When will there be Gift Exchange? Addressing the Lab-Field Debate with Laboratory Gift Exchange Experiments

Gift exchange experiments have demonstrated that norms can affect labor market outcomes and provided an explanation for involuntary unemployment. However, conflicting results from laboratory and field experiments have questioned the relevance of gift exchange and helped spark an ongoing debate about the relative merits of the lab and field. This paper uses laboratory experiments to identify three parameters that affect the likelihood workers engage in gift exchange, helping to reconcile results across lab and field experiments. Gift exchange is more prevalent when workers are rich relative to the firm, worker effort is efficient, or workers have a restricted action space

Norms and Contracting

We argue that contracts establish the norms of a relationship and that individuals incur disutility when deviating from these norms. In a laboratory experiment, we allow agents to make simple contracts before they play one of four games, and the most effective contract always includes an unenforceable “handshake” agreement to take the first-best action. In three games, a contract with only this handshake agreement is (at least weakly) optimal. The handshake is particularly effective in games with strategic complements. Our results highlight an explanation for contractual incompleteness: establishing a norm can effectively substitute for weak enforceable restrictions

Learning From (Failed) Replications: Cognitive Load Manipulations and Charitable Giving

Replication of empirical studies is much more than a tool to police the field. Failed replications force us to recognize that seemingly arbitrary design features may impact results in important ways. We describe a study that used a cognitive load manipulation to investigate the role of the deliberative system in charitable giving and a set of failed replications of that study. While the original study showed large and statistically significant results, we failed to replicate using the same protocol and the same subject pool. After the first failed replication, we hypothesized that the order our study was taken in a set of unrelated studies in a laboratory session generated the differences in effects. Three more replication attempts supported this hypothesis. The study demonstrates the importance of replication in advancing our understanding of the mechanisms driving a particular result and it questions the robustness of results established by cognitive load tests

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

Finding the cost of control

A large and growing literature has demonstrated that explicit incentives, such as enforceable contracts, can lead agents to withhold effort. We investigate when this behavioral result arises. In an extensive laboratory experiment, we find that imposing control through an enforceable contract is only detrimental to principals in a special case when: (1) there is a preexisting norm that agents provide high effort; (2) control is imposed unilaterally and has an asymmetric effect on the agent; (3) control is weak (i.e. it cannot induce significant effort); and (4) the agent does not use control when acting as a principal

Motivated Errors

In three sets of experiments involving 5,432 subjects, we show that agents make more errors when doing so allows them to justify selfish behavior. We show that errors relating to addition arise when they can help to justify selfishness but are eliminated when selfish motives are removed. In addition, we show that selfish motives can either exacerbate or mitigate errors relating to correlation neglect and anchoring. Our results are consistent with individuals acting confused as a justification for selfish behavior

Getting More Organs for Transplantation

Organs for transplantation are a scarce resource. Paying to increase the supply of organs is illegal in much of the world. We review efforts to increase transplantation by increasing the supply of available organs from living and deceased donors. Progress has been made in increasing the availability of living donor kidneys through kidney exchange. Recent legislation in Israel aims at encouraging deceased donation by awarding priority for receiving organs to registered donors. We also explore the manner in which organ donation is solicited and present evidence to suggest that some recent movement towards mandated choice may be counterproductive

Loopholes Undermine Donation: An Experiment Motivated by an Organ Donation Priority Loophole in Israel

Giving registered organ donors priority on organ waiting lists, as has been implemented in Israel and Singapore, provides an incentive for registration and has the potential to increase the pool of deceased donor organs. However, the implementation of a priority rule might allow for loopholes – as is the case in Israel – in which an individual can register to receive priority but avoid ever being in a position to donate organs. We experimentally investigate how such a loophole affects donation and find that the majority of subjects use the loophole when available. The existence of a loophole completely eliminates the increase in donation generated by the priority rule. When information about loophole use is made public, subjects respond to others\u27 use of the loophole by withholding donation such that the priority system with a loophole generates fewer donations than an allocation system without priority

Information Avoidance and Image Concerns

A rich literature finds that individuals avoid information and speculates that avoidance is driven by image concerns. This paper provides the first direct test of whether individuals avoid information because of image concerns. We build off of a classic paradigm, introducing a control condition that makes minimal changes to eliminate the role of image concerns while keeping other key features of the environment unchanged. Data from 6,421 experimental subjects shows that image concerns play a role in driving information avoidance, but a role that is substantially smaller-less than half of the magnitude-than the common approach in the literature would suggest

Organ Allocation Policy and the Decision to Donate

Organ donations from deceased donors provide the majority of transplanted organs in the United States, and one deceased donor can save numerous lives by providing multiple organs. Nevertheless, most Americans are not registered organ donors despite the relative ease of becoming one. We study in the laboratory an experimental game modeled on the decision to register as an organ donor, and investigate how changes in the management of organ waiting lists might impact donations. We find that an organ allocation policy giving priority on waiting lists to those who previously registered as donors has a significant positive impact on registration.