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on Experimental Economics |
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Issue of 2023‒03‒27
twenty-six papers chosen by |
| By: | Michele Bernasconi (Department of Economics, University Of Venice CÃ Foscari); Enrico Longo (University of Hamburg); Valeria Maggian (Department of Economics, University Of Venice CÃ Foscari) |
| Abstract: | We experimentally investigate subjects’ preferences for redistribution depending on i) their personal stake in the outcome (either absent or not), ii) the effect of luck in strengthening or weakening the income inequality as derived from merit, and iii) whether individuals are informed about their relative wealth position in the society or not. We find that self-interest is the main driver of subjects’ redistributive choices when they have direct monetary interests in the outcome. Leaving subjects under the veil of ignorance about their relative gross income position reduces selfish behavior, also controlling for beliefs and risk attitude. Inequality aversion and fairness mostly affect redistributive choices of impartial spectators when recipients of redistribution are not informed about their initial endowments, suggesting that the luck vs. merit effect is not the only driver of redistribution on behalf of others. |
| Keywords: | Income redistribution, Inequality aversion, Fairness, Experiment |
| JEL: | D31 D63 D81 C91 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:ven:wpaper:2023:02&r=exp |
| By: | Hajime Tomura (Waseda University) |
| Abstract: | This study investigates whether revealing others' actions canreduce polarization in the decontextualized settings of laboratory experiments. Despite wealth of studies on polarization, it has not been examined rigorously with varying treatments in laboratory settings. Theoretically, if people can infer others' private information through their actions, polarization should reduce for a policy that has common interests. To this end, we have conducted a novel laboratory experiment with a set of treatments theoretically derived. Our experiments show the following implications. First, when others' actions were revealed only once, polarization reduced in the short run, but increased in the long run. Second, when others' actions were revealed in all rounds, polarization reduced and almost disappeared. However, if participants thought that others had insufficient information, polarization persisted—even when others' actions were revealed in all rounds. In addition, a reduction in polarization is not necessary to increase participants' welfare since they may converge in the wrong direction. We apply our findings to real-world political issues including COVID-19 vaccination and cross-cutting views on social media and extend our discussions. |
| Keywords: | belief polarization, laboratory experiments, asymmetric information |
| JEL: | C92 D72 D82 D83 |
| Date: | 2022–10 |
| URL: | https://d.repec.org/n?u=RePEc:wap:wpaper:2205&r=exp |
| By: | Stefano Fiorin |
| Abstract: | I show that offering monetary rewards to whistleblowers can backfire as a moral aversion to being paid for harming others can reverse the effect of financial incentives. I run a field experiment with employees of the Afghan Ministry of Education, who are asked to confidentially report on their colleagues’ attendance. I use a two-by-two design, randomizing whether or not reporting absence carries a monetary incentive as well as the perceived consequentiality of the reports. In the consequential treatment arm, where employees are given examples of the penalties that might be imposed on absentees, 15% of participants choose to denounce their peers when reports are not incentivized. In this consequential group, rewards backfire: only 10% of employees report when denunciations are incentivized. In the non-consequential group, where participants are guaranteed that their reports will not be forwarded to the government, only 6% of employees denounce absence without rewards. However, when moral concerns of harming others are limited through the guarantee of non-consequentiality, rewards do not backfire: the incentivized reporting rate is 12% Keywords: Absence, Financial Incentives, Morality, Peer Reporting, Whistleblowing JEL Codes: C93, D73, D91, M59 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:igi:igierp:692&r=exp |
| By: | Ingar Haaland; Ole-Andreas Elvik Næss; Ingar K. Haaland |
| Abstract: | We conduct field experiments with retail investors recruited from a social trading platform. In our main experiment, we first elicit beliefs about the returns to active investing. We then generate exogenous variation in beliefs by providing treated respondents with information about index funds historically outperforming active funds. Treated respondents are 17.8 percentage points more likely to believe that index funds will outperform active funds in the future. Four months after the experiment, we collect administrative data on portfolio allocations. Treated respondents increase the index fund shares of their portfolios by 4.4 percentage points (37.7%) relative to the control group. |
