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We present an experiment that models a repeated public good provision setting where the policy maker or manager does not have perfect control over information flows. Rather, information seeking can be affected by changing the information default as well as the price of information. The default is one either with or without information about others’ contributions, and having information comes with a positive, zero or negative financial incentive. When information comes without a financial incentive or even is financially beneficial, almost all subjects choose to have the information, but around a third have the information even when this is costly. Moreover, a default of not having information about the others’ contributions leads to a slower unravelling of cooperation, independent of the financial incentives of having information. This slower unravelling is explained by the beliefs about others’ contributions in these treatments. A secondary informational default effect appears to take place. When the default is no information, subjects do not seek information more often but, conditional on financial incentives, they tend to believe that more other subjects seek information.

We present a coordination game experiment testing the robustness of the predictive power of level-k reasoning and team reasoning in a sample of Chinese tax administrators that is matched for likely socio-economic characteristics with our student sample. We show how the incidence of coordination game play is virtually identical between Chinese tax administrators and university students. However, relatively to non-students, students are comparatively more attracted by the focal point under team reasoning when this has equal payoffs and the other outcomes do not.

We present an experiment that models a repeated public good provision setting where the policy maker or manager does not have perfect control over information flows. Rather, information seeking can be affected by changing the information default as well as the price of information. The default is one either with or without information about others’ contributions, and having information comes with a positive, zero or negative financial incentive. When information comes without a financial incentive or even is financially beneficial, almost all subjects choose to have the information, but around a third have the information even when this is costly. Moreover, a default of not having information about the others’ contributions leads to a slower unravelling of cooperation, independent of the financial incentives of having information. This slower unravelling is explained by the beliefs about others’ contributions in these treatments. A secondary informational default effect appears to take place. When the default is no information, subjects do not seek information more often but, conditional on financial incentives, they tend to believe that more other subjects seek information.

We present a coordination game experiment testing the robustness of the predictive power of level-k reasoning and team reasoning in a sample of Chinese tax administrators that is matched for likely socio-economic characteristics with our student sample. We show how the incidence of coordination game play is virtually identical between Chinese tax administrators and university students. However, relatively to non-students, students are comparatively more attracted by the focal point under team reasoning when this has equal payoffs and the other outcomes do not.

In a real effort lab and online team production experiment, we analyze exerted effort under different conditions of individual accountability. In a repeated setting, we vary the degree to which production can be directly traced back to a collaborator’s individual or randomly drawn effort level, respectively. We find that individuals produce much less and the decline of effort over time is significantly steeper under high as compared to low and endogenously chosen personal accountability. While endogenous accountability provides an option for monitoring others, it does not force subjects to learn about their under-performing peers, thus limiting the typical decline of contributions over time. We conclude that accountability one step removed may be an interesting institutional setting for repeated collaborations in contexts where low accountability for political, social or legal reasons is not a viable option. (author's abstract)

In a real effort lab and online team production experiment, we analyze exerted effort under different conditions of individual accountability. In a repeated setting, we vary the degree to which production can be directly traced back to a collaborator’s individual or randomly drawn effort level, respectively. We find that individuals produce much less and the decline of effort over time is significantly steeper under high as compared to low and endogenously chosen personal accountability. While endogenous accountability provides an option for monitoring others, it does not force subjects to learn about their under-performing peers, thus limiting the typical decline of contributions over time. We conclude that accountability one step removed may be an interesting institutional setting for repeated collaborations in contexts where low accountability for political, social or legal reasons is not a viable option. (author's abstract)

We relate models based on costs of switching beliefs (e.g., due to inattention) to hypothesis tests. Specifically, for an inference problem with a penalty for mistakes and for switching the inferred value, a band of inaction is optimal. We show this band is equivalent to a confidence interval, and therefore to a two-sided hypothesis test.

