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  1. Comparing input interfaces to elicit belief distributions
    Erschienen: [2022]
    Verlag:  [Department of Economics, University of Bergen], [Bergen]

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    Schriftenreihe: Working papers in economics / Department of Economics, University of Bergen ; no. 22, 08
    Schlagworte: Belief elicitation; Forecasting; Scoring rules; interfaces
    Umfang: 1 Online-Ressource (circa 26 Seiten), Illustrationen
  2. Fast then slow
    a choice process explanation for the attraction effect
    Erschienen: [2019]
    Verlag:  Center for European, Governance and Economic Development Research, cege, Georg-August-Universität Göttingen, [Göttingen]

    In this paper we provide choice-process experimental evidence that the attraction effect is a short-term phenomenon, that disappears when individuals are given time and incentives to revise their choices. The attraction (or decoy) effect is the most... mehr

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    In this paper we provide choice-process experimental evidence that the attraction effect is a short-term phenomenon, that disappears when individuals are given time and incentives to revise their choices. The attraction (or decoy) effect is the most prominent example of context effects, and it appears when adding a dominated option to a choice set increases the choice share of the now dominant option at the expense of other options. While widely replicated, the attraction effect is usually tested in hypothetical or payoff-irrelevant situations and without following the choice process. We run a laboratory experiment where we incentivize choice, vary the difference in utility between options and track which option participants consider best over time. We find that the effect is a transitory phenomenon that emerges only in the early stages of the choice process to later disappear. Participants are fast then slow: they first choose the dominant option to avoid the dominated decoy and then progressively revise their choices until choice shares come to correspond to price differences only. We expand our analysis by considering differences in utility among options and differences in the presentation of options (numerical or graphical). We also consider differences in the choice processes followed by individuals (intuitive vs. deliberative). This allows us to ascribe more precisely the role of fast and slow cognitive process in the emergence and disappearance of the attraction effect.

     

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    hdl: 10419/209649
    Schriftenreihe: Discussion papers / Center for European, Governance and Economic Development Research ; number 386 (December 2019)
    Umfang: 1 Online-Ressource (circa 42 Seiten), Illustrationen
  3. Hard vs. soft commitments: experimental evidence from a sample of French gamblers
    Erschienen: [2023]
    Verlag:  CEE-M, Center for Environmental Economics, Montpellier

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    Schriftenreihe: CEE-M working paper ; 2023, 09
    Schlagworte: soft commitment; hard commitment; risk taking; self-control
    Umfang: 1 Online-Ressource (circa 34 Seiten), Illustrationen
  4. A reconsideration of gender differences in risk attitudes
    Erschienen: gennaio 2014
    Verlag:  Università degli Studi di Milano, Department of Economics, Management and Quantitative Methods, Milano

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    Schriftenreihe: Working paper / Università degli Studi di Milano, Dipartimento di Economia, Management e Metodi Quantitativi ; n. 2014, 01
    Umfang: 1 Online-Ressource (circa 32 Seiten), Illustrationen
  5. Availability of information and representation effects in the centipede game
    Erschienen: 2012
    Verlag:  Univ. [u.a.], Jena

    The paper presents the results of a novel experiment testing the effects of environment complexity on strategic behavior, using a centipede game. Behavior in the centipede game has been explained either by appealing to failures of backward induction... mehr

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    The paper presents the results of a novel experiment testing the effects of environment complexity on strategic behavior, using a centipede game. Behavior in the centipede game has been explained either by appealing to failures of backward induction or by calling for preferences that induce equilibria consistent with observed behavior. By manipulating the way in which information is provided to subjects we show that reduced availability of information is sufficient to shift the distribution of take-nodes further from the equilibrium prediction. On the other hand, similar results are obtained in a treatment where reduced availability of information is combined with an attempt to elicit preferences for reciprocity, through the presentation of the centipede as a repeated trust game. Our results could be interpreted as cognitive limitations being more effective than preferences in determining (shifts in) behavior in our experimental centipede. Furthermore our results are at odds with the recent ones in Cox and James (2012), suggesting caution in generalizing their results. Reducing the availability of information may hamper backward induction or induce myopic behavior, depending on the strategic environment. -- Centipede ; Backward Induction ; Representation effects