| Keywords: | household finance, retail investors, portfolio allocations, field experiment |
| JEL: | G50 D91 D83 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_10257&r=exp |
| By: | Attanasi, Giuseppe (University of Nice Sophia-Antipolis); Rimbaud, Claire (University of Lyon 2); Villeval, Marie Claire (CNRS, GATE) |
| Abstract: | We investigate whether a player's guilt aversion is modulated by the co-players' vulnerability. To this goal, we introduce new variations of a three-player Trust game in which we manipulate payoff vulnerability and endowment vulnerability. The former is the traditional vulnerability which arises when a player's material payoff depends on another player's action (e.g., recipient's payoff in a Dictator game). The latter arises when a player's initial endowment is entrusted to another player (e.g., trustor's endowment in a Trust game). Treatments vary whether trustees can condition their decision on the belief of a co-player who is payoff-vulnerable and/or endowment-vulnerable, or not vulnerable at all, and the decision rights of the vulnerable player. We find that trustees' guilt aversion is insensitive to the dimension of the co-player's vulnerability and to the decision rights of the co-player. Guilt is activated even absent vulnerability of the co-player whose beliefs are disappointed. It is triggered by the willingness to respond to the co-player's beliefs on his strategy, regardless of whether this strategy concerns this player or a third player's vulnerability, that is, indirect vulnerability. |
| Keywords: | guilt aversion, vulnerability, psychological game theory, Dictator game, Trust game, experiment |
| JEL: | C72 C91 D91 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp15960&r=exp |
| By: | Franca Glenzer; Pierre-Carl Michaud; Stefan Staubli |
| Abstract: | Many people forgo a higher stream of public pension income by claiming early. We provide both quasi-experimental and survey-experimental evidence that the timing of public pension claiming is relatively inelastic to changes in financial incentives in Canada. Using the survey experiment, we evaluate the effect of two different educational interventions and different ways of framing the incentive to delay claiming. While all three types of interventions induce delays, these interventions have heterogeneous financial consequences for participants who react. |
| JEL: | G53 J26 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30938&r=exp |
| By: | Verlaat, Timo (Utrecht School of Economics); Todeschini, Federico (Pompeu Fabra University); Ramos, Xavier (Universitat Autònoma de Barcelona) |
| Abstract: | While unconditional cash transfers have been studied extensively in developing countries, little is known about their effects in a wealthier context. Through a randomized controlled trial, we study the employment effects of a generous and unconditional transfer targeting low-income families in Spain. Two years into the program, subjects assigned to treatment are 20 percent less likely to work than subjects assigned to a control group. Assignment to an activation plan does not attenuate adverse effects; a more lenient transfer withdrawal rate does. It appears that effects are driven by subjects with children, suggesting substitution of labour for care tasks. |
| Keywords: | welfare reform, cash transfer, basic income, policy evaluation, RCT |
| JEL: | C93 H53 I38 J64 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp15976&r=exp |
| By: | Walker, Brigham (Tulane University); Wisniewski, Janna (Tulane University); Tinkler, Sarah (Portland State University); Stano, Miron (Oakland University); Sharma, Rajiv (Portland State University) |
| Abstract: | Roughly a quarter of physicians in the United States are either international medical graduates (IMGs) or foreign-born physicians (FBPs). We propose a theoretical model where patient preferences that disfavor IMGs and FBPs may result in those physicians offering better access to their services compared with non-IMGs/FBPs in equilibrium. We use data from two field experiments to test the predictions from the model: one concerning patient preferences and the other concerning physician availability. In the patient preferences field experiment, we find that patients strongly prefer doctors educated in the United States to IMGs by about 2-to-1. In the physician availability field experiment, we find that US-born physicians generally have lower levels of availability including offering fewer appointments and longer wait times. These results indicate a substantial underutilization of FBPs relative to US-born physicians and suggest that a sizable share of the US healthcare provider base is unfairly disadvantaged based on nativity. |
