Papers - All

David H Herberich, Steven D Levitt, John A List

Cited by*: 3 Downloads*: 74

No abstract available

John A List, Imran Rasul

Cited by*: 3 Downloads*: 46

We overview the use of field experiments in labor economics. We showcase studies that highlight the central advantages of this methodology, which include: (i) using economic theory to design the null and alternative hypotheses; (ii) engineering exogenous variation in real world economic environments to establish causal relations and learning about the underlying mechanisms; and (iii) engaging in primary data collection and often working closely with practitioners. To highlight the potential for field experiments to inform issues in labor economics, we organize our discussion around the individual life cycle. We therefore consider field experiments related to the accumulation of human capital, the demand and supply of labor, behavior within firms, and close with a brief discussion of the nascent literature of field experiments related to household decision-making.

Timothy Cason, Anya Samek, Roman Sheremeta

Cited by*: 2 Downloads*: 4

Motivated by problems of coordination failure observed in weak-link games, we experimentally investigate behavioral spillovers for order-statistic coordination games. Subjects play the minimum- and median-effort coordination games simultaneously and sequentially. The results show the precedent for cooperative behavior spills over from the median game to the minimum game when the games are played sequentially, but not when they are played simultaneously. Moreover, spillover occurs even when group composition changes, although the effect is not as strong. We also find that the precedent for uncooperative behavior does not spill over from the minimum game to the median game. These findings suggest guidelines for increasing cooperative behavior within organizations.

Maurizio Bovi

Cited by*: 2 Downloads*: 29

To learn the people's expectations formation process, we examine shocks and survey expectations on individual and aggregate income. Data show that shocks have permanent effects on both expectations, which do not diverge systematically because agents revise forecasts. Actually, only expectations on GDP dynamics are revised. These latter overreact to shocks and are more volatile than expectations on personal stances. Disagreement is persistently high. Astonishingly, there is even less consensus when expectations deal with the same fundamental. Lastly, we elaborate a test on whether - and find evidence that - cross sectional disagreement and time series volatility in expectations are equal.

Omar Al-Ubaydli, John A List

Cited by*: 2 Downloads*: 1

Economists are increasingly turning to the experimental method as a means to estimate causal effects. By using randomization to identify key treatment effects, theories previously viewed as untestable are now scrutinized, efficacy of public policies are now more easily verified, and stakeholders can swiftly add empirical evidence to aid their decision-making. This study provides an overview of experimental methods in economics, with a special focus on developing an economic theory of generalizability. Given that field experiments are in their infancy, our secondary focus pertains to a discussion of the various parameters that they identify, and how they add to scientific knowledge. We conclude that until we conduct more field experiments that build a bridge between the lab and the naturally-occurring settings of interest we cannot begin to make strong conclusions empirically on the crucial question of generalizability from the lab to the field.

John A List, Anya Samek

Cited by*: 2 Downloads*: 14

Almost a third of US children ages 2-19 are deemed overweight or obese, and part of the problem is the habitual decision to consume high calorie, low nutrient foods. We propose that the school lunchroom provides a 'teachable moment' to engage children in making healthful choices. We conduct a field experiment with over 1,500 participants in grades K-8 and evaluate the impact of small non-monetary incentives on the selection of milk in the school lunchroom. At baseline, only 16% of children select white milk relative to 84% choosing chocolate milk. We find a significant effect of incentives, which increase white milk selection by 2.5 times, to 40%. One concern with incentives is that they may decrease intrinsic motivation to eat healthy, called 'crowd-out of intrinsic motivation.' However, we do not find evidence of 'crowd-out'; rather, we see some suggestive evidence of the positive habit forming effect of incentives.

Santosh Anagol, Vimal Balasubramaniam, Tarun Ramadorai

Cited by*: 2 Downloads*: 24

Winners of randomly assigned initial public offering (IPO) lottery shares are significantly more likely to hold these shares than lottery losers 1, 6, and even 24 months after the random allocation. This effect persists in samples of wealthy and highly active investors, suggesting along with additional evidence that this type of "endowment effect" is not solely driven by portfolio inertia or wealth effects. The effect decreases as experience in the IPO market increases, but persists even for the most experienced investors. These results suggest that agents' preferences and/or beliefs about an asset are not independent of ownership, providing field evidence derived from the behavior of 1.5 million Indian stock investors which is in line with the large laboratory literature documenting endowment effects. We evaluate the extent to which prominent models of endowment effects and/or investor behavior can explain our results. A combination of inattention and non-standard preferences (realization utility) or non-standard beliefs (salience based probability distortions) appears most consistent with our findings.

