost all jobs require a combination of cognitive effort and labor effort. The focus of the paper is on the effect of different incentive schemes on the chosen combination of these types of efforts. We use an experimental approach to show that tournament incentives may induce agents to work harder but not necessarily smarter. This effect was stronger for women. We then ran a "managerial bonus" experiment in which a preassigned manager receives a bonus whenever the overall performance of his/her group is above a given threshold level. Although the bonus does not affect the participants' direct incentives, it induces participants to lower their cognitive effort and increase their labor effort. |
| Keywords: | Financial Economics, Labor and Human Capital |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:ags:isfiwp:275740&r=exp |
| By: | Joseph Kaboski (University of Notre Dame); Molly Lipscomb (University of Virginia); Virgiliu Midrigan (New York University) |
| Abstract: | In theory, high yield, indivisible investments investment indivisibilities and the nonconvexities in production can play crucial roles in development, especially when financial frictions are present. When facing such investments, agents can be more risk-loving and impatient. This paper uses a cash grant experiment in rural and semi-urban Uganda to evaluate how quantitatively important these investment indivisibilities may be. Specifically, we offer households a choice between a safer, low payoff and a riskier, large payoff lotteries. We also offer them a chance between an safer payoff or riskier, larger payoff. We also offer them an opportunity to delay receipt, earning interest. Consistent with the presence of high yield, indivisible investments, we find significant rates of risk-loving demand (27 percent) and impatient demand (71 percent), and this demand is linked to savings and returns. Higher payoffs are associated with increased savings, especially if the payoffs are sufficient to enable indivisible investments. We calibrate a model with financial frictions and high yield, indivisible investments to the empirical results, and evaluate their importance for aggregate development and the impacts of financial frictions. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1033&r=exp |
| By: | de Walque, Damien (World Bank); Valente, Christine (University of Bristol) |
| Abstract: | Education conditional cash transfer programs may increase school attendance in part due to the information they transmit to parents about their child's attendance. This paper presents experimental evidence that the information content of an education conditional cash transfer program, when given to parents independently of any transfer, can have a substantial effect on school attendance. The effect is as large as 75 percent of the effect of a conditional cash transfer incentivizing parents, and not significantly different from it. In contrast, a conditional transfer program incentivizing children instead of parents is nearly twice as effective as an "information only" treatment providing the same information to parents about their child's attendance. Taken together, these results suggest that children have substantial agency in their schooling decisions. The paper replicates the findings from most evaluations of conditional cash transfers that gains in attendance achieved by incentivizing parents financially do not translate into gains in test scores. But it finds that both the information only treatment and the alternative intervention incentivizing children substantially improve math test scores. |
| Keywords: | school attendance, conditional cash transfers, moral hazard |
| JEL: | I25 D82 N37 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11637&r=exp |
| By: | Johannes Buckenmaier; Eugen Dimant; Luigi Mittone |
| Abstract: | We investigate the effects of an institutional mechanism that incentivizes taxpayers to blow the whistle on collusive corruption and tax compliance. We explore this through a formal leniency program. In our experiment, we nest collusive corruption within a tax evasion framework. We not only study the effect of the presence of such a mechanism on behavior, but also the dynamic effect caused by the introduction and the removal of leniency. We find that in the presence of a leniency mechanism, subjects collude and accept bribes less often while paying more taxes, but there is no increase in bribe offers. Our results show that the introduction of the opportunity to blow the whistle decreases the collusion and bribe acceptance rate, and increases the collected tax yield. It also does not encourage bribe offers. In contrast, the removal of the institutional mechanism does not induce negative effects, suggesting a positive spillover effect of leniency that persists even after the mechanism has been removed. |
| Keywords: | Collusive bribery, institutions, tax compliance, leniency, spillover |
