Reducing ambiguity in lotteries: evidence from a field experiment

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.     

Performance pay and worker cooperation: Evidence from an artefactual field experiment

We report the results of an artefactual field experiment with bicycle messengers in Switzerland and the United States. Messenger work is individualized enough that firms can choose to condition pay on it, but significant externalities in messenger behavior nonetheless give their on-the-job interactions the character of a social dilemma. Second-mover behavior in our sequential prisoner's dilemma allows us to characterize the cooperativeness of our participants. Among messengers, we find that employees at firms that pay for performance are significantly less cooperative than those at firms that pay hourly wages or who are members of cooperatives. To examine whether the difference is the result of treatment or selection we exploit the fact that firm type is location-specific in Switzerland and that entering messengers must work in performance pay firms in the U.S.     

Second-party and third-party punishment in a public goods experiment

We experimentally investigate whether third-party punishment is more effective than second-party punishment to increase public goods contribution. In our experiment, third parties first played the standard public goods game and then made punishment decisions as independent bystanders. We find that third parties punished more frequently, severely and less antisocially, resulting in a higher contribution level than that driven by second-party punishment. The third party’s exaggerated emotion towards free riders is proposed to explain their superior punishment effectiveness.     

Externalities in knowledge production: evidence from a randomized field experiment

Experimental Economics - Are there positive or negative externalities in knowledge production? We analyze whether current contributions to knowledge production increase or decrease the future...     

Trade liberalization and trade performance of environmental goods: evidence from Asia-Pacific economic cooperation members

In this article, we study the impact of trade liberalization, including reductions in both tariff and nontariff trade barriers, on environmental goods (EGs) exports. Using bilateral trade data from 20 Asia-Pacific Economic Cooperation members, we find that tariff reduction in an exporting country has a larger positive impact on its exports of EGs than tariff reduction in an importing country. Our results also show that a lower nontariff barrier in an importing country increases its imports of EGs. A considerable amount of heterogeneity also exists in subsample results based on countries’ income levels.     

Framing effects on risk-taking behavior: evidence from a field experiment in multiple-choice tests

We exploit testing data to gain better understanding on framing effects on decision-making and performance under risk. In a randomized field experiment, we modified the framing of scoring rules for penalized multiple-choice tests. In penalized multiple-choice tests, right answers are typically framed as gains while wrong answers are framed as losses (Mixed-framing). In the Loss-framing proposed, both non-responses and wrong answers are presented in a loss domain. According to our theoretical model, we expect the change in the framing to decrease students’ non-response and to increase students’ performance. Under the Loss-framing, students’ non-response reduces by a 18%-20%. However, it fails to increase students’ scores. Indeed, our results support the possibility of impaired performance in the Loss-framing.

     

Correction to: Framing effects on risk-taking behavior: evidence from a field experiment in multiple choice tests

Experimental Economics -     

Subsidizing charitable contributions: a natural field experiment comparing matching and rebate subsidies

We report the results of a field experiment conducted in conjunction with a mailed fundraising campaign of a nonprofit organization. The experiment is designed to compare the response of donors to subsidies in the form of matching amounts or rebated amounts. Matching subsidies are used by many corporations as an employee benefit; the US federal tax system encourages giving using a rebate subsidy by making donations tax deductible. The design includes a control group and two levels of subsidy of each type. Our main result is that matching subsidies result in larger total donations to charities than rebate subsidies, a result that is qualitatively similar to the lab findings. The estimated price elasticities for the matching subsidy are very similar to (and insignificantly different from) the lab experiments, while rebate subsidies lead to lower contributions in the field than in the lab. Since rebates in the field involve substantial lags and additional complications as compared with the “instant rebates” of the lab, this latter difference is not unexpected. The matching results are an important step in validating lab estimates of responsiveness to subsidies of charitable giving.

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Electronic Supplementary Material  The online version of this article () contains supplementary material, which is available to authorized users.      

