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Experimental,Economics, Lecture,9:,Social,Norms,€¦ · Experimental,Economics,,...

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Experimental Economics Lecture 9: Social Norms Prof. Dr. Dorothea Kübler Taught by Dr. Hande Erkut Summer term 2018
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Page 1: Experimental,Economics, Lecture,9:,Social,Norms,€¦ · Experimental,Economics,, Lecture,9:,Social,Norms, Prof.,Dr.,DorotheaKübler,, Taughtby,Dr., Hande,Erkut,, Summer,term,2018,

Experimental  Economics    

Lecture  9:  Social  Norms  

Prof.  Dr.  Dorothea  Kübler    Taught  by  Dr.  Hande  Erkut    Summer  term  2018  

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What  is  a  social  norm?  

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Social  norms  are…        “…shared  understandings  about  ac0ons  that  are  obligatory,  permiLed,  or  forbidden”      

(Ostrom,  2000,  pp.  143–144)  

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   Collec&vely  perceived  Their  existence  must  be  accepted  by  the  members  of  the  society.    Non-­‐outcome  oriented    Prescribe  or  proscribe  acTons  rather  than  outcomes:  Help  others,  Don’t  lie…  

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I.  Which  norms  apply  to  a  given  situaTon?  

II.  Do  measured  social  norms  explain  behavior  in  a  given  seXng?  

III.  How  can  we  make  good  norms  more  salient?    

 

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I.  Methods  for  idenTfying  norms    Indirect  methods:  1.  Observing  pro-­‐social  behaviour  that  seems  to  be  in  line  with  the  norms  of  reciprocity,  fairness,  cooperaTon,  etc.    Dictator  game:  fairness  

 

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2.  Introducing  punishment  mechanisms  Example:  Public  goods  game  

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Social  norm:  CooperaTon  

o  Social  norm  is  detected  and  sustained  by  the  punishment  mechanism.  

Weimann  et  al.  (2012)   Fehr  and  Gächter  (2000)  

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Direct  Methods    1.  Ask   subjects   their   opinion  on  what   the   appropriate  behavior  is  in  a  given  situaTon.    Non-­‐incenTvized    2.  EliciTng  social  norms  by  incenTvizing  subjects.        

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Krupka  and  Weber  (2013,  JEEA)  IdenTfying  social  norms  using  coordinaTon  games:  Why  does  dictator  game  sharing  vary?  

 Two  payoff-­‐equivalent  dictator  games    Standard  Game:  Dictator  has  $10  and  decides  how  much  to  give  to  second  player.    Bully  Game:  Both  players  have  $5  and  dictator  decides  how  much  to  take  from  or  give  to  the  second  player.    

 

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Norm  elicitaTon  experiment    Subjects  are  described  one  of  the  two  payoff-­‐idenTcal  dictator  games  (standard  or  bully)  and  rank  the  social  appropriateness  of  each  possible  acTon  of  the  dictator.      KW  incenTvized  subjects  by  offering  them  extra  money  in  case  they  manage  to  match  the  modal  choice.    

 

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KW’s  conjecture:  Taking  will  be  perceived  as  less  socially  appropriate  than  giving;  choices  that  involve  taking  will  be  less  socially  appropriate  in  bully  game  compared  to  standard  game.  

 

-­‐1  

-­‐0.8  

-­‐0.6  

-­‐0.4  

-­‐0.2  

0  

0.2  

0.4  

0.6  

0.8  

1  

(10,0)   (9,1)   (8,2)   (7,3)   (6,4)   (5,5)   (4,6)   (3,7)   (2,8)   (1,9)   (0,10)  

Standard  

Bully  

Average  appropriateness  raTngs  across  games  

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Two  PredicTons  from  Norm  ElicitaTon  Experiment:    o  AcTon  that  produces  equal  split  ($5,  $5)  is  more  likely  to  

be  selected  in  bully  dictator  than  in  the  standard  dictator  game.    

 o  Given  equal  split  is  not  selected,  the  acTon  that  produces  

($10,   $0)   split   is   more   likely   to   be   selected   in   bully  dictator  than  in  the  standard  dictator  game.  

 

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I.  Which  norms  apply  to  a  given  situaTon?  

II.  Do  measured  social  norms  explain  behavior  in  a  given  seXng?  

III.  How  can  we  make  good  norms  more  salient?    

 

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Dictator  Game  Experiment:  A  different  group  of  subjects  actually  play  either  bully  dictator  game  or  standard  dictator  game.  