| JEL: | C92 D02 D73 H26 K42 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:295&r=exp |
| By: | Bauermeister, Golo-Friedrich; Mußhoff, Oliver |
| Abstract: | A common approach to elicit risk attitude is the multiple price list with a series of binary choices. However, a frequently observed problem when using multiple price lists is that participants switch more than once from the safer to the riskier option, thus exhibiting multiple switching behavior. The present study analyzes whether the visualization of different multiple price lists reduce multiple switching behavior. Therefore, we conduct two types of multiple price lists in two different display formats. Participants are randomly assigned into a textual or a visual group and carry out both multiple price lists in the corresponding display format. Our results reveal that different types of multiple price lists lead to differences in the extent of multiple switching behavior. Moreover, we show that the visualization of a multiple price list can be an instrument to greatly reduce multiple switching behavior. |
| Keywords: | Consumer/Household Economics, Institutional and Behavioral Economics |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gadadp:260770&r=exp |
| By: | Sascha O. Becker (University of Warwick); Ana Fernandes (Berner Fachhochschule; University of Fri); Doris Weichselbaumer (University of Linz) |
| Abstract: | We conducted a large scale correspondence test in Switzerland, Germany, and Austria to examine whether employers discriminate among job candidates concerning family status. In German speaking countries, CVs routinely include detailed information about the job candidate's personal characteristics. We considered thirty-year-old job applicants seeking secretarial or accounting positions. We found that having a family (indicated by marriage and the presence of children and their ages, or by being married but childless) does not affect the job candidate's chances of being called back for an interview for a full-time job. However, women were significantly less likely to receive a callback compared to men if the applicant's skills were not a good fit for the advertised position, if they lived far from the workplace, or when applying to large companies. Such gender asymmetric callback decisions are likely the result of subconscious decision making. Our results remain even after controlling for differences in the variance of unobservable determinants of productivity across applicants with and without a family. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:650&r=exp |
| By: | Gary Charness (Department of Economics, University of California, Santa Barbara); Alessandro Sontuoso (Philosophy, Politics and Economics, University of Pennsylvania); ; |
| Abstract: | We investigate how a player’s strategic behavior is affected by the set of notions she uses in thinking about the game, i.e., the “frame”. To do so, we consider matching games where two players are presented with a set of objects, from which each player must privately choose one (with the goal of matching the counterpart’s choice). We propose a behavioral theory positing that different player types are aware of different attributes of the strategy options, hence different frames; we then rationalize why differences in players’ frames may lead to differences in choice behavior. Unlike previous theories of framing, our model features an epistemic structure allowing for the case in which an individual learns new frames, given some initial unawareness (of the fact that her perception of attributes may be incomplete). To test our model, we introduce an experimental design in which we bring about different frames by manipulating subjects’ awareness of various attributes. The experimental results provide striking support for our theory. |
| Keywords: | frames, focal points, unawareness, coordination games |
| JEL: | C72 C91 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:ppc:wpaper:0013&r=exp |
| By: | Jérôme Hergueux (ETH Zurich); Nicolas Jacquemet (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Stéphane Luchini (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université - EHESS - École des hautes études en sciences sociales); Jason Shogren (Departement of Economics and Finance, University of Wyoming - UW - University of Wyoming) |
| Abstract: | Real economic commitment (or the lack of it) of others affects a person's preferences to cooperate. But what if the commitment of others cannot be observed ex ante? Herein we examine how a classic non-monetary institution– a solemn oath of honesty –creates economic commitment within the public goods game. Commitment-through-the-oath asks people to hold themselves to a higher standard of integrity. Our results suggest the oath can increase cooperation (by 33%)– but the oath does not change preferences for cooperation. Rather people react quicker and cooperate, taking less time to ponder on the strategic free riding behavior. |