     

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    hdl: 10419/70141
    Schriftenreihe: Jena economic research papers ; 2012,051
    Schlagworte: Extensives Spiel; Wiederholte Spiele; Vertrauen; Unvollkommene Information; Experiment
    Umfang: Online-Ressource (PDF-Datei: 21 S., 774 KB), graph. Darst.
  6. Partnerships, imperfect monitoring and outside options
    theory and experimental evidence
    Erschienen: 2012
    Verlag:  Univ. [u.a.], Jena

    We study theoretically and experimentally a two-person partnership game whereby agents only see the uncertain outcome of their joint effort but not how much the other agent contributed to it. The model combines problems of free-riding present in... mehr

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    We study theoretically and experimentally a two-person partnership game whereby agents only see the uncertain outcome of their joint effort but not how much the other agent contributed to it. The model combines problems of free-riding present in public good production and in teams with imperfect monitoring. We analyse effort and exit behaviour conditional on subjects' beliefs over the action taken by their partners and consider the effect of the availability and profitability of outside options. Our subjects do not adapt effort as a response to changes in their beliefs about the effort of their partner. Subjects display aversion for team work by exiting the partnership even when they believe their partner exerts sufficient effort to sustain it. Higher outside options do not either motivate or discourage effort in joint work but rather result in not only inefficient but also irrational breakdown in partnerships. Overall, social welfare decreases as the incentive to exit increases. -- Imperfect monitoring ; outside options ; partnerships ; public good production ; repeated games ; teams

     

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    hdl: 10419/70179
    Schriftenreihe: Jena economic research papers ; 2012,052
    Schlagworte: Arbeitsgruppe; Arbeitsleistung; Kontrolle; Trittbrettfahrerverhalten; Wiederholte Spiele; Experiment
    Umfang: Online-Ressource (PDF-Datei: 44 S., 0,99 MB), graph. Darst.
  7. The "bomb" risk elicitation task
    Erschienen: 2012
    Verlag:  DIW, Berlin

    This paper presents the Bomb Risk Elicitation Task (BRET), an intuitive procedure aimed at measuring risk attitudes. Subjects decide how many boxes to collect out of 100, one of which containing a bomb. Earnings increase linearly with the number of... mehr

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    Leibniz-Institut für Wirtschaftsforschung Halle, Bibliothek
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    This paper presents the Bomb Risk Elicitation Task (BRET), an intuitive procedure aimed at measuring risk attitudes. Subjects decide how many boxes to collect out of 100, one of which containing a bomb. Earnings increase linearly with the number of boxes accumulated but are zero if the bomb is also collected. The BRET requires minimal numeracy skills, avoids truncation of the data, allows to precisely estimate both risk aversion and risk seeking, and is not affected by the degree of loss aversion or by violations of the Reduction Axiom. We validate the BRET and test its robustness in a large-scale experiment, although the task can be performed in the field as well. Choices react significantly to the stakes and to the size of the choice set. Our experiment rationalizes the gender gap that often characterizes choices under uncertainty by means of a higher loss rather than risk aversion. -- Risk Aversion ; Loss Aversion ; Elicitation Method

     

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    hdl: 10419/68161
    Schriftenreihe: SOEPpapers on multidisciplinary panel data research ; 517
    Umfang: Online-Ressource, graph. Darst.
  8. A theoretical and experimental appraisal of five risk elicitation methods
    Erschienen: 2013
    Verlag:  DIW, Berlin

    We perform a comparative analysis of five incentivized tasks used to elicit risk preferences. Theoretically, we compare the elicitation methods in terms of completeness of the range of the estimates as well as their precision, the likelihood of... mehr

