Papers - Framed

Stefano DellaVigna, John A List, Ulrike Malmendier, Gautam Rao

Cited by*: 4 Downloads*: 61

Why do people vote? We design a field experiment to estimate a model of voting 'because others will ask'. The expectation of being asked motivates turnout if individuals derive pride from telling others that they voted, or feel shame from admitting that they did not vote, provided that lying is costly. In a door-to-door survey about election turnout, we experimentally vary (i) the informational content and use of a flyer pre-announcing the survey, (ii) the duration and payment for the survey, and (iii) the incentives to lie about past voting. The experimental results indicate significant social image concerns. For the 2010 Congressional election, we estimate a value of voting 'to tell others' of about $15, contributing 2 percentage points to turnout. Lastly, we evaluate a get-out-the-vote intervention in which we tell potential voters that we will ask if they voted.

Omar Al-Ubaydli, John A List

Cited by*: 0 Downloads*: 60

A commonly held view is that laboratory experiments provide researchers with more "control" than natural field experiments, and that this advantage is to be balanced against the disadvantage that laboratory experiments are less generalizable. This paper presents a simple model that explores circumstances under which natural field experiments provide researchers with more control than laboratory experiments afford. This stems from the covertness of natural field experiments: laboratory experiments provide researchers with a high degree of control in the environment which participants agree to be experimental subjects. When participants systematically opt out of laboratory experiments, the researcher's ability to manipulate certain variables is limited. In contrast, natural field experiments bypass the participation decision altogether and allow for a potentially more diverse participant pool within the market of interest. We show one particular case where such selection is invaluable: when treatment effects interact with participant characteristics.

Lars Hultkrantz, Gunnar Lindberg, Jan-Eric Nilsson, Fridtjof Thomas

Cited by*: 4 Downloads*: 58

Around one million people are killed world wide every year in road-traffic accidents. The risks and consequences of accidents increase progressively with speed, which ultimately is determined by the individual driver. The behaviour of the motorist thus affects both her own and other peoples safety. Internalisation of external costs of road transport has hitherto been focused on distance-based taxes or insurance premiums. While these means, as they are designed today, may affect driven distance, they have no influence on driving behaviour. This paper argues that by linking on-board positioning systems to insurance premiums it is possible to reward careful driving and get drivers to self select into different risk categories depending on their compliance to speed limits. We report two economic field experiments that have tested ways to induce car-owners to have technical platforms installed in their vehicle in order to affect the extent of speeding. It is demonstrated that a bonus to remunerate those that have the device installed, tantamount to a lower insurance premium, increases drivers?propensity to accept the technical devices. In a second experiment the size of the bonus is made dependent on the actual frequency of speeding. We find that this is a second way to discipline users to drive at legal speeds.

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.

Esther Duflo, Petia Topalova

Cited by*: 14 Downloads*: 54

This paper studies the impact of reservation for women on the performance of policy makers and on voters' perceptions of this performance. Since the mid 1990's, one third of Village Council head positions in India have been randomly reserved for a woman: In these councils only women could be elected to the position of chief. Village Councils are responsible for the provision of many local public goods in rural areas. Using a data set which combines individual level data on satisfaction with public services with independent assessments of the quality of public facilities, we compare objective measures of the quantity and quality of public goods, and information about how villagers evaluate the performance of male and female leaders. Overall, villages reserved for women leaders have more public goods, and the measured quality of these goods is at least as high as in non-reserved villages. Moreover, villagers are less likely to pay bribes in villages reserved for women. Yet, residents of villages headed by women are less satisfied with the public goods, including goods that are beyond the jurisdiction of the Panchayat. This may help explain why women rarely win elections even though they appear to be at least as effective leaders along observable dimensions, and are less corrupt.

