The Handbook of Experimental Economics Volume 2

771 Pages·2015·10.989 MB·English

by  Kagel, John Henry;Roth, Alvin E

THEHANDBOOKOFEXPERIMENTALECONOMICS
VOLUME2

THE HANDBOOK OF
EXPERIMENTAL ECONOMICS
Volume2
Edited by John H. Kagel and Alvin E. Roth
PRINCETON UNIVERSITY PRESS
PRINCETON AND OXFORD
Copyright©2015PrincetonUniversityPress
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CONTENTS
Preface xiii
Chapter1 Macroeconomics:ASurveyofLaboratoryResearch 1
JohnDuffy
1. Introduction:LaboratoryMacroeconomics 1
2. Dynamic,IntertemporalOptimization 4
2.1. OptimalConsumption/SavingsDecisions 4
2.2. ExponentialDiscountingandInfiniteHorizons 12
2.3. ExponentialorHyperbolicDiscounting? 13
2.4. ExpectationFormation 14
3. CoordinationProblems 21
3.1. PovertyTraps 21
3.2. BankRuns 24
3.3. ResolvingCoordinationProblems:Sunspots 27
3.4. ResolvingCoordinationProblems:TheGlobalGameApproach 30
4. FieldsinMacroeconomics 32
4.1. MonetaryEconomics 33
4.2. LaborEconomics 46
4.3. InternationalEconomics 50
4.4. MultisectoralMacroeconomics 55
5. MacroeconomicPolicies 61
5.1. RicardianEquivalence 61
5.2. CommitmentversusDiscretion 64
5.3. MonetaryPolicy 67
5.4. FiscalandTaxPolicies 73
6. Conclusions 78
Acknowledgments 79
Notes 79
References 82
Chapter2 UsingExperimentalMethodstoUnderstandWhyandHowWe
GivetoCharity 91
LiseVesterlund
1. Introduction 91
2. PreferencesforGiving 92
2.1. IsGivingRational? 95
2.2. Motives 97
vi • Contents
3. Fundraising 108
3.1. Announcements:SequentialandDynamicGiving 109
3.2. Lotteries 119
3.3. Auctions 123
3.4. RebatesandMatches 126
4. Conclusion 131
Notes 133
References 141
Chapter3 Neuroeconomics 153
ColinF.Camerer,JonathanD.Cohen,ErnstFehr,PaulW.Glimcher,
andDavidLaibson
INTRODUCTION 153
1. NeurobiologicalFoundations 156
1.1. TheCellularStructureoftheBrain 156
1.2. FromNeuronstoNetworks 161
1.3. SummaryofNeurobiology 164
2. FunctionalMRI:AWindowintotheWorkingBrain 164
2.1. FunctionalMRIandtheBOLDSignal 165
2.2. DesignConsiderations 166
2.3. ImageAnalysis 168
2.4. SummaryofFunctionalMRI 171
3. RiskyChoice 172
3.1. StatisticalMoments 172
3.2. ProspectTheory 172
3.3. CausalManipulations 175
3.4. LogicalRationalityandBiologicalAdaptation 176
3.5. SummaryofRiskyChoice 177
4. IntertemporalChoiceandSelf-regulation 177
4.1. EmpiricalRegularities 178
4.2. Multiple-SelfModelswithSelvesThatHaveOverlappingPeriods
of Control 181
4.3. Multiple-SelfModelswithSelvesThatHaveNonoverlappingPeriods
of Control 182
4.4. Unitary-SelfModels 182
4.5. TheoreticalSummary 183
5. TheNeuralCircuitryofSocialPreferences 183
5.1. SocialPreferencesandRewardCircuitry 184
5.2. DoActivationsinRewardCircuitryPredictChoices? 186
5.3. TheRoleofthePrefrontalCortexinDecisionsInvolvingSocial
Preferences 186
5.4. Summary 188
6. StrategicThinking 189
6.1. StrategicAwareness 189
6.2. Beliefs,IteratedBeliefs,andStrategicChoice 190
Contents • vii
6.3. Learning 192
6.4. StrategicTeachingandInfluenceValue 194
6.5. DiscussionofStrategicNeuroscience 196
6.6. Summary 199
7. Conclusion 200
Acknowledgments 200
Notes 201
References 202
Chapter4 Other-RegardingPreferences:ASelectiveSurveyof
ExperimentalResults 217
DavidJ.CooperandJohnH.Kagel
INTRODUCTION 217
I. WhereThingsStoodCirca1995 218
II. ModelsofOther-RegardingPreferences,Theory,andTests 222
A. Outcome-BasedSocialPreferenceModels 222
B. SomeInitialTestsoftheBolton-OckenfelsandFehr-SchmidtModels 225
C. SocialPreferencesversusDifferenceAversion 231
