Journal of Economic Psychology最新文献

Negative emotions have been shown to influence financial risk-taking. However, how receiving salient information about prior outcomes interacts with a decision-maker’s emotional state is not well known. In a laboratory experiment, we induced a fearful emotional state to investigate its effects on financial investment when outcome probabilities are unknown but decision-makers observe prior outcomes. The effects of fear on investment depended on whether the sequence of previous outcomes was favorable or unfavorable and contained weak or strong information. Our findings suggest that fear affected investment, at least in part, through changes in expectations of success.

Policy makers often implement laws or mandates to attempt to change people’s behavior. Such policies act not only as deterrents, but also as societal signposts for what is considered morally right and wrong within a society. In this paper we argue that the presence of laws and mandates may be associated with citizens’ inclination to engage in social norm enforcement within their own network. We studied this using four different datasets in different settings (text-and-drive laws, influenza vaccination mandates, speed limit laws, and COVID-19 mask mandates), in three different countries (total N = 3,156). In all datasets, we found associations between mandates or laws and the inclination to socially confront norm violators. This is in line with our theorizing that mandates and laws may help to increase citizens’ inclination to engage in social norm enforcement, and to foster interpersonal policing of behavior, inviting future research to establish more direct causal conclusions in this regard.

Teams play a key role in tackling complex societal challenges, such as developing vaccines or novel clean energy technologies. Yet, the effect of air pollution on team performance in non-routine problem-solving tasks is not well explored. Here, we document a sizable adverse effect of air pollution on team performance using data from 15,000 live escape games in London, United Kingdom. On high-pollution days, teams take on average 5% more time to solve a sequence of non-routine analytical tasks, which require collaborative skills analogous to those needed in the modern workplace. Negative effects are non-linear and only occur at high levels of air pollution, which are however commonplace in many developing countries. As team efforts predominantly drive innovation, high levels of air pollution may significantly hamper economic development.

The paper explores the potential influence of subjective factors on salary determination, particularly examining the impact of physical appearance on the earnings of soccer players. This study encompasses data from 373 Major League Soccer players over 12 seasons (2007-2018). Facial symmetry, quantified using the coordinates of each player’s facial features, is utilized as an indicator of physical attractiveness. Various analytical models, including linear, semiparametric, and quantile models, are applied. The results point to a notable 'beauty premium' in the salary structure within this context, with the effects being more significant among the highest earners.

We report results from a unique data set of real-life bargaining transactions collected from the market for livestock (sheep) before the Festival of Sacrifice (Eid al-Adha) in Izmir, Turkey. This market is characterized by frequent and aggressive bargaining, which occurs in the form of sequential price offers. We record bargaining transactions as they occur, and collect detailed information on the bargaining environment, as well as on the characteristics of buyers and sellers. We also elicit each seller’s outside option by means of an incentive compatible mechanism and obtain a reported maximum willingness to pay from buyers. We particularly focus on aspects of the bargaining process, such as non-price communication. In different types of empirical analysis, results robustly indicate that the presence and content of communication matters, for the likelihood of a sale as well as concessions made. Specifically, buyer-side communication is associated with larger concessions from the seller and a higher probability of sale. The presence of a mediator during the negotiation is associated with a higher probability of sale as well, while it has no effect on prices. We also provide results on the relative importance of groups of variables for predicting bargaining outcomes, which can provide directions for further research in bargaining.

Whereas several studies find that financial scarcity has a detrimental impact on cognitive functioning, some studies find no relationship and others even report beneficial effects. To shed light on this issue we conducted a meta-analysis on the relationship between financial scarcity and cognitive functioning. We went beyond testing the direct relationship between these two concepts and looked at potential moderators, namely education, the moment of scarcity, the severity of scarcity, the type of tasks used to assess cognitive functioning, and the type of study. Our findings suggest that scarcity does have a detrimental effect on cognitive functioning. Across 256 effect sizes from 29 datasets involving 111,852 respondents, we found a detrimental total effect of scarcity on cognitive performance of Hedge’s g = -0.43. We then estimated a meta-regression model of the drivers of the effect of scarcity on cognition. Education strongly explained this relationship, reducing the effect size by 60 % (partial effect of scarcity on cognitive performance is Hedge’s g = -0.15, when accounting for education), to a small effect size. The moment and the severity of scarcity also contribute to this relationship, by moderating the effect, such that lifetime and adulthood scarcity have a larger effect than childhood scarcity, and more extreme levels of scarcity lead to higher cognitive dysfunction. The type of task used to assess cognitive functioning did not moderate the effect. And when controlling for education, higher effect sizes were found for non-correlational designs. We discuss these findings and their implications in light of existing research and theories.

The Journal of Economic Psychology’s previous Special Issue related to biology - the Special Issue on Decision Neuroscience by Smith and Huettel (2010) - was released over a decade ago. Since then, technological advances have led to better data availability and methodologies across various scientific fields. New techniques and biomedical measures, such as brain stimulation and genotyping, have become more accessible to researchers. Therefore, we found it timely to organize a Special Issue on the Biological Foundations of Economic Decision-Making. The Introduction to this Special Issue will provide an overview of the latest research findings in this field and the selected papers for this Special Issue. The different contributions are grouped into three main subtopics, namely Neuroeconomics, hormones and neuroendocrine signaling, and studies utilizing genetic information.

Much policy attention has been placed on encouraging saving behaviours to avoid financial deprivation at older adulthood. However, optimising financial investments is highly dependent on cognitive capacity, which can be deteriorated by the natural ageing process. This paper explores the relationship between age-related cognitive deterioration with risky and non-risky financial investments. The data analysed comes from eight waves (2002 to 2019) of the English Longitudinal Study of Ageing (ELSA) which, for a nationally representative sample, contains information about cognitive ability and their ownership of financial investments over time. Cognition emerges as one of the strongest predictors of the type and number of financial products that individuals hold. Specifically, the results show a positive relation of cognitive level with risky and non-risky financial investments. Even alongside other important factors – such as education, labour status, age, and household wealth – the explanatory power of cognition is found to be significant at the 0.1% significance level. The results are robust when accounting for unobservables and when using a genetic measure of cognition as main explanatory variable. More importantly, cognitive deterioration is only significantly associated with risky financial investments. That means, individuals reduce their risky financial investments when they start suffering old age related cognitive deterioration, while they do not change their holdings in non-risky ones in a significant manner. There are also no significant differences in the reactions to stock-market fluctuations due to cognitive level. In other words, individuals react to stock market fluctuations changing their financial holdings, but those reactions do not differ due to their cognitive level.

In alpine skiing competitions, one of the coaches of the participating countries sets the course. This may provide an advantage, but it may also exert higher pressure on the racers. We analyze 45,467 men’s and 41,221 women’s performances from all competitions in alpine skiing’s Slalom, Giant Slalom, and Super Giant disciplines that took place in the World Cups, World Championships, and Olympic Games between the 2001/2002 and 2019/2020 seasons. We compare the performance of racers when competing on a course that was set by their compatriot to the performance of the same racers in the same season when the course was set by a coach from another country. Having a compatriot course setter only has an effect in the second (and decisive) run of the most technical discipline Slalom. We find that men fail significantly more often to complete their run when their compatriots set the course, whereas women fail significantly less in the same situation. The most likely drivers of our results relate to gender differences in response to expectations and choking under pressure in skill-based tasks.