Papers - All

Nava Ashaf, Dean S Karlan, Wesley Yin

Cited by*: 3 Downloads*: 9

Informal lending and savings institutions exist around the world, and often include regular door-to-door deposit collection of cash. Some banks have adopted similar services in order to expand access to banking services in areas that lack physical branches. Using a randomized control trial, we investigate determinants of participation in a deposit collection service and evaluate the impact of offering the service for micro-savers of a rural bank in the Philippines. Of 137 individuals offered the service in the treatment group, 38 agreed to sign-up, and 20 regularly used the service. Take-up is predicted by distance to the bank (a measure of transaction costs of depositing without the service) as well as being married (a suggestion that household bargaining issues are important). Those offered the service saved 188 pesos more (which equates to about a 25% increase in savings stock) and were slightly less likely to borrow from the bank.

Maria De Paola, Vincenzo Scoppa

Cited by*: 9 Downloads*: 9

We carry out a randomized experiment involving undergraduate students enrolled at an Italian University attending two introductory economics classes to evaluate the impact on achievement of examination frequency and interim feedback provision. Students in the treated group were allowed to undertake an intermediate exam and were informed about the results obtained, while students in the control group could only take the final exam. The results show that students undertaking the intermediate exam perform better both in terms of the probability of passing the exams and of grades obtained. High ability students appear to benefit more from the treatment. The experiment design allows us to disentangle "workload division or commitment" effects from "feedback provision" effects. We find that the estimated treatment impact is due exclusively to the first effect, while the feedback provision has no positive effect on performance. Finally, the better performance of treated students in targeted examinations seems not to be obtained at the expenses of results earned in other examinations.

John A List, Warren McHone

Cited by*: 0 Downloads*: 9

In this article, we use annual (1980-90) county-level manufacturing plant location data for New York State to examine the effects of the 1977 Clean Air Act Amendments on the location decisions of new pollution-intensive manufacturing plants in the "neo-regulatory" (1980-84) and "mature-regulatory" (1985-90) phases of the Act's implementation. Our results suggest that the temporal effects of regulation vary. Whereas the location decisions of pollution intensive manufacturing firms were unaffected by the Act's regulatory restrictions in the "neo-regulatory" period, the restrictions appear to have had a significant negative impact on the location decisions of these types of firms in the Act's "mature-regulatory" phase. The diversion of new pollution intensive plants to counties with less stringent environmental regulations suggests that current US environmental regulations may be leading to a "browning process" whereby counties historically free of pollution become havens for polluters.

Per Fredriksson , John A List, Daniel L Millimet

Cited by*: 33 Downloads*: 9

Previous studies have proposed that equilibrium capital flows are affected by environmental regulations-the commonly coined 'pollution haven' hypothesis. We revisit this issue by treating environmental policies as endogenous and allowing governmental corruption to influence foreign direct investment patterns. Via these two simple extensions, we are able to provide a much richer model of international capital flows. The theoretical model presumes that the effect of corruption on FDI operates via two channels: corruption affects capital flows through its impact on environmental policy stringency and due to greater theft of public funds earmarked for public spending. We empirically examine the implications of the model using US state-level panel data from four industrial sectors over the period 1977-1987. Empirical results suggest environmental policy and corruption both play a significant role in determining the spatial allocation of inbound US FDI. In addition, the estimated effect of environmental policy is found to depend critically on exogeneity assumptions.

Charles Bellemare, Sabine Kroger, Arthur van Soest

Cited by*: 3 Downloads*: 9

We combine the choice data of proposers and responders in the ultimatum game, their expectations elicited in the form of subjective probability questions, and the choice data of proposers (dictators) in a dictator game to estimate a structural model of decision making under uncertainty. We use a large and representative sample of subjects drawn from the Dutch population. Our results indicate that there is considerable heterogeneity in preferences for equity in the population. Changes in preferences have an important impact on decisions of dictators in the dictator game and responders in the ultimatum game, but a smaller impact on decisions of proposers in the ultimatum game, a result due to proposers subjective expectations about responders decisions. The model which uses subjective data on expectations has better predictive power and lower noise level than a model which assumes that players have rational expectations.

Kosuke Imai

Cited by*: 12 Downloads*: 9

In their landmark study of a field experiment, Gerber and Green (2000) found that get-out-the-vote calls reduce turnout by five percentage points. In this article, I introduce statistical methods that can uncover discrepancies between experimental design and actual implementation. The application of this methodology shows that Gerber and Green's negative finding is caused by inadvertent deviations from their stated experimental protocol. The initial discovery led to revisions of the original data by the authors and retraction of the numerical results in their article. Analysis of their revised data, however, reveals new systematic patterns of implementation errors. Indeed, treatment assignments of the revised data appear to be even less randomized than before their corrections. To adjust for these problems, I employ a more appropriate statistical method and demonstrate that telephone canvassing increases turnout by five percentage points. This article demonstrates how statistical methods can find and correct complications of field experiments.

