The Good of the Few: Reciprocity in the Provision of a Public Bad

People have been shown to engage in favor-trading when it is efficiency-enhancing to do so. Will they also trade favors when it reduces efficiency, as in a series of wasteful public projects that each benefits an individual? We introduce the “Stakeholder Public Bad” game to study this question. In each round, contributions to a common fund increase the earnings of one person (the “Stakeholder”) but reduce the earnings of the rest of the group so much that overall efficiency is reduced. The Stakeholder position rotates through members of the group and the promise of the high reward associated with this position may enable subjects to behave reciprocally. We hypothesize that some people will help a current Stakeholder by contributing in hopes of being rewarded later with a reciprocal gift. In a lab experiment, we find evidence of such favor trading. We also find that Stakeholders in this situation seem perfectly willing to sacrifice the good of the group to reap their own personal rewards, and this is true even when their contribution decisions are public. While the revelation of information about others’ actions and roles has previously been shown to enable efficiency-increasing reciprocity, we show that it also enables efficiency-decreasing reciprocal acts. Subjects who are more risk-averse behave in a way that is more myopically self-interested as compared to less risk-averse people when information conditions preclude favor trading, and subjects who identify with the Democratic Party show more restraint when they are Stakeholder than those who do not.logrolling, social preferences, reciprocity, externalities, public bad, public good

Favor Trading in Public Good Provision

Grassroots fundraising leverages favor trading in social networks to support the provision of a public good. We use a laboratory experiment to study the elements and dynamics of this type of institution. Peer-to-peer reciprocity is important, and having the ability to practice targeted reciprocity in our experiment increases contributions to the public good by 14%. Subjects reward group members who have previously been generous to them and withhold rewards from ungenerous group members. When someone is rendered unable to benefit from favor trading, he gives much less to the public good than he does in other settings. People thus excluded from the “circle of giving” provide a clean and strict test of indirect reciprocity, since they cannot benefit from a norm of cooperation. Contrary to previous studies, we do not observe indirect reciprocity.public goods, reciprocity, experiment, peer-to-peer fundraising

Essays in Experimental and Environmental Economics

The chapters of this dissertation explore complementary areas of applied microeconomics, within the fields of experimental and environmental economics. In each case, preferences and institutions interact in ways that enhance or subvert efficiency. The first chapter, The Girl Scout Cookie Phenomenon, uses a laboratory experiment to study favor trading in a public goods setting. The ability to practice targeted reciprocity increases contributions by 14%, which corresponds directly to increased efficiency. Subjects discriminate by rewarding group members who have been generous and withholding rewards from ungenerous group members. At least some reciprocal behavior is rooted in other-regarding preferences. When someone is outside the circle of reciprocity, he gives less to the public good than in other settings. We find no evidence of indirect reciprocity. We find two behavioral types in each treatment, differing in baseline giving but not in tendency to reciprocate. The second chapter, The Effects of Conservation Reserve Program Participation on Later Land Use, studies another public goods issue: conservation. The Conservation Reserve Program (CRP) pays farmers to retire farmland. We use a treatment effect framework to find that ex-CRP land is 21-28% more likely to be farmed than comparable non-CRP land. This implies that the CRP improves low-quality land, making it more attractive to farm. This could demonstrate inefficiency, since farmers gain private benefit from a program meant to provide a public good. On the other hand, farmed ex-CRP land is more likely to adopt conservation practices, although this may not be caused by CRP participation. The third chapter, Learning from Mistakes, examines financial decisions by adult Rwandans in institutions inside and outside the lab. Over 50% of subjects make irrational choices over risk—choices that likely do not reflect their preferences, and are therefore likely inefficient—and these subjects share tendencies in their take-up of financial instruments. Risk-averse individuals are more likely to belong to a savings group and less likely to take out an informal loan. For those who make mistakes, however, as they become more risk averse, they are less likely to belong to a savings group and more likely to take up informal credit

Inconsistent Choices in Lottery Experiments: Evidence from Rwanda

Lottery experiments have been performed in many contexts to test theories of risk aversion and to measure risk preferences. People are typically offered a series of lotteries with increasing expected payoffs and variances. A person with a concave utility function should switch from risky bets to safer bets at some point and never switch back. Switching back implies preferences inconsistent with a concave utility function. Our experiment, conducted with a population of adults in Rwanda, presents respondents with a series of binary-choice lotteries over gains and losses. We observe that 54-55% of subjects made at least one inconsistent choice over gains or losses, and 7-13% made at least two inconsistent choices. This holds for both hypothetical and real lottery payoffs. Inconsistent choices were less common when stakes were higher, and women are more likely to be inconsistent. While risk aversion alone is not correlated with actual economic outcomes, such as membership in savings (tontines) and insurance groups and holding a larger number of bank accounts, inconsistency is

Is There Any Difference In The Retirement Intentions Of Female And Male Physicians?

Since the percentage of active female physicians in the United States is increasing rapidly, their retirement behavior will represent an important organizational and policy consideration in years to come.   The present study, is the first to explore possible differences in retirement intentions among female versus male physicians.  Findings are based on data obtained from a random national survey of nearly four thousand physicians regarding factors potentially relevant to their retirement.  Our empirical analysis identifies several factors that are correlated with male and female physicians retirement intentions.  Significant factors affecting male physicians retirement decisions include: expected social security income, pension income, the availability of early retirement incentives, decreasing annual income, current age, the existence of dependents in the family, years of service as a physician, the health status of ones spouse, stress/burnout, personal interests, the availability of part-time jobs, and general working conditions.  In the case of female physicians significant variables are: other expected income, perceived adequacy of retirement income, current age, years of service, work stress/burnout, the availability of part-time jobs,  and the employment setting.  An understanding of these factors is potentially important for healthcare administrators in dealing with the retention and retirement issues of the female and male physicians and may lead to more effective institutional decision making in this regard

Dakota Tribal Courts in Minnesota: Benchmarks of Self-Determination

Professor Frank Pommersheim has written that “[t]ribal courts are the front line institutions that most often confront issues of American Indian self-determination and sovereignty.”1 It is only fitting, then, that an issue devoted to the legal history and survival of Dakota people includes some information about the role Dakota tribal courts play in furthering the aims of self-determination. Of the over 565 federally recognized tribes in the United States, most operate some form of dispute resolution or judicial system—and all have distinct, unique histories and stories.2 Little has been written about the Dakota legal systems, and it is in the spirit of tribal self-determination that we offer some foundational information. This article focuses on the four Dakota tribal courts within the state of Minnesota.3 In Part I, we provide a basic history of Dakota tribal government in Minnesota, as well as a general overview of tribal courts. The article then explores the twentieth-century history of each Dakota tribal government, including the development of each court and the current laws that govern the tribe. Part II focuses on the Lower Sioux Indian Community. Part III focuses on the Prairie Island Indian Community. Part IV focuses on the Shakopee Mdewakanton Sioux Community, and Part V focuses on the Upper Sioux Community. The concluding section will offer some predictions as to the future development of the four courts. Readers will no doubt notice that we have more information on some tribes than others. Because there is no centralized database for compiling tribal court information, we have done our best to assess the information that is available to the public for understanding how Dakota courts work. We hope that readers will come away with a greater understanding of the significance and influence of Dakota tribal judiciaries