Papers - Natural

Yan Chen, Xin Li, Jeffrey K MacKie-Mason

Cited by*: 13 Downloads*: 11

We implemented the first web-based online field experiments of fund-raising. We embedded our experiment in the Internet Public Library to test four mechanisms: Voluntary Contribution (VCM), Premium, Seed Money and Matching. Although the gift size is not significantly different across mechanisms, the Seed and Matching mechanisms each generate significantly higher user click-through response rate than the Premium mechanism. Because this is one of the earliest embedded, web-based field experiments, we report our methodology findings in some detail. Cookies work better as participant assignment techniques than pop-up windows and elicitation of geographic information. Participant clickstream data that nominally demonstrate a desire to donate is a poor predictor of actual giving.

Craig Gallet, John A List

Cited by*: 12 Downloads*: 4

Recent research has posited that, in advanced economies, there is a positive correlation between income inequality and development. Using a new unbalanced panel dataset for 71 countries from 1961 to 1992, we present evidence that supports this conjecture. Although many factors may be contributing to this renewed positive relationship between growth and inequality, one plausible explanation rests on the shift away from a manufacturing base towards a service base in most advanced economies.

John A List

Cited by*: 12 Downloads*: 4

Previous studies of income distribution have found evidence indicating that incomes across U.S. regions have converged, supporting the prediction of the neoclassical growth model. A potential shortcoming in these studies is that only one measure of well-being is considered a measure of wealth linked to incomes or production. This paper examines whether income convergence was accompanied by air pollutant emission convergence. Results from unit root tests provide some evidence that indicators of environmental quality have converged across U.S. regions during the 1929-1994 period.

Alan S Gerber, Donald P Green

Cited by*: 12 Downloads*: 13

No abstract available

Uri Gneezy, John A List, Michael K Price

Cited by*: 12 Downloads*: 7

Social scientists have presented evidence that suggests discrimination is ubiquitous: women, nonwhites, and the elderly have been found to be the target of discriminatory behavior across several labor and product markets. Scholars have been less successful at pinpointing the underlying motives for such discriminatory patterns. We employ a series of field experiments across several market and agent types to examine the nature and extent of discrimination. Our exploration includes examining discrimination based on gender, age, sexual orientation, race, and disability. Using data from more than 3000 individual transactions, we find evidence of discrimination in each market. Interestingly, we find that when the discriminator believes the object of discrimination is controllable, any observed discrimination is motivated by animus. When the object of discrimination is not due to choice, the evidence suggests that statistical discrimination is the underlying reason for the disparate behavior.

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.

Jeffrey A Flory, Andreas Leibbrandt, John A List

Cited by*: 12 Downloads*: 3

Recently an important line of research using laboratory experiments has provided a new potential reason for why we observe gender imbalances in labor markets: men are more competitively inclined than women. Whether, and to what extent, such preferences yield differences in naturally-occurring labor market outcomes remains an open issue. We address this question by exploring job-entry decisions in a natural field experiment where we randomized nearly 7,000 interested job-seekers into different compensation regimes. By varying the role that individual competition plays in setting the wage, we are able to explore whether competition, by itself, can cause differential job entry. The data highlight the power of the compensation regime in that women disproportionately shy away from competitive work settings. Yet, there are important factors that attenuate the gender differences, including whether the job is performed in teams, whether the job task is female-oriented, and the local labor market.

Xavier Gine, Dean S Karlan

Cited by*: 12 Downloads*: 19

Group liability is often portrayed as the key innovation that led to the explosion of the microcredit movement, which started with the Grameen Bank in the 1970s and continues on today with hundreds of institutions around the world. Group lending claims to improve repayment rates and lower transaction costs when lending to the poor by providing incentives for peers to screen, monitor and enforce each other's loans. However, some argue that group liability creates excessive pressure and discourages good clients from borrowing, jeopardizing both growth and sustainability. Therefore, it remains unclear whether group liability improves the lender's overall profitability and the poor's access to financial markets. We worked with a bank in the Philippines to conduct a field experiment to examine these issues. We randomly assigned half of the 169 pre-existing group liability centers of approximately twenty women to individual-liability centers (treatment) and kept the other half as-is with group liability (control). We find that the conversion to individual liability does not affect the repayment rate, and leads to higher growth in center size by attracting new clients.