| Keywords: | patient preferences, physician availability, foreign doctors, International Medical Graduates (IMGs), Foreign-Born Physicians (FBPs) |
| JEL: | I11 C93 J7 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp15951&r=exp |
| By: | Ludovica Spinola (Department of Economics, University Of Venice CÃ Foscari) |
| Abstract: | We experimentally test how information about the number of caught tax evaders, by interacting with individuals’ prior beliefs, affect the decision to underreport taxes. Specifically, our results indicate that when individuals receive the information about the number of people caught evading taxes and perceive this as higher than prior beliefs, they evade less. When, instead, individuals consider the number of caught evaders as low with respect to their beliefs, they evade more. These findings suggest that when subjects are informed on how many people have been found evading taxes they infer the audit probability, rather than the tax evasion rate. Finally, we observe no salience bias effect when considering individuals to whom we highlighted information about others’ norm violation nor when looking at those to whom we emphasised the probability of being audited. |
| Keywords: | tax evasion, social information, audit probability, salience bias, laboratory experiment |
| JEL: | D83 D9 H2 H26 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:ven:wpaper:2023:04&r=exp |
| By: | William N. Evans; Shawna Kolka; James X. Sullivan; Patrick S. Turner |
| Abstract: | Families in poverty face numerous barriers to establishing stable economic footing. This paper examines the effect of a holistic, individualized wrap-around service intervention on outcomes for low-income individuals. The intervention includes a detailed assessment, an individualized service plan, intensive case management administered by a two-person team with small caseloads, and temporary financial assistance used to overcome obstacles to self-sufficiency and incentivize behavior. We evaluate the intervention through a randomized controlled trial among participants seeking assistance at a local social service provider. Results indicate that the program improved labor market and housing outcomes two years after enrollment. Given the customized nature of the services, overall program effects might mask important heterogeneity. Exploratory analysis suggests the program helped employ participants who lacked employment but had stable housing, and that those without stable housing were helped in securing it. |
| JEL: | I30 I39 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30992&r=exp |
| By: | Stefano Fiorin; Joseph Hall; Martin Kanz |
| Abstract: | Debt moratoria that allow borrowers to postpone loan payments are a frequently used tool intended to soften the impact of economic crises. We conduct a nationwide experiment with a large consumer lender in India to study how debt forbearance offers affect loan repayment and banking relationships. In the experiment, borrowers receive forbearance offers that are presented either as an initiative of their lender or the result of government regulation. We find that delinquent borrowers who are offered a debt moratorium by their lender are 4 percentage points (7 percent) less likely to default on their loan, while forbearance has no effect on repayment if it is granted by the regulator. Borrowers who are offered forbearance by their lender also have higher demand for future interactions with the lender: in a follow-up experiment conducted several months after the main intervention, demand for a non-credit product offered by the lender is 10 percentage points (27 percent) higher among customers who were offered rep ayment flexibility by the lender than among customers who received a moratorium offer presented as an initiative of the regulator. Overall, our results suggest that, rather than generating moral hazard, debt forbearance can improve loan repayment and support the creation of longer-term banking relationships not only for liquidity but also for relational contracting reasons. This provides a rationale for offering repayment flexibility even in settings where lenders are not required to provide forbearance. JEL: G2, G5, O12 Keywords: Debt forbearance, moral hazard, relational contracting |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:igi:igierp:691&r=exp |
| By: | Lea Cassar; Mira Fischer; Vanessa Valero |