We present a simple principal-agent experiment in which the principals are allowed to choose between a revenue-sharing, a bonus, and a trust contract, to offer to an agent. Our findings suggest that a large majority of experimental subjects choose the revenue-sharing contract. This choice turns out to be not only the most efficient but also, at the same time, fair. Overall, the distribution of earnings is only mildly skewed towards the principal. We conclude that, under revenue-sharing contracts, concerns for fairness can be closely associated with the use of monetary incentives. (Author's abstract)

We present a simple principal-agent experiment in which the principals are allowed to choose between a revenue-sharing, a bonus, and a trust contract, to offer to an agent. Our findings suggest that a large majority of experimental subjects choose the revenue-sharing contract. This choice turns out to be not only the most efficient but also, at the same time, fair. Overall, the distribution of earnings is only mildly skewed towards the principal. We conclude that, under revenue-sharing contracts, concerns for fairness can be closely associated with the use of monetary incentives. (Author's abstract)

Increasing the perception of legal risk via publicized litigation and lobbying for copyright law enforcement has had limited success in reducing unlawful content sharing by the public. We consider the extent to which engaging in file sharing online is motivated by the perceived benefits of this activity as opposed to perceived legal risks. Moreover, we explore moderators of the relationship between perceived risk and perceived benefits; namely trust in industry and legal regulators, and perceived online anonymity. We examine these questions via a large two-part survey of consumers of music (n = 658) and eBooks (n = 737). We find that perceptions of benefit, but not of legal risk, predict stated file sharing behavior. An affect heuristic is employed: as perceived benefit increases, perceived risk falls. This relationship is increased under high regulator and industry trust (which actually increases perceived risk in this study) and low anonymity (which also increases perceived risk). We propose that, given the limited impact of perceived legal risk upon unlawful downloading, it would be better for the media industries to target enhancing the perceived benefit and availability of lawful alternatives.

Unlawful digital media sharing is common and believed to be extremely damaging to business. Understanding unlawful file sharers' motivations offers the opportunity to develop business models and behavioral interventions to maximize consumers' and businesses’ benefit. This paper uses a systematic review of unlawful file sharing research, and the Theory of Planned Behavior, to motivate a large-scale panel study in which initial determinants were used to predict subsequent behavior. A meta-analysis found Attitudes, Subjective Norms and Perceived Behavioral Control were all associated with unlawful file sharing. Media type and demographic differences in the importance of Perceived Behavioral Control were found and attributed to more accurate evaluation of familiar activities, i.e., greater experience increases the influence of Perceived Behavioral Control but age does not. The panel study confirmed that greater past experience was associated with Perceived Behavioral Control and Intention. We conclude that past experience increases the efficacy of the Theory of Planned Behavior and specifically Perceived Behavioral control in predicting behavior, contrary to some widely held beliefs about the role of experience. The role of experience is therefore crucial to understanding people's choices. Practically, improving social approval, positive evaluation and access to lawful media should reduce unlawful behavior.

Unlawful digital media sharing is common and believed to be extremely damaging to business. Understanding unlawful file sharers' motivations offers the opportunity to develop business models and behavioral interventions to maximize consumers' and businesses’ benefit. This paper uses a systematic review of unlawful file sharing research, and the Theory of Planned Behavior, to motivate a large-scale panel study in which initial determinants were used to predict subsequent behavior. A meta-analysis found Attitudes, Subjective Norms and Perceived Behavioral Control were all associated with unlawful file sharing. Media type and demographic differences in the importance of Perceived Behavioral Control were found and attributed to more accurate evaluation of familiar activities, i.e., greater experience increases the influence of Perceived Behavioral Control but age does not. The panel study confirmed that greater past experience was associated with Perceived Behavioral Control and Intention. We conclude that past experience increases the efficacy of the Theory of Planned Behavior and specifically Perceived Behavioral control in predicting behavior, contrary to some widely held beliefs about the role of experience. The role of experience is therefore crucial to understanding people's choices. Practically, improving social approval, positive evaluation and access to lawful media should reduce unlawful behavior.