Effects of a holiday trip on health and quality of life: evidence from a natural experiment in South Korea

We examine whether having a holiday trip affects an individual’s well-being, namely quality of life, health status, stress level and health behaviours. We use the two-stage estimation method to control for endogeneity of a travel experience, exploiting a natural experiment of distributing Travel Vouchers at random among qualified applicants in South Korea in 2012. We find that, for applicants whose decision to travel is influenced by receiving a voucher, a travel experience has no significant effects on the traveller’s well-being measured 3–12 months later. We also find that the OLS estimates overstate benefits of a travel.     

Does an economic incentive affect provider behavior? Evidence from a field experiment on different payment mechanisms

Aims: This study analyzed discrepancies in the quantity of medical services supplied by physicians under different payment systems for patients with different health statuses and illnesses by means of a field experiment.

Methods: Based on the laboratory experiment of Heike Hennig-Schmidt, we designed a field experiment to examine fee-for-service (FFS), capitation (CAP), and diagnosis-related group (DRG) payment systems. Medical students were replaced with 220 physicians as experimental subjects, which more closely reflected the clinical choices made by physicians in the real world. Under the three payment mechanisms, the quantity of medical services provided by physicians when they treated patients with different health statuses and illnesses were collected. Finally, relevant statistics were computed and analyzed.

Results: It was found that payment systems (sig. = 0.000) and patient health status (sig. = 0.000) had a stronger effect on physicians’ choices regarding quantity of medical services than illness types (sig. = 0.793). Additionally, under the FFS and CAP payment systems, physicians overserved patients in good and intermediate health while underserving patients in bad health. Under the DRG payment system, physicians overserved patients in good health and underserved patients in intermediate and bad health. Correspondingly, under FFS and CAP, the proportional loss of benefits was the highest for patients in bad health and the lowest for patients in good and intermediate health; while under DRGs, patients in good and intermediate health had the largest and smallest loss of benefits, respectively.

Limitations: In order to increase external effects of experiment results, we used the field experiment to replace laboratory experiment. However, the external effects still existed because of the blurring and abstraction of the parameters.

Conclusions: Medical treatment cost and price affected the quantity of medical services provided by physicians. Therefore, we proposed that a mix of payment systems could address the common interests of physicians and patients, as well as influence incentives from payment systems.     

Identifying significant characteristics of organic milk consumers: a CART analysis of an artefactual field experiment

The organic dairy category is one of the fastest growing categories of organic foods in the US. Organic milk consumers generally cite perceived health benefits and lower risk of food contamination, as well as perceived superior quality and environmental sustainability of organic farming methods, as the major motivations for preference of organic over conventional milk. While the attributes of organic milk that are valued by consumers are fairly well-known, more ambiguity exists regarding the demographic characteristics of the typical organic milk consumer. This research makes use of experimental data from 148 adult participants and use a Classification and Regression Tree (CART) analysis, a nonparametric modelling approach, to identify how Willingness-to-Pay (WTP) for organic milk varies with the demographic profile of experiment participants. The study finds that perceived taste of organic milk, concern for the risk of consuming conventional milk, being a primary shopper, and the quantity of milk consumed are the major factors that separate experiment participants into groups with high and low WTP for organic milk.     

The response to incentives and contractual efficiency: Evidence from a field experiment

We use data from a field experiment to estimate worker reaction to incentives and the optimality of piece-rate contracts. Our estimate of the elasticity of output with respect to piece rates is 0.39. Regression methods cannot predict performance under hypothetical contracts. Therefore, we apply structural econometric methods (without imposing profit maximization) to evaluate observed-contract optimality. Using profit as a metric, we estimate the distance between observed and profit-maximizing contracts to be negligible. This suggests that observed contracts closely approximate optimal contracts under asymmetric information about worker ability. Under complete information, the firm could increase expected profits by 14 percent keeping workers indifferent to the observed piece-rate contract. Profits could increase between 44 and 49 percent if the firm exploited information about ability to reduce worker utility to the outside alternative.     

