“By chance or by choice? Biased attribution of others’ outcomes when social preferences matter,” with Nisvan Erkal and Lata Gangadharan, forthcoming, Experimental Economics. [pdf] [supplementary material]
(Previously titled: “By chance or by choice? Biased attribution of others’ outcomes” and “Attribution biases in leadership: Is it effort or luck?”)
Decision makers in positions of power often make unobserved choices under risk and uncertainty. In many cases, they face a trade-off between maximizing their own payoff and those of other individuals. What inferences are made in such instances about their choices when only outcomes are observable? We conduct two experiments that investigate whether outcomes are attributed to luck or choices. Decision makers choose between two investment options, where the more costly option has a higher chance of delivering a good outcome (that is, a higher payoff) for the group. We show that attribution biases exist in the evaluation of good outcomes. On average, good outcomes of decision makers are attributed more to luck as compared to bad outcomes. This asymmetry implies that decision makers get too little credit for their successes. The biases are exhibited by those individuals who make or would make the less prosocial choice for the group as decision makers, suggesting that a consensus effect may be shaping both the belief formation and updating processes.
“Replication: Belief elicitation with quadratic and binarized scoring rules,” with Nisvan Erkal and Lata Gangadharan, 2020, Journal of Economic Psychology. [link]
(Previously titled: “Belief elicitation with binary outcomes: A comparison of quadratic and binarized scoring rules,” Working paper version available here.)
Researchers increasingly elicit beliefs to understand the underlying motivations of decision makers. Two commonly used methods are the quadratic scoring rule (QSR) and the binarized scoring rule (BSR). Hossain and Okui (2013) use a within-subject design to evaluate the performance of these two methods in an environment where subjects report probabilistic beliefs over binary outcomes with objective probabilities. In a near replication of their study, we show that their results continue to hold with a between-subject design. This is an important validation of the BSR given that researchers typically implement only one method to elicit beliefs. In favor of the BSR, reported beliefs are less accurate under the QSR than the BSR. Consistent with theoretical predictions, risk-averse subjects distort their reported beliefs under the QSR.
Results from laboratory experiments using real-effort tasks provide mixed evidence on the relationship between monetary incentives and effort provision. To examine this issue, we design three experiments where subjects participate in two-player real-effort tournaments with two prizes. Experiment 1 shows that subjects exert high effort even if there are no monetary incentives, suggesting that non-monetary incentives are contributing to their effort choices. Moreover, increasing monetary incentives does not result in higher effort provision. Experiment 2 shows that the impact of non-monetary incentives can be reduced by providing subjects with the option of leaving the laboratory early, using an incentivized timeout button, or working on an incentivized alternative activity. Experiment 3 revisits the relationship between monetary incentives and effort provision using the insights from Experiment 2. Using a design with an incentivized alternative activity, we show that participants increase effort in response to monetary incentives. Taken together, the findings from the three experiments suggest that results from real-effort tasks require a careful evaluation and interpretation of the motivations underlying the observed performance.
“Impact of rebates and refunds on contributions to threshold public goods: Evidence from a field experiment,” with Matthew Donazzan and Nisvan Erkal, 2016, Southern Economic Journal, 83(1), 69-86. [link] [pdf]
We investigate the impact of rebates and refunds on contributions to threshold public goods using evidence from a field experiment conducted in conjunction with an Australian charity, Life Goes On. We find that offering rebates and refunds has a significant positive impact on both participation and average donations in the absence of seed money. Our results suggest that offering rebates and refunds, and the existence of seed money may, to some extent, play substitute roles in encouraging giving behavior. Seed money has a significant positive effect on participation only. Seed money’s impact on average donations may be mitigated by a threshold effect.
We study discrimination in prosocial domains against sexual minorities using a sharing (dictator) game in an online experiment, where these individuals have the opportunity to signal their identity. We find that political affiliations matter: Republican heterosexual individuals are less generous to others who are perceived to be sexual minorities, while their Democratic counterparts are slightly more generous. This is robust to alternative specifications and cannot be explained by perceptions about the recipient’s political leaning. Moreover, women, but not men, are less likely to signal their sexual minority status when they are aware of the potential payoff implications of their decisions.