Human behavior can have effects on oneself and externalities on others. Mask wearing is such a behavior in the current pandemic. What motivates people to wear face masks in public when mask wearing is voluntary or not enforced? Which benefits should the policy makers rather emphasize in information campaigns—the reduced chances of getting the SARS-CoV-2 virus (benefits for oneself) or the reduced chances of transmitting the virus (benefits for others in the society)? In this paper, we link measured risk preferences and other-regarding preferences to mask wearing habits among 840 surveyed employees of two large Swiss hospitals. We find that the leading mask-wearing motivations change with age: While for older people, mask wearing habits are best explained by their self-regarding risk preferences, younger people are also motivated by other-regarding concerns. Our results are robust to different specifications including linear probability models, probit models and Lasso covariate selection models. Our findings thus allow drawing policy implications for effectively communicating public-health recommendations to frontline workers during the COVID-19 pandemic.

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Organizational decisions are often made by groups rather than individuals. Depending on the group composition, each member's characteristics—like gender and motivated beliefs—can influence the final group investment decision. To capture this, we design two types of investment situations in a randomized controlled laboratory experiment—one with fixed chances of success and one with performance-dependent chances of success. This novel design entails the perceived ability to “beat the odds” of the investment and thus models real-life investment situations more accurately than standard lottery choice. Our results demonstrate the benefits of mixed group composition in terms of both gender and overconfidence: Groups with all men and/or all overconfident group members consistently overinvest when a possibility to “beat the odds” is present, but not in standard situations. We explore several channels for our results and find that (i) individual probability perception, (ii) leader responsibility allocation and (iii) spillover effects from priming show significant effects.

The majority consensus in the empirical literature is that probability weighting functions are typically inverse-S shaped, that is, people tend to overweight small and underweight large probabilities. A separate stream of literature has reported event-splitting effects (also called violations of coalescing) and shown that they can explain violations of expected utility. This leads to the questions whether (1) the observed shape of weighting functions is a mere consequence of the coalesced presentation and, more generally, whether (2) preference elicitation should rely on presenting lotteries in a canonical split form instead of the commonly used coalesced form. We analyze data from a binary choice experiment where all lottery pairs are presented in both split and coalesced forms. Our results show that the presentation in a split form leads to a better fit of expected utility theory and to probability weighting functions that are closer to linear. We thus provide some evidence that the extent of probability weighting is not an ingrained feature, but rather a result of processing difficulties.