Economics: Research Guide

In this paper, we experimentally investigate how sending a signal of following social norms impacts people’s cooperative behavior in a repeated public goods game, where we disentangle the effect of strategy and internalization of social norms on cooperation. We find that under the signaling mechanism, less cooperative players disguise themselves in the rule-following game, but this does not decrease cooperation overall. More importantly, the signaling mechanism has a heterogeneous effect on cooperation in rule-following and rule-breaking groups: It increases cooperation in rule-following groups but decreases cooperation in rule-breaking groups. Finally, the signaling mechanism tends to off..

This paper explores communication strategies for anchoring households' medium-term inflation expectations in a high inflation environment. We conducted a survey experiment with a representative sample of 4, 000 German households at the height of the recent inflation surge in early 2023, with information treatments including a qualitative statement by the ECB president and quantitative information about the ECB's inflation target or projected inflation. Inflation projections are most effective, but combining information about the target with a qualitative statement also significantly improves anchoring. The treatment effects are particularly pronounced among respondents with high financial li..

While headline news frequently report cases of large-scale fraud, corruption, and other immoral behavior, laboratory experiments often show prosocial behavior in strategic games. To reconcile and explain these seemingly conflicting observations, Alós-Ferrer et al. (2022) introduced the Big Robber Game — an altered dictator game where one robber can take money from multiple victims. They reported low prosocial behavior among a pool of student subjects who behaved more prosocial in bilateral games than in the Big Robber Game. In our study, we employ the Big Robber Game within a 2x2 factorial design, engaging over 860 participants to examine the behaviors of financial professionals versus st..

Individual-level discrimination is often attributed to deep-seated prejudice that is difficult to change. But at the societal level, we sometimes observe rapid reductions in discriminatory preferences, suggesting that social interactions and the communication they entail might drive such shifts. I examine whether discrimination can be reduced by two types of communication about a minority: (i) horizontal communication between majority-group members, or (ii) top-down communication from agents of authority (e.g., the legal system). I run a field experiment in urban India (N=3, 397) that measures discrimination against a marginalized community of transgender people. Participants are highly disc..

We evaluate a multi-faceted intervention aimed at improving social inclusion and reducing prejudice against individuals with visual impairment. The intervention, randomly assigned to upper-secondary school students, consists of an awareness-raising activity and a simulationbased inter-group contact activity. While we find positive effects on knowledge of visual impairment, perspective-taking and empathic concerns, and general societal attitudes toward persons with visual impairment, no improvements are observed in terms of implicit attitudes or multidimensional attitudes. Moreover, the intervention does not improve outcomes measured through incentivized choices, such as the willingness to pa..

In the digital age, privacy in economic activities is increasingly threatened. In considering policies to address this threat, it is useful to consider what value, if any, that people attach to privacy in economic activities. We study this question by eliciting individuals’ willingness to pay (WTP) to avoid detection in an economic experiment involving a coin-flipping task. We collect data from Japan, China, and the U.S.A. to examine whether there are cross-country differences. Our findings reveal that people’s WTP to “avoid the spotlight” is positive and economically sizable across all three countries and is the largest in Japan.

The culture of cynicism expresses that problems in sustainable financial resource security could come from the historical distrust of society members and the government. This study uses a simulated experiment to evaluate this claim while analyzing possible solutions to escape this non-cooperation trap. Therefore, it analyzes the “reasons behind this non-cooperation” while evaluating effective methods to get out of it with an experimental approach using the gaming method as a simulation tool. In this experiment, more than 1, 200 people participated in the game through a telegram robot. The experiment results show that people’s cooperation with the government is affected by the governmen..

This paper studies a key element of discrimination, namely when stereotypes translate into discriminatory actions. Using a hiring experiment, we rule out taste-based discrimination by design and test for the presence of two types of belief-based gender discrimination. We document evidence of explicit discriminators—individuals who are willing to discriminate even when their hiring choices are highly revealing of their gender-biased beliefs. Crucially, we also identify implicit discriminators—individuals who do not discriminate against women when taking a discriminatory action is highly revealing of their biased beliefs, but do discriminate against women when their biased motive is obscur..

This paper investigates and quantifies citizens’ susceptibility to fake news and assesses, using a randomized control trial, the effectiveness of a policy intervention to raise awareness. We find that the average citizen lacks proficiency in identifying fake news and harbors an inflated perception of his/her ability to differentiate between true and fake news content. Increasing awareness by providing information about personal susceptibility to fall for fake news causally adjusts individuals’ beliefs about their fake news detection ability. Most importantly, we show that the simple intervention of informing citizens about their personal susceptibility to fall for fake news causally incr..

This paper presents experimental evidence on games where individuals can unilaterally decide on their links with each other. Linking decisions give rise to directed graphs. We consider two classes of situations: one, benefits flow along the direction of the network paths (one-way flow), and two, when the benefits flow on network paths without regard to the direction of links (two-way flow). Our experiments reveal that in the one-way flow model subjects create sparse networks whose distance grows and efficiency falls as group size grows; by contrast, in the two-way flow model subjects create sparse and small world networks whose efficiency remains high in both small and large groups. We show ..

