Essays on experimental and behavioral economics

Anna Savikhin, Purdue University

Abstract

This dissertation consists of three essays on experimental and behavioral economics that examine how decision-making in the laboratory environment is affected by changes in context.1 The first three essays focus on how behavior changes when individuals are presented with two simultaneous decision making tasks. The first two essays are experimental investigations of simultaneous decision-making in two contrasting environments: an environment that encourages competition (a lottery contest) and an environment that encourages cooperation (a voluntary contribution mechanism). In the first essay, individuals participate in different environments with the same group members, while in the second essay individuals participate in same and different environments with different group members. We find evidence both for behavioral spillovers and for social interaction effects, suggesting that context matters in laboratory settings. The third essay explores the existence of conditional cooperators as an alternative explanation for behavioral spillover. The fourth essay uses experimental methods to study a market with differently-valued goods under a reputation system. We find that the addition of a reputation system increases efficiency, and the reputation system is especially effective for increasing trade in high value goods. The caveat is that allowing for differently-valued goods reduces the information carried by the reputation system. To resolve this issue, we investigate a new reputation system, which displays reputation separately for each type of good. Efficiency is not increased as compared to the original reputation system, suggesting that the reputation system typically implemented with homogeneous goods performs adequately in the heterogeneous good setting. 1The first two essays are co-authored with Roman Sheremeta. The third essay is single authored.

Degree

Ph.D.

Advisors

Cason, Purdue University.

Subject Area

Economics

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