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    Leibniz-Institut für Wirtschaftsforschung Halle, Bibliothek
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    We perform a comparative analysis of five incentivized tasks used to elicit risk preferences. Theoretically, we compare the elicitation methods in terms of completeness of the range of the estimates as well as their precision, the likelihood of triggering loss aversion, and problems arising when multiple choices are required. Using original data from a homogeneous population, we experimentally investigate the distribution of estimated risk preferences, whether they differ by gender, and the complexity of the tasks. We do so using both non-parametric tests and a structural model estimated with maximum likelihood. We find that the estimated risk aversion parameters vary greatly across tasks and that gender differences appear only when the task is more likely to trigger loss aversion. -- Risk attitudes ; Elicitation methods ; Experiment

     

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    hdl: 10419/73671
    Schriftenreihe: SOEPpapers on multidisciplinary panel data research ; 547
    Umfang: Online-Ressource (28 S.), graph. Darst.
  9. A study of outcome reporting bias using gender differences in risk attitudes
    Erschienen: 2013
    Verlag:  CESifo, München

    This paper exploits a large dataset of replications of the Holt and Laury (2002) risk elicitation task to study a possible outcome reporting bias using gender differences in risk attitudes. There is a strong consensus view in the experimental... mehr

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    This paper exploits a large dataset of replications of the Holt and Laury (2002) risk elicitation task to study a possible outcome reporting bias using gender differences in risk attitudes. There is a strong consensus view in the experimental literature according to which women are more prudent than men in risky choices. The evidence collected in the dataset, however, does not support the consensus: only a tiny fraction of the replications displays gender differences. This striking distance between the consensus and the data gathered with this elicitation task allows us to test directly for the presence of outcome reporting bias in the risk and gender literature. We find no evidence that the likelihood of reporting about gender differences is affected by obtaining results in line or against the consensus, also controlling for authors fixed effects. The vast majority of the studies does not report gender results. The only significant determinant of the probability of reporting is the fact that the study focuses directly on the analysis of risk preferences.

     

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    hdl: 10419/89673
    RVK Klassifikation: QB 910
    Schriftenreihe: Array ; 4466
    Umfang: Online-Ressource (15 S.)
  10. The "bomb" risk elicitation task
    Erschienen: 2012
    Verlag:  IZA, Bonn

    This paper presents the Bomb Risk Elicitation Task (BRET), an intuitive procedure aimed at measuring risk attitudes. Subjects decide how many boxes to collect out of 100, one of which containing a bomb. Earnings increase linearly with the number of... mehr

    ZBW - Leibniz-Informationszentrum Wirtschaft, Standort Kiel
    DS 4 (6710)
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    This paper presents the Bomb Risk Elicitation Task (BRET), an intuitive procedure aimed at measuring risk attitudes. Subjects decide how many boxes to collect out of 100, one of which containing a bomb. Earnings increase linearly with the number of boxes accumulated but are zero if the bomb is also collected. The BRET requires minimal numeracy skills, avoids truncation of the data, allows to precisely estimate both risk aversion and risk seeking, and is not affected by the degree of loss aversion or by violations of the Reduction Axiom. We validate the task and test its robustness in a large-scale experiment. Choices react significantly to the stakes and to the size of the choice set. Our experiment rationalizes the gender gap that often characterizes choices under uncertainty by means of a higher loss rather than risk aversion. -- risk aversion ; loss aversion ; elicitation method

     

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    hdl: 10419/62586
    Schriftenreihe: Discussion paper series / Forschungsinstitut zur Zukunft der Arbeit ; 6710
    Schlagworte: Risikoaversion; Verlust; Entscheidung unter Unsicherheit; Experiment; Risikopräferenz
    Umfang: Online-Ressource (PDF-Datei: 30 S., 590,25 KB), graph. Darst.
  11. Fear of being left alone drives inefficient exit from partnerships
    an experiment
    Erschienen: 2014
    Verlag:  Univ. [u.a.], Jena

    We explore in an experiment what leads to the breakdown of partnerships. Subjects are assigned a partner and participate in a repeated public good game with stochastic outcomes. They can choose each period between staying in the public project or... mehr

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    We explore in an experiment what leads to the breakdown of partnerships. Subjects are assigned a partner and participate in a repeated public good game with stochastic outcomes. They can choose each period between staying in the public project or working on their own. There is excessive exit as subjects overestimate the likelihood their partner will leave. High barriers to exit thus improve welfare. We observe that exit is driven by failure within the common project but also by pay-off comparisons across options and beliefs about being exploited. Those considerations increasingly matter as we lower exit costs across treatments.

