Lecture #7.pdf - Experiments Economics 4374(Econ 4374 Lecture 7 Experiments 1 27 Outline 1 Announcements 2 Questions from last time 3 Why experiment

Lecture #7.pdf - Experiments Economics 4374(Econ 4374...

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Experiments Economics 4374 September 10, 2019 (Econ 4374) Lecture 7 - Experiments September 10, 2019 1 / 27
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Outline 1 Announcements 2 Questions from last time 3 Why experiment Internal and external validity 4 Examples of experiments Scarcity 5 Different Types of Experiments Experiments vs. “real world” data Laboratory versus field experiments 6 Ethics in experiments (Econ 4374) Lecture 7 - Experiments September 10, 2019 2 / 27
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Announcements Announcements Assignment 3 due today. Assignment 4 posted on blackboard. Due next Tuesday (not eligible to skip - if this is your lowest grade, I will drop it only if you turn something in). (Econ 4374) Lecture 7 - Experiments September 10, 2019 3 / 27
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Questions from last time Some questions from last time Larger compensation for transaction price? (eg: offer to trade mug + more than 5cents for pen) I Haven’t seen this. Seems to be seen as unnecessary to demonstrate since the gap is wide. I Many variations listed here: Kahneman, Daniel, Jack L. Knetsch, and Richard H. Thaler. “Experimental tests of the endowment effect and the Coase theorem.” Journal of Political Economy 98, no. 6 (1990): 1325-1348. (Econ 4374) Lecture 7 - Experiments September 10, 2019 4 / 27
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Questions from last time Some questions from last time Endowment effect in other places I Some evidence endowment effect is more muted among East Asians (all Northwestern and University of Waterloo Undergrads): F Maddux, William W., Haiyang Yang, Carl Falk, Hajo Adam, Wendi Adair, Yumi Endo, Ziv Carmon, and Steven J. Heine. “For whom is parting with possessions more painful? Cultural differences in the endowment effect.” Psychological Science 21, no. 12 (2010): 1910-1917. (Econ 4374) Lecture 7 - Experiments September 10, 2019 5 / 27
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Questions from last time Some questions from last time Endowment effect in other places Some evidence it doesn’t always exist: I Apicella, Coren L., Eduardo M. Azevedo, Nicholas A. Christakis, and James H. Fowler. 2014. “Evolutionary Origins of the Endowment Effect: Evidence from Hunter-Gatherers.” American Economic Review , 104 (6): 1793-1805. I Find evidence of no endowment effect among group in Northern Tanzania living in the most isolated region (effect grows with geographic proximity to others, presumably through exposure) (Econ 4374) Lecture 7 - Experiments September 10, 2019 6 / 27
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Questions from last time Some questions from last time Endowment effects with children?
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