E. Lance Howe, James J Murphy, Drew Gerkey, Colin Thor West

Cited by*: 0 Downloads*: 54

Integrating information from existing research, qualitative ethnographic interviews, and participant observation, we designed a field experiment that introduces idiosyncratic environmental risk and a voluntary sharing decision into a standard public goods game. Conducted with subsistence resource users in rural villages on the Kamchatka Peninsula in Northeast Siberia, we find evidence consistent with a model of indirect reciprocity and local social norms of helping the needy. When participants are allowed to develop reputations in the experiments, as is the case in most small-scale societies, we find that sharing is increasingly directed toward individuals experiencing hardship, good reputations increase aid, and the pooling of resources through voluntary sharing becomes more effective. We also find high levels of voluntary sharing without a strong commitment device; however, this form of cooperation does not increase contributions to the public good. Our results are consistent with previous experiments and theoretical models, suggesting strategic risks tied to rewards, punishments, and reputations are important. However, unlike studies that focus solely on strategic risks, we find the effects of rewards, punishments, and reputations are altered by the presence of environmental factors. Unexpected changes in resource abundance increase interdependence and may alter the costs and benefits of cooperation, relative to defection. We suggest environmental factors that increase interdependence are critically important to consider when developing and testing theories of cooperation.

Paul J Ferraro

Cited by*: 0 Downloads*: 54

Economic analyses of asymmetric information typically start with the assumption that individuals know more about their own characteristics than outside observers. This assumption implies that individuals can accurately assess their own competence in a given domain. However, individuals can only judge their competence if they are sufficiently competent. The relationship between competence and self-awareness explains a great deal of the overconfidence observed among economic agents. More specifically, overconfidence is inversely proportional to competence. Through a series of experiments and analyses of field data, the link between incompetence and overconfidence is confirmed and its implications for economic theory are explored.

Adriaan R Soetevent

Cited by*: 63 Downloads*: 51

The role of anonymity in giving is examined in a field experiment performed in thirty Dutch churches. For a period of 29 weeks, the means by which offerings are gathered is determined by chance, prescribing for each offering the use of either 'closed' collection bags or open collection baskets. When using baskets, attendants' contributions can be identified by their direct neighbors, and attendants can observe the total amount given by the people who preceded them. Initially, contributions to the services' second offerings increase by 10% when baskets are used, whereas no effect is found for first offerings. The positive effect of using baskets peters out over the experimental period. Additional data on the coins collected show that in both offerings, people switch to giving larger coins when baskets are used.

Julian Conrads, Tommaso Reggiani, Rainer M Rilke

Cited by*: 0 Downloads*: 51

Ambiguity about the chances of winning represents a key aspect in lotteries. By means of a controlled field experiment, we exogenously vary the degree of ambiguity about the winning chances of lotteries organized to incentivize the contribution for a public good. In one treatment, people have been simply informed about the maximum number of potential participants (i.e. the number of lottery tickets released). In a second treatment, this information has been omitted as in all traditional lotteries. Our general finding shows that simply reducing the degree of ambiguity of the lottery leads to a sizable and significant increase (67%) in the participation rate. This result is robust to alternative prize configurations.

Steffen Andersen, Alec Brandon, Uri Gneezy, John A List

Cited by*: 6 Downloads*: 51

Perhaps the most powerful form of framing arises through reference dependence, wherein choices are made recognizing the starting point or a goal. In labor economics, for example, a form of reference dependence, income targeting, has been argued to represent a serious challenge to traditional economic models. We design a field experiment linked tightly to three popular economic models of labor supply-two behavioral variants and one simple neoclassical model--to deepen our understanding of the positive implications of our major theories. Consistent with neoclassical theory and reference--dependent preferences with endogenous reference points, workers (vendors in open air markets) supply more hours when presented with an expected transitory increase in hourly wages. In contrast with the prediction of behavioral models, however, when vendors earn an unexpected windfall early in the day, their labor supply does not respond. A key feature of our market in terms of parsing the theories is that vendors do not post prices rather they haggle with customers. In this way, our data also speak to the possibility of reference-dependent preferences over other dimensions. Our investigation again yields results that are in line with neoclassical theory, as bargaining patterns are unaffected by the unexpected windfall.

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.

Uri Gneezy, Aldo Rustichini

Cited by*: 227 Downloads*: 49

No abstract available

Uzma Afzal, Giovanna d'Adda, Marcel Fafchamps, Farah Said

Cited by*: 0 Downloads*: 47

Theoretical and empirical work on intra-household decision making capture empowerment through bargaining weights given to individual preferences, and infer such weights from household consumption allocations. In this paper we test two key hypotheses underlying this work: first, that spousal influence is the same for all private consumption goods; and second, that women have pent up demand for pure agency. We use data from a survey and a novel laboratory experiment implemented with adult couples in Pakistan. We find that women's influence on household decisions is decreasing in the importance of the decision. We find no evidence that women have pent up demand for agency. Instead, women are less willing to pay for agency when facing an unknown man. We interpret this evidence as suggesting that women in our study population have internalized gender norms, and that these norms regulate interactions between genders most strongly outside of the household. We also find little evidence, within our experimental setting, that willingness to pay for agency is affected by the instrumental value of agency.

