Anticipated verbal feedback induces altruistic behavior

A distinctive feature of humans compared to other species is the high rate of cooperation with non-kin. One explanation is that humans are motivated by concerns for social esteem. In this paper we experimentally investigate the impact of anticipated verbal feedback on altruistic behavior. We study pairwise interactions in which one subject, the “divider”, decides how to split a sum of money between herself and a recipient. Thereafter, the recipient can send an unrestricted anonymous message to the divider. The subjects’ relationship is anonymous and one-shot to rule out any reputation effects. Compared to a control treatment without feedback messages, donations increase substantially when recipients can communicate. With verbal feedback, the fraction of zero donations decreases from about 40% to about 20%, and there is a corresponding increase in the fraction of equal splits from about 30% to about 50%. Recipients who receive no money almost always express disapproval of the divider, sometimes strongly and in foul language. Following an equal split, almost all recipients praise the divider. The results suggest that anticipated verbal rewards and punishments play a role in promoting altruistic behavior among humans.Punishment; Approval; Disapproval; Dictator game; Altruism; Communication; Verbal feedback

Generosity

We develop a simple model of generous behavior. It is based on the premise that some people are generous, but everyone wants to appear generous. Although non-monetary donations are always inefficient, our model predicts donors to favor non-monetary donations when the inefficiency is relatively small and when the recipient is sufficiently rich. The model helps to explain the prevalence of volunteering, the nature of Christmas gifts, and the taboo against paying cash in return for friendly favors. The model also explains why it is socially more acceptable to ask for favors than for money.Altruism; Non-monetary gifts; Volunteering

Is Misoprostol Cost-effective in the Prevention of Nonsteroidal Anti-inflammatory Drug—Induced Gastropathy in Patients With Chronic Arthritis?

Whether misoprostol, a synthetic prostaglandin E1 analogue, should be routinely prescribed along with nonsteriodal anti-inflammatory drugs (NSAIDS) to prevent gastric damage is of great clinical importance and has profound cost implications. No consensus exists on whether misoprostol cotherapy results in a cost-saving, is cost-effective, or is costly. The different conclusions reached by five economic evaluations of misoprostol can be explained solely by the assumed absolute risk reduction of symptomatic ulcer, which was more than seven times greater in the studies that concluded that misoprostol was cost-effective than in a study that concluded misoprostol to be costly. Since no study has directly shown the effectiveness of misoprostol cotherapy in preventing clinically significant ulcer disease (ie, hemorrhage and preforation), it is impossible to judge which assumptions are most appropriate. The absence of firm data on the rate of NSAID-induced gastric ulcers reduced by misoprostol makes it impossible to conclude whether it is cost-effective in patients with chronic arthritis who use NSAIDS

Confidence Interval Estimation Tasks and the Economics of Overconfidence

Experiments in psychology, where subjects estimate confidence intervals to a series of factual questions, have shown that individuals report far too narrow intervals. This has been interpreted as evidence of overconfidence in the preciseness of knowledge, a potentially serious violation of the rationality assumption in economics. Following these results a growing literature in economics has incorporated overconfidence in models of, for instance, financial markets. In this paper we investigate the robustness of results from confidence interval estimation tasks with respect to a number of manipulations: frequency assessments, peer frequency assessments, iteration, and monetary incentives. Our results suggest that a large share of the overconfidence in interval estimation tasks is an artifact of the response format. Using frequencies and monetary incentives reduces the measured overconfidence in the confidence interval method by about 65%. The results are consistent with the notion that subjects have a deep aversion to setting broad confidence intervals, a reluctance that we attribute to a socially rational trade-off between informativeness and accuracy.overconfidence; uncertainty; monetary incentives; experiments

Are boys discriminated in Swedish high schools?

Girls typically have higher grades than boys in school and recent research suggests that part of this gender difference may be due to discrimination of boys. We rigorously test this in a field experiment where a random sample of the same tests in the Swedish language is subject to blind and non-blind grading. The non-blind test score is on average 15 % lower for boys than for girls. Blind grading lowers the average grades with 13 %, indicating that personal ties and/or grade inflation are important in non-blind grading. But we find no evidence of discrimination against boys. The point estimate of the discrimination effect is close to zero with a 95 % confidence interval of ±4.5 % of the average non-blind grade.Discrimination; Field experiments; Grading; Education; Gender

Ethnic Discrimination in High School Grading: Evidence from a Field Experiment

We rigorously test for ethnic discrimination in high school grading in Sweden. A random sample of the national tests in the Swedish language is graded both non-blind by the student’s own teacher and blind without any identifying information. The increase in the test score due to non-blind grading is significantly higher for students with Swedish background compared to students with foreign background. This discrimination effect is sizeable, and explains the entire difference in test scores between students with Swedish and foreign background.Discrimination; Field experiments; Education

Anticipated verbal feedback induces altruistic behavior

A distinctive feature of humans compared to other species is the high rate of cooperation with non-kin. One explanation is that humans are motivated by concerns for social esteem. In this paper we experimentally investigate the impact of anticipated verbal feedback on altruistic behavior. We study pairwise interactions in which one subject, the divider, decides how to split a sum of money between herself and a recipient. Thereafter, the recipient can send an unrestricted anonymous message to the divider. The subjects' relationship is anonymous and one-shot to rule out any reputation effects. Compared to a control treatment without feedback messages, donations increase substantially when recipients can communicate. With verbal feedback, the fraction of zero donations decreases from about 40% to about 20%, and there is a corresponding increase in the fraction of equal splits from about 30% to about 50%. Recipients who receive no money almost always express disapproval of the divider, sometimes strongly and in foul language. Following an equal split, almost all recipients praise the divider. The results suggest that anticipated verbal rewards and punishments play a role in promoting altruistic behavior among humans

Time is not money

Casual observation suggests that people are more generous with their time than with their money. In this paper we present experimental evidence supporting the hypothesis. A third of our subjects demand no compensation for non-monetary investments, whereas almost all subjects demand compensation for equally costly monetary investments. The finding supports the contention that generosity to some extent is symbolic and context dependent, and that social norms encourage generosity in the time domain

Generosity

We develop a simple model of generous behavior. It is based on the premise that some people are generous, but everyone wants to appear generous. Although non-monetary donations are always inefficient, our model predicts donors to favor non-monetary donations when the inefficiency is relatively small and when the recipient is sufficiently rich. The model helps to explain the prevalence of volunteering, the nature of Christmas gifts, and the taboo against paying cash in return for friendly favors. The model also explains why it is socially more acceptable to ask for favors than for money

The impact of physician preferences and patient habits on the diffusion of new drugs

We study the choice of drug for the treatment of high blood pressure (hypertension) in Sweden between 1988-1994. During this time period calcium antagonists and ACE-inhibitors increased their market shares at the expense of the older drugs diuretics and beta-blockers. We use a prescription micro dataset where both patients and physicians can be followed over time - an important feature since it allows us to study the impact of physician preferences and patient habits on the choice of drug. The choice of drug is unaffected by relative prices, indicating a moral hazard problem on the Swedish drug market characterized by a high degree of third-party financing. Physician preferences, measured as physician prescription history, are important for the choice of drug among new patients. Among existing patients the effect of physician preferences is mitigated by patient habit formation which slows down the diffusion of new drugs. Without habit effects the market share of calcium antagonists and ACE-inhibitors would have been more than 50% higher during our observation period (30% instead of the observed 19%)