A “collusion puzzle” exists by which, even though increasing the number of firms reduces the ability to tacitly collude, and leads to a collapse in collusion in experimental markets with three or more firms, in natural markets there are such numbers of firms colluding successfully. We present an experiment showing that, if managers are deferential toward an authority, firms can induce more collusion by delegating production decisions to middle managers and providing suitable informal nudges. This holds not only with two but also with four firms. We are also able to distinguish compliance effects from coordination effects. (Author's abstract)

We present the results of an experiment that (a) shows the usefulness of screening out drop-outs and (b) tests whether different methods of payment and reminder intervals affect charitable giving. Following a lab session, participants could make online donations to charity for a total duration of three months. Our procedure justifying the exclusion of drop-outs consists in requiring participants to collect payments in person flexibly and as known in advance and as highlighted to them later. Our interpretation is that participants who failed to collect their positive payments under these circumstances are likely not to satisfy dominance. If we restrict the sample to subjects who did not drop out, but not otherwise, reminders significantly increase the overall amount of charitable giving. We also find that weekly reminders are no more effective than monthly reminders in increasing charitable giving, and that, in our three months duration experiment, standing orders do not increase giving relative to one-off donations. (Author's Abstract)

We present the results of an experiment that (a) shows the usefulness of screening out drop-outs and (b) tests whether different methods of payment and reminder intervals affect charitable giving. Following a lab session, participants could make online donations to charity for a total duration of three months. Our procedure justifying the exclusion of drop-outs consists in requiring participants to collect payments in person flexibly and as known in advance and as highlighted to them later. Our interpretation is that participants who failed to collect their positive payments under these circumstances are likely not to satisfy dominance. If we restrict the sample to subjects who did not drop out, but not otherwise, reminders significantly increase the overall amount of charitable giving. We also find that weekly reminders are no more effective than monthly reminders in increasing charitable giving, and that, in our three months duration experiment, standing orders do not increase giving relative to one-off donations. (Author's Abstract)

A “collusion puzzle” exists by which, even though increasing the number of firms reduces the ability to tacitly collude, and leads to a collapse in collusion in experimental markets with three or more firms, in natural markets there are such numbers of firms colluding successfully. We present an experiment showing that, if managers are deferential toward an authority, firms can induce more collusion by delegating production decisions to middle managers and providing suitable informal nudges. This holds not only with two but also with four firms. We are also able to distinguish compliance effects from coordination effects. (Author's abstract)

A “collusion puzzle” exists by which, even though increasing the number of firms reduces the ability to tacitly collude, and leads to a collapse in collusion in experimental markets with three or more firms, in natural markets there are such numbers of firms colluding successfully. We present an experiment showing that, if managers are deferential toward an authority, firms can induce more collusion by delegating production decisions to middle managers and providing suitable informal nudges. This holds not only with two but also with four firms. We are also able to distinguish compliance effects from coordination effects. (Author's abstract)

We present the results of an experiment that (a) shows the usefulness of screening out drop-outs and (b) tests whether different methods of payment and reminder intervals affect charitable giving. Following a lab session, participants could make online donations to charity for a total duration of three months. Our procedure justifying the exclusion of drop-outs consists in requiring participants to collect payments in person flexibly and as known in advance and as highlighted to them later. Our interpretation is that participants who failed to collect their positive payments under these circumstances are likely not to satisfy dominance. If we restrict the sample to subjects who did not drop out, but not otherwise, reminders significantly increase the overall amount of charitable giving. We also find that weekly reminders are no more effective than monthly reminders in increasing charitable giving, and that, in our three months duration experiment, standing orders do not increase giving relative to one-off donations. (Author's Abstract)

In an experiment on markets for services, we find that consumers are likely to stick to default tariffs and achieve suboptimal outcomes. We find that inattention to the task of choosing a better tariff is likely to be a substantial problem in addition to any task and tariff complexity effect. The institutional setup on which we primarily model our experiment is the UK electricity and gas markets, and our conclusion is that the new measures by the UK regulator Ofgem to improve consumer outcomes are likely to be of limited impact.