     

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    hdl: 10419/98443
    Schriftenreihe: Jena economic research papers ; 2014-012
    Umfang: Online-Ressource (60 S.), graph. Darst.
  12. A reconsideration of gender differences in risk attitudes
    Erschienen: 2014
    Verlag:  IZA, Bonn

    This paper reconsiders the wide agreement that females are more risk averse than males providing a leap forward in its understanding. Thoroughly surveying the experimental literature we first find that gender differences are less ubiquitous than... mehr

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    This paper reconsiders the wide agreement that females are more risk averse than males providing a leap forward in its understanding. Thoroughly surveying the experimental literature we first find that gender differences are less ubiquitous than usually depicted. Gathering the microdata of an even larger sample of Holt and Laury replications we boost the statistical power of the test and show that the magnitude of gender differences, although significant, is economically unimportant. We conclude that gender differences systematically correlate with the features of the elicitation method used and in particular the availability of a safe option and fixed probabilities.

     

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    hdl: 10419/98955
    Schriftenreihe: Discussion paper series / Forschungsinstitut zur Zukunft der Arbeit ; 8184
    Umfang: Online-Ressource (31 S.), graph. Darst.
  13. A flexible z-Tree implementation of the Social Value Orientation Slider Measure (Murphy et al. 2011)
    manual
    Erschienen: 2012
    Verlag:  Univ. [u.a.], Jena

    This manual describes a z-Tree (Fischbacher, 2007) implementation of the paper-based Social Vaule Orientation (SVO) Slider Measure by Murphy et al. (2011). Using the paper-based version instead of the slider-based version (as implemented on the... mehr

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    This manual describes a z-Tree (Fischbacher, 2007) implementation of the paper-based Social Vaule Orientation (SVO) Slider Measure by Murphy et al. (2011). Using the paper-based version instead of the slider-based version (as implemented on the SVO-Website) avoids server-traffic related delays we experienced in the latter implementation. -- z-Tree ; Social Value Orientation

     

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    hdl: 10419/70183
    Schriftenreihe: Jena economic research papers ; 2012,062
    Umfang: Online-Ressource (PDF-Datei: 7 S., 415 KB), Ill.
  14. The "Bomb" risk elicitation task
    Erschienen: 2012
    Verlag:  Univ. [u.a.], Jena

    This paper presents the Bomb Risk Elicitation Task (BRET), an intuitive procedure aimed at measuring risk attitudes. Subjects decide how many boxes to collect out of 100, one of which containing a bomb. Earnings increase linearly with the number of... mehr

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    Niedersächsische Staats- und Universitätsbibliothek Göttingen
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    DS 78 (2012,35)
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    This paper presents the Bomb Risk Elicitation Task (BRET), an intuitive procedure aimed at measuring risk attitudes. Subjects decide how many boxes to collect out of 100, one of which containing a bomb. Earnings increase linearly with the number of boxes accumulated but are zero if the bomb is also collected. The BRET requires minimal numeracy skills, avoids truncation of the data, allows to precisely es- timate both risk aversion and risk seeking, and is not affected by the degree of loss aversion or by violations of the Reduction Axiom. We validate the task and test its robustness in a large-scale experiment. Choices react significantly to the stakes and to the size of the choice set. Our experiment rationalizes the gender gap that often characterizes choices under uncertainty by means of a higher loss rather than risk aversion. -- Risk Aversion ; Loss Aversion ; Elicitation method

     

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    hdl: 10419/70172
    Schriftenreihe: Jena economic research papers ; 2012,035
    Schlagworte: Risikoaversion; Verlust; Entscheidung unter Unsicherheit; Experiment; Risikopräferenz
    Umfang: Online-Ressource (PDF-Datei: 29 S., 843 KB), Ill., graph. Darst.
  15. A theoretical and experimental appraisal of five risk elicitation methods
    Erschienen: 2013
    Verlag:  Univ. [u.a.], Jena