Paul W Rhode, Koleman S Strumpf

Cited by*: 12 Downloads*: 16

Political stock markets have a long history in the United States. Organized prediction markets for Presidential elections have operated on Wall Street (1880-1944), the Iowa Electronic Market (1988-present), and TradeSports (2001-present). Proponents claim such markets efficiently aggregate information and provide forecasts superior to polls. An important counterclaim is that such markets may be subject to manipulation by interested parties. We analyze this argument by studying alleged and actual speculative attacks- large trades, uninformed by fundamentals, intended to change prices- in these three markets. We first examine the historical Wall Street markets where political operatives from the contending parties actively and openly bet on city, state and national races; the record is rife with accusations that parties tried to boost their candidates through investments and wash bets. Next we report the results of a field experiment involving a series of planned, random investments-- accounting for two percent of total market volume-- in the Iowa Electronic Market in 2000. Finally, we investigate the speculative attacks on TradeSports market in 2004 when a single trader made a series of large investments in an apparent attempt to make one candidate appear stronger. In the cases studied here, the speculative attack initially moved prices, but these changes were quickly undone and prices returned close to their previous levels. We find little evidence that political stock markets can be systematically manipulated beyond short time periods.

John A List, Warren McHone , Daniel L Millimet

Cited by*: 11 Downloads*: 19

Whether environmental regulations alter capital flows remains a hotly debated issue. This paper uses county-level data to examine the location decisions of domestic and foreign firms in a single empirical model and tests for asymmetries by firm origin in the degree to which capital flows are influenced by environmental standards. We find that while domestic firms are influenced by environmental regulations, foreign firms are not. Since the benefits of foreign investment are well-documented-foreign plants typically provide more jobs and increase local wages by more than domestic plants-this result suggests a double-dividend is available: foreign plants provide an economic stimulus and are not unduly influenced by environmental protections.

Rachel Croson, Jen Shang

Cited by*: 11 Downloads*: 67

This paper examines the impact of social comparisons on fundraising and charitable contributions. We present results from a field experiment involving contribution to a public radio station. Some callers are told of the contributions decisions of others, and other callers are given no such information. We find that providing ambitions (high) social comparison information can significantly increase contributions.

Michael E Levine, Charles R Plott

Cited by*: 11 Downloads*: 32

No abstract available

John A List, Daniel L Millimet

Cited by*: 11 Downloads*: 4

One particularly vexing puzzle for economists and policymakers over the past several decades concerns the empirical significance of the theoretically predicted pollution haven hypothesis. While neoclassical theory and conventional wisdom both surmise that local economies will suffer deleterious effects from stricter environmental regulations, empirical studies have largely failed to validate such claims. This study utilizes the method of matching to show that the impact of stricter regulation is heterogeneous spatially, varying systematically based on location-specific attributes. Previous studies that assume a homogenous response may therefore inadvertently mask the overall impact of more stringent regulations by pooling unaffected and affected regions.

John A List, Warren McHone , Daniel L Millimet

Cited by*: 11 Downloads*: 8

Whether lax environmental regulations are an important attraction for mobile capital remains one of the most controversial issues in the area of regulatory federalism. While the extant literature does a nice job of estimating the effects of environmental regulation on the spatial allocation of new plant births, one neglected area of research is the effect that environmental regulation has on plant relocation decisions. This paper uses an annual (1980-90) county level panel data set to examine the relationship between air quality regulatory stringency and the destination choice of relocating plants. We estimate empirical models using both parametric and semi-nonparametric specifications. Empirical results from both models suggest that air quality regulations alter significantly the destination choices of relocating plants.