| Abstract: | Mindfulness-based meditation practices are becoming increasingly popular in Western societies, including in the business world and in education. While the scientific literature has largely documented the benefits of mindfulness meditation for mental health, little is still known about potential spillovers of these practices on other important life outcomes, such as performance. We address this question through a field experiment in an educational setting. We study the causal impact of mindfulness meditation on academic performance through a randomized evaluation of a well-known 8-week mindfulness meditation training delivered to university students on campus. As expected, the intervention improves students’ mental health and non-cognitive skills. However, it takes time before students' performance can benefit from mindfulness meditation: we find that, if anything, the intervention marginally decreases average grades in the short run, i.e., during the exam period right after the end of the intervention, whereas it significantly increases academic performance, by about 0.4 standard deviations, in the long run (ca. 6 months after the end of intervention). We investigate the underlying mechanisms and discuss the implications of our results. |
| Keywords: | performance, mental health, education, meditation, field experiment |
| JEL: | I21 C93 I12 I31 |
| Date: | 2022–11–18 |
| URL: | https://d.repec.org/n?u=RePEc:bdp:dpaper:0002&r=exp |
| By: | Maria José Montoya Villalobos; Noémi Berlin |
| Abstract: | This experiment seeks to study the impact of uncertainty and attitudes towards uncertainty on charity donations. We use a modified dictator game, where the donations received by the beneficiaries (environmental NGOs) are exposed to different levels of uncertainty. We study the level of donations and elicit risk aversion, ambiguity aversion, likelihood insensitivity, and pessimism. We aim to test if different levels of uncertainty at the receiver level (risk and ambiguity) impact donations. We do not find any differences between levels of uncertainty compared to no uncertainty. We find that a ``high" level of ambiguity has a significant and negative effect on altruistic behavior compared to a risk or a``low" ambiguity environment. We also find that the effect of pessimism depends on the level of ambiguity. We find no effect of ambiguity aversion, likelihood insensitivity, and pessimism under ``low" ambiguity on altruistic behavior. Meanwhile, under ``high" ambiguity, we find a negative effect of pessimism on charitable giving. These results suggest that there is a threshold for which ambiguity and ambiguity attitudes have a negative impact on donations. |
| Keywords: | Charitable giving, uncertainty, pro-social behavior, ambiguity attitudes |
| JEL: | C91 D64 D81 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2023-8&r=exp |
| By: | Sona Badalyan; Darya Korlyakova; Rastislav Rehak |
| Abstract: | We focus on communication among hiring team members and document the existence of discrimination in the disclosure of information about candidates. In particular, we conduct an online experiment with a nationally representative sample of Czech individuals who act as human resource assistants and hiring managers in our online labor market. The main novel feature of our experiment is the monitoring of information flow between human resource assistants and hiring managers. We exogenously manipulate candidates’ names to explore the causal effects of their gender and nationality on information that assistants select for managers. Our findings reveal that assistants disclose more information about family and less information about work for female candidates relative to male candidates. An in-depth analysis of the disclosed information suggests that gender stereotypes play an important role in this disclosure discrimination. Furthermore, assistants disclose less information about foreigners overall. This effect appears to be driven by the less attention assistants are willing to devote to the CVs of foreigners, measured by the extra effort to learn more about the candidates. |
| Keywords: | Information; Disclosure; Hiring; Discrimination; Foreigners; Women; Online Experiment; |
| JEL: | C90 D83 J71 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:cer:papers:wp743&r=exp |
| By: | Emma van Inwegen; Zanele T. Munyikwa; John J. Horton |
| Abstract: | There is a strong association between the quality of the writing in a resume for new labor market entrants and whether those entrants are ultimately hired. We show that this relationship is, at least partially, causal: a field experiment in an online labor market was conducted with nearly half a million jobseekers in which a treated group received algorithmic writing assistance. Treated jobseekers experienced an 8% increase in the probability of getting hired. Contrary to concerns that the assistance is taking away a valuable signal, we find no evidence that employers were less satisfied. We present a model in which better writing is not a signal of ability but helps employers ascertain ability, which rationalizes our findings. |
| JEL: | M5 J0 J64 |
| Date: | 2023–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30886&r=exp |
