Economic incentives transform psychological anomalies

Frey, Bruno S.; Eichenberger, Reiner

doi:10.1016/0167-2681(94)90068-x

Cited by 112 publications

(45 citation statements)

References 65 publications

(55 reference statements)

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…The NOAA panel report recognizes that problem in stating (Arrow et al, 1993) Our experiment fills an important gap between the correlative field studies by political scientists (Lupia, 1994;Bowler and Donovan, 1998;Lupia and Matsusaka, 2004;Druckman 2004), theoretical and experimental work on bounded rationality (Conlisk 1996;Ariely et al 2003;Frey and Eichenberger, 1994;McFadden, 1999;Payne et al, 1999;Camerer, 1995;Slembeck and Tyran, 2004;Vatn, 2004;Gowdy, 2004;Camerer and Fehr, 2006) and recent experiments on the role of social interactions in surveys of stated preferences for public goods (MacMillan et al, 2002;List et al, 2004;Hanley, 2006, Alvarez-Farizo et al, 2007). Our experiment makes the previous findings fruitful for applied valuation research.…”

Section: Discussionmentioning

confidence: 99%

Competitive politics, simplified heuristics, and preferences for public goods

Schläpfer

Schmitt

Roschewitz

2008

Ecological Economics

View full text Add to dashboard Cite

This paper examines the role of simplified heuristics in the formation of preferences for public goods. Political scientists have suggested that voters use simplified heuristics based on the positions of familiar parties to infer how a proposed policy will affect them and to cast a vote in line with their interests and values. Here, we use a two-stage field-survey experiment to investigate how knowledge of party positions affects policy choices. We followed standard procedures in developing an attribute-based choice experiment on alternative land-use policies in Switzerland. In contrast to the usual formulation, however, the hypothetical costs of the proposed policies were formulated as a percentage change in taxes. The benefit of this formulation relative to the usual absolute money amounts is that the credibility of the (hypothetical) costs for respondents does not depend on respondent income. Furthermore, the formulation allowed us to solicit party positions on the proposed policies. Six out of eight contacted parties provided their positions. We then conducted a split-sample mail survey where we included a table of the party positions with a sub-sample of the questionnaires. We report six main experimental results. (1) The response rate of the survey was unaffected by the party positions. (5) Respondents who knew the party positions were more sensitive to the tax attribute. (6) For respondents with medium and higher tax bills, the resulting willingness-to-pay estimates were decreased by a factor of two to ten relative to the control. These findings suggest that the party information helped the respondents to articulate more consistent preferences than in the treatment without the party information.

show abstract

Section: Discussionmentioning

confidence: 99%

Competitive politics, simplified heuristics, and preferences for public goods

Schläpfer

Schmitt

Roschewitz

2008

Ecological Economics

View full text Add to dashboard Cite

show abstract

“…The significant interactions found in the study underscore the importance of expanding this theoretical understanding to quantify the effect of number superstitions on prices. Data analysis highlights theoretical explanations of the rationality of superstition that cause consumers to be willing to pay to support their psychological anomalies [35]. Thus, this study contributes to the field of purchase intention studies by demonstrating that consumers may consider the combination of auspicious numbers and prices in making a decision for choosing a mobile number.…”

Section: Discussionmentioning

confidence: 95%

While Number Superstitions Exist: The Influence of Prices on Mobile Phone Consumers Purchase Intentions

Chen

Chang

2016

J Mass Communicat Journalism

View full text Add to dashboard Cite

“…This will allow drawing policy conclusions on the institutional level. We argue that it is important to carefully analyze how the anomalies found on the individual level are manifested on the level of society as a whole (Frey and Eichenberger 1994). Three different outcomes may result from this process.…”

Section: Aggregating Individual Behavioral Anomaliesmentioning

confidence: 99%

“…The relative price effect on which economics is based (Becker 1976, Frey 1999, 2001, Kirchgässner 2000 is, of course, a behavioral and not a mechanistic concept. 2 For further examples, see Frey and Eichenberger (1994). laboratory approach as normally undertaken, especially concerning the subject pool.…”

Section: Great Advancesmentioning

confidence: 99%

See 1 more Smart Citation

Aggregate Effects of Behavioral Anomalies: A New Research Area

Frey

Gallus

2014

Economics

Self Cite

View full text Add to dashboard Cite

Much recent research in economics focuses on exploring behavioral anomalies, i.e., systematic deviations from the assumptions of the rationally self-interested model of man. Laboratory studies are used to identify seeming inconsistencies with micro-economic theory on the level of individuals. Since economics is a social science, this article proposes that the next crucial step consists in shifting the focus to the macro-level. It examines the process through which behavioral anomalies are aggregated to a societal outcome. Since individuals are reactive when they interact with others and face institutional constraints, the aggregation process may lead to different outcomes than what has been observed in individual-level studies: the respective anomalies may disappear, or they may become stronger on the macro-level. The discussion demonstrates that there are a great number of aspects to be analyzed. The paper presents fragments of what could become a more extensive field of research.

show abstract

Economic incentives transform psychological anomalies

Cited by 112 publications

References 65 publications

Competitive politics, simplified heuristics, and preferences for public goods

Competitive politics, simplified heuristics, and preferences for public goods

While Number Superstitions Exist: The Influence of Prices on Mobile Phone Consumers Purchase Intentions

Aggregate Effects of Behavioral Anomalies: A New Research Area

Contact Info

Product

Resources

About