An Offer You Can't Refuse? Incentives Change What We Believe

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Much of economics assumes that higher incentives increase participation in a transaction only because they exceed more people's reservation price. This paper shows theoretically and experimentally that when information about the consequences is costly, higher incentives also change reservation prices to further increase participation. A higher incentive makes people gather information in a way that is more favorable to participation-as if they were persuading themselves to participate. Hence, incentives change not only what people choose, but also what they believe their choices entail. This result informs the debate about laws around the world that severely restrict incentives for transactions such as organ donation, surrogate motherhood, human egg donation, and medical trial participation. It helps bridge a gap between economists on the one hand and the policy makers and ethicists on the other. Terms of use: Documents inJEL-Codes: D030, D040, D840.

Marketplaces, Markets, and Market Design

“…Ambuehl, Niederle, and Roth (2015) find that a non-trivial minority of surveyed subjects share this intuition, a result replicated and extended by Leuker et al (2018). Ambuehl (2017), Ambuehl and Ockenfels (2017), and Ambuehl, Ockenfels, and Stewart (2018) explore the way large payments change not only the decision but the decision processes of experimental subjects, and draw conclusions about how informed consent faces extra challenges when the payments are very salient. These papers bridge some of the gap in the discussion of "coercion" in the ethics and economics literatures.…”

“…Under American law, opioids and other drugs with a high potential for abuse and addiction are legally classified as either Schedule I drugs, like heroin, which have no currently accepted medical use in the United States, or Schedule II drugs, like oxycodone and fentanyl, which are available as prescription painkillers, but cannot be sold or administered legally except when prescribed by a physician. 76 The law provides severe penalties for sale, resale, or inappropriate prescription of such drugs, and is vigorously enforced-often with mandatory minimum sentencing laws-so 74 For example, foods made from edible insects are available for sale in the United States, but are not widely purchased: see Ambuehl (2017) for an experiment in which consumption of edible insects is explored not only as distasteful to some, but also as a potentially repugnant transaction in which some people would prevent others from participating. 75 The Supreme Court decision that legalized same-sex marriage was Obergefell et al v. Hodges, Director, Ohio Department of Health, et al, that American prisons are filled with people convicted of drug offenses.…”

When money talks: Judging risk and coercion in high-paying clinical trials

“…Following [10], we categorized respondents into three types, based on how they rated the ethicality of different payment amounts in a side-by-side judgment at the end of the survey (δ rating = rating £10,000 − rating £1,000 ). Trustful respondents rated a payment of £10,000 as strictly more ethically appropriate than a payment of £1,000 (N = 712, 50%, δ rating = 1.84, CI = [1.77, 1.91]).…”

“…All of these transactions commodify the human bodyalthough clearly not all of these transactions may be considered equally repugnant, and some people or cultures do not see them as repugnant at all. The repugnance of clinical trials has so far mainly been attributed to payment coercing or unduly influencing volunteers [9,10]. Note that the terms "undue influence" and "coercion" are often used interchangeably, but see [4], 2017 for a disambiguation.…”

Paying for Kidneys? A Randomized Survey and Choice Experiment

“…4 See Basu (2007); Halpern et al (2010); Kerstein (2009);Radin (1996); Rippon (2012); Satz (2010). Ambuehl (2018) and Ambuehl et al (2015) provide experimental evidence of whether remuneration leads to undue influence. 5 See Council of Europe (2015); Delmonico et al (2002); Grant (2011); Sandel (2012); WHO (2004).…”