| By: | Jeanne Hagenbach (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Charlotte Saucet (UP1 UFR02 - Université Paris 1 Panthéon-Sorbonne - École d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We experimentally study how individuals read strategically-transmitted information when they have preferences over what they will learn. Subjects play disclosure games in which Receivers should interpret messages skeptically. We vary whether the state that Senders communicate about is ego-relevant or neutral for Receivers, and whether skeptical beliefs are aligned or not with what Receivers prefer believing. Skepticism is lower when skeptical beliefs are self-threatening than in neutral settings. When skeptical beliefs are self-serving, skepticism is not enhanced compared to neutral settings. These results demonstrate that individuals' exercise of skepticism depends on the conclusions of skeptical inferences. |
| Keywords: | Disclosure games, Hard information, Unraveling result, Skepticism, Motivated beliefs |
| Date: | 2022–07–15 |
| URL: | https://d.repec.org/n?u=RePEc:hal:cesptp:hal-03770685&r=exp |
| By: | Carlsson, Magnus (Linnaeus University); Eriksson, Stefan (Uppsala University); Rooth, Dan-Olof (Stockholm University) |
| Abstract: | Labor markets in advanced economies have undergone substantial change in recent decades due to globalization, technological improvements, and organizational changes. Due to these developments, oral and written language skills have become increasingly important even in less skilled jobs. Immigrants – who often have limited skills in the host country language upon arrival – are likely to be particularly affected by the increase in language requirements. Despite this increase in literacy requirements, little is known about how immigrants' language proficiency is rewarded in the labor market. However, estimating the causal effect of immigrants' language skills on hiring is challenging due to potential biases caused by omitted variables, reverse causality, and measurement error. To address identification problems, we conduct a large-scale field experiment, where we send thousands of fictitious resumes to employers with a job opening. With the help of a professional linguist, we manipulate the cover letters by introducing common second-language features, which makes the resumes reflect variation in the language skills of real-world migrants. Our findings show that better language proficiency in the cover letter has a strong positive effect on the callback rate for a job interview: moving from the lowest level of language proficiency to a level similar to natives almost doubles the callback rate. Consistent with the recent development that language proficiency is also important for many low- and medium-skilled jobs, the effect of better language skills does not vary across the vastly different types of occupations we study. Finally, the results from employer surveys suggest that it is improved language skills per se that is the dominant explanation behind the language proficiency effect, rather than language skills acting as a proxy for other unobserved abilities or characteristics. |
| Keywords: | labor migrants, language proficiency, language skills, human capital, field experiment |
| JEL: | F22 J15 J24 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp15950&r=exp |
| By: | Henning Schaak (Department of Economics and Social Sciences, University of Natural Resources and Life Sciences, Vienna); Jens Rommel (Department of Economics, Swedish University of Agricultural Sciences); Julian Sagebiel (Biodiversity Economics, German Centre for Integrative Biodiversity Research (iDiv) Halle-Jena-Leipzig); Jesus Barreiro-Hurlé (European Commission, Joint Research Centre (JRC)); Douadia Bougherara (CEE-M, Univ. Montpellier, CNRS, INRAE, Institut Agro); Luigi Cemablo (Department of Agricultural Sciences, University of Naples Federico II); Marija Cerjak (Faculty of Agriculture, University of Zagreb); Tajana Čop (Faculty of Agriculture, University of Zagreb); Mikołaj Czajkowski (Faculty of Economic Sciences, University of Warsaw); María Espinosa-Goded (Faculty of Economic and Business Science, University of Sevilla); Julia Höhler (Business Economics Group, Wageningen University & Research); Carl-Johan Lagerkvist (Department of Economics, Swedish University of Agricultural Sciences); Macario Rodriguez-Entrena (WEARE - Water, Environmental, and Agricultural Resources Economics Research Group, Universidad de Córdoba); Annika Tensi (Business Economics Group, Wageningen University & Research); Sophie Thoyer (CEE-M, Univ. Montpellier, CNRS, INRAE, Institut Agro); Marina Tomić Maksan (Faculty of Agriculture, University of Zagreb); Riccardo Vecchio (Department of Agricultural Sciences, University of Naples Federico II); Katarzyna Zagórska (Faculty of Economic Sciences, University of Warsaw) |
