Papers - All

Rachel Croson, Americus Reed, Jen Shang

Cited by*: 1 Downloads*: 54

Information is presented about a presentation at the Advances in Consumer Research North American Conference on social information and marketing environments in donation behavior. Topics in the presentation include activated identities in decision-making, contextual cues in donation behavior, and gender identity in informers and targets of social information. Field experiments on radio pledges are also described.

Maria De Paola, Francesca Gioia, Vincenzo Scoppa

Cited by*: 1 Downloads*: 10

We analyze how overconfidence is affected by superstitious beliefs and emotions induced by positive and negative stimuli in a field experiment involving about 700 Italian students who were randomly assigned to numbered seats in their written examination sessions. According to widespread superstitions, some numbers are considered lucky, while others are considered unlucky. At the end of the examination, we asked students the grade they expected to get. We find that students tend to be systematically overconfident and that their overconfidence is positively affected by being assigned to a lucky number. Interestingly, males and females react differently: on the one hand, females tend to expect lower grades when assigned to unlucky numbers, while they are not affected by being assigned to lucky numbers. On the other hand, males are not affected by being assigned to unlucky numbers but expect higher grades when assigned to lucky numbers.

Werner Guth, Carsten Schmidt, Matthias Sutter

Cited by*: 1 Downloads*: 17

5,132 readers of the German weekly, Die Zeit, participated in a three-person bargaining experiment. In our data analysis we focus on (1) the influence of age, gender, profession and medium chosen for participation and (2) the external validity of student behaviour (inside and outside the lab). We find that older participants and women care more about equal distributions and that Internet users are more self-regarding than those using mail or fax. Decisions made by students in the lab are rather similar to those made by participants in the newspaper experiment, indicating a high degree of external validity of student data.

Christina M Fong

Cited by*: 1 Downloads*: 4

This paper reports a surprising finding from an experiment on giving to welfare recipients. The experiment tests how offers of money in n-donor dictator games are affected by 1) donors' humanitarian and egalitarian values and 2) direct information about the recipients' work-preferences. People who are self-reported humanitarians and egalitarians have giving that is highly elastic with respect to the apparent worthiness of the recipient. Among high scoring humanitarian-egalitarians, the median offer to a recipient who appeared industrious was $5.00, while the median offer to a recipient who appeared lazy was only $1.00. Among low scoring humanitarian-egalitarians, the median offer was $1.00 in both conditions. I refer to this combination of altruism and equity/reciprocity as empathic responsiveness. This finding can be rationalized by a model of inequity aversion.

Glenn W Harrison, John A List, Charles Towe

Cited by*: 1 Downloads*: 29

Does individual behavior in a laboratory setting provide a reliable indicator of behavior in a naturally occurring setting? We consider this general methodological question in the context of eliciting risk attitudes. The controls that are typically employed in laboratory settings, such as the use of abstract lotteries, could lead subjects to employ behavioral rules that differ from the ones they employ in the field. Because it is field behavior that we are interested in understanding, those controls might be a confound in themselves if they result in differences in behavior. We find that the use of artificial monetary prizes provides a reliable measure of risk attitudes when the natural counterpart outcome has minimal uncertainty, but that it can provide an unreliable measure when the natural counterpart outcome has background risk. Behavior tended to be moderately risk averse when artificial monetary prizes were used or when there was minimal uncertainty in the natural nonmonetary outcome, but subjects drawn from the same population were much more risk averse when their attitudes were elicited using the natural nonmonetary outcome that had some background risk. These results are consistent with conventional expected utility theory for the effects of background risk on attitudes to risk.

Alessandra Cassar, Lucas Crowley, Bruce Wydick

Cited by*: 1 Downloads*: 13

An important question to microfinance is the relevance of existing social capital in target communities to the performance of group lending. This research presents evidence from field experiments in South Africa and Armenia, in which subjects participate in trust games and a microfinance game. We present moderately strong evidence that personal trust between group members and peer homogeneity are more important to group loan repayment than general societal trust or mere acquaintanceship between members. We also find some evidence of reciprocity in groups: those who have been helped by other members are more likely to contribute themselves.