    We perform a comparative analysis of five incentivized tasks used to elicit risk preferences. Theoretically, we compare the elicitation methods in terms of completeness of the range of the estimates as well as their precision, the likelihood of... mehr

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    We perform a comparative analysis of five incentivized tasks used to elicit risk preferences. Theoretically, we compare the elicitation methods in terms of completeness of the range of the estimates as well as their precision, the likelihood of triggering loss aversion, and problems arising when multiple choices are required. Using original data from a homogeneous population, we experimentally investigate the distribution of estimated risk preferences, whether they differ by gender, and the complexity of the tasks. We do so using both non-parametric tests and a structural model estimated with maximum likelihood. We find that the estimated risk aversion parameters vary greatly across tasks and that gender differences appear only when the task is more likely to trigger loss aversion. -- elicitation methods ; experiment ; risk attitudes

     

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    hdl: 10419/70182
    Schriftenreihe: Jena economic research papers ; 2013-009
    Umfang: Online-Ressource, Ill., graph. Darst.
  16. The sound of others
    surprising evidence of conformist behavior
    Erschienen: 2015
    Verlag:  IZA, Bonn

    It has been shown that subjects tend to follow others' behavior even when the external signals are uninformative. In this paper we go one step further, showing that conformism occurs even when the choices of others are not even presented to the... mehr

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    It has been shown that subjects tend to follow others' behavior even when the external signals are uninformative. In this paper we go one step further, showing that conformism occurs even when the choices of others are not even presented to the subjects, but just indirectly perceived. We use the "Click" version of the Bomb Risk Elicitation Task, in which subjects can infer the behavior of others only from the mass of clicks heard. This signal is payoff-irrelevant and largely uninformative about the actual choices of the other participants. Moreover, it is never mentioned in the instructions and therefore it must be spontaneously (and possibly unconsciously) perceived in order to be used. We control the exposure of subjects to clicks by implementing treatments with and without earmuffs. Moreover, we test whether the introduction of a minimal form of commonality, i.e., facing a common rather than individual resolution of uncertainty, makes conformism more likely to emerge. We find strong evidence of conformist behavior even in such an adverse environment. Simply hearing the others clicking affects subjects' behavior. Introducing a common random draw results in a further dramatic shift of the average choices, in particular by women.

     

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    hdl: 10419/110748
    Schriftenreihe: Discussion paper series / Forschungsinstitut zur Zukunft der Arbeit ; 9029
    Umfang: Online-Ressource (18 S.), graph. Darst.
  17. Click'n'roll
    no evidence of illusion of control
    Erschienen: 2015
    Verlag:  IZA, Bonn

    Evidence of Illusion of Control - the fact that people believe to have control over pure chance events - is a recurrent finding in experimental psychology. Results in economics find instead little to no support. In this paper we test whether this... mehr

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    Evidence of Illusion of Control - the fact that people believe to have control over pure chance events - is a recurrent finding in experimental psychology. Results in economics find instead little to no support. In this paper we test whether this dissonant result across disciplines is due to the fact that economists have implemented only one form of illusory control. We identify and separately tests in an incentive-compatible design two types of control: a) over the resolution of uncertainty, as usually done in the economics literature, and b) over the choice of the lottery, as sometimes done in the psychology literature but without monetary payoffs. Results show no evidence of illusion of control, neither on choices nor on beliefs about the likelihood of winning, thus supporting the hypotheses that incentives crowd out illusion of control.

     

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    hdl: 10419/110766
    Schriftenreihe: Discussion paper series / Forschungsinstitut zur Zukunft der Arbeit ; 9030
    Umfang: Online-Ressource (15 S.), graph. Darst.
  18. Of the stability of partnerships when individuals have outside options, or why allowing exit is inefficient
    Erschienen: 2015
    Verlag:  Univ., Jena

    Should people be allowed to leave joint projects freely or should they be deterred from breaking off? This depends on why people stop collaborating and whether they have good reasons to do so. We explore the factors that lead to the breakdown of... mehr