Transfer payments from the central government to the local governments and the local governments' efforts on taxation: taking China as an example

The influence of the transfer payments from the central government to the local governments on the local governments' efforts on taxation must be taken into consideration by every country for the design of the transfer payments. Based on the theoretical analysis on the influence of the transfer payments from the central government to the local governments on the local governments'payments, this paper indicates that the local governments'efforts on taxation depends on the demand elasticity of the district for public goods. It increases with the increase of the elasticityλ.Judge the degree of the local government's efforts on taxation by measureλ. After an empirical analysis on the transfer payments from the central government to the local governments from 2000 to 2004, thins paper gets the conclusion that the local governments'efforts on taxation abates with the increase of supporting payments or with the increase of the ratio of transfer payments to local willing public payments. Under specific circumstances, the higher the ratio of transfer payments to the local fiscal expenditure is, the smaller the local governments' efforts on taxation is under the central payments, whereas the higher the local income is, the higher the efforts is under the eentral payments. Based on this. this paper gives the meanmg of its corresponding policies.     

Effects of supervision on tax compliance: Evidence from a field experiment in Austria

We conduct a field experiment on tax compliance, focusing on newly founded firms. As a novelty the effect of tax authorities’ supervision on timely tax payments is examined. Interestingly, results show no positive overall effect of close supervision on tax compliance.     

When financial work incentives pay for themselves: evidence from a randomized social experiment for welfare recipients

This paper summarizes early findings from a social experiment that provided financial incentives for new welfare recipients to leave welfare and work full time. The financial incentive was essentially a negative income tax with a requirement that people work at least 30 h/week. Early results show that the financial incentive increased full-time employment, earnings, and income, and reduced poverty. Furthermore, at the end of the period discussed in this paper, the program was paying for itself through increased tax revenues.     

Willingness‐to‐pay for parallel private health insurance: evidence from a laboratory experiment

Abstract Debate over the effects of public versus private health care finance persists in both academic and policy circles. This paper presents the results of a revealed preference laboratory experiment that tests how characteristics of the public health system affect a subject's willingness‐to‐pay (WTP) for parallel private health insurance. Consistent with the theoretical predictions of Cuff et al. (2010), subjects’ average WTP is lower and the size of the private insurance sector smaller when the public system allocates health care based on need rather than randomly and when the probability of receiving health care from the public system is high.     

Measuring asymmetry and persistence in conditional volatility in real output: evidence from three East Asian tigers using a multivariate GARCH approach

We search for evidence of conditional volatility in the quarterly real Gross Domestic Product (GDP) growth rates of three East Asian tigers: Singapore, Hong Kong and Taiwan. The widely accepted Exponential Generalized Autoregressive Conditional Heteroscedasticity (EGARCH)-type model is used to capture the existence of asymmetric volatility and the potential structural break points in the volatility. We find evidence of asymmetry and persistence in the volatility of GDP growth rates. It is noted that the structural breakpoints of volatility correspond reasonably well to the historical economic and political events in these economies. Policy implications from our findings are discussed.     

Effectiveness of the reserve option mechanism as a macroeconomic prudential tool: evidence from Turkey

This article assesses the effectiveness of a novel macroprudential tool – the reserve option mechanism (ROM) – which Turkey’s central bank developed during the post-2008 period and has employed to control the risk associated with excessive capital flows. We assess how capital flows have affected economic variable changes since the introduction and usage of the ROM. Empirical evidence gathered from Turkey suggests that the tool decreases the effect of capital flow on capital flow (positive shock to capital flow dies out faster or becomes less persistent) and diminishes the effects of capital flow shocks on exchange and interest rates.     

Commitment and satisfaction in the classroom and on the field: evidence from a Division I liberal arts college

Within higher education, there has been a persistent concern that student-athlete commitments to their athletic activities are detrimental to their academic studies. We collect data on student-athletes from a selective liberal arts university with Division I athletics where the expectations and levels of commitment to academics and athletics can be substantial. We fail to find any relationship between athletic experiences and time allocations to athletics or academics, but we do observe that individuals who exhibit greater levels of commitment in general, and to academics in particular, devote more time per week to academics and perform better as measured by grade point average. The only evidence of a trade-off between athletics and academics arises for individuals who report difficulty in managing and fulfilling their obligations who devote fewer hours to academics and perform worse academically. We also find that satisfaction with athletic experiences is correlated with interpersonal relationships and the athlete’s role on his/her team whereas satisfaction with academics depends upon the influence that he/she has over training. However, this flexibility does not translate into improved academic performance. The results suggest that universities concerned with adverse impacts of athletics upon academic performance should focus on policies that promote time and task management skills.