Do Women Shy Away From Competition? Do Men Compete Too Much?

Competitive high ranking positions are largely occupied by men, and women remain scarce in engineering and sciences. Explanations for these occupational differences focus on discrimination and preferences for work hours and field of study. We examine if absent these factors gender differences in occupations may still occur. Specifically we explore whether women and men, on a leveled playing field, differ in their selection into competitive environments. Men and women in a laboratory experiment perform a real task under a non-competitive piece rate and a competitive tournament scheme. Although there are no gender differences in performance under either compensation, there is a substantial gender difference when participants subsequently choose the scheme they want to apply to their next performance. Twice as many men as women choose the tournament over the piece rate. This gender gap in tournament entry is not explained by performance either before or after the entry decision. Furthermore, while men are more optimistic about their relative performance, differences in beliefs only explain a small share of the gap in tournament entry. In a final task we assess the impact of non-tournament-specific factors, such as risk and feedback aversion, on the gender difference in compensation choice. We conclude that even controlling for these general factors, there is a large residual gender gap in tournament entry.

Optimal Pricing and Endogenous Herding

We consider a monopolist who sells indetical objects of common but unknown value in a herding-prone environment. Buyers make their purchasing decisions sequentially, and rely on a private signal as well as previous buyers´actions to infer the common value of the object. The model applies to a variety of cases, such as the introduction of a new product or the sale of licenses to use a patent. We characterize the monopolist´s optimal pricing strategy and its implications for the temporal pattern of prices and for herding.The analysis is performed under alternative assumptions about observability of prices. We find that when previous prices are observable, herding may but need not arise. In contrast, herding arises immediately when previous prices are unobservable and the seller´s equilibrium strategy is a pure Markov strategy. While the possibility of social learning is present in the first case, it is absent in the second. Finally, we examine the seller´s to manipulate the buyers´evaluation of the object when buyers are naive. Using secret discounts the seller succsessfully interferes with social learning, and herding occurs in finite time.

Optimal Pricing and Endogenous Herding

We consider a monopolist who sells identical objects of common but unknown value in a herding-prone environment. Buyers make their purchasing decisions sequentially, and rely on a private signal as well as We consider a monopolist who sells identical objects of common but previous buyers’ actions to infer the common value of the object. The model applies to a variety of cases, such as the introduction of a new product or the sale of licenses to use a patent. We characterize the monopolist’s optimal pricing strategy and its implications for the temporal pattern of prices and for herding. The analysis is performed under alternative assumptions about observability of prices. We find that when previous prices are observable, herding may but need not arise. In contrast, herding arises immediately when previous prices are unobservable and the seller’s equilibrium strategy is a pure Markov strategy. While the possibility of social learning is present in the first case, it is absent in the second. Finally, we examine the seller’s incentive to manipulate the buyers’ evaluation of the object when buyers are naive. Using secret discounts the seller successfully interferes with social learning, and herding occurs in finite time.herding, informational cascades, optimal pricing

The External Validity of Laboratory Experiments: Qualitative Rather Than Quantitative Effects

This chapter comments on the papers of Levitt and List and of Camerer. It explains why for most laboratory studies it is only relevant whether the qualitative or directional results of the study are externally valid. It argues that laboratory studies are conducted to identify general principles of behavior and therefore promise to generalize. It then examines whether laboratory experiments live up to this promise. It discusses the extent to which qualitative results persist outside of the lab and how we should respond when they do not. The chapter concludes by arguing that the lab and field methodologies are highly complementary and that both provide important insights to the understanding of economics

How Costly is Diversity? Affirmative Action in Light of Gender Differences in Competitiveness

Recent research documents that while men are eager to compete, women often shy away from competitive environments. A consequence is that few women enter and win competitions. Using experimental methods we examine how affirmative action affects competitive entry. We find that when women are guaranteed equal representation among winners, more women and fewer men enter competitions, and the response exceeds that predicted by changes in the probability of winning. An explanation for this response is that under affirmative action the probability of winning depends not only on one's rank relative to other group members, but also on one's rank within gender. Both beliefs on rank and attitudes towards competition change when moving to a more gender-specific competition. The changes in competitive entry have important implications when assessing the costs of affirmative action. Based on ex-ante tournament entry affirmative action is predicted to lower the performance requirement for women and thus result in reverse discrimination towards men. Interestingly this need not be the outcome when competitive entry is not payoff maximizing. The response in entry implies that it may not be necessary to lower the performance requirement for women to achieve a more diverse set of winners.

Why Do People Give? Testing Pure and Impure Altruism

Researchers measure crowd-out around one level of charity output to identify whether giving is motivated by altruism and/or warm-glow. However, crowd-out depends on output, implying first that the power to reject pure altruism varies, and second that a single measurement of incomplete crowd-out can be rationalized by many different preferences. By instead measuring crowd-out at different output levels, we allow both for identification and for a novel and direct test of impure altruism. Using a new experimental design, we present the first empirical evidence that, consistent with impure altruism, crowd-out decreases with output