Papers - Artefactual

Justin Krieg, Anya Samek

Cited by*: 1 Downloads*: 6

What happens when charities compete? We begin to answer this question through a laboratory experiment in which subjects play two public goods games simultaneously. We systematically vary the incentives for contributing in one of the games - investigating the effects of recognition, a bonus conditional on contributing, and non-monetary sanctions - and measure the effect on contributions in both games. Monetary incentives in the form of conditional bonuses increase contributions, even when two games are played simultaneously. However, non-monetary incentives such as recognition and sanctions are less effective than in related literature on games played in isolation. Moreover, we find mixed evidence of the spillover effect of treatment on the un-treated games - bonuses increase contributions initially, recognition decreases contributions, and sanctions have no effect.

Iwan Barankay, Magnus Johannesson, John A List, Richard Friberg, Matti Liski, Kjetil Storesletten

Cited by*: 1 Downloads*: 1

No abstract available

Daniel Henderson , John A List, Daniel L Millimet, Christopher Parmeter , Michael K Price

Cited by*: 1 Downloads*: 4

Nonparametric estimators provide a flexible means of uncovering salient features of auction data. Although these estimators are popular in the literature, many key features necessary for proper implementation have yet to be uncovered. Here we provide several suggestions for nonparamteric estimation of first-price auction models. Specifically, we show how to impose monotonicity of the equilibrium bidding strategy; a key property of structural auction models not guaranteed in standard nonparametric estimation. We further develop methods for automatic bandwidth selection. Finally, we discuss how to impose monotonicity in auctions with differering number of bidders, reserve prices, and auction-specific characteristics. Finite sample performance is examined using simulated data as well as experimental auction data.

Catherine Kling , John A List, Jinhua Zhao

Cited by*: 1 Downloads*: 5

Recent evidence from laboratory experiments suggests that important disparities exist between willingness to pay (WTP) and compensation demanded for the same good. Because a fundamental postulate in neoclassical theory is that with small income effects and many available substitutes, the willingness to accept (WTA) and WTP measures of value for a commodity should be roughly equivalent, this finding has vast implications in both a positive and normative sense. This study advances, and experimentally tests, a new explanation of the WTP/WTA disparity-a dynamic theory based on the presence of commitment costs. Although to date neoclassical models have not explained the observed data patterns well, we find that the commitment cost theory combined with a simple behavioral anomaly is able to lend insights into the causes and severity of the WTA/WTP disparity. Furthermore, we find that market experience attenuates the behavioral anomaly, consistent with the notion that no value disparity exists for agents with sufficient market experience.

Ori Heffetz , John A List

Cited by*: 1 Downloads*: 14

A hallmark result within behavioral economics is that individuals' choices are affected by current endowments. A recent theory due to Koszegi and Rabin (2006) explains such endowment effect with a model of expectations-based reference-dependent preferences. Departing from past work, we conduct complementary experiments to disentangle expectations - verified probabilistic beliefs held by subjects - from other features of endowment - such as "assignment" to a good - hence allowing us to compare the effect of expectations with that of other variations. While mere assignment can affect choices, we do not find a large role in the effect for Koszegi-Rabin expectations.

Matthew McCarter, Anya Samek, Roman Sheremeta

Cited by*: 1 Downloads*: 5

It is common in organizational life to be simultaneously involved in multiple collective actions. These collective actions may be modeled using public good dilemmas. The developing social dilemma literature has two perspectives - the "divided loyalties" and "conditional cooperation" perspectives - that give opposite predictions about how individuals will behave when they simultaneously play two identical public good games. The current paper creates consensus between these social dilemma perspectives by examining cooperative behavior of participants interacting in two public good games with either different or the same group members. In each round, individuals have a common budget constraint across the two games. In support of the conditional cooperator's perspective of social dilemmas, we find that playing two games with different, rather than same, group members increases overall contributions. Over the course of the experiment, participants playing two games with different group members shift their contributions significantly more often toward more cooperative public good games than participants playing with the same group members.