D. ModelsIncorporatingReciprocity/IntentionsofProposers 233
E. Other-RegardingBehaviorandUtilityMaximization 235
F. Learning 236
III. Other-RegardingBehavior,Applications,andRegularities 240
A. TheInvestment/TrustGame 240
B. ResultsfromMultilateralBargainingExperiments 242
C. ASecondLookatDictatorGames 244
D. ProceduralFairness 247
E. DiffusionofResponsibility 249
F. GroupIdentityandSocialPreferences 253
G. Generalizability 255
IV. GiftExchangeExperiments 259
A. AnInitialSeriesofExperiments 259
B. IncompleteContracts 261
C. WageRigidity 262
D. TheEffectofCognitiveAbilityandtheBigFivePersonalityCharacteristics
inOther-RegardingBehavior 264
E. WhyDoesGiftExchangeOccur? 265
F. LaboratoryversusFieldSettingsandRealEffort 267
G. Summary 274
V. Conclusions 274
Acknowledgments 276
Notes 277
References 282
viii • Contents
Chapter5 ExperimentsinMarketDesign 290
AlvinE.Roth
1. Introduction 290
2. SomeEarlyDesignExperiments:AllocationofAirportSlots 295
3. FCCSpectrumAuctions 300
4. OtherAuctions 307
4.1. eBayAuctions 307
4.2. APoorlyDesignedAuction(forMedicareSupplies) 316
5. LaborMarketClearinghouses 318
5.1. DesigningLaborMarketsforDoctors 318
5.2. MatchingwithoutaClearinghouse:TheMarketforEconomists,and
OnlineDating 327
6. CourseAllocation 329
7. Conclusions 333
Notes 334
References 339
Chapter6 ExperimentsinPoliticalEconomy 347
ThomasR.Palfrey
1. IntroductionandOverview 347
1.1. Methodology:RelationshiptoExperimentalEconomics 348
1.2. ChapterRoadMap 350
2. ExperimentsinCommitteeBargaining 352
2.1. UnstructuredCommitteeBargaining 352
2.2. CommitteeBargainingwithaFixedExtensiveFormStructure 359
3. ElectionsandCandidateCompetition 381
3.1. TheSpatialModelofCompetitiveElectionsandtheMedianVoter
Theorem 381
3.2. MulticandidateElections 387
3.3. CandidateCompetitionwithValence 390
4. VoterTurnout 392
4.1. InstrumentalVotingExperiments 392
4.2. TheEffectsofBeliefs,Communication,andInformationonTurnout 397
4.3. ExpressiveVotingExperiments 398
5. InformationAggregationinCommittees 400
5.1. CondorcetJuryExperiments 400
5.2. TheSwingVoter’sCurse 406
6. VotingMechanismsthatReflectPreferenceIntensity 410
6.1. MechanismsWhereaBudgetofVotesCanBeAllocated
AcrossIssues 411
6.2. VoteTradingandVoteMarkets 414
7. WhereDoWeGoFromHere? 418
Contents • ix
Acknowledgments 419
Notes 419
References 424
Chapter7 ExperimentalEconomicsacrossSubjectPopulations 435
GuillaumeR.Fréchette
I. Introduction 435
II. Infrahumans 438
II.A. MethodologicalNotes 443
III. Children 444
III.A. MethodologicalNotes 449
IV. TokenEconomies 449
IV.A. MethodologicalNotes 451
V. Elderly 451
V.A. MethodologicalNotes 455
VI. HighlyDemographicallyVaried(Representative)Sample 455
VI.A. MethodologicalNotes 460
VII. SubjectswithRelevantTaskExperience 461
VII.A. MethodologicalNotes 468
VIII. Discussion 468
VIII.A. IndividualChoice 469
VIII.B. Games 470
IX. Conclusion 471
Acknowledgments 472
Notes 472
References 475
Chapter8 Gender 481
MurielNiederle
I. Introduction 481
II. GenderDifferencesinCompetitiveness 485
II.A. DoWomenShyAwayfromCompetition? 486
II.B. ReplicationandRobustnessofWomenShyingAway
fromCompetition 489
II.C. ReducingtheGenderGapinTournamentEntry 492
II.D. PerformanceinTournaments 497
II.E. FieldExperimentsonGenderDifferencesinCompetitiveness 503
II.F. ExternalRelevanceofCompetitiveness 504
III. GenderDifferencesinSelectingChallengingTasksand
SpeakingUp 507
III.A. GenderDifferencesinTaskChoice 507
III.B. GenderDifferencesinSpeakingup 510
IV. AltruismandCooperation 512