In economic theory, utility depends on past, present and future outcomes. The experiment described in this paper suggests that utility also depends on people's attitudes, and that it can easily be manipulated through these attitudes. The results imply, ?rst, that purely outcome-based models of individual utility may be incomplete. Second, that reference-states are not determined completely endogenously but can be influenced from outside. And third, that experiments in economics may be sensitive to subtle details of the experimental design.
{"title":"Manipulating Reference States: The Effect of Attitudes on Utility","authors":"Astrid Matthey","doi":"10.2139/ssrn.1103407","DOIUrl":"https://doi.org/10.2139/ssrn.1103407","url":null,"abstract":"In economic theory, utility depends on past, present and future outcomes. The experiment described in this paper suggests that utility also depends on people's attitudes, and that it can easily be manipulated through these attitudes. The results imply, ?rst, that purely outcome-based models of individual utility may be incomplete. Second, that reference-states are not determined completely endogenously but can be influenced from outside. And third, that experiments in economics may be sensitive to subtle details of the experimental design.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2008-05-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"115412848","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In this paper we experimentally test skewness seeking at the individual level. Several prospects that can be ordered with respect to the third-degree stochastic dominance (3SD) criterion are ranked by the participants of the experiment. We i¬ nd that the skewness of a distribution has a signii¬ cant impact on the decisions. Yet, while skewness has an impact, its direction dii¬€ers substantially across subjects: 39% of our subjects act in accordance with skewness seeking and 10% seem to avoid skewness. On the level of individual decisions we i¬ nd that the variance of the prospects and subjects’ experience increase the probability of their choosing the lottery with greater skewness.
{"title":"A Note on Skewness Seeking: An Experimental Analysis","authors":"Tobias Bruenner, R. Levínský, J. Qiu","doi":"10.2139/ssrn.1026602","DOIUrl":"https://doi.org/10.2139/ssrn.1026602","url":null,"abstract":"In this paper we experimentally test skewness seeking at the individual level. Several prospects that can be ordered with respect to the third-degree stochastic dominance (3SD) criterion are ranked by the participants of the experiment. We i¬ nd that the skewness of a distribution has a signii¬ cant impact on the decisions. Yet, while skewness has an impact, its direction dii¬€ers substantially across subjects: 39% of our subjects act in accordance with skewness seeking and 10% seem to avoid skewness. On the level of individual decisions we i¬ nd that the variance of the prospects and subjects’ experience increase the probability of their choosing the lottery with greater skewness.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2007-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123355221","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We study sequential parimutuel betting markets with asymmetrically informed bettors, using an experimental approach. In one treatment, groups of eight participants play twenty repetitions of a sequential betting game. The second treatment is identical, except that bettors are observed by other participants who assess the winning probabilities of each potential outcome. In the third treatment, the same individuals make bets and assess the winning probabilities of the outcomes. A favorite-longshot bias is observed in the first and second treatments, but does not exist in the third treatment. Information aggregation is better in the third than in the other two treatments, and contrarian betting is almost completely eliminated by the belief elicitation procedure. Making bets improves the accuracy of stated beliefs. We propose a theoretical model, the Adaptive Model, to describe individual behavior and we find that it effectively explains betting decisions, especially in the third treatment.
{"title":"Information Aggregation and Beliefs in Experimental Parimutuel Betting Markets","authors":"Frédéric Koessler, C. Noussair, A. Ziegelmeyer","doi":"10.2139/ssrn.1021172","DOIUrl":"https://doi.org/10.2139/ssrn.1021172","url":null,"abstract":"We study sequential parimutuel betting markets with asymmetrically informed bettors, using an experimental approach. In one treatment, groups of eight participants play twenty repetitions of a sequential betting game. The second treatment is identical, except that bettors are observed by other participants who assess the winning probabilities of each potential outcome. In the third treatment, the same individuals make bets and assess the winning probabilities of the outcomes. A favorite-longshot bias is observed in the first and second treatments, but does not exist in the third treatment. Information aggregation is better in the third than in the other two treatments, and contrarian betting is almost completely eliminated by the belief elicitation procedure. Making bets improves the accuracy of stated beliefs. We propose a theoretical model, the Adaptive Model, to describe individual behavior and we find that it effectively explains betting decisions, especially in the third treatment.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2007-07-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"115492793","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This Monte-Carlo study investigates sensitivity of the Wilcoxon signed rank test to certain assumption violations in small samples. Emphasis is put on within-sample-dependence, between-sample dependence, and the presence of ties. Our results show that both assumption violations induce severe size distortions and entail power losses. Surprisingly, these consequences do vary substantially with other properties the data may display. Results provided are particularly relevant for experimental settings where ties and within-sample dependence are frequently observed.