| Keywords: | WorkingPublic good game,Social Preference,Truth Keywords: Public good game |
| Date: | 2016–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01379060&r=exp |
| By: | Br: Yessica Sorayda, Castillo Arauz.; Br: Gabriela Elizabeth, Domínguez Velásquez. |
| Abstract: | The aim of this research was to determine the dynamics of blood glucose concentration, liver and muscle of tilapia (Oreochromis niloticus), after food intake. The MSc. Leonel Aguilar Fiallos donated the tilapias. The experiment was performed at the Quinta Yolanda fish farm owned by the MSc. Aguilar located in Comarca Los Ranchos, Department of León, Nicaragua, Km 83 Highway to Managua, Motel La Gloria 400 meters to the east, 400 meters to the south. The organisms were kept in a concrete tank of 25 m3 until reaching an average weight of 90 ± 10gr. Subsequently, the tilapias were moved randomly to experimental tanks of 120 liters. A battery of 4 tanks was placed (1 control and 3 treatments of 2, 4 and 6 hours each), N = 10. Prior to the experiment, the tilapia were anesthetized, blood samples were taken, they were sacrificed and liver and muscle samples were taken. Subsequently, the samples were transferred to the Animal Physiology Laboratory for analysis. The results show that: in blood, glucose levels increase significantly at three hours, at six hours increases with respect to the group of three hours and prevails until nine hours. In muscle, the increase was observed at six hours and remained until nine hours. In liver, no significant differences were observed throughout the study period. |
| Keywords: | Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety |
| Date: | 2018–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:ags:nauntg:275441&r=exp |
| By: | d’Adda , Giovanna; Gao , Yu; Golman, Russell; Tavoni, Massimo |
| Abstract: | Environmental policies based on information provision are widespread, but have often proven ineffective. One possible explanation for information’s low effectiveness is that people actively avoid it. We conduct an online field experiment on air conditioning usage to test the theory of moral wiggle room, according to which people avoid information that would compel them to act morally, against the standard theory of information acquisition, and identify conditions under which each theory applies. In the experiment, we observe how exogenously imposing a feeling of moral obligation to reduce air conditioning usage and exploiting natural variation in the cost of doing so, given by outside temperature, influences subjects’ avoidance of information about their energy use impacts on the environment. Moral obligation increases information avoidance when it is hot outside, consistent with the moral wiggle room theory, but decreases it when outside temperature is low. Avoiding information positively correlates with air conditioning usage. These findings provide guidance about tailoring the use of nudges and informational tools to the decision environment. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2018–03–12 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cpaper:269535&r=exp |
| By: | Shotaro Shiba (Graduate School of Economics, Waseda University.); Kazumi Shimizu (Graduate School of Economics, Waseda University.) |
| Abstract: | Several studies in the time preference literature have found time inconsistency (TI) of both gain and loss preferences. However, the relationship between the two within the same person remains unclear; that is, does an individual who demonstrates TI for gain outcomes do so for loss as well? This paper reports the individual’s TI for both gain and loss in a laboratory setting. To compare individuals’ TI for gain and loss precisely, we allowed the experiment to test for so-called future bias, which has been a focus area in recent TI literature. Further, we measured the level of TI rather than only identifying whether TI was present. We used a non-parametric elicitation method to avoid any specification error in the analysis. Based on this setting, we could examine the intra-personal relationship of TI for gain and loss–whether the same person shows similar TI of gain preference and TI of loss preference. Our findings are as follows: First, we found future bias in preference for not only gain but also loss, and confirmed that this tendency was consistent with previous findings on preference for gain. Second, such TI tended to have a positive relationship at the individual level for both gain and loss. Participants who exhibited TI when they chose gain tended to exhibit similar TI when they chose loss. These results suggest that people’s perception of time is important in time preference; how far they perceive the future in their mind may play a crucial role in TI. |
| Keywords: | time inconsistency, sign effect, non-parametric elicitation, future bias, intra-personal comparison |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:wap:wpaper:1807&r=exp |