Omar Al-Ubaydli, John A List

Cited by*: 2 Downloads*: 4

Economists are increasingly turning to the experimental method as a means to estimate causal effects. By using randomization to identify key treatment effects, theories previously viewed as untestable are now scrutinized, efficacy of public policies are now more easily verified, and stakeholders can swiftly add empirical evidence to aid their decision-making. This study provides an overview of experimental methods in economics, with a special focus on developing an economic theory of generalizability. Given that field experiments are in their infancy, our secondary focus pertains to a discussion of the various parameters that they identify, and how they add to scientific knowledge. We conclude that until we conduct more field experiments that build a bridge between the lab and the naturally-occurring settings of interest we cannot begin to make strong conclusions empirically on the crucial question of generalizability from the lab to the field.

Anthony Heyes, John A List

Cited by*: 2 Downloads*: 157

No abstract available

Ginger Z Jin, Andrew Kato

Cited by*: 2 Downloads*: 18

Every new method of trade offers an opportunity for economic agents to compare its costs and benefits relative to the status quo. Such comparison motivates sorting across market segments and reshapes the whole marketplace. The Internet provides an excellent example: it introduces substantial search cost savings over brick and mortar retail stores but imposes new obstacles for sellers to convey quality. Using sports card trading as a case study, we provide empirical evidence on (1) the sorting of product quality between the online and offline segments, (2) the changes for retail outlets after the Internet came into place, and (3) how supporting industries such as professional grading and card manufacturing adapted to take advantage of the new market.

John A List, Sally Sadoff, Mathis Wagner

Cited by*: 2 Downloads*: 33

Experimental economics represents a strong growth industry. In the past several decades the method has expanded beyond intellectual curiosity, now meriting consideration alongside the other more traditional empirical approaches used in economics. Accompanying this growth is an influx of new experimenters who are in need of straightforward direction to make their designs more powerful. This study provides several simple rules of thumb that researchers can apply to improve the efficiency of their experimental designs. We buttress these points by including empirical examples from the literature.

Abhijit Banerjee, Esther Duflo, Leigh Linden

Cited by*: 2 Downloads*: 54

This note presents the results obtained after the first year of a two-year randomized evaluation of a computer assisted learning (CAL) program in Vadodara, India. The CAL program, implemented by a NGO, took advantage of the donation of four computers to each municipal primary school in Vadodara by the state government. The program provided each child in the fourth standard with two hours of shared computer time in which students played educational games that reinforced mathematics competencies ranging from the standard 1 to the standard 3 level. We find the program to be quite effective. On average, it increased math scores by 0.37 standard deviations. The program effect is slightly higher at the bottom of the distribution but persists throughout the distribution. The program had no apparent spillover on language competencies.

Michael J. Seiler

Cited by*: 2 Downloads*: 1

In this study, I examine relative private signal strength and find that offered advice is significantly more influential in changing strategic mortgage default proclivity than is observed actions. Moreover, these private signals are more reflective of financial herding than they are of an information cascade. From a policy perspective, herds are easier to reverse than are cascades making more effective policies aimed at curbing the incidence of strategic mortgage default. Interestingly, an informationally equivalent change in private signal strength across actions and advice alters strategic default willingness, but not the moral stance of borrowers, which demonstrates the complexity of this life-altering financially and emotionally impactful decision.

Eric Floyd, John A List

Cited by*: 2 Downloads*: 49

The gold standard in the sciences is uncovering causal relationships. A growing literature in economics utilizes field experiments as a methodology to establish causality between variables. Taking lessons from the economics literature, this study provides an "A-to-Z" description of how to conduct field experiments in accounting and finance. We begin by providing a user's guide into what a field experiment is, what behavioral parameters field experiments identify, and how to efficiently generate and analyze experimental data. We then provide a discussion of extant field experiments that touch on important issues in accounting and finance, and we also review areas that have ample opportunities for future field experimental explorations. We conclude that the time is ripe for field experimentation to deepen our understanding of important issues in accounting and finance.

