Using Experimental Economics to Measure the Effects of a Natural Educational Experiment on Altruism

Economic research examining how educational intervention programs affect primary and secondary schooling focuses largely on test scores although the interventions can affect many other outcomes. This paper examines how an educational intervention, a voucher program, affected students' altruism. The voucher program used a lottery to allocate scholarships among low-income applicant families with children in K-8th grade. By exploiting the lottery to identify the voucher effects, and using experimental economic methods, we measure the effects of the intervention on children's altruism. We also measure the voucher program's effects on parents' altruism and several academic outcomes including test scores. We find that the educational intervention positively affects students' altruism towards charitable organizations but not towards their peers. We fail to find statistically significant effects of the vouchers on parents' altruism or test scores.

Will There Be Blood? Incentives and Substitution Effects in Pro-social Behavior

We examine how economic incentives affect pro-social behavior through the analysis of a unique dataset with information on more than 14,000 American Red Cross blood drives. Our findings are consistent with blood donors responding to incentives in a "standard" way; offering donors economic incentives significantly increases turnout and blood units collected, and more so the greater the incentive's monetary value. In addition, there is no disproportionate increase in donors who come to a drive but are ineligible to donate when incentives are offered. Further evidence from a small-scale field experiment corroborates these findings and confirms that donors are motivated by the economic value of the items offered. We also find that a substantial fraction of the increase in donations due to incentives may be explained by donors substituting away from neighboring drives toward drives where rewards are offered, and the likelihood of this substitution is higher the higher the monetary value of the incentive offered and if neighboring drives do not offer incentives. Thus, extrinsic incentives motivate pro-social behavior, but unless substitution effects are also considered, the effect of incentives may be overestimated.incentives, altruism, public good provision, pro-social behavior, public health

Is There Selection Bias in Laboratory Experiments? The Case of Social and Risk Preferences

Laboratory experiments are frequently used to examine the nature of individual preferences and inform economic theory. However, it is unknown whether the preferences of volunteer participants are representative of the population from which the participants are drawn or whether they differ due to selection bias. We examine whether the social and risk preferences of participants in a laboratory experiment represent the preferences of the population from which they are recruited. To answer this question, we measured the preferences of 1,173 students in a classroom experiment. Separately, we invited all students to participate in a laboratory experiment. We find that the social and risk preferences of students who attend the laboratory experiment do not differ significantly from the preferences of the population from which they were recruited. Moreover, participation decisions based on social and risk preferences do not differ significantly across most subgroups, with the exception that female participants are on average less risk averse than female non-participants, and male participants are more risk averse than male non-participants.selection bias, laboratory experiments, external validity, social preferences, risk preferences

Objective Classification of Galaxy Spectra using the Information Bottleneck Method

A new method for classification of galaxy spectra is presented, based on a recently introduced information theoretical principle, the `Information Bottleneck'. For any desired number of classes, galaxies are classified such that the information content about the spectra is maximally preserved. The result is classes of galaxies with similar spectra, where the similarity is determined via a measure of information. We apply our method to approximately 6000 galaxy spectra from the ongoing 2dF redshift survey, and a mock-2dF catalogue produced by a Cold Dark Matter-based semi-analytic model of galaxy formation. We find a good match between the mean spectra of the classes found in the data and in the models. For the mock catalogue, we find that the classes produced by our algorithm form an intuitively sensible sequence in terms of physical properties such as colour, star formation activity, morphology, and internal velocity dispersion. We also show the correlation of the classes with the projections resulting from a Principal Component Analysis.Comment: submitted to MNRAS, 17 pages, Latex, with 14 figures embedde

Rewarding Altruism? A Natural Field Experiment

We present evidence from a natural field experiment involving nearly 100,000 individuals on the effects of offering economic incentives for blood donations. Subjects who were offered economic rewards to donate blood were more likely to donate, and more so the higher the value of the rewards. They were also more likely to attract others to donate, spatially alter the location of their donations towards the drives offering rewards, and modify their temporal donation schedule leading to a short-term reduction in donations immediately after the reward offer was removed. Although offering economic incentives, combining all of these effects, positively and significantly increased donations, ignoring individuals who took additional actions beyond donating to get others to donate would have led to an under-estimate of the total effect, whereas ignoring the spatial effect would have led to an over-estimate of the total effect. We also find that individuals who received a reward by surprise were less likely to donate after the intervention than subjects who received no reward, suggesting that for some individuals a surprise reward adversely affected their intrinsic motivations. We discuss the implications of these findings for understanding pro-social behavior.

WILL THERE BE BLOOD? INCENTIVES AND SUBSTITUTION EFFECTS IN PRO-SOCIAL BEHAVIOR*

We present evidence from observational data on nearly 14,000 American Red Cross blood drives and from a randomized natural field experiment showing that economic incentives have a positive effect on blood donations without increasing the fraction of donors who come to a drive but are ineligible to donate. We also show that the effect of incentives on donations increases with the incentive's economic value. However, we further show that a substantial proportion of the increase in donations due to incentives may be explained by donors leaving neighboring drives without incentives to attend the drive with incentives, and the likelihood of this substitution is higher the higher the monetary value of the incentive offered. We conclude that extrinsic incentives stimulate pro-social behavior, but, unless substitution effects are also considered, the effect of incentives may be overesti mated.