{"title":"Small Sample Properties of the Wilcoxon Signed Rank Test with Discontinuous and Dependent Observations","authors":"Nadine Chlass, J. Krüger","doi":"10.2139/ssrn.1021169","DOIUrl":"https://doi.org/10.2139/ssrn.1021169","url":null,"abstract":"This Monte-Carlo study investigates sensitivity of the Wilcoxon signed rank test to certain assumption violations in small samples. Emphasis is put on within-sample-dependence, between-sample dependence, and the presence of ties. Our results show that both assumption violations induce severe size distortions and entail power losses. Surprisingly, these consequences do vary substantially with other properties the data may display. Results provided are particularly relevant for experimental settings where ties and within-sample dependence are frequently observed.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2007-07-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132928200","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
It is not a surprise that informal investment is a widespread phenomenon in the developed countries with long experience in market economy practices. But what about is informal investment in countries that started economic transition just a decade ago? Present study investigates the influential factors of informal investment decision by the use of GEM individual data of three transition countries of Croatia, Hungary and Slovenia. Compared to previous results of Finish informal investors, similar factors of previous business ownership, startup skills and personally knowing an entrepreneur are found to be the driving forces of informal investment decision. Moreover, transition country individuals put more emphasis on good business opportunities and higher household income than Finish ones when they have become informal investors. A comparison of close-family versus not close-family related informal investors revealed that despite significant differences close family related investors cannot be characterized by economically irrational decision making called "providing love money", i.e. good opportunity recognition, business and startup skills increased the probability to become informal investor even in the case of family related businesses. The seven clusters of the 160 transition informal investors showed a variety of groups of different informal investors according to their age, level of education, amount of investment, start-up skills, existing ownership status, and country of residence. Since the three examined transition countries have a problem not only with the low prevalence rate of the informal investors but also with the short of the amount of investment, the group of the individuals with the highest invested amount was analyzed. We found that the most important reasons of the limited informal investment activity and low level of investment had been associated with the limited entrepreneurial activity, the unfamiliarity with start-up and business leadership skills, the limited ability of opportunity recognition, and more generally, with inexperience in market economy and entrepreneurial practices. The study closes with policy recommendations of supporting business education, entrepreneurial culture and providing better business opportunities.
{"title":"Informal Investments in Transition: The Motivations, Characteristics and Classification of Informal Investors in Croatia, Hungary and Slovenia","authors":"Zsolt Makra, László Szerb, G. Rappai","doi":"10.2139/ssrn.959469","DOIUrl":"https://doi.org/10.2139/ssrn.959469","url":null,"abstract":"It is not a surprise that informal investment is a widespread phenomenon in the developed countries with long experience in market economy practices. But what about is informal investment in countries that started economic transition just a decade ago? Present study investigates the influential factors of informal investment decision by the use of GEM individual data of three transition countries of Croatia, Hungary and Slovenia. Compared to previous results of Finish informal investors, similar factors of previous business ownership, startup skills and personally knowing an entrepreneur are found to be the driving forces of informal investment decision. Moreover, transition country individuals put more emphasis on good business opportunities and higher household income than Finish ones when they have become informal investors. A comparison of close-family versus not close-family related informal investors revealed that despite significant differences close family related investors cannot be characterized by economically irrational decision making called \"providing love money\", i.e. good opportunity recognition, business and startup skills increased the probability to become informal investor even in the case of family related businesses. The seven clusters of the 160 transition informal investors showed a variety of groups of different informal investors according to their age, level of education, amount of investment, start-up skills, existing ownership status, and country of residence. Since the three examined transition countries have a problem not only with the low prevalence rate of the informal investors but also with the short of the amount of investment, the group of the individuals with the highest invested amount was analyzed. We found that the most important reasons of the limited informal investment activity and low level of investment had been associated with the limited entrepreneurial activity, the unfamiliarity with start-up and business leadership skills, the limited ability of opportunity recognition, and more generally, with inexperience in market economy and entrepreneurial practices. The study closes with policy recommendations of supporting business education, entrepreneurial culture and providing better business opportunities.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2007-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133657804","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In this paper we estimate the demand for liquidity by US business firms using COMPUSTAT database. In contrast to the previous literature, we consider firm-specific effects, such as cost-of-capital and wages. From the balanced and unbalanced panel estimations we infer that there are economies of scale in money demand by US business firms, because estimated sales elasticities are smaller than unity. In particular, they are lower than in previous papers, suggesting that economies of scales in the demand for money are even bigger than formerly thought. In addition, it emerges that labor is not a substitute for money.