| Abstract: | Risk is ubiquitous in agriculture and a core interest of agricultural economists. While farmers’ risk preferences are well studied, there is limited knowledge on the perspectives of other stakeholders on farmers’ risk preferences. We address this gap by eliciting predictions for a multiple-price-list task from 561 students, farm advisors, and experts from Italy, Poland, Croatia, Spain, France, Sweden, and the Netherlands. First, we investigate whether the risk preferences of farmers from different European production systems differ in terms of predictability for the experts. Second, we compare the predictions of different groups of experts, as well as their accuracy. Third, we evaluate whether the accuracy of predictions can be improved by changing incentive mechanisms. Overall, we find substantial variation in individual predictions. Yet, average predictions are close to the averages of the observed responses of farmers. We find that an international group of researchers in experimental economics provides more accurate predictions than farm advisors and other experts or students of agriculture. Differences in predictions by production systems are small. Incentivizing predictions by either a tournament scheme (the best prediction receives a reward) or high accuracy (randomly selected participants are paid depending on the quality of their prediction) do not strongly affect the accuracy, but may slightly reduce noise in the predictions. |
| Keywords: | Risk attitudes, Expert predictions, Expert forecasts, Multiple prices lists, Meta-science, Experimental economics |
| JEL: | Q19 D81 C99 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:war:wpaper:2023-03&r=exp |
| By: | Martina Björkman-Nyqvist; Seema Jayachandran; Celine P. Zipfel |
| Abstract: | Building on prior evidence that mothers often have a stronger preference for spending on children than fathers do, we use a randomized experiment to evaluate the impacts of a communication training program for mothers on child health in Uganda. The hypothesis is that the training will enable women to better convey their knowledge and preferences to their husbands and, thereby, boost investments in children's health. We find that the program increases spousal discussion about the family's health, nutrition, and finances. However, this does not increase overall adoption of health-promoting behaviors or improve child anthropometrics. One exception is that the communication training increases women's and children’s intake of protein-rich foods as well as household spending on these foods. |
| JEL: | D10 I12 O12 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30962&r=exp |
| By: | Mieko Fujisawa (Kanazawa University); Kazuhisa Takemura Author-Name-Kazuhisa (Waseda University); Yukihiko Funaki Author-Name-Yukihiko (Waseda University) |
| Abstract: | This study focuses on energy labels, which are set to be displayed mandatorily in Japanese real estate advertisements soon. In this study, we conducted eye-tracking experiments to identify effective design elements for energy labels. The novelty of this study lies in the fact that we not only collected data on reaction times and areas of interest(AOIs) using eye tracking, but also conducted a panel analysis controlling for individual effects by adding data from a questionnaire survey conducted after the experiment. Our findingsverifiedthat the display of energy labels in real estate advertisements is likely to lead to improved consumer understanding of energy conservation standards as learning effects.This suggestsrehearsal effects that invited availability heuristics by appearing repeatedly. Moreover, the results of the panel analysis suggest that design of energy labels are important on reaction time and number of round trips between the AOIs. We compared the two label designs in the experiment, the information in the European Union energy label was difficult to read and judge intuitively, and can conclude the rating scale label was more suitable for advertising and readers in Japan.As energy labels help with increased consumer awarenessregardingenergy standards of dwellings and energy saving, an early start to labeling is recommended. |
| Keywords: | energy label, eye-tracking, label design, response times, AOI, energy-saving policy |
| Date: | 2022–08 |
| URL: | https://d.repec.org/n?u=RePEc:wap:wpaper:2203&r=exp |
| By: | Jean-Christian Tisserand (BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC), CEREN - Centre de Recherche sur l'ENtreprise [Dijon] - BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC)); Astrid Hopfensitz (EM - emlyon business school, GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet - Saint-Étienne - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Serge Blondel (GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - Institut Agro Rennes Angers - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement); Youenn Loheac (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, ESC Rennes School of Business - ESC [Rennes] - ESC Rennes School of Business); César Mantilla (Universidad del Rosario [Bogota]); Guillermo Mateu (BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC)); Julie Rosaz (BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC)); Anne Rozan (UMR GESTE - Gestion Territoriale de l'Eau et de l'environnement - ENGEES - École Nationale du Génie de l'Eau et de l'Environnement de Strasbourg - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Marc Willinger (CEE-M - Centre d'Economie de l'Environnement - Montpellier - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - UM - Université de Montpellier); Angela Sutan (BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC), CEREN - Centre de Recherche sur l'ENtreprise [Dijon] - BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC)) |