•  Out  of  the  parTcipants  who  did  not  choose  equal  split:    Standard  game:  40%  gave  $0      Bully  Game:  52%  gave  $0    

II.  Do  norms  explain  behavior?  

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CondiTonal  logit  esTmaTon  of  choice  determinants      

π(ak  ):  monetary  payoff  produced  by  the  selected  acTon  N(ak  ):  social  appropriateness  of  an  acTon    

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Measured  social  norms  explain  behavior  in    •  Dictator  games  (Krupka  and  Weber  2013,  Erkut  et  al.  2015)  

•  Gim  exchange  games  (Gächter  et  al.  2013)    •  Bertrand  game  (Krupka  et  al.  2017)  

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I.  Which  norms  apply  to  a  given  situaTon?  

II.  Do  measured  social  norms  explain  behavior  in  a  given  seXng?  

III.  How  can  we  make  good  norms  more  salient?    

 

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III.  How  can  we  make  good  norms  more  salient?  i.  Framing  of  the  game  

Ø People  choose  ‘cooperate’  more  when  the  game  is  labeled  as  Community  Game  instead  of  a  Wall  Street  Game.  (Liberman  et  al.  2004)  

Ø People  choose  ‘cooperate’  more  when  the  game  is  explained  as  an  interpersonal  interacTon  or  internaTonal  negoTaTon  game,  instead  of  a  bargaining  game.  (Eiser  and  Bhavnani  1974)  

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ii.  Inducing  norms    Cialdini  et  al.  (1990,  J  Pers  Soc  Psychol)  A  Focus  Theory  of  NormaTve  Conduct:  Recycling  the  Concept  of  Norms  to  Reduce  LiLering  in  Public  Places      Influence  the  parTcipants’  beliefs  about  the  acTons  of  others  and  their  normaTve  beliefs  by  •  varying  the  cleanliness  of  environment    •  displaying  a  message  saying  "April  is  keep  Arizona  beauTful  

month.  Please  do  not  liLer.”    

Ø  People  liLer  less  to  a  clean  environment  as  opposed  to  a  liLered  environment  

Ø  People  liLer  less  when  they  are  shown  the  message  above    

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iii.  Social  image    Since  social  norms  are  shared  in  common,  their  applicaTon  is  detected  by  society  itself.      Thus,  they  are  mostly  acTvated  when  others  observe  the  acTon  (Elster,  2007).      Conjecture:  Since  we  have  social  image  concerns,  we  behave  more  in  line  with  the  social  norms  when  others  are  present.  

   

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Andreoni  and  Petrie  (2004,  JPubE)  Public  goods  experiments  without  confidenTality:  a  glimpse  into  fund-­‐raising    

     

Ø  People  contribute  more  when  they  can  be  idenTfied  by  the  group  members.  

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Filiz-­‐Ozbay  and  Ozbay  (2013,  EE)  Effect  of  an  audience  in  public  good  provision.  

Effort  Money  

Ø  Being  observed  by  an  audience  increases  effort  contribuTons,  but  not  monetary  contribuTons.  

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Andreoni  and  Bernheim  (2009,  Econometrica)  Social  image  and  the  50–50  norm:  A  theoreTcal  and    experimental  analysis  of  audience  effects      •  Dictator  game:  Dictator  decides  how  to  allocate  $20.    •  With  probability  1  −  p,  dictator  chooses  the  transfer,  and  with  

probability  p,  nature  sets  it  equal  to  some  fixed  value,  x0.      •  Dictators,  recipients,  and  outcomes  are  publicly  idenTfied.          

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UD=F((1-­‐x),m)+t  G(x-­‐xF) x:  The  payoff  dictator  allocates  to  recipient  m:  Social  image  concern  xF:  Social  norm  (1/2  for  dictator  game)  t:  Fairness  concern  

 TheoreTcal  predicTon:  As  p  increases  -­‐the  mass  of  dictators  who  choose  any  given  x0  (close  to  zero)  increase    -­‐the  mass  of  dictators  who  split  the  payoff  equally  decrease  

 

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Ariely  et  al.  (2009,  AER)  Doing  Good  or  Doing  Well?  Image  MoTvaTon  and  Monetary  IncenTves  in  Behaving  Prosocially.    

 Do  monetary  incenTves  crowd-­‐out  image  moTvaTon  in  public?    Experiment:  Subjects  earn  money  for  a  charity  by  doing  a  real-­‐effort  task.  (Public  vs.  private;  with  vs.  without  monetary  incenTves)    Image-­‐Mo0va0on  Hypothesis:  For  a  posiTve  image,  increasing  visibility  increases  the  level  of  prosocial  acTvity.    Effec0veness  Hypothesis:  Extrinsic  rewards  are  less  effecTve  the  greater  is  the  visibility  of  the  prosocial  act.              

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For  a  good  charity:  •  Effort  is  greater  when  observed  by  others  •  Effort  is  greater  in  private  condiTon  when  there  are  monetary  incenTves  

•  Effort  is  smaller  in  public  condiTon  when  there  are  monetary  incenTves  

 


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