Research
Publications
"Social Preferences and the Variability of Conditional Cooperation" (with Simon Gächter, Kyeongtae Lee & Martin Sefton). Economic Theory. 2024.
We experimentally examine how incentives affect conditional cooperation (i.e., cooperating in response to cooperation and defecting in response to defection) in social dilemmas. In our first study, subjects play eight Sequential Prisoner’s Dilemma games with varying payoffs. We elicit second mover strategies and find that most second movers conditionally cooperate in some games and free ride in others. The rate of conditional cooperation is higher when the own gain from defecting is lower and when the loss imposed on the first mover by defecting is higher. This pattern is consistent with both social preference models and stochastic choice models. In a second study subjects play 64 social dilemma games, and we jointly estimate noise and social preference parameters at the individual level. Most of our subjects place significantly positive weight on others’ payoffs, supporting the underlying role of social preferences in conditional cooperation. Our results suggest that conditional cooperation is not a fixed trait but rather a symptom of the interaction between game incentives and underlying social preferences.
"Introducing IOS11 as an extended interactive version of the ‘Inclusion of Other in the Self’ scale to estimate relationship closeness" (with Chris Starmer, Fabio Tufano & Simon Gächter). Scientific Reports. 2024.
The study of relationship closeness has a long history in psychology and is currently expanding across the social sciences, including economics. Estimating relationship closeness requires appropriate tools. Here, we introduce and test a tool for estimating relationship closeness: 'IOS11'. The IOS11 scale has an 11-point response scale, is a refinement of the widely used Inclusion-of-Other-in-the-Self scale. Our tool has three key features. First, the IOS11 scale is easy to understand and administer. Second, we provide a portable, interactive interface for the IOS11 scale, which can be used in lab and online studies. Third, and crucially, based on within-participant correlations of 751 individuals, we demonstrate strong validity of the IOS11 scale in terms of representing features of relationships captured by a range of more complex survey instruments. Based on these correlations we find that the IOS11 scale outperforms the IOS scale and performs as well as the related Oneness scale.
"Interaction of reasoning ability and distributional preferences in a social dilemma" (with Alexander Vostroknutov). Journal of Economic Behavior & Organization. 2017.
In a within subjects design we evaluate distributional preferences and reasoning ability to explain choices in the Traveler's Dilemma. We recruit subjects from economics and non-economics majors to have a high variance of preferences and abilities. We find that economists follow the efficiency criterion while non-economists follow maximin. Economists also show a better reasoning ability. We, therefore, confirm the self-selection hypothesis of choosing a major. An equilibrium of an incomplete information version of the Traveler's Dilemma explains the behavior we observe. Subjects with low reasoning ability make choices away from equilibrium. Thus, (non)cooperative behavior might be misinterpreted if subjects’ reasoning ability is not taken into account.
Working Papers
"To hide or not to hide? How fear and futility affect the decision to report a mistake" (with Sarah Bowen, Anna Hochleitner & Richard Mills)
Even though reporting mistakes could substantially improve work processes and productivity within organisations, employees often hesitate to do so. This paper studies the role of fear (of being fired) and futility (i.e. reports being inconsequential) in explaining such employee silence. Drawing on a principal-agent framework with career concerns, we formalise mistakes as noisy signals of both agent quality and the work environment and show that optimal reporting decisions are affected by fear and futility considerations. We then use a novel experiment to exogenously manipulate the degree of fear and futility and test our theoretical predictions. In a 2x2 between-subject design, we vary the anonymity of reporting and the likelihood of organisational response. Results show that reducing fear and futility are complementary actions. Tackling both significantly increases reporting by about 20pp. This improvement in communication is accompanied by better organisational income, highlighting the value of improved reporting structures for firms and employees.
Work in Progress
Flexi-DPE: A Flexible Method for Distributional Preference Elicitation (with Simon Gächter, Chris Starmer & Fabio Tufano)
Working paper in preparation [Draft available upon request]In this paper we develop Flexi-DPE, which allows the estimation of distributional preference parameters elicited from as few as five decisions. Flexi-DPE builds on a method by Fisman, Kariv, and Markovits (2007) that uses 50 modified dictator games to estimate preference parameters of “fairmindedness” and “equity-efficiency”. Since eliciting 50 decisions is often not practical, we use simulations and pre-registered experiments to test the accuracy of preference parameters elicited from 20, 10, and 5 modified dictator games compared to the 50-decision benchmark. Accuracy of parameter estimates of fairmindedness is only slightly reduced with few decisions; accuracy of parameter estimates for equity-efficiency suffers somewhat with few decisions. We also show that preferences elicited with Flexi-DPE are robust with and without incentives, stable over time, and predictive of charitable giving. Our results provide a menu of options for researchers in terms of the trade-off between the accuracy of parameter estimates and the duration of elicitation.
Testing Contemplation Questions to Promote Integrity in Organizations (with Maxim Egorov, Baiba Renerte, Carmen Tanner, Alexander Wagner & Nicole Witt)
Working paper in preparation [Draft available upon request]
Unethical behavior, deception, and fraud are major concerns in corporate governance. This paper examines the effectiveness of contemplation questions (CQs) as decision aids for employees facing ethical dilemmas. CQs, such as “Will the reputation of our company be damaged if my decision is made public?” are intended to activate moral agency and prompt employees to consider their actions from various perspectives (e.g., self, peers, company). In a review of S&P 200 and Fortune Global 200 companies we find that at least 44% of firms use CQs as ethical decision aids, yet their effectiveness lacks scientific validation. Through two pre-registered, incentivized vignette experiments, we systematically investigate the causal effect of CQs on ethical decision-making. In Study 1 (N = 1,986), merely presenting CQs had no impact on ethical decisions. In Study 2 (N = 1,322), increasing engagement with CQs led to marginally more ethical decisions among individuals with high moral identity but significantly fewer ethical decisions among those with low moral identity. These findings suggest that while CQs can positively affect some individuals, they also backfire, promoting unethical behavior precisely in those already predisposed to such tendencies.
Altruism in Networks: A Field Experiment on Social Closeness, Preferences and Transfers (with Simon Gächter, Chris Starmer & Fabio Tufano)
Working paper in preparationInvestigating Associative Thinking: A Network Exploration Task (with Urs Fischbacher, Chris Starmer & Fabio Tufano)
Working paper in preparation