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.

Frode Alfnes, Maren E Bachke, Mette Wik

Cited by*: 1 Downloads*: 27

Most charity organizations depend on contributions from the general public, but little research is conducted on donor preferences. Do donors have geographical, recipient, or thematic preferences? We designed a conjoint analysis experiment in which people rated development aid projects by donating money in dictator games. We find that our sample show strong age, gender, regional, and thematic preferences. Furthermore, we find significant differences between segments. The differences in donations are consistent with differences in donors' attitudes toward development aid and their beliefs about differences in poverty and vulnerability of the recipients. The method here used for development projects can easily be adapted to elicit preferences for other kinds of projects that rely on gifts from private donors.

John A List, Anya Samek, Michael K Price

Cited by*: 0 Downloads*: 2

No abstract available

James Andreoni, John A List

Cited by*: 0 Downloads*: 0

No abstract available

John A List, Anya Samek, Dana L Suskind

Cited by*: 0 Downloads*: 258

Behavioral economics and field experiments within the social sciences have advanced well beyond academic curiosum. Governments around the globe as well as the most powerful firms in modern economies employ staffs of behavioralists and experimentalists to advance and test best practices. In this study, we combine behavioral economics with field experiments to reimagine a new model of early childhood education. Our approach has three distinct features. First, by focusing public policy dollars on prevention rather than remediation, we call for much earlier educational programs than currently conceived. Second, our approach has parents at the center of the education production function rather than at its periphery. Third, we advocate attacking the macro education problem using a public health methodology, rather than focusing on piecemeal advances.

Omar Al-Ubaydli, Uri Gneezy, John A List, Min Sok Lee

Cited by*: 0 Downloads*: 2

A stylized fact is that agents respond more acutely to negative than positive stimuli. Such findings have generated insights on mechanism-design, have been featured prominently in policymaking, and more generally have led to discussions of whether preferences are defined over consumption levels or changes in consumption. This study reconsiders this stylized fact. In doing so, it provides insights into an important domain wherein positive stimuli induce a greater response than negative stimuli: a principal-agent game with reputational considerations and with the agent on the market's short end. This common setting represents an important feature of labor markets with involuntary unemployment.

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.

Andreas Leibbrandt

Cited by*: 0 Downloads*: 5

This paper combines experimental with field data from professional sellers to study whether social preferences are related to performance in natural markets. The data show that sellers who are more pro-social in a laboratory experiment are also more successful in natural markets: they achieve higher prices, have superior trade relations and better abilities to signal trustworthiness to buyers. These findings suggest that social preferences play a significant role for outcomes in natural markets.

John A List, Charles F Mason

Cited by*: 0 Downloads*: 20

Are individuals expected utility maximizers? This question represents much more than academic curiosity. In a normative sense, at stake are the fundamental underpinnings of the bulk of the last half-century's models of choice under uncertainty. From a positive perspective, the ubiquitous use of benefit-cost analysis across government agencies renders the expected utility maximization paradigm literally the only game in town. In this study, we advance the literature by exploring CEO's preferences over small probability, high loss lotteries. Using undergraduate students as our experimental control group, we find that both our CEO and student subject pools exhibit frequent and large departures from expected utility theory. In addition, as the extreme payoffs become more likely CEOs exhibit greater aversion to risk. Our results suggest that use of the expected utility paradigm in decision making substantially underestimates society's willingness to pay to reduce risk in small probability, high loss events.

Avner Ben-Ner, John A List, Louis Putterman, Anya Samek

Cited by*: 0 Downloads*: 43

An active area of research within the social sciences concerns the underlying motivation for sharing scarce resources and engaging in other pro-social actions. We develop a theoretical framework that sheds light on the developmental origins of social preferences by providing mechanisms through which parents transmit preferences for generosity to their children. Then, we conduct a field experiment with nearly 150 3-5 year old children and their parents, measuring (1) whether child and parent generosity is correlated, (2) whether children are influenced by their parents when making sharing decisions and (3) whether parents model generosity to children. We observe no correlation of independently measured parent and child sharing decisions at this young age. Yet, we find that apart from those choosing an equal allocation of resources between themselves and another child, children adjust their behaviors to narrow the gap with their parent's or other adult's choice. We find that fathers, and parents of initially generous children, increase their sharing when informed that their child will be shown their choice.