Daniel Hungerman, Mark Ottoni-Wilhelm

Cited by*: 1 Downloads*: 34

There are independent literatures in economics considering tax-price and match-price incentives for giving. The match-price literature has produced well-identified small price elasticities, but scholars have widely questioned whether these estimates can inform tax policy. The tax-price literature in contrast has produced a large range of estimates. Here, we explore and compare these different incentives. First, we consider tax incentives for giving by focusing on a state-level tax credit that creates a convex kink. We use traditional, as well as more novel, kink methods to estimate the tax-price elasticity of giving. Second, a subgroup of donors in our data were temporarily offered a match for their gifts, creating an opportunity to compare tax-price and match-price effects for the same group of donors giving to the same organization at the same time. We find the tax-price elasticity is about -.2. The match-price elasticity is essentially the same. Our results thus suggest a small tax-price elasticity, close to the match-price elasticity, and close to match-price elasticity estimates in the experimental match-price literature. The implication is that in the giving environment we investigate the match-price elasticity is informative for tax policy.

Richard Engelbrecht-Wiggans, John A List, David H Reiley

Cited by*: 1 Downloads*: 4

My coauthors and I reply to the comments of Daniel Levin on our paper "Demand Reduction in Multiunit Auctions: Evidence from a Sportscard Field Experiment." In his comment, Levin presents new theory and proposes a new equilibrium to explain annomalies reported in our earlier sportscard auction, such as higher first-unit bids under the uniform-price institution. We evaluate his theory and equilibrium in the context of both uniform-price and Vickrey auctions and point out our concerns. Where possible, we attempt to test the predictions of his theory with our existing data.

Erwin Bulte, Simon Levin , John A List, Steven Pacala

Cited by*: 1 Downloads*: 2

n/a

Glenn W Harrison, Steven J Humphrey, Arjan Verschoor

Cited by*: 1 Downloads*: 24

We review experimental evidence collected from risky choice experiments using poor subjects in Ethiopia, India and Uganda. Using these data we estimate that just over 50% of our sample behaves in accordance with expected utility theory and that the rest subjectively weight probability according to prospect theory. Our results show that inferences about risk aversion are robust to whichever model we adopt when we estimate each model separately. However, when we allow both models to explain portions of the data simultaneously, we infer risk aversion for subjects behaving according to expected utility theory and risk seeking behavior for subjects behaving according to prospect theory. We conclude that the current practice of designing policies under the assumption that one or other explains all behavior is fundamentally flawed.

Juan-Camilo Cardenas

Cited by*: 1 Downloads*: 54

This paper discusses why running experiments in the field, outside of the university lab, can help us enrich the analysis we do of experimental data. One of the main arguments of the paper is that people participating in experiments, including students, do not come naked to the lab. They bring a great deal of rules of thumb, heuristics, values, prejudices, expectations and knowledge about the others participating, and about similar games, and use such information to make their decisions. The paper offers a short mention of relevant field experiments, and a more detailed look at field experiments conducted by the author, including a data set of CPR experiments run in 10 villages, between 2000 and 2002, with more than 1300 villagers in about 220 sessions, and replications with about 250 university students in more than 40 sessions. It offers then main lessons from bringing the lab to the field. Also there is a discussion of additional information gathered through different field instruments as well as community workshops with the participants to discuss the experimental data, the external validity of the experiments and their results, through parallels with their daily life. One of the lessons is that the greater variance in certain demographics about the experimental subjects might help explain variations in lab behavior that cannot be fully explained by the experimental institutions we study. Also, certain significant differences in behavior between villagers and students will be discussed.

Peter Bohm

Cited by*: 1 Downloads*: 13

No abstract available

Juan-Camilo Cardenas, Jeff P Carpenter

Cited by*: 1 Downloads*: 13

No abstract available

Hisaki Kono

Cited by*: 1 Downloads*: 12

Microfinance institutions employ various kinds of incentive schemes but estimating the effect of each scheme is not easy due to endogeneity bias. We conducted field experiments in Vietnam to capture the role of joint liability, monitoring, cross-reporting, social sanctions, communication and group formation in borrowers' repayment behavior. We find that joint liability contracts cause serious free-riding problems, inducing strategic default and lowering repayment rates. When group members observe each others' investment returns, participants are more likely to choose strategic default. Even after introducing a cross-reporting system and/or penalties among borrowers, the default rates and the ratios of participants who chose strategic default under joint liability are still higher than those under individual lending. We also find that joint liability lending often failed to induce mutual insurance among borrowers. Those who had been helped or who had repaid a little in the previous round were more likely to default strategically and repay a little again in the current round and those who paid large amounts were always the same individuals.