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.

William Masters, Diakalia Sanogo

Cited by*: 9 Downloads*: 9

In low-income countries, malnutrition is often most sever among infants of six to twenty-four months. They need higher-density foods than the family diet, but density is a credence attribute. We hypothesize that the premium now paid for heavily advertised brands reflects demand for quality assurance, which could be provided at lower cost to competing firms through third-party certification. We use a new market experiment to find that mothers' average willingness-to-pay for certification is about $1.75/kg, for four times its cost, so that total economic-surplus gains from introducing certification to Mali would be on the order of $1 million annually.

Nava Ashaf, Dean S Karlan, Wesley Yin

Cited by*: 0 Downloads*: 9

Commitment devices for savings could benefit those with self-control as well as familial or spousal control issues. We find evidence to support both motivations. We examine the impact of a commitment savings product in the Philippines on household decision making power and self-perception of savings behavior, as well as actual savings. The product leads to more decision making power in the household for women, and likewise more purchases of female-oriented durable goods. We also find that the product leads women who appear time-inconsistent in a baseline survey to self-report being a disciplined saver in the follow-up survey. For impact on savings balances, we find that the 81% increase in savings after one year did not crowd out savings held outside of the participating bank, but that the longer-term impact over two and a half years on bank savings dissipated to only a 33% increase, which is no longer statistically significant. We discuss reasons why the effect dissipated and the implications for designing and implementing sustainable, equilibrium-shifting interventions.

John A List, David Lucking-Reiley

Cited by*: 12 Downloads*: 9

Whether rationality of economic behavior increases with expected payoffs and decreases with the cognitive cost it takes to formulate an optimal strategy remains an open question. We explore these issues with field data, using individual bids from sealed-bid auctions in which we sold nearly $10,000 worth of sportscards. Our results indicate that stakes do indeed matter, as high-priced ($70) cards produced more of the theoretically predicted strategic behavior than did lower-priced ($3) cards. We find additional evidence consistent with the importance of cognitive costs, as subjects more experienced with sportscard auctions exhibited a greater tendency to behave strategically than did less experienced bidders.

Stephan Meier

Cited by*: 0 Downloads*: 8

Subsidizing charitable giving-for example, for victims of natural disasters-is very popular, not only with governments but also with private organizations. Many companies match their employees' charitable contributions, hoping that this will foster the willingness to contribute. However, systematic analyses of the effect of such a matching mechanism are still lacking. This article tests the effect of matching charitable giving in a randomized field experiment in the short and the long run. The donations of a randomly selected group were matched by contributions from an anonymous donor. The results support the hypothesis that a matching mechanism increases contributions to a public good. However, in the periods after the experiment, when matching donations have been stopped, the contribution rate declines for the treatment group. The matching mechanism leads to a negative net effect on the participation rate. The field experiment therefore provides evidence suggesting that the willingness to contribute may be undermined by a matching mechanism in the long run.

Bradley J Ruffle, Richard Sosis

Cited by*: 11 Downloads*: 8

Time-consuming and costly religious rituals pose a puzzle for economists committed to rational choice theories of human behavior. We propose that either through selection or a causal relationship, the performance of religious rituals is associated with higher levels of cooperation. To test this hypothesis we design field experiments to measure the in-group cooperative behavior of members of religious and secular Israeli kibbutzim, communal societies for which mutual cooperation is a matter of survival. Our results show that religious males (the primary practitioners of collective religious ritual in Orthodox Judaism) are more cooperative than religious females, secular males and secular females. Moreover, the frequency with which religious males engage in collective religious rituals predicts well their degree of cooperative behavior.

Abigail Barr

Cited by*: 4 Downloads*: 8

This paper presents rigorous and direct tests of two assumptions relating to limited commitment and asymmetric information that underpin current models of risk pooling. A specially designed economic experiment involving 678 subjects across 23 Zimbabwean villages is used to solve the problems of observability and quantification that have frustrated previous attempts to conduct such tests. I find that more extrinsic commitment is associated with more risk pooling, but that more information is associated with less risk pooling. The first of these results accords with our expectations and assumptions. The second does not. I offer two explanations as to the origin of the second result and discuss their implications for how we view the assumptions made elsewhere in the literature. I also conduct a test of the relevance or external validity of the experimental results to our understanding of real risk pooling behaviour. In four out of the five villages for which the test could be conducted the networks of risk pooling contracts constructed during the experiment and the networks existing in real life were significantly correlated.

