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Essays in Behavioral and Experimental Economics

Jhunjhunwala, Tanushree, Jhunjhunwala
http://rave.ohiolink.edu/etdc/view?acc_num=osu152388532104035

Abstract Details

2018, Doctor of Philosophy, Ohio State University, Economics.
My dissertation integrates behavioral economics with experimental methods to better understand consumer search behavior, social preferences, and power dynamics in political and organizational frameworks. In the first chapter of my dissertation, 'Searching to Avoid Regret: Experimental Evidence and an Application to Charitable Giving', I identify the role of post-decision feedback on product quality that individuals receive to explain the extent to which they would search available options in the following two settings: when making a choice decision for self and when choosing a charity to donate to. People gather seemingly disparate amounts of information before making a decision: We can spend an hour reading restaurant reviews before choosing where to eat, but only 3% of donors claim to have done any research on alternative charities before giving. In this paper, I investigate whether an important feature of the good predicts search intensity: whether or not the consumer anticipates ex post feedback about the product quality. If the consumer anticipates feedback, like how good the food at the restaurant is and/or how it compares with other restaurants around, she will search more to avoid feeling regret. However, if the consumer anticipates no feedback, as in never learning how the charity ranks on impact per dollar, then she will not search as exhaustively because there will be no regret to avoid. To identify and quantify the impact of regret on search intensity of individuals when making choice decisions for self, I amend the canonical sequential search model (Weitzman 1979) to account for regret. The amended model predicts higher search in the presence of regret. Using an abstract lab experiment with treatments differing only in the amount of feedback provided, I show this prediction holds. Guided by these findings, I conduct a framed field charitable giving experiment to investigate if absence of feedback on charity outcomes can explain why only a handful of donors claim to compare charitable options before donating. I develop an online experiment wherein subjects can research available charities before donating. The control group receives no feedback on charity performance, whereas the treatment group is aware of receiving this feedback ex post of making a donation. While the control group donates without gathering information on charities, the treatment group donates to better performing charities as a result of increased search. In the second chapter of my dissertation, 'Gains versus Costs in Legislative Bargaining', joint with Nels Christiansen and John Kagel, we explore changes in bargaining outcomes when allocating costs versus gains under the Baron-Ferejohn (1989) model. Although the treatments are isomorphic, we find there is lower proposer power and more delays under gains than costs, inconsistent with what might be expected under reference dependent preferences. Questionnaire responses indicate that voters are most concerned with being left out of the winning coalition in costs, wiping out their entire endowment. A second set of sessions with increased voters’ endowments resulted in modestly greater proposer power under gains. Surprisingly this resulted from increased proposer power under Gains, as opposed to a reduction in proposer power under Costs. In the third chapter of my dissertation, 'When Is Inequality Fair?', joint with Catherine Eckel, Haley Harwell, and Nicholas Lafferty, we conduct a lab experiment to investigate how preferences for income redistribution change as the source of income inequality changes. Subjects participate in six different tasks that determine their source of income. These tasks are divided into three types: chance-based, effort-based, and merit/ability-based. The degree of inequality is held constant across sources, with half of the subjects in a group earning $20 and the other half earning $100. Subjects are asked the highest amount of redistribution they'd support from high to low earners for each task, before being informed about their own income status. The highest redistribution amount supported by the majority in a group gets implemented. Prior studies have shown that participants support less redistribution when inequality is “deserved.” We are able to fine-tune that result based on subjects’ expectations about their own position in the earnings hierarchy to identify self-serving redistribution. We find one's beliefs to be a key factor impacting preference for redistribution, with a higher fraction of our subject pool supporting redistribution when the source of inequality is random/unfair.
John Kagel (Advisor)
Lucas Coffman (Committee Member)
Paul Healy (Committee Member)
149 p.
Economics; Experiments
Behavioral and Experimental Economics

Recommended Citations

Citations

  • Jhunjhunwala, Jhunjhunwala, T. (2018). Essays in Behavioral and Experimental Economics [Doctoral dissertation, Ohio State University]. OhioLINK Electronic Theses and Dissertations Center. http://rave.ohiolink.edu/etdc/view?acc_num=osu152388532104035

    APA Style (7th edition)

  • Jhunjhunwala, Jhunjhunwala, Tanushree. Essays in Behavioral and Experimental Economics. 2018. Ohio State University, Doctoral dissertation. OhioLINK Electronic Theses and Dissertations Center, http://rave.ohiolink.edu/etdc/view?acc_num=osu152388532104035.

    MLA Style (8th edition)

  • Jhunjhunwala, Jhunjhunwala, Tanushree. "Essays in Behavioral and Experimental Economics." Doctoral dissertation, Ohio State University, 2018. http://rave.ohiolink.edu/etdc/view?acc_num=osu152388532104035

    Chicago Manual of Style (17th edition)

osu152388532104035
332
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This open access ETD is published by The Ohio State University and OhioLINK.