To reduce the widespread unlawful downloading of copyrighted media, industry has responded via litigation against individual file sharers and by lobbying governments to strengthen intellectual property laws. Such approaches have had limited success in reducing unlawful content sharing. We explore how much perceptions of legal risk impact upon stated unlawful behaviour as well as how relevant factors such as the perceived benefits of unlawful file sharing, trust in industry and legal regulators, and perceived anonymity online impact upon this perceived risk. We examine these questions via a large two-part survey of consumers of music (n = 658) and eBooks (n = 737). We find perceptions of legal risk fail to predict stated file sharing behaviour, while the perceived benefit of unlawfully downloaded files does predict behaviour. The relationship between perceived risk and behaviour is partially mitigated by perceived benefits. We also show that trust in industry and regulators enhance perceptions of risk, while perceptions of anonymity lower perceptions of risk. High trust and high anonymity impact on the effect of perceived benefit on risk perception. These findings have practical implications in terms of the likely success of different behavioural interventions and theoretical implications into how perceptions of risk are processed.

We employ a scoping review methodology to consider and assess the existing evidence on the determinants of unlawful file sharing (UFS) transparently and systematically. Based on the evidence, we build a simple conceptual framework to model the psychological decision to engage in UFS, purchase legally or do nothing. We identify social, moral, experiential, technical, legal and financial utility sources of the decision to purchase or to file share. They interact in complex ways. We consider the strength of evidence within these areas and note patterns of results. There is good evidence for influences on UFS within each of the identified determinants, particularly for self-reported measures, with more behavioral research needed. There are also indications that the reasons for UFS differ across media; more studies exploring media other than music are required.

In an experiment on markets for services, we find that consumers are likely to stick to default tariffs and achieve suboptimal outcomes. We find that inattention to the task of choosing a better tariff is likely to be a substantial problem in addition to any task and tariff complexity effect. The institutional setup on which we primarily model our experiment is the UK electricity and gas markets, and our conclusion is that the new measures by the UK regulator Ofgem to improve consumer outcomes are likely to be of limited impact.

To reduce the widespread unlawful downloading of copyrighted media, industry has responded via litigation against individual file sharers and by lobbying governments to strengthen intellectual property laws. Such approaches have had limited success in reducing unlawful content sharing. We explore how much perceptions of legal risk impact upon stated unlawful behaviour as well as how relevant factors such as the perceived benefits of unlawful file sharing, trust in industry and legal regulators, and perceived anonymity online impact upon this perceived risk. We examine these questions via a large two-part survey of consumers of music (n = 658) and eBooks (n = 737). We find perceptions of legal risk fail to predict stated file sharing behaviour, while the perceived benefit of unlawfully downloaded files does predict behaviour. The relationship between perceived risk and behaviour is partially mitigated by perceived benefits. We also show that trust in industry and regulators enhance perceptions of risk, while perceptions of anonymity lower perceptions of risk. High trust and high anonymity impact on the effect of perceived benefit on risk perception. These findings have practical implications in terms of the likely success of different behavioural interventions and theoretical implications into how perceptions of risk are processed.

We employ a scoping review methodology to consider and assess the existing evidence on the determinants of unlawful file sharing (UFS) transparently and systematically. Based on the evidence, we build a simple conceptual framework to model the psychological decision to engage in UFS, purchase legally or do nothing. We identify social, moral, experiential, technical, legal and financial utility sources of the decision to purchase or to file share. They interact in complex ways. We consider the strength of evidence within these areas and note patterns of results. There is good evidence for influences on UFS within each of the identified determinants, particularly for self-reported measures, with more behavioral research needed. There are also indications that the reasons for UFS differ across media; more studies exploring media other than music are required.

We employ an innovative scoping review methodology to consider and assess the existing evidence on the consequences and determinants of unlawful file sharing (UFS) transparently and systematically. We complement this with a simple conceptual framework to model the decision to engage in UFS and to map out the existing evidence. Whether UFS is good or bad for welfare remains unclear. Regarding determinants of UFS, studies that employ observed behavior as a measured outcome remain few, and fewer still for potential moral, experiential and social determinants. More experimental and longitudinal studies assessing causality are needed.