Sarah Ahmed , John Beshears , James Choi , Joelle Friedman , Jonathan Kolstad, Suzanne Linck , John A List, George Loewenstein, Brigitte Madrain , Barbara McGill, Stacey Sinkula , Kevin Volpp

Cited by*: 3 Downloads*: 8

We report results from two surveys of representative samples of Americans with private health insurance. The first examines how well Americans understand, and believe they understand, traditional health insurance coverage. The second examines whether those insured under a simplified all-copay insurance plan will be more likely to engage in cost-reducing behaviors relative to those insured under a traditional plan with deductibles and coinsurance, and measures consumer preferences between the two plans. The surveys provide strong evidence that consumers do not understand traditional plans and would better understand a simplified plan, but weaker evidence that a simplified plan would have strong appeal to consumers or change their healthcare choices.

Alan S Gerber, Anton Orlich, Jennifer K Smith

Cited by*: 9 Downloads*: 8

Psychological research has found that being asked to predict one's future actions can bring about subsequent behavior consistent with the prediction but different from what would have occurred had no prediction been made. In a 1987 study, Greenwald, Carnot, Beach, and Young induced an increase in voting behavior by means of such a "self-prophecy" effect: Undergraduates who were asked to predict whether they would vote in an upcoming election were substantially more likely to go to the polls than those who had not been asked for a prediction. This paper reports on a replication of the Greenwald study conducted among a larger group of respondents more representative of the American electorate. No evidence was found that self-prophecy effects increase voter turnout.

Shakun Mago, Anya Samek, Roman Sheremeta

Cited by*: 0 Downloads*: 8

We experimentally investigate the effect of social identification and information feedback on individual behavior in contests. In all treatments we find significant over-expenditure of effort relative to the standard theoretical predictions. Identifying subjects through photo display decreases wasteful effort. Providing information feedback about others' effort does not affect the aggregate effort, but it decreases the heterogeneity of effort and significantly affects the dynamics of individual behavior. A behavioral model which incorporates a non-monetary utility of winning and relative payoff maximization explains significant over-expenditure of effort. It also suggests that decrease in 'social distance' between group members through social identification promotes pro-social behavior and decreases over-expenditure of effort, while improved information feedback decreases the heterogeneity of effort.

Eric Bettinger, Robert Slonim

Cited by*: 13 Downloads*: 8

Economic research examining how educational intervention programs affect primary and secondary schooling focuses largely on test scores although the interventions can affect many other outcomes. This paper examines how an educational intervention, a voucher program, affected students' altruism. The voucher program used a lottery to allocate scholarships among low-income applicant families with children in K-8th grade. By exploiting the lottery to identify the voucher effects, and using experimental economic methods, we measure the effects of the intervention on childrens altruism. We also measure the voucher programs effects on parents' altruism and several academic outcomes including test scores. We find that the educational intervention positively affects students' altruism towards charitable organizations but not towards their peers. We fail to find statistically significant effects of the vouchers on parents' altruism or test scores.

Tanjim Hossain, John Morgan

Cited by*: 3 Downloads*: 8

We conducted 80 auctions on eBay. Forty of these auctions were for various popular music CDs while the remaining 40 auctions were for video games for Microsoft's Xbox gaming console. The revenue equivalence theorem states that any auction form having the same effective reserve price yields the same expected revenue. The effective reserve price on eBay consists of three components: the opening bid amount, the secret reserve amount, and the shipping and handling charge to keep the overall reserve level fixed. We set no secret reserve price and varied the opening bid and the shipping and handling charge to keep the overall reserve level fixed. When the effective reserve was $4, auctions with a low opening bid and high shipping charges attracted more bidders, earlier bidding, and yielded higher revenue than those with a high opening bid and low shipping charges. The same results hold only for Xbox games under the $8 effective reserve. Unlike the other treatments, where the reserve represents less than 30% of the retail price of the item, for CDs, the $8 effective reserve represents over 50% of the retail price of the item. In this treatment, we find no systematic difference in the number of bidders attracted to the auction or revenues as a function of how the effective reserve is allocated between opening bid and shipping charges. We show that these results can be accounted for by bounded-rational bidding behavior.

Erwin Bulte, Aart de Zeeuw, Shelby Gerking, John A List

Cited by*: 0 Downloads*: 8

Measuring preferences via stated methods remains the only technique to obtain the total economic value of a non-marketed good or service. This study examines if alternative causes of an environmental problem affect individual statements of compensation demanded. Making use of a unique sample drawn from the Netherlands, we find that Hicksian equivalent surplus (ES) is not significantly affected by causes of environmental harm. While our finding that agents only care about outcomes, rather than causes, is consonant with standard applications of utility theory, it is at odds with some recent experimental findings measuring the effects of cause on Hicksian compensating surplus (CS).

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.