| By: | Roland Bènabou (Princeton University); Armin Falk (University of Bonn); Jean Tirole (Toulouse School of Economics) |
| Abstract: | By downplaying externalities, magnifying the cost of moral behavior, or suggesting not being pivotal, exculpatory narratives can allow individuals to maintain a positive image when in fact acting in a morally questionable way. Conversely, responsibilizing narratives can help sustain better social norms. We investigate when narratives emerge from a principal or the actor himself, how they are interpreted and transmitted by others, and when they spread virally. We then turn to how narratives compete with imperatives (general moral rules or precepts) as alternative modes of communication to persuade agents to behave in desirable ways. |
| Keywords: | moral behavior, prosocial behavior, narratives, imperatives, justifications, rules, Kantian reasoning, deontology, consequentialism, utilitarianism, norms, organizations |
| JEL: | D62 D64 D78 D83 D85 D91 H41 K42 L14 Z13 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2018-049&r=exp |
| By: | Le Cotty, Tristan; Maître d'Hôtel, Elodie; Soubeyran, Raphaël; Subervie, Julie |
| Abstract: | This paper investigates whether Burkinabe maize farmers’ fertilizer-use decisions are correlated with their risk and time preferences. We conducted a survey and a series of hypothetical experiments on a sample of 1,500 farmers. We ?nd that more patient farmers do use more fertilizer, but it is only because they plant more maize (a fertilizer-intensive crop) rather than because they use more fertilizer per hectare of maize planted. Conversely, we ?nd no statistically signi?cant link between risk aversion and fertilizer use. We use a simple two-period model, which suggests that risk aversion may indeed have an ambiguous effect on fertilizer use. |
| Keywords: | Agricultural and Food Policy, Production Economics, Risk and Uncertainty |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:ags:inramo:253532&r=exp |
| By: | Dohmen, Thomas (University of Bonn and IZA); Quercia, Simone (University of Bonn); Willrodt, Jana (Düsseldorf Institute for Competition Economics (DICE)) |
| Abstract: | We show that the disposition to focus on favorable or unfavorable outcomes of risky situations affects willingness to take risk as measured by the general risk question. We demonstrate that this disposition, which we call risk conception, is strongly associated with optimism, a stable facet of personality and that it predicts real-life risk taking. The general risk question captures this disposition alongside pure risk preference. This enlightens why the general risk question is a better predictor of behavior under risk across different domains than measures of pure risk preference. Our results also rationalize why risk taking is related to optimism. |
| Keywords: | risk taking behavior, optimism, preference measures, risk conception |
| JEL: | D91 C91 D81 D01 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11642&r=exp |
| By: | Thomas Dohmen (Universität Bonn); Simone Quercia (University of Bonn); Jana Willrodt (University of Duesseldorf) |
| Abstract: | We show that the disposition to focus on favorable or unfavorable outcomes of risky situations affects willingness to take risk as measured by the general risk question. We demonstrate that this disposition, which we call risk conception, is strongly associated with optimism, a stable facet of personality and that it predicts real-life risk taking. The general risk question captures this disposition alongside pure risk preference. This enlightens why the general risk question is a better predictor of behavior under risk across different domains than measures of pure risk preference. Our results also rationalize why risk taking is related to optimism. |
| Keywords: | risk, optimism, behavior |
| JEL: | D91 C91 D81 D01 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2018-056&r=exp |
| By: | Wunsch, Conny (University of Basel); Strobl, Renate (University of Basel) |
| Abstract: | Understanding the mechanisms through which treatment effects come about is crucial for designing effective interventions. The identification of such causal mechanisms is challenging and typically requires strong assumptions. This paper discusses identification and estimation of natural direct and indirect effects in so-called double randomization designs that combine two experiments. The first and main experiment randomizes the treatment and measures its effect on the mediator and the outcome of interest. A second auxiliary experiment randomizes the mediator of interest and measures its effect on the outcome. We show that such designs allow for identification based on an assumption that is weaker than the assumption of sequential ignorability that is typically made in the literature. It allows for unobserved confounders that do not cause heterogeneous mediator effects. We demonstrate estimation of direct and indirect effects based on different identification strategies that we compare to our approach using data from a laboratory experiment we conducted in Kenya. |