| Abstract: | Dilemmas related to the use of environmental resources concern diverse populations at local or global scales. Frequently, individuals are unable to visualize the consequences of their actions, where they belong in the decision-making line, and have no information about past choices or the time horizon. We design a new one-shot extraction game to capture these dynamic decisions. We present results from a nationwide common pool resource experiment, conducted simultaneously in eleven French cities, involving a total of 2813 participants. We examine, for the first time, the simultaneous impact of several variables on the amount of resource extracted: the local vs. the national scale of the resource, the size of the group (small vs. big), the low vs. high recovery rate of the resource, and the available information. We show that individuals significantly reduce extraction levels in local as compared to national level dilemmas and that providing recommendations on sustainable extraction amounts significantly improves the sustainability of the resource. Overall, women extract significantly less, but care more about preserving the local resource; older participants extract significantly more resources but extract less from the national resource. Our experiment also fulfills a science popularization pedagogical aim, which we discuss.. |
| Keywords: | Common Pool Resource, Experiment, Large Sample, Science Popularization |
| Date: | 2022–11 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-03762599&r=exp |
| By: | Amanda Y. Agan; Diag Davenport; Jens Ludwig; Sendhil Mullainathan |
| Abstract: | Consumer choices are increasingly mediated by algorithms, which use data on those past choices to infer consumer preferences and then curate future choice sets. Behavioral economics suggests one reason these algorithms so often fail: choices can systematically deviate from preferences. For example, research shows that prejudice can arise not just from preferences and beliefs, but also from the context in which people choose. When people behave automatically, biases creep in; snap decisions are typically more prejudiced than slow, deliberate ones, and can lead to behaviors that users themselves do not consciously want or intend. As a result, algorithms trained on automatic behaviors can misunderstand the prejudice of users: the more automatic the behavior, the greater the error. We empirically test these ideas in a lab experiment, and find that more automatic behavior does indeed seem to lead to more biased algorithms. We then explore the large-scale consequences of this idea by carrying out algorithmic audits of Facebook in its two biggest markets, the US and India, focusing on two algorithms that differ in how users engage with them: News Feed (people interact with friends' posts fairly automatically) and People You May Know (people choose friends fairly deliberately). We find significant out-group bias in the News Feed algorithm (e.g., whites are less likely to be shown Black friends' posts, and Muslims less likely to be shown Hindu friends' posts), but no detectable bias in the PYMK algorithm. Together, these results suggest a need to rethink how large-scale algorithms use data on human behavior, especially in online contexts where so much of the measured behavior might be quite automatic. |
| JEL: | A12 D63 D83 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30981&r=exp |
| By: | Sebastian Blesse (ifo Institute, ZEW Mannheim); Philipp Lergetporer (TU Munich); Justus Nover (ZEW Mannheim, University of Mannheim); Katharina Werner (CESifo, ifo Institute) |
| Abstract: | A lack of transparency about policy performance can pose a major obstacle to welfare-enhancing policy competition across jurisdictions. In parallel surveys with German citizens and state parliamentarians, we document that both groups misperceive the performance of their state’s education system. Experimentally providing performance information polarizes citizens’ political satisfaction between high- and low-performing states and increases their demand for greater transparency of states’ educational performance. Parliamentarians’ support for the transparency policy is opportunistic: Performance information increases (decreases) policy support in high-performing (low-performing) states. We conclude that increasing the public salience of educational performance information may incentivize politicians to implement welfare-enhancing reforms. |