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    Should people be allowed to leave joint projects freely or should they be deterred from breaking off? This depends on why people stop collaborating and whether they have good reasons to do so. We explore the factors that lead to the breakdown of partnerships by studying a public good game with imperfect public monitoring and an exit option. In our experiment, subjects were assigned a partner with whom they could contribute over several periods to a public good with stochastic out- comes. They could choose in each period between participating in the public project or working on their own. We find there was excessive exit especially because subjects over-estimated the likelihood their partner would leave. Treatments with high barriers to exit generated higher welfare overall as they fostered stability and prevented inefficient breakdowns in relationships. There were differences across treatments in the intensity with which different factors drove the choice to work alone. Differences in expected payoffs between independent and group work were more important as a driver of exit in treatments with low barriers to exit. The intensity of other factors was more constant across treatments, including whether the common project failed in the previous period, the belief that oneś partner did not want to maintain the partnership and the belief that he exerted less effort than oneself.

     

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    Schriftenreihe: Jena economic research papers ; 2015-001
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  19. Crowdfunding
    determinants of success and funding dynamics
    Erschienen: 2014
    Verlag:  Univ. [u.a.], Jena

    Over the past years crowdfunding emerged as an alternative funding channel for entrepreneurs. In contrast to traditional financiers (banks, venture capital firms or angel investors), crowdfunding allows individuals to fund entrepreneurs directly even... mehr

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    Over the past years crowdfunding emerged as an alternative funding channel for entrepreneurs. In contrast to traditional financiers (banks, venture capital firms or angel investors), crowdfunding allows individuals to fund entrepreneurs directly even with small amounts. We received individual-level data from Startnext, the biggest crowdfunding platform in Germany, enabling us to investigate funding dynamics, explore pledgers’ motivations and analyze projects’ success determinants. We find substantial heterogeneity of how success (about half of the 2,252 projects in our dataset get funded) is reached. When two thirds of the funding duration has passed, the majority of projects (59%) that eventually get funded are not on a successful track. However, pledges in the final phase can only partially be explained by a rush to get still unfunded projects succeed. Overall, 18.7% of pledges are made to projects that already reached their funding target and our analysis shows that the increased funding towards the deadline is due to pledges to projects that already made it, particularly pre-selling pledges.

     

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    Schriftenreihe: Jena economic research papers ; 2014-035
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  20. Safe options induce gender differences in risk attitudes
    Erschienen: May 2017
    Verlag:  IZA, Bonn, Germany

    Gender differences in risk attitudes are frequently observed, although recent literature has shown that they are context dependent rather than ubiquitous. In this paper we try to rationalize the heterogeneity of results investigating experimentally... mehr

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    Gender differences in risk attitudes are frequently observed, although recent literature has shown that they are context dependent rather than ubiquitous. In this paper we try to rationalize the heterogeneity of results investigating experimentally whether the presence of a safe option among the set of alternatives explains why females are more risk averse than males. We manipulate three widely used risk elicitation methods finding that the availability of a safe option causally affects risk attitudes. The presence of a riskless alternative does not entirely explain the gender gap but it has a significant effect in triggering or magnifying (when already present) such differences. Despite the pronounced instability that usually characterizes the measurement of risk preferences, we show estimating a structural model that the effect of a safe option is remarkably stable across tasks. This paper constitutes the first successful attempt to shed light on the determinants of gender differences in risk attitudes.

     

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    Schriftenreihe: Discussion paper / IZA ; no. 10793
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  21. Turning private vices into collective virtues
    a simple model and an experiment on the SourceForge development community
    Autor*in: Crosetto, Paolo
    Erschienen: giugno 2009
    Verlag:  Università degli Studi di Milano, Dipartimento di Scienze Economiche, Aziendali e Statistiche, Milano

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    Schriftenreihe: Working paper / Università degli Studi di Milano, Dipartimento di Scienze Economiche, Aziendali e Statistiche ; n. 2009, 14
    Umfang: 1 Online-Ressource (circa 27 Seiten), Illustrationen
  22. To patent or not to patent
    a pilot experiment on incentives to copyright in a sequential innovation setting
    Autor*in: Crosetto, Paolo
    Erschienen: marzo 2010
    Verlag:  Università degli Studi di Milano, Department of Economics, Management and Quantitative Methods, Milano