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

Cited by*: 10 Downloads*: 9

Auction theory has recently revealed that multi-unit uniform-price auctions, such as those used by the U.S. Treasury for debt sales, entail demand-reduction incentives that can cause inefficient allocations. Recent experimental results show that bidders do indeed strategically reduce their bids in uniform-price auctions. The present paper extends this work, both theoretically and experimentally, to consider the effects of varying numbers of bidders. We derive several theoretical predictions, including the result that demand reduction should decrease with increasing numbers of bidders, though some demand reduction remains even in the asymptotic limit. We then examine the bidding behavior of subjects in this environment by auctioning dozens of Cal Ripken, Jr. baseball cards using both uniform-price and Vickrey auction formats. The field data are broadly consistent with the theoretical predictions of our model: most notably, demand reduction on second-unit bids becomes much smaller and harder to detect as the number of bidders increases.

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

Cited by*: 10 Downloads*: 3

Recent auction theory and experimental results document strategic demand reduction by bidders in uniform-price auctions. The present article extends this area of research to consider the effects of varying the number of bidders. Our theoretical model predicts that demand reduction should decrease with an increase in the number of bidders. Considerable demand reduction remains even in the asymptotic limit, although truthful bidding yields profits very close to those of equilibrium play. We experimentally confirm several of our predictions by examining bidding behavior of subjects in an actual marketplace, auctioning dozens of sportscards using both uniform-price and Vickrey auction formats.

John A List, Charles Bailey, Patricia Euzent , Thomas Martin

Cited by*: 10 Downloads*: 42

This article measures the degree to which academic economists have engaged in unethical behavior and the degree to which academic economists believe the profession as a whole engages in unethical behavior. Three main types of unethical behavior are examined: (1) falsification of research; (2) expropriation of graduate student research or including an undeserving co-author on a research paper; and(3) exchange of grades for gifts, money, or sex. Using a unique data set gathered at the 1998 American Economic Association (AEA) meetings, we find that there is a significant amount of misconduct, particularly in the second category.

Michel Marechal, Christian Thoni

Cited by*: 10 Downloads*: 16

A substantive amount of lab experimental evidence suggests that the norm of reciprocity has important economic consequences. However, it is unclear whether the norm of reciprocity survives in a natural and competitive environment with experienced agents. For this purpose we analyze data from a natural field experiment conducted with sales representatives who were instructed to randomly distribute product samples as gifts to their business partners. We find that distributing gifts to store managers boosts sales revenue substantially, which is consistent with the notion of reciprocity. However, the results underline that the nature of the relationship between market participants crucially affects the prevalence of reciprocal behavior.

Rachel Croson, Jen Shang

Cited by*: 10 Downloads*: 36

We study the effect of social information on the voluntary provision of public goods. Competing theories predict that others[1] contributions might be either substitutes or complements to one's own. We demonstrate a positive social information effect on individual contributions, supporting theories of complementarities. We find the most influential level of social information is drawn from the 90th to 95th percentile of previous contributions. We furthermore find the effect to be significant for new members but not for renewing members. In the most effective condition, social information increases contributions by 12% ($13). These increased contributions do not crowd out future contributions.

Christina Gravert, Mette Trier Damgaard

Cited by*: 9 Downloads*: 63

We document the hidden costs of one of the most policy-relevant nudges, reminders. Sending reminders, while proven effective in facilitating behavior change, may come at a cost for both senders and receivers. Using a large scale field experiment with a charity, we find that reminders increase donations, but they also substantially increase unsubscriptions from the mailing list. To understand this novel finding, we develop a dynamic model of donation and unsubscription behavior with limited attention which is tested in reduced-form using a second field experiment. We also estimate our model structurally to perform a welfare analysis. We show that when not accounting for the hidden costs of reminders the average welfare effects for donors are overstated by a factor of ten and depending on the discount factor the welfare effects of the charity may be negative. Our results show the need to evaluate nudges on their intended as well as unintended consequences.