The prevalence of conspiracy theories is a concern in western countries, yet the phenomenon is rarely addressed in experimental economics. In two preregistered online studies (NStudy 1 = 97, NStudy 2 = 203) we examine the relationship between exposure to conspiracy modes of thinking, self-reported conspiracy mentality, and behaviour in an economic game that measures strategic sophistication. Part of our design was based on Balafoutas, Libman, Selamis, and Vollan (2021), who found a positive relationship between exposure to conspiracy modes of thinking and strategic sophistication. Our results did not corroborate their findings in an online setting. Our measures of conspiracy mentality were m..

This paper presents experimental evidence on games where individuals can unilaterally decide on their links with each other. Linking decisions give rise to directed graphs. We consider two classes of situations: one, benefits flow along the direction of the network paths (one-way flow), and two, when the benefits flow on network paths without regard to the direction of links (two-way flow). Our experiments reveal that in the one-way flow model subjects create sparse networks whose distance grows and efficiency falls as group size grows; by contrast, in the two-way flow model subjects create sparse and small world networks whose efficiency remains high in both small and large groups. We show ..

Throughout history, people with mental illness have been discriminated against and stigmatized. Our experiment provides a new measure of perceived depression stigma and then investigates the causal effect of perceived stigma on help-seeking in a sample of 1, 844 Americans suffering from depression. A large majority of our participants overestimate the extent of stigma associated with depression. In contrast to prior correlational evidence, lowering perceived social stigma through an information intervention leads to a reduction in the demand for psychotherapy. A mechanism experiment reveals that this information increases optimism about future mental health, thereby reducing the perceived ne..

While psychotherapy has been shown to be effective in treating depression, take-up remains low. In a sample of 1, 843 depressed individuals, we document that effectiveness concerns are top-of-mind when respondents consider the value of therapy. We then show that the average respondent underestimates the effectiveness of therapy and that an information treatment correcting this misperception increases participants’ incentivized willingness to pay for therapy. Information affects therapy demand by changing beliefs rather than by shifting attention. Our results suggest that information interventions that target the perceived effectiveness of therapy are a potent tool in combating the ongoing ..

Strong gender and social norms limit women's opportunities and labor market outcomes in the Middle East and North Africa. Empowering women in these settings is a key priority, and one typical policy response involves using cash grants and training programs to improve women's situation. In a recent paper (Gazeaud et al. 2023), we set up a randomized experiment in Tunisia to explore whether inviting women to bring their partners to financial training, combined with an unrestricted cash grant, changed the program's impacts.

The twin challenge of increasing capacity to accommodate growing travel demand while simultaneously decarbonizing the transport sector places enormous pressure on public transport (PT) systems globally. Arguably the most fundamental policy choice and trade-off in designing and operating PT systems in the coming years will be service levels versus cost implications. On the presumption that public (citizen and consumer) opinion is crucial to making such choices, we study this question with a focus on Switzerland by using a factorial experiment (n = 1'634) that considers the frequency and geographic coverage of PT services as well as the cost implications for PT users and taxpayers. We find tha..

Shifting individual behaviour is an important tool for addressing environmental issues and there is a wide literature evaluating interventions to encourage pro-environmental behaviour. One important but under-researched area is the effect of combining interventions to affect behaviour. In this paper, we evaluate the effects of two interventions – monetary incentives and nudges – on nature restoration volunteering. We use a two-by-two treatment design to evaluate the individual and combined effects of the interventions in a field experiment setting. We find that the monetary incentive significantly increases volunteering behaviour, despite concerns incentives may crowd out motivation, but..

Older employees often face discrimination and exclusion from work teams. In two scenario studies, we tested the impact of age diversity statements on the representation and inclusion of older employees in teams. In Study 1 (N= 304), participants were either exposed to a diversity statement or not, before selecting two teammates out of a list of four differing in age and gender for a project team. Then, we measured participants’ inclusive behavior towards a new older member joining this team. Age diversity statements were effective in boosting representation, but not inclusion. In Study 2 (N= 518), we further manipulated the content of the statement (diversity or diversity and inclusion) an..

Majority voting is considered an efficient information aggregation mechanism in committee decision-making. We examine if this holds in environments where voters first need to acquire information from sources of varied quality and cost. In such environments, efficiency may depend on free-riding incentives and the ‘transparency’ regime - the knowledge voters have about other voters’ acquired information. Intuitively, more transparent regimes should improve efficiency. Our theoretical model instead demonstrates that under some conditions, less transparent regimes can match the rate of efficient information aggregation in more transparent regimes if all members cast a vote based on the inf..