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    Schriftenreihe: Working paper / Università degli Studi di Milano, Dipartimento di Scienze Economiche, Aziendali e Statistiche ; n. 2010, 05
    Umfang: 1 Online-Ressource (circa 23 Seiten), Illustrationen
  23. Do consumers prefer offers that are easy to compare?
    an experimental investigation
    Erschienen: 2011
    Verlag:  Univ. [u.a.], Jena

    Consumers make mistakes when facing complex purchasing decision problems but if at least some consumers choose only among offers that are easy to compare with others then firms will adopt common ways to present their offers and thus make choice... mehr

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    Consumers make mistakes when facing complex purchasing decision problems but if at least some consumers choose only among offers that are easy to compare with others then firms will adopt common ways to present their offers and thus make choice easier (Gaudeul and Sugden, 2011). We design an original experiment to identify consumers' choice heuristics in the lab. Subjects are presented with menus of offers and do appear to favour offers that are easy to compare with others in the menu. While not all subjects do so, this is enough to deter firms from introducing spurious complexity in the way they present products. -- Bounded Rationality ; Cognitive Limitations ; Common Standards ; Consumer Choice ; Experimental Economics ; Heuristics ; Libertarian Paternalism ; Pricing Formats ; Spurious Complexity

     

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    hdl: 10419/56852
    Schriftenreihe: Jena economic research papers ; 2011,044
    Schlagworte: Konsumtheorie; Entscheidung; Vergleich; Begrenzte Rationalität; Experiment
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  24. Testing the strength and robustness of the attraction effect in consumer decision making
    Erschienen: 2014
    Verlag:  Univ. [u.a.], Jena

    We report the results of an original experiment that was designed to test the strength and robustness of the attraction effect. Rather than the usual simple tests for this effect, we consider a conceptually simple consumer purchasing task where... mehr

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    We report the results of an original experiment that was designed to test the strength and robustness of the attraction effect. Rather than the usual simple tests for this effect, we consider a conceptually simple consumer purchasing task where alternatives are however difficult to evaluate. For the attraction effect to be observed, the consumer must go through two steps: the first is to find out that two or more options are comparable, which leads him to exclude the dominated alternatives. The second is to favor the dominant option over those that are not comparable. Our experiment allows us to determine whether and how many individuals stop before each of those two steps. The results confirm the existence of an attraction effect in our setting, but the effect is not strong. Indeed, only a minority of subjects perform the second step. The effect is not robust to introducing larger differences in prices among options and to widening the range of options to choose from. We conclude by showing that our subjects would benefit from relying more on performing asymmetric dominance editing rather than on their skills in the purchasing task.

     

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    hdl: 10419/104571
    Schriftenreihe: Jena economic research papers ; 2014-021
    Umfang: Online-Ressource (49 S.), Ill., graph. Darst.
  25. Choosing whether to compete
    price and format competition with consumer confusion
    Erschienen: 2014
    Verlag:  Univ. [u.a.], Jena

    We run a market experiment where firms can choose not only their price but also whether to present comparable offers. They are faced with artificial demand from consumers who make mistakes when assessing the net value of products on the market. If... mehr

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    We run a market experiment where firms can choose not only their price but also whether to present comparable offers. They are faced with artificial demand from consumers who make mistakes when assessing the net value of products on the market. If some offers are comparable however, some consumers favor the best of the comparable offers vs. non-comparable offers. We vary the number of such consumers as well as the strength of their preferences for the best of the comparable offers. In treatments where firms observe the past decisions of their competitors, firms learn not to present comparable offers especially when many consumers prefer comparable offers. This occurs after initial periods with strong competition and leads to lower welfare for all consumers. In treatments where firms cannot monitor the competition, firms end up having to present comparable offers, which leads to an improvement in welfare for all consumers.

     

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    hdl: 10419/108534
    Schriftenreihe: Jena economic research papers ; 2014-026
    Umfang: Online-Ressource (40 S.), graph. Darst.