| Keywords: | direct and indirect effects, causal inference, mediation analysis, identification |
| JEL: | C31 D64 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11626&r=exp |
| By: | Römer, Ulf; Mußhoff, Oliver; Weber, Ron; Turvey, Calum G. |
| Abstract: | The prevention of asymmetric information plays a major role in successful small business lending. The purpose of this research is to determine if small business applicants report their income information correctly when requesting a loan. Therefore, a randomized controlled trial bogus pipeline experiment was set up during a typical cash-flow analysis of a bank for small businesses in the Philippines. Results indicate that loan applicants of the treatment group reported a lower income, an effect which is most pronounced in the lowest income percentile. Moreover, our analyses reveal higher loan delinquencies in the control group. |
| Keywords: | Agribusiness, Agricultural Finance, Financial Economics |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gadadp:260765&r=exp |
| By: | Dorner, Zack |
| Keywords: | Environmental Economics and Policy |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ags:nzar17:269390&r=exp |
| By: | Nicolas J. Duquette (Sol Price School of Public Policy, University of Southern California); Enda Hargaden (Department of Economics, University of Tennessee) |
| Abstract: | This paper demonstrates that economic inequality has a negative, causal effect on prosocial behavior, specifcally, charitable giving. Standard theories predict that greater inequality increases giving, though income tax return data suggest the opposite may be true. We develop a new theory which, incorporating insights from behavioral economics and social psychology, predicts when greater inequality will lower charitable giving. We test the theory in an experiment on donations to a real-world charity. By randomizing the income distribution, we identify the effect of inequality on giving behavior. Consistent with our model, heightened inequality causes total giving to fall. Policy agendas that rely on charitable giving and other voluntary, prosocial behaviors to mitigate income and wealth inequality are likely to fail. |
| Keywords: | Inequality; charitable giving; social distance; lab experiments |
| JEL: | C91 D31 D64 H23 N32 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ten:wpaper:2018-03&r=exp |
| By: | Bereket Kebede; Nicole Gross-Camp; Adrian Martin; Shawn McGuire; Joseph Munyarukaza |
| Abstract: | This paper examines the impact of inequality on contributions to public goods focusing on the mediating role of personality using an inequality aversion model as a theoretical framework and experimental data from rural Rwanda. As predicted by the theoretical model, low-income players contribute less. We examine the predictive power of two personality approaches. The first is a person-centred approach using latent class analysis (LCA) to identify types of individuals with specific constellation of Big Five dimensions. The second focuses on individual dimensions of Big Five. While the person-centred approach has no explanatory power, one dimension of Big Five, Extraversion, is a significant and robust determinant; low-income players with higher Extraversion significantly reduce their contribution. Further exploratory analyses focusing on two dimensions of Big Five reveal that it does not provide any additional explanation compared to when each dimension is considered. |
| Keywords: | public goods games; personality; inequality; envy; Rwanda |
| JEL: | C93 H41 D63 O12 O55 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2018-10&r=exp |
| By: | Lecoutere, Els |
| Abstract: | Does increased cooperation between spouses in agricultural households lead to more efficient farming? This working paper describes an experiment in Uganda in which were given either couple seminars or randomly encouraged for an intensive coaching package or did not receive any treatment. First, the experiment found that intensively coached couples did better on joint management of food crops and cash crops than couples in the couple seminars group. Secondly, they were more likely to change towards more food security by growing crops with a more reliable harvest. Thirdly, intensive coached couples tended to adopt more sustainable and efficient farming practices for cash crops such as coffee as compared to the group without treatment. Fourthly, the intensive coaching resulted in a higher income from livestock as compared to the group without treatment; and while coffee income generally decreased over time, it decreases less among the intensively coached couples than among the couple seminar group. Fifthly, couples who received couple seminars bought or acquired more land than the group without treatment. And finally, couples from both the intensively coached and couple seminars groups reported they perceived their economic wellbeing as higher than couples who did not receive any treatment. Women seem to have particularly benefitted in terms of being better informed about the household income – which will help for their intrahousehold bargaining power – and in terms of subjective wellbeing and household food security. There is still little evidence of positive impact on household income or asset accumulation, but it may have been too soon for such impact to realise. |