David P Tracer

Cited by*: 0 Downloads*: 56

In order to test the proposition that performance in bargaining experiments is significantly affected by degree of monetarization, market integration, and relative westernization, a one-shot Ultimatum Game was conducted during the months of June and July 1998 in two villages in a rural region of Papua New Guinea: Anguganak (where the people speak Au) and Bogasip (where they speak Gnau). Although the villages are located in close proximity to one another and are relatively homogeneous culturally, and both subsist using a mixture of foraging and horticulture and have an elaborate system of exchange relationships, they are distinguished by their average degree of exposure to and integration in a cash-based economy, as well as their degree of education (both are greater in Anguganak). The different sections of the chapter provide: an ethnographic account of the two villages; a description of the experimental methods employed; a presentation and analysis of the results in terms of various indicators of wealth and market integration; and a discussion of the implications of the results. The level of offers made in the Ultimatum Game data combined for Anguganak and Bogasip were between those in western industrialized populations and the Machiguenga of Peru. There was some indication that variability in the level of market integration between the two village populations may have influenced the results, although they appeared to be equally influenced by local beliefs on reciprocity, generosity, and indebtedness, and an unfamiliarity with impersonal transactions.

John A List, Jason F Shogren, Michael Spencer , Stephen Swallow

Cited by*: 0 Downloads*: 5

This paper considers how six alternative rebate rules affect voluntary contributions in a threshold public-good experiment. The rules differ by (1) whether an individual can receive a proportional rebate of excess contributions, a winner-takes-all of any excess contributions, or a full rebate of one's contribution in the event the public good is provided and excess contributions exist, and (2) whether the probability of receiving a rebate is proportional to an individual's contribution relative to total contributions or is a simple uniform probability distribution set by the number of contributors. The paper adds to the existing experimental economics literature on threshold public goods by investigating both aggregate and individual demand revelation under the winner-take-all and random full-rebate rules. Half of the rules (proportional rebate, winner-take-all with uniform probability among all group members, and random full-rebate with uniform probability) provide total contributions that nearly equal total benefits, while the rest (winner-take-all with proportional probability, winner-take-all with uniform probability among contributors only, and random full-rebate with proportional probability) exceed benefits by over 30 percent. Only the proportional rebate rule is found to achieve both aggregate and individual demand revelation. Our experimental results have implications for both fundraisers and valuation practitioners.

Edwin Leuven, Hessel Oosterbeek, Bas van der Klaauw

Cited by*: 0 Downloads*: 62

In a randomized field experiment where first year university students could earn financial rewards for passing all first year requirements within one year we find small and non-significant average effects of financial incentives on the pass rate and the numbers of collected credit points. There is however evidence that high ability students collect significantly more credit points when assigned to (larger) reward groups. Low ability students collect less credit points when assigned to larger reward groups. After three years these effects have increased, suggesting dynamic spillovers. The small average effect in the population is therefore the sum of a positive effect for high ability students and a (partly) off-setting negative effect for low ability students. A negative effect of financial incentives for less able individuals is in line with research from psychology and recent economic laboratory experiments which shows that external rewards may be detrimental for intrinsic motivation.

Steven D Levitt, John A List, Sally Sadoff

Cited by*: 0 Downloads*: 25

Although backward induction is a cornerstone of game theory, most laboratory experiments have found that agents are not able to successfully backward induct. We analyze the play of world-class chess players in the centipede game, which is ill-suited for testing backward induction, and in pure backward induction games--Race to 100 games. We find that chess players almost never play the backward induction equilibrium in the centipede game, but many properly backward induct in the Race to 100 games. We find no systematic within-subject relationship between choices in the centipede game and performance in pure backward induction games.