|
on Neuroeconomics |
|
Issue of 2017‒12‒03
four papers chosen by |
| By: | Toke Aidt; Christopher Rauh |
| Abstract: | We propose a new framework for the study of the psychological foundation of party identification. We draw a distinction between the part of an individual’s party preference that is stable throughout adult life and the dynamic part responding to lifecycle events and macro shocks. We theorize that the Big Five personality traits exert a causal effect on the stable part of an individual’s party preference and provide evidence from a large nationally representative English panel dataset in support of this theory. We find that supporters of the major parties (Labour, the Conservatives and the Liberal Democrats) have substantively different personality traits. Moreover, we show that those not identifying with any party, who are close to holding the majority, are similar to those identifying with the Conservatives. We show that these results are robust to controlling for cognitive skills and parental party preferences, and to estimation on a subsample of siblings. The relationship between personality traits and party identification is stable across birth cohorts. |
| Keywords: | Big Five personality traits, party identification, partisanship, England |
| JEL: | D79 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6732&r=neu |
| By: | Larbi Alaoui; Antonio Penta |
| Abstract: | Recent experiments suggest that level-k behavior is often driven by subjects' beliefs, rather than their binding cognitive bounds. But the extent to which this is true in general is not completely understood, mainly because disentangling 'cognitive' and 'behavioral' levels is challenging experimentally and theoretically. In this paper we provide a simple experimental design strategy (the 'tutorial method') to disentangle the two concepts purely based on subjects' choices. We also provide a 'replacement method' to assess whether the increased sophistication observed when stakes are higher is due to an increase in subjects' own understanding or their beliefs over others' increased incentives to reason. We find evidence that, in some of our treatments, the cognitive bound is indeed binding for a large fraction of subjects. Furthermore, a significant fraction of subjects do take into account others' incentives to reason. Our findings also suggest that in general, level-k behavior should not be taken as driven either by cognitive limits alone or beliefs alone. Rather, there is an interaction between own cognitive bound and reasoning about the opponent's reasoning process. From a methodological viewpoint, the tutorial and replacement methods have broader applicability, and can be used to study the beliefs-cognition dichotomy and higher order beliefs e ects in non level-k settings as well. |
| Keywords: | cognitive bound, depth of reasoning, higher-order beliefs. level-k reasoning, replacement method, tutorial method |
| JEL: | C72 C92 D80 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1587&r=neu |
| By: | Buddelmeyer, Hielke; Powdthavee, Nattavudh |
| Abstract: | We investigate whether the intensity of emotional pain following a negative shock is different across the distribution of a person's locus of control – the extent to which individuals believe that their actions can influence future outcomes. Using panel data from Australia, we show that individuals with strong internal locus of control are psychologically insured against own and others’ serious illness or injury, close family member detained in jail, becoming a victim of property crime and death of a close friend, but not against the majority of other life events. The buffering effects vary across gender. Our findings thus add to the existing literature on the benefits of internal locus of control. |
| Keywords: | locus of control; resilience; well-being; happiness; HILDA |
| JEL: | I19 |
| Date: | 2015–12–24 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:66190&r=neu |
| By: | Huck, Steffen; Szech, Nora; Wenner, Lukas M. |
| Abstract: | Recent behavioral models argue in favor of avoidance of instrumental information. We explore the role of information avoidance in a real-effort setting. Our experiment offers three main results. First, we confirm that preferences for avoidance of instrumental information exist, studying information structures on performance pay. Second, information avoiders outperform information receivers. This result holds independently of effects of self-selection. Third, the findings support theories on information avoidance that favor an optimistic belief design rather than theories that rationalize such behavior as a way to mitigate selfcontrol problems. This suggests that coarse information structures lead agents to distort their beliefs away from the objective prior. |
| Keywords: | optimal expectations,belief design,performance,real effort task,coarse incentive structures,workplace incentives |
| JEL: | D83 D84 J31 M52 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbeoc:spii2015304r2&r=neu |