Sam Asher, Lorenzo Casaburi, Plamen Nikolov, Maoliang Ye

Cited by*: 2 Downloads*: 8

We study how gradualism -- increasing required levels ("thresholds") of contributions slowly over time rather than requiring a high level of contribution immediately -- affects individuals' decisions to contribute to a public project. Using a laboratory binary choice minimum-effort coordination game, we randomly assign participants to three treatments: starting and continuing at a high threshold, starting at a low threshold but jumping to a high threshold after a few periods, and starting at a low threshold and gradually increasing the threshold over time (the "gradualism" treatment). We find that individuals coordinate most successfully at the high threshold in the gradualism treatment relative to the other two groups. We propose a theory based on belief updating to explain why gradualism works. We also discuss alternative explanations such as reinforcement learning, conditional cooperation, inertia, preference for consistency, and limited attention. Our findings point to a simple, voluntary mechanism to promote successful coordination when the capacity to impose sanctions is limited.

Alexander W Cappelen, John A List, Anya Samek, Bertil Tungodden

Cited by*: 2 Downloads*: 44

We present results from the first study to examine the causal impact of early childhood education on social preferences of children. We compare children who, at 3-4 years old, were randomized into either a full-time preschool, a parenting program with incentives, or to a control group. We returned to the same children when they reach 7-8 years old a conducted a series of incentivized experiments to elicit there social preferences. We find that early childhood education has a strong causal impact on social preferences several years after the intervention: attending preschool makes children more egalitarian in their fairness view and the parenting program enhances the importance children place on efficiency relative to fairness. Our findings highlight the importance of taking a broad perspective when designing and evaluating early childhood education programs, and provide evidence how differences in institutional exposure may contribute to explaining heterogeneity in social preferences in society.

Omar Al-Ubaydli, John A List

Cited by*: 2 Downloads*: 88

This is a review of the literature of field experimental studies of markets. The main results covered by the review are as follows: (1) Generally speaking, markets organize the efficient exchange of commodities; (2) There are some behavioral anomalies that impede efficient exchange; (3) Many behavioral anomalies disappear when traders are experienced.

John Horowitz, John A List, Kenneth E McConnell

Cited by*: 2 Downloads*: 14

The notion of diminishing marginal value had a profound impact on the development of neoclassical theory. Early neoclassical scholars had difficulty convincing contemporaries of the new paradigm's value until political economists used the critical assumption of diminishing marginal value to link utility and demand. While diminishing marginal value remains a key component of modern economic intuition, there is little direct verification of this behavioral property. This paper reports experiments on a myriad of subject pools to examine behavior in both price and exchange settings. We report results from nearly 900 subjects across 19 treatments and find strong evidence of diminishing marginal value.

John A List, Jan Stoop, Daan van Soest, Haiwen Zhou

Cited by*: 2 Downloads*: 3

Both private and public organizations constantly grapple with incentive schemes to induce maximum effort from agents. We begin with a theoretical exploration of optimal contest design, focusing on the number of competitors. Our theory reveals a critical link between the distribution of luck and the number of contestants. We find that if there is considerable (little) mass on good draws, equilibrium effort is an increasing (decreasing) function of the number of contestants. Our first test of the theory implements a laboratory experiment, where important features of the theory can be exogenously imposed. We complement our lab experiment with a field experiment, where we rely on biological models complemented by economic models to inform us of the relevant theoretical predictions. In both cases we find that the theory has a fair amount of explanatory power, allowing a deeper understanding of how to effectively design tournaments. From a methodological perspective, our study showcases the benefits of combining data from both lab and field experiments to deepen our understanding of the economic science.

Michael J. Seiler

Cited by*: 2 Downloads*: 0

This study identifies a severe gap between the financial backlash borrowers believe awaits them after strategic mortgage default and the reality that lenders rarely pursue deficiency judgments. This coupled with the social norm finding that borrowers widely view strategic default as immoral, leads us to recommend lenders and policymakers seeking to stem the tide of defaults to pursue a policy of informational opacity. We make several recommendations for how to carry out such a policy as well as what might need to change in society before the alternative policy of informational transparency becomes ideal.