| Keywords: | Uganda; intrahousehold cooperation |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:iob:wpaper:201807&r=exp |
| By: | Ernesto Dal Bó; Frederico Finan; Nicholas Y. Li; Laura Schechter |
| Abstract: | Standard models of hierarchy assume that agents and middle managers are better informed than principals about how to implement a particular task. We estimate the value of the informational advantage held by supervisors (middle managers) when ministerial leadership (the principal) introduced a new monitoring technology aimed at improving the performance of agricultural extension agents (AEAs) in rural Paraguay. Our approach employs a novel experimental design that, before randomization of treatment, elicited from supervisors which AEAs they believed should be prioritized for treatment. We find that supervisors did have valuable information—they prioritized AEAs who would be more responsive to the monitoring treatment. We develop a model of monitoring under different allocation rules and rollout scales (i.e., the share of AEAs to receive treatment). We semi-parametrically estimate marginal treatment effects (MTEs) to demonstrate that the value of information and the benefits to decentralizing treatment decisions depend crucially on the sophistication of the principal and on the scale of rollout. |
| JEL: | D02 D04 D23 D61 D73 D78 D82 H11 H43 J45 O22 Q28 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24879&r=exp |
| By: | Ro’i Zultan (BGU); Todd R. Kaplan (University of Exeter, Exeter, EX4 4PU, UK, and University of Haifa); Lawrence Choo (Germany) |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:bgu:wpaper:1807&r=exp |
| By: | Olivier Deschenes; Kyle C. Meng |
| Abstract: | This paper examines the application of quasi-experimental methods in environmental economics. We begin with two observations: i) standard quasi-experimental methods, first applied in other microeconomic fields, typically assume unit-level treatments that do not spill over across units; (ii) because public goods, such as environmental attributes, exhibit externalities, treatment of one unit often affects other units. To explore the implications of applying standard quasi-experimental methods to public good problems, we extend the potential outcomes framework to explicitly distinguish between unit-level source and the resulting group-level exposure of a public good. This new framework serves as a foundation for reviewing and interpreting key papers from the recent empirical literature. We formally demonstrate that two common quasi-experimental estimators of the marginal social benefit of a public good can be biased due to externality spillovers, even when the source of the public good itself is quasi-randomly assigned. We propose an unbiased estimator for the valuation of local public goods and discuss how it can be implemented in future studies. Finally, we consider how to preserve the advantages of the quasi-experimental approach when valuing global public goods, such as climate change mitigation, for which no control units are available. |
| JEL: | C21 H23 H41 Q50 Q51 Q52 Q53 Q54 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24903&r=exp |
| By: | Lergetporer, Philipp (ifo Institute); Werner, Katharina (ifo Institute); Woessmann, Ludger (ifo Institute and LMU) |
| Abstract: | To study how information about educational inequality affects public concerns and policy preferences, we devise survey experiments in representative samples of the German population. Providing information about the extent of educational inequality strongly increases concerns about educational inequality but only slightly affects support for equity-oriented education policies, which is generally high. The small treatment effects are not due to respondents\' failure to connect policies with educational inequality or aversion against government interventions. Support for compulsory preschool is the one policy with a strong positive information treatment effect, which is increased further by informing about policy effectiveness. |
| Keywords: | inequality; education; information; survey experiment; |
| JEL: | D30 H52 I24 H11 D63 D83 D72 P16 |
| Date: | 2018–08–03 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:110&r=exp |