Unraveling public good games

This paper provides experimental evidence on how players predict end-game effects in a linear public good game. Our regression analysis yields a measure of the relative importance of priors and signals on subjects’ beliefs on contributions and allows us to conclude that, first, the weight of the signal is relatively unimportant, while priors have a large weight and, second, priors are the same for all periods. Hence, subjects do not expect end-game effects and there is very little updating of beliefs. We argue that the sustainability of cooperation is related to this pattern of belief formation

Cognitive abilities and economic behavior

At the heart of behavioral and experimental economics is the goal to better understand behavior through observation so that economic models can be improved. However, despite the predictions of classical economics, the researcher is often confronted with a great deal of behavioral heterogeneity. One way to approach this heterogeneity is to acknowledge that decision makers differ from each other in fundamental ways and these differences contribute to the differences in observed economic behavior

Self-identified obese people request less money: a field experiment

Empirical evidence suggests that obese people are discriminated in different social environments such as the work place. Yet, the degree to which obese people are internalizing and adjusting their own behaviour as a result of this discriminatory behaviour has not been studied thoroughly. We develop a proxy for measuring experimentally the "self-weight bias" by giving to both self-identified obese (n=90) and non-obese (n=180) individuals the opportunity to request a positive amount of money after having performed an identical task. Consistent with the System Justification Theory, we find that self-identified obese individuals, due to a preexisting false consciousness, request significantly lower amounts of money than non-obese ones. A within subject comparison between self-reports and external interviewers' evaluations reveals that the excessive weight felt by the "self" but not reported by evaluators captures the self-weight bias not only for obese but also for non-obese individuals. Linking our experimental results to the supply side of the labour market, we argue that self-weight bias, as expressed by lower salary requests, enhances discriminatory behaviour against individuals who feel, but may not actually be, obese and consequently exacerbates the wage gab across weight

Organizing effects of testosterone and economic behavior: not just risk taking

Recent literature emphasizes the role that testosterone, as well as markers indicating early exposure to T and its organizing effect on the brain (such as the ratio of second to fourth finger,D2:D4), have on performance in financial markets. These results may suggest that the main effect of T, either circulating or in fetal exposure, on economic behavior occurs through the increased willingness to take risks. However, these findings indicate that traders with a low digit ratio are not only more profitable, but more able to survive in the long run, thus the effect might consist of more than just lower risk aversion. In addition, recent literature suggests a positive correlation between abstract reasoning ability and higher willingness to take risks. To test the two hypotheses of testosterone on performance in financial activities (effect on risk attitude versus a complex effect involving risk attitude and reasoning ability), we gather data on the three variables in a sample of 188 ethnically homogeneous college students (Caucasians). We measure a D2:D4 digit ratio, abstract reasoning ability with the Raven Progressive Matrices task, and risk attitude with choice among lotteries. Low digit ratio in men is associated with higher risk taking and higher scores in abstract reasoning ability when a combined measure of risk aversion over different tasks is used. This explains both the higher performance and higher survival rate observed in traders, as well as the observed correlation between abstract reasoning ability and risk taking. We also analyze how much of the total effect of digit ratio on risk attitude is direct, and how much is mediated. Mediation analysis shows that a substantial part of the effect of T on attitude to risk is mediated by abstract reasoning ability

Cognitive reflection test: whom, how, when

The use of the Cognitive Reflection Test as a covariate to explain behavior in Economics and Psychology experiments has significantly increased in the past few years. Experiments have shown its usefulness in predicting behavior. However, little is known about if the test is gender biased, whether incentives matter or how different implementation procedures impact outcomes. Here we report the results of a meta-study of 118 Cognitive Reflection Test studies comprising of 44,558 participants across 21 countries. We find that there is a negative correlation between being female and the overall, and individual, correct answers to CRT questions. Monetary incentives do not impact performance. Regarding implementation procedures, taking the test at the end of the experiment negatively impacts performance. Students perform better compared to non-students. We obtain mixed evidence on whether the sequence of questions matters. Finally, we find that computerized tests marginally improve results