Steven D Levitt, John A List, Sally Sadoff

Cited by*: 8 Downloads*: 46

We test the effect of performance-based incentives on educational achievement in a low-performing school district using a randomized field experiment. High school freshmen were provided monthly financial incentives for meeting an achievement standard based on multiple measures of performance including attendance, behavior, grades and standardized test scores. Within the design, we compare the effectiveness of varying the recipient of the reward (students or parents) and the incentive structure (fixed rate or lottery). While the overall effects of the incentives are modest, the program has a large and significant impact among students on the threshold of meeting the achievement standard. These students continue to outperform their control group peers a year after the financial incentives end. However, the program effects fade in longer term follow up, highlighting the importance of longer term tracking of incentive programs.

Jonathan E Alevy, Craig E Landry, John A List

Cited by*: 4 Downloads*: 46

A pillar of behavioral research is that preferences are constructed during the process of choice. A prominent finding is that uninformative numerical "anchors" influence judgment and valuation. It remains unclear whether such processes influence market equilibria. We conduct two experiments that extend the study of anchoring to field settings. The first experiment produces evidence that some consumers' valuations can be anchored in novel situations; there is no evidence that experienced agents are influenced by anchors. The second experiment finds that anchors have only transient effects on market outcomes that converge to equilibrium predictions after a few market periods.

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.

Abhijit Banerjee, Angus Deaton, Esther Duflo

Cited by*: 23 Downloads*: 44

There is surprisingly little information about the delivery of health care in rural India, and about the relationship, if any, between health care and health status. Some, such as the Commission on Macroeconomics and Health of the World Health Organization (2001), have argued that better health care is the key to improving health as well as economic growth in poor countries, but there is little systematic evidence that gives us a sense of how easy it is to impact the quality of health care delivery in developing countries and through these improvements to impact the health of the population. This paper reports on a recent survey in a poor rural area of the state of Rajasthan in India intended to shed some light on this issue, where we use a set of interlocking surveys to collect data on health and economic status, as well as the public and private provision of health care.

Sarah Lichtenstein, Paul Slovic

Cited by*: 37 Downloads*: 43

The present report describes an expanded replication of the previous experiments in a nonlaboratory real-play setting unique to the experimental literature on decision processes - a casino in downtown Las Vegas.

Greer K Gosnell, John A List, Robert D Metcalfe

Cited by*: 8 Downloads*: 42

Understanding motivations in the workplace remains of utmost import as economies around the world rely on increases in labor productivity to foster sustainable economic growth. This study makes use of a unique opportunity to "look under the hood" of an organization that critically relies on worker effort and performance. By partnering with Virgin Atlantic Airways on a field experiment that includes over 40,000 unique flights covering an eight-month period, we explore how information and incentives affect captains' performance. Making use of more than 110,000 captain-level observations, we find that our set of treatments-which include performance information, personal targets, and prosocial incentives-induces captains to improve efficiency in all three key flight areas: pre-flight, in-flight, and post-flight. We estimate that our treatments saved between 266,000-704,000 kg of fuel for the airline over the eight-month experimental period. These savings led to between 838,000-2.22 million kg of CO2 abated at a marginal abatement cost of negative $250 per ton of CO2 (i.e. a $250 savings per ton abated) over the eight-month experimental period. Methodologically, our approach highlights the potential usefulness of moving beyond an experimental design that focuses on short-run substitution effects, and it also suggests a new way to combat firm-level externalities: target workers rather than the firm as a whole.

David H Herberich, John A List

Cited by*: 9 Downloads*: 42

The article reports on a study that provides understanding of how risk preferences and other factors influence a farmer's decision to participate in a carbon offset market. It states incorporating background risk in a laboratory setting and drawing subjects from both a standard student population and a nonstandard farmer population helped to understand the decision making process. The study suggests that farmers are slightly more risk averse than students.