| Keywords: | yardstick competition; beliefs; information; citizens; politicians; survey experiment; |
| JEL: | H11 I28 D83 |
| Date: | 2023–02–17 |
| URL: | https://d.repec.org/n?u=RePEc:rco:dpaper:387&r=exp |
| By: | Shai Bernstein; Emanuele Colonnelli; Mitchell Hoffman; Benjamin Iverson |
| Abstract: | In an RCT with US small businesses, we document that a large share of firms are not well-informed about bankruptcy. Many assume that bankruptcy necessarily entails the death of a business and do not know about Chapter 11 bankruptcy, where debts are renegotiated so that the business can continue operating. Small businesses are also unaware of a recent major reform that lowered the costs of bankruptcy procedures to enhance their protection. In addition, they exhibit substantial stigma related to bankruptcy, believing that bankruptcy is embarrassing, a sign of failure, and a negative signal to employees and customers. Randomly providing short educational videos that address information or stigma gaps leads to increased firm knowledge about bankruptcy and decreased perceptions of stigma, both immediately and durably over 4 months. The videos also increase reported interest in using Chapter 11 bankruptcy and increase firms' intended debt and investment. However, we do not find long-term evidence of real effects. We then conduct a survey of bankruptcy attorneys and judges, who point to entrepreneurs' overconfidence and, to a lesser extent, excessive perceived legal fees as first-order frictions explaining the limited real impact of treatments that only address information and stigma. Our findings help inform the design of policies targeting the limited use of bankruptcy protection by small businesses. |
| JEL: | G33 M5 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30933&r=exp |
| By: | Patrick Premand; Dominic Rohner |
| Abstract: | Conflict undermines development, while poverty, in turn, breeds conflict. Policy interventions such as cash transfers could lower engagement in conflict by raising poor households’ welfare and productivity. However, cash transfers may also trigger appropriation or looting of cash or assets. The expansion of government programs may further attract attacks to undermine state legitimacy. To investigate the net effect across these forces, this paper studies the impact of cash transfers on conflict in Niger. The analysis relies on the large-scale randomization of a government-led cash transfer program among nearly 4, 000 villages over seven years, combined with geo-referenced conflict events that draw on media and nongovernmental organization reports from a wide variety of international and domestic sources. The findings show that cash transfers did not result in greater pacification but−if anything−triggered a short-term increase in conflict events, which were to a large extent driven by terrorist attacks by foreign rebel groups (such as Boko Haram) that could have incentives to “sabotage” successful government programs. |
| Keywords: | conflict, terrorism, cash transfers, Sahel |
| JEL: | D74 I38 O17 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_10277&r=exp |
| By: | Catherine Wolfram; Edward Miguel; Eric Hsu; Susanna B. Berkouwer |
| Abstract: | There is limited causal evidence on the effects of different public procurement regulations on project quality and value-for-money for projects funded by national governments and foreign aid donors. This paper uses policy and experimental variation to study how two key contracting features—namely, contract bundling and monitoring—affect outcomes of a large economic development project. We leverage an unusual feature of Kenya’s nationwide electrification program: the quasi-random allocation of multilateral funding sources across nearby villages. African Development Bank (AfDB) projects used bundled contracts while the World Bank (WB) employed unbundled contracts together with strengthened inspections. To measure impacts, we collect on-the-ground engineering assessments, power quality data, household surveys, and analyze original contracts. The analysis suggests a stark trade-off: WB procedures delayed construction completion by 16 months relative to AfDB sites but improved construction quality by a sizeable 0.6 standard deviations. To disentangle the effects of contract bundling versus monitoring, we conducted randomized audits that enhanced monitoring. The audits improve household connectivity, network size, and voltage at AfDB sites, but have no impact at WB sites, suggesting monitoring and unbundling contracts may be substitutes. Given the apparent trade-off, we investigate how net benefits depend on policymaker time preferences and infrastructure longevity. |
| JEL: | D73 F35 H5 L94 O19 |
| Date: | 2023–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:30948&r=exp |