Plant-based meats, like the Beyond Sausage or Impossible Burger, and cultivated meats have become a source of optimism for public health, environmental and animal welfare advocates hoping to mitigate the myriad harms of animal-based foods by replacing them with perfect alternatives. Some have proposed that these substitutes might soon replace animal-based meats based on the supposition that price, taste and convenience are the primary drivers of food choice. Thus, it is hypothesized that if a plant-based meat matches (or exceeds) its animal-based counterpart on the basis of these three criteria, consumption will largely shift from animal-based to plant-based. However, this hypothesis has rec..

We study the relationship between inequality and social instability. While the argument that inequality can be damaging for the cohesion of a society is well established, the empirical evidence is mixed. We use a novel approach to isolate the causal relationship running from inequality to social instability. We run a laboratory experiment in which two groups interact repeatedly and have an incentive to coordinate even though coordination comes at the cost of inter-group inequality. Then, we vary the extent of the inequality implied by coordination. Our results show that increasing inequality has a destabilising effect; the disadvantaged initiate the destabilisation; and a worsening of the ab..

The literature on administrative burdens demonstrates that citizens may experience different kinds of administrative burdens when interacting with the state. However, we know little about whether citizens' communication of these experiences affects how frontline employees implement compliance demands. Building on the street-level bureaucracy and administrative burden literature, we hypothesize that citizens' communication of direct and indirect psychological costs affects frontline employees' inclination to accommodate citizens. Furthermore, we expect this effect to be stronger for members of the ethnic majority than for ethnic minority members. We test these expectations using a preregister..

In prediction markets prices can be interpreted as the average belief of the traders under restrictive theoretical assumptions, namely specific risk preferences (e.g., log utility) and the prior information equilibrium. Prior information equilibrium is more likely to hold in a call auction, but prediction markets are usually implemented in double auctions that are known to better aggregate information. In this paper we present a laboratory experiment meant to shed some light on this tension, assessing the influence of the main elements that should affect the equilibrium price also manipulating the market institution. We do not find that risk preferences and incorrect beliefs play a significa..

We conducted a laboratory experiment where participants could either choose between an equal or unequal allocation, either delegate the choice to an algorithm controlled by another participant. This participant either has a high control on the algorithm (the algorithm follow perfectly the participants' decision) either a low control (the algorithm sometimes follows the participants' decisions). Our results suggest that a high level of control by the participants over the algorithm implies that participants bear full responsibility in the event of an unequal decision. A low level of control by the participants over the algorithm implies that the participants are perceived as 56.17% less respo..

This paper focuses on computational reproducibility and robustness replicability of Gubler et al.’s(2022) studies which examine the effect of media messages on empathic concern, dissonance, and out-group policy attitudes. The original paper tests four hypotheses using two online experiments with large samples from one US state (N1=5, 800; N2=2, 200). Regarding the first experiment, we successfully reproduced the effect that initial antipathy weakens the effect of humanizing treatment on empathic concern (H1). However, we show that the moderating effect is negligible and has little practical significance. Moreover, the individual effect estimates in our analyses slightly differed from the o..

We study the impact of a personalized mentoring program on university enrollment choices and academic outcomes. Conducting a randomized controlled trial among 337 high school students, we find that the program significantly influences students' decisions, increasing the likelihood of choosing a field aligned with their mentor's by 22 percentage points, representing a 45% increase from the baseline. Notably, the program also shifts preferences towards STEM/Economics fields, enhancing prospective wages by 3.1-3.7%, without negatively impacting university performance. These findings underscore the mentorship's potential to guide students towards more informed and beneficial educational choices.

Recent studies have shown that individuals’ behavior is sensitive to their perceptions of socially appropri-ate behavior. In this paper, I introduce a theory of injunctive norms in which individuals evaluate the social appropriateness of a given behavior using universalization reasoning. The theory allows one to compute the social appropriateness of any behavior without relying on individuals’ expectations, preferences, and actual behavior. Furthermore, it can be applied to a wide range of interactions and rationalize several observations unaccounted for by theories of social preferences. I test the theory’s predictions with evidence from past studies and new data from a lab experiment..

This paper reports a meta-analysis of the disposition effect – the reluctance to liquidate losing investments – in three standard experimental environments in which this behaviour is normatively a mistake. Under baseline conditions, the literature finds that investors are around 10% more willing to sell winning compared to losing assets, despite optimal choice dictating the opposite. In treatment tests of interventions to debias the disposition effect, the meta-analytic effect size implies slightly over a one-half standard deviation reduction in the bias. There is little evidence of selective reporting of the baseline disposition effect, but stronger evidence of bias in reporting treatme..

The financial motivation to earn advertising revenue by spreading misinformation has been widely conjectured to be among the main reasons misinformation continues to be prevalent online. Research aimed at reducing the spread of misinformation has so far focused on user-level interventions with little emphasis on how the supply of misinformation can itself be countered. In this work, we show how online misinformation is largely financially sustained via advertising, examine how financing misinformation affects the advertisers and ad platforms involved and outline ways of reducing the financing of misinformation. First, we find that advertising on misinformation outlets is pervasive for compan..