{"title":"Corporate Liquidity Demand in the Us: Evidence from Panel Data","authors":"F. Lotti, Juri Marcucci","doi":"10.2139/ssrn.531042","DOIUrl":"https://doi.org/10.2139/ssrn.531042","url":null,"abstract":"In this paper we estimate the demand for liquidity by US business firms using COMPUSTAT database. In contrast to the previous literature, we consider firm-specific effects, such as cost-of-capital and wages. From the balanced and unbalanced panel estimations we infer that there are economies of scale in money demand by US business firms, because estimated sales elasticities are smaller than unity. In particular, they are lower than in previous papers, suggesting that economies of scales in the demand for money are even bigger than formerly thought. In addition, it emerges that labor is not a substitute for money.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2003-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128852063","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The Community Development Banks (CDBs) should not be seen as a substitute for the Community Reinvestment Act (CRA) or for other programs designed to revitalize lower income areas. Rather, they should be seen as a complement for existing programs and for other programs that will be proposed by the Clinton administration. As discussed above, the CRA process ensures that a dialogue takes place among regulators, financial institutions, and served communities: it ensures that banks identify their communities and that they satisfy some of the needs of these communities. Moreover, it helps to expand the awareness of bankers such that their expectations about presently undeserved areas are revised. It is unrealistic to expect that any financial institution can meet all the needs of any community; this, there is a role for a CDB to play in some communities that supplements the role played by traditional financial institutions. Similarly, while we believe that CDBs have an important role to play in revitalizing low income communities, we certainly do not see these as a substitute for the wide range of programs (both public and private) that will be needed to reverse long trends of deterioration experienced by some distressed communities. Finally, the CDBs are not intended to be welfare programs but to provide services to the community's residents, and consequently, they must meet the long-run market tests of profitability. Aside from the service aspect, community development banks will: (i)improve the well-being of our citizens not now served because of unresponsive, yet traditional loan qualification norms, and (ii) directly increase the opportunities for potential entrepreneurs and potential employees. The basic assumption underlying the community development bank is that all areas of the country need banks that are clearly oriented toward the small customer: households that have a small net worth, a small IRA account, and a small transactions account, and businesses that need financing measured in thousands rather then millions or billions of dollars.
{"title":"The Community Reinvestment Act, Lending Discrimination, and the Role of Community Development Banks","authors":"D. Papadimitriou, R. Phillips, L. Randall Wray","doi":"10.2139/ssrn.142811","DOIUrl":"https://doi.org/10.2139/ssrn.142811","url":null,"abstract":"The Community Development Banks (CDBs) should not be seen as a substitute for the Community Reinvestment Act (CRA) or for other programs designed to revitalize lower income areas. Rather, they should be seen as a complement for existing programs and for other programs that will be proposed by the Clinton administration. As discussed above, the CRA process ensures that a dialogue takes place among regulators, financial institutions, and served communities: it ensures that banks identify their communities and that they satisfy some of the needs of these communities. Moreover, it helps to expand the awareness of bankers such that their expectations about presently undeserved areas are revised. It is unrealistic to expect that any financial institution can meet all the needs of any community; this, there is a role for a CDB to play in some communities that supplements the role played by traditional financial institutions. Similarly, while we believe that CDBs have an important role to play in revitalizing low income communities, we certainly do not see these as a substitute for the wide range of programs (both public and private) that will be needed to reverse long trends of deterioration experienced by some distressed communities. Finally, the CDBs are not intended to be welfare programs but to provide services to the community's residents, and consequently, they must meet the long-run market tests of profitability. Aside from the service aspect, community development banks will: (i)improve the well-being of our citizens not now served because of unresponsive, yet traditional loan qualification norms, and (ii) directly increase the opportunities for potential entrepreneurs and potential employees. The basic assumption underlying the community development bank is that all areas of the country need banks that are clearly oriented toward the small customer: households that have a small net worth, a small IRA account, and a small transactions account, and businesses that need financing measured in thousands rather then millions or billions of dollars.","PeriodicalId":365027,"journal":{"name":"Jena Economic Research Paper Series","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"1993-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129722487","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
京公网安备 11010802042870号
京ICP备2023020795号-1
扫码关注我们
求助内容：
应助结果提醒方式：