Alex Imas, Sally Sadoff, Anya Samek

Cited by*: 1 Downloads*: 104

There is growing interest in the use of loss contracts that offer performance incentives as upfront payments that employees can lose. Standard behavioral models predict a tradeoff in the use of loss contracts: employees will work harder under loss contracts than under gain contracts; but, anticipating loss aversion, they will prefer gain contracts to loss contracts. In a series of experiments, we test these predictions by measuring performance and preferences for payoff-equivalent gain and loss contracts. We find that people indeed work harder under loss than gain contracts, as the theory predicts. Surprisingly, rather than a preference for the gain contract, we find that people actually prefer loss contracts. In exploring mechanisms for our results, we find suggestive evidence that people do anticipate loss aversion but select into loss contracts as a commitment device to improve performance.

Michael Hallsworth, John A List, Robert D Metcalfe, Ivo Vlaev

Cited by*: 1 Downloads*: 82

Framing remains one of the pillars of behavioral economics. While framing effects have been found to be quite important in the lab, what is less clear is how well evidence drawn from naturally-occurring settings conforms to received laboratory insights. We use debt obligation to the UK government as a case study to explore the 'omission bias' present in decision making with large stakes. Using a natural field experiment that generates nearly 40,000 observations, we find that repayment rates are roughly doubled when the act is reframed as one of commission rather than omission. We estimate that this reframing of the perceived nature of the action generated over $1.3 million of new yield. We find evidence that this behavior may result from a deliberate 'omission strategy', rather than a behavioral bias, as is often assumed in the literature. Our natural field experiment highlights that behavioral economics is much more than a series of empirical exercises to quench the intellectual curiosity of academics.

Uri Gneezy, Andreas Leibbrandt, John A List

Cited by*: 1 Downloads*: 9

The functioning and well-being of any society and organization critically hinges on norms of cooperation that regulate social activities. Empirical evidence on how such norms emerge and in which environments they thrive remains a clear void in the literature. To provide an initial set of insights, we overlay a set of field experiments in a natural setting. Our approach is to compare behavior in Brazilian fishermen societies that differ along one major dimension: the workplace organization. In one society (located by the sea) fishermen are forced to work in groups whereas in the adjacent society (located on a lake) fishing is inherently an individual activity. We report sharp evidence that the sea fishermen trust and cooperate more and have greater ability to coordinate group actions than their lake fishermen counterparts. These findings are consistent with the argument that people internalize social norms that emerge from specific needs and support the idea that socio-ecological factors play a decisive role in the proliferation of pro-social behaviors.

Jay R Corrigan, Matthew C Rousu

Cited by*: 0 Downloads*: 11

Firms spend billions of dollars annually on new product and label designs in order to attract and retain customers. The issue of labeling is also important to government agencies and nonprofit labeling organizations. For example, the U.S. Food and Drug Administration has an organizational body in its Office of Nutritional Products that deals with issues of food and dietary supplement labeling. The U.S. Department of Agriculture's Food Safety and Inspection Service also deals with labeling through its Labeling and Consumer Protection Staff. These government agencies spend millions of dollars trying to ensure that food labels adequately inform consumers. One issue that has not been examined is the welfare difference to consumers from alternative labeling schemes/regulations. It seems likely that different labels would differ in effectiveness at informing consumers.

Carina Cavalcanti, Andreas Leibbrandt

Cited by*: 0 Downloads*: 18

This paper investigates the role of dry promotions for community participation in eight Brazilian fishing villages. We randomly promoted some fishermen to assistants before the start of an environmental program, increasing their responsibilities but not providing any monetary compensation. Thereafter, we study whether they engage more in conservation behavior during this program. The data shows that promoted fishermen provide substantially more effort, which suggests that such promotions my be a cost-effective tool to stimulate cooperation and community participation.

Jeffrey A Flory, Andreas Leibbrandt, John A List

Cited by*: 0 Downloads*: 109

Workplace misbehaviors are often governed by explicit monitoring and strict punishment. Such enforcement activities can serve to lessen worker productivity and harm worker morale. We take a different approach to curbing worker misbehaviour - bonuses. Examining more than 6500 donor phone calls across more than 80 workers, we use a natural field experiment to investigate how different wage contracts influence workers' propensity to break workplace rules in harmful ways. Our findings show that even though standard relative performance pay contracts, relative to a fixed wage scheme, increase productivity, they have a dark side: they cause considerable cheating and sabotage of co-workers. Yet, even in such environments, by including an unexpected bonus, the employer can substantially curb worker misbehavior. In this manner, our findings reveal how employers can effectively leverage bonuses to eliminate undesired behaviors induced by performance pay contracts.