Strategic risk and response time across games

Experimental data for two types of bargaining games are used to study the role of strategic risk in the decision making process that takes place when subjects play a game only once. The bargaining games are the Ultimatum Game (UG) and the Yes-or-No Game (YNG). Strategic risk in a game stems from the effect on one player’s payoff of the behavior of other players. In the UG this risk is high, while it is nearly absent in the YNG. In studying the decision making process of subjects we use the time elapsed before a choice is made (response time) as a proxy for amount of thought or introspection. We find that response times are on average larger in the UG than in the YNG, indicating a positive correlation between strategic risk and introspection. In both games the behavior of subjects with large response times is more dispersed than that of subjects with small response times. In the UG larger response time is associated with less generous and thus riskier behavior, while it is associated to more generous behavior in the YNG

Experimental and self-reported measures of risk taking and digit ratio (2D:4D): evidence from a large, systematic study

Using a large (n=704) sample of laboratory subjects, we systematically investigate the links between the digit ratio - a biomarker for pre-natal testosterone exposure - and two measures of individual risk taking: (i) risk preferences over lotteries with real monetary incentives, and (ii) self-reported risk attitude. The digit ratio (also called 2D:4D) is the ratio of the length of the index finger to the length of the ring finger, and we consider both hands’ digit ratios. Previous studies have found that the digit ratio correlates with risk taking in some subject samples, but not others. In our sample, we find that both the right-hand and the left-hand digit ratio are significantly associated with risk preferences: subjects with lower digit ratios tend to choose riskier lotteries. Neither digit ratio, however, is associated with self-reported risk attitude

Experimental subjects are not different

Experiments using economic games are becoming a major source for the study of human social behavior. These experiments are usually conducted with university students who voluntarily choose to participate. Across the natural and social sciences, there is some concern about how this “particular” subject pool may systematically produce biased results. Focusing on social preferences, this study employs data from a survey-experiment conducted with a representative sample of a city's population (N = 765). We report behavioral data from five experimental decisions in three canonical games: dictator, ultimatum and trust games. The dataset includes students and non-students as well as volunteers and non-volunteers. We separately examine the effects of being a student and being a volunteer on behavior, which allows a ceteris paribus comparison between self-selected students (students*volunteers) and the representative population. Our results suggest that self-selected students are an appropriate subject pool for the study of social behavior

Religious pro-sociality? Experimental evidence from a sample of 766 Spaniards

This study explores the relationship between several personal religion-related variables and social behaviour, using three paradigmatic economic games: the dictator (DG), ultimatum (UG), and trust (TG) games. A large carefully designed sample of the urban adult population in Granada (Spain) is employed (N = 766). From participants' decisions in these games we obtain measures of altruism, bargaining behaviour and sense of fairness/equality, trust, and positive reciprocity. Three dimensions of religiosity are examined: (i) religious denomination; (ii) intensity of religiosity, measured by active participation at church services; and (iii) conversion out into a different denomination than the one raised in. The major results are: (i) individuals with “no religion” made decisions closer to rational selfish behaviour in the DG and the UG compared to those who affiliate with a “standard” religious denomination; (ii) among Catholics, intensity of religiosity is the key variable that affects social behaviour insofar as religiously-active individuals are generally more pro-social than non-active ones; and (iii) the religion raised in seems to have no effect on pro-sociality, beyond the effect of the current measures of religiosity. Importantly, behaviour in the TG is not predicted by any of the religion-related variables we analyse. While the results partially support the notion of religious pro-sociality, on the other hand, they also highlight the importance of closely examining the multidimensional nature of both religiosity and pro-social behaviour

BMI is not related to altruism, fairness, trust or reciprocity: experimental evidence from the field and the lab

Over the past few decades obesity has become one of the largest public policy concerns among the adult population in the developed world. Obesity and overweight are hypothesized to affect individuals’ sociability through a number of channels, including discrimination and low self-esteem. However, whether these effects translate into differential behavioural patterns in social interactions remains unknown. In two large-scale economic experiments, we explore the relationship between Body Mass Index (BMI) and social behaviour, using three paradigmatic economic games: the dictator, ultimatum, and trust games. Our first experiment employs a representative sample of a Spanish city's population (N=753), while the second employs a sample of university students from the same city (N=618). Measures of altruism, fairness/equality, trust and reciprocity are obtained from participants’ experimental decisions. Using a variety of regression specifications and control variables, our results suggest that BMI does not exert an effect on any of these social preferences. Some implications of these findings are discussed