A launch event for a scoping review of a decade of file sharing research was held by the CREATe group on 11 April 2014. Panellists were invited from stakeholder groups including industry, civil rights and technological intermediaries. The review addressed five key determinants of unlawful file sharing which were repeatedly found in the 206 reviewed studies: legal and financial, technical, experiential, social and moral. It also covered issues of social welfare and the costs and benefits to producers and consumers. The unequal coverage of different media sectors and research types, and the insufficient actual causal behavioural data, were highlighted. A subsequent discussion covered technological change, harm and issues of production. There is need for more and better evidence to support policy.

We employ an innovative scoping review methodology to consider and assess the existing evidence on the consequences and determinants of unlawful file sharing (UFS) transparently and systematically. We complement this with a simple conceptual framework to model the decision to engage in UFS and to map out the existing evidence. Whether UFS is good or bad for welfare remains unclear. Regarding determinants of UFS, studies that employ observed behavior as a measured outcome remain few, and fewer still for potential moral, experiential and social determinants. More experimental and longitudinal studies assessing causality are needed.

A launch event for a scoping review of a decade of file sharing research was held by the CREATe group on 11 April 2014. Panellists were invited from stakeholder groups including industry, civil rights and technological intermediaries. The review addressed five key determinants of unlawful file sharing which were repeatedly found in the 206 reviewed studies: legal and financial, technical, experiential, social and moral. It also covered issues of social welfare and the costs and benefits to producers and consumers. The unequal coverage of different media sectors and research types, and the insufficient actual causal behavioural data, were highlighted. A subsequent discussion covered technological change, harm and issues of production. There is need for more and better evidence to support policy.

We investigate the effects of a range of different types of anchor on WTP and WTA valuations of familiar consumer products, elicited through individuals’ buying or selling decisions at given prices. We find anchoring effects only when the anchor value is framed as a plausible price for the good for which the individual is a potential buyer or seller. Anchoring effects are stronger for WTA than for WTP. We conclude that anchoring effects can affect market behaviour, but that not all anchors are effective.

We investigate the effects of a range of different types of anchor on WTP and WTA valuations of familiar consumer products, elicited through individuals’ buying or selling decisions at given prices. We find anchoring effects only when the anchor value is framed as a plausible price for the good for which the individual is a potential buyer or seller. Anchoring effects are stronger for WTA than for WTP. We conclude that anchoring effects can affect market behaviour, but that not all anchors are effective.

We present a macroeconomic market experiment to isolate the impact of monetary shocks on the exchange rate, as an alternative to SVAR identification. In a non-stochastic treatment, covered interest rate parity holds and predicted exchange rates are tracked well. In a stochastic treatment, we model expectations using a Neyman-Pearson hypothesis test (inferential expectations) and find evidence of belief conservatism and uncovered interest rate parity failure. The market environment magnifies belief conservatism, which is opposite to the standard claim that markets tend to eliminate individual choice anomalies.

"We present a neural network methodology for learning game-playing rules in general. Existing research suggests learning to find a Nash equilibrium in a new game is too difficult a task for a neural network, but says little about what it will do instead. We observe that a neural network trained to find Nash equilibria in a known subset of games will use self-taught rules developed endogenously when facing new games. These rules are close to payoff dominance and its best response. Our findings are consistent with existing experimental results, both in terms of subject's methodology and success rates." [author's abstract]

We incorporate inferential expectations into the Barro-Gordon model (Barro and Gordon, 1983a) of time inconsistency and consider reputational equilibria. The range of sustainable equilibria shrinks as the private sector becomes more belief-conservative.

This paper studies utility interdependence in the laboratory. We design an experiment where subjects can reduce ("burn") other subjects' money. Those who burn the money of others have to give up some of their own cash. Despite this cost, and contrary to the assumptions of economics textbooks, the majority of our subjects choose to destroy at least part of others' money holdings. We vary experimentally the amount that subjects have to pay to reduce other people's cash. The implied price elasticity of burning is calculated; it is mostly less than unity. There is a strong correlation between wealth, or rank, and the amounts by which subjects are burnt. In making their decisions, many burners, especially disadvantaged ones, seem to care about whether another person ‘deserves’ the money he has. Desert is not simply a matter of relative payoff.

In fact, a super-short ultimatum makes it less likely that people will bite, write Mengjie Wang, Robert Sugden and Daniel Zizzo