Publications:
Waiting To Give: Stated and Revealed Preferences (with Ashley Craig, Ellen Garbarino and Robert Slonim) [pdf] [supplementary material]
Management Science 63.11 (2016): 3672-3690.
We estimate and compare the effect of increased time costs on consumer satisfaction and behavior. We are able to move beyond the existing literature, which focuses on satisfaction and intention, and estimate the effect of waiting time on return behavior. Further, we do so in a prosocial context and our measure of cost is the length of time a blood donor spends waiting. We find that relying on satisfaction data masks important time cost sensitivities; namely, it is not how the donor feels about the wait time that matters for return behavior, but rather the actual duration of the wait. Consistent with theory we develop, our results indicate that waiting has a significant longer-term social cost: we estimate that a 38% increase (equivalent to one standard deviation) in the average wait would result in a 10% decrease in donations per year.
We Should Totally Open a Restaurant: How Optimism and Overconfidence Affect Beliefs (with Nicholas W. Papageorge) [pdf] [online appendix]
Forthcoming at Journal of Economic Psychology.
Wishful thinking, defined as the tendency to over-estimate the probability of high-payoff outcomes, is a widely-documented phenomenon that can affect decision-making across numerous domains, including finance, management, and entrepreneurship. We design an experiment to distinguish and test the relationship between two easily-confounded biases, optimism and overconfidence, both of which can contribute to wishful thinking. We find that optimism and overconfidence are positively correlated at the individual level and that both help to explain wishful thinking. These findings suggest that ignoring optimism results in an upwardly biased estimate of the role of overconfidence in explaining wishful thinking. To illustrate this point, we show that 30% of our observations are misclassified as under- or over-confident if optimism is omitted from the analysis. Our findings have potential implications for the design of information interventions since how agents incorporate information depends on whether the bias is ego-related.
Working Papers:
Redesigning the Market for Volunteers: A Donor Registry (with Ellen Garbarino, Robert Slonim and Carmen Wang) [pdf][supplemental material]
Job Market Paper.
Revision Requested at Management Science.
This paper addresses volunteer labor markets where the lack of price signals, non-pecuniary motivations to supply labor, and limited fungibility of supply lead to market failure. To address the causes of the market failure, we conduct a natural field experiment with volunteer whole blood donors where we introduce a market-clearing mechanism (henceforth: the Registry). Our intention-to-treat estimates suggest that subjects assigned to the Registry condition are 18-30\% more likely to volunteer and are 50% more responsive to critical shortage appeals than control subjects. Thus, the Registry significantly improves coordination between volunteer donors and collection centers, thereby improving market outcomes. We find evidence that the Registry's effectiveness stems from crowding-in volunteers with purely altruistic motives and volunteers with a preference for commitment.
Altruism or Diminishing Marginal Utility? (with Romain Gauriot & Robert Slonim) [pdf]
Submitted.
We challenge a commonly used assumption in the literature on social preferences and show that this assumption leads to significantly biased estimates of the social preference parameter. Using Monte Carlo simulations, we demonstrate that the literature's common restrictions on the curvature of the decision-makers utility function can dramatically bias the altruism parameter. We show that this is particularly problematic when comparing altruism between groups with well-documented differences in risk aversion or diminishing marginal utility, i.e., men versus women, giving motivated by pure versus warm glow motives, and wealthy versus poor.
The Innovative Personality (with Barton Hamilton) [pdf]
We consider the joint role of individual traits and information/experience in driving innovative behavior. Using a laboratory experiment, we are able to disentangle the role of traits on information demand versus directly on innovation. We find no evidence that individual traits unambiguously drive innovative behavior. Instead, we find evidence of a trait-based comparative advantage; that is, certain traits are assets when paired with some forms of information, but liabilities with others. Further, individuals optimally leverage their trait-based advantage when demanding information. Our results have implications for how we study the role of individual traits in labor markets, particularly entrepreneurship, with various sectors.
In Progress:
The Inter-temporal Effects of a Nudge (with Robert Slonim)
We test the inter-temporal effects of a popular policy ``nudge", the default option, in a charitable giving setting. We find that the nudge is effective: subjects randomly assigned to the ``opt-out" condition are significantly more likely to donate than subjects assigned to the ``opt-in" condition. Next, we test the inter-temporal effects of the nudge. Consistent with a habit formation model, we find evidence of positive, rather than negative, spill-over effects. Not only are subjects in the opt-out condition more likely to donate again at a later period, but estimating a local average treatment effect indicates that the nudge-induced increased propensity to give in ``today" (i.e., Round 1) causes a 40 percentage point increase in the propensity to give in ``tomorrow" (i.e., Round 2). These findings are consistent with a model of habit formation and moral consistency, whereby increased pro-sociality ``today" results in an increased demand for pro-sociality ``tomorrow".
Vice-Virtue Bundles: Substitution and non-Substitution Effects
Parents' Investments in Children and Children's Investment in Themselves (with Robert A. Pollak)
Waiting To Give: Stated and Revealed Preferences (with Ashley Craig, Ellen Garbarino and Robert Slonim) [pdf] [supplementary material]
Management Science 63.11 (2016): 3672-3690.
We estimate and compare the effect of increased time costs on consumer satisfaction and behavior. We are able to move beyond the existing literature, which focuses on satisfaction and intention, and estimate the effect of waiting time on return behavior. Further, we do so in a prosocial context and our measure of cost is the length of time a blood donor spends waiting. We find that relying on satisfaction data masks important time cost sensitivities; namely, it is not how the donor feels about the wait time that matters for return behavior, but rather the actual duration of the wait. Consistent with theory we develop, our results indicate that waiting has a significant longer-term social cost: we estimate that a 38% increase (equivalent to one standard deviation) in the average wait would result in a 10% decrease in donations per year.
We Should Totally Open a Restaurant: How Optimism and Overconfidence Affect Beliefs (with Nicholas W. Papageorge) [pdf] [online appendix]
Forthcoming at Journal of Economic Psychology.
Wishful thinking, defined as the tendency to over-estimate the probability of high-payoff outcomes, is a widely-documented phenomenon that can affect decision-making across numerous domains, including finance, management, and entrepreneurship. We design an experiment to distinguish and test the relationship between two easily-confounded biases, optimism and overconfidence, both of which can contribute to wishful thinking. We find that optimism and overconfidence are positively correlated at the individual level and that both help to explain wishful thinking. These findings suggest that ignoring optimism results in an upwardly biased estimate of the role of overconfidence in explaining wishful thinking. To illustrate this point, we show that 30% of our observations are misclassified as under- or over-confident if optimism is omitted from the analysis. Our findings have potential implications for the design of information interventions since how agents incorporate information depends on whether the bias is ego-related.
Working Papers:
Redesigning the Market for Volunteers: A Donor Registry (with Ellen Garbarino, Robert Slonim and Carmen Wang) [pdf][supplemental material]
Job Market Paper.
Revision Requested at Management Science.
This paper addresses volunteer labor markets where the lack of price signals, non-pecuniary motivations to supply labor, and limited fungibility of supply lead to market failure. To address the causes of the market failure, we conduct a natural field experiment with volunteer whole blood donors where we introduce a market-clearing mechanism (henceforth: the Registry). Our intention-to-treat estimates suggest that subjects assigned to the Registry condition are 18-30\% more likely to volunteer and are 50% more responsive to critical shortage appeals than control subjects. Thus, the Registry significantly improves coordination between volunteer donors and collection centers, thereby improving market outcomes. We find evidence that the Registry's effectiveness stems from crowding-in volunteers with purely altruistic motives and volunteers with a preference for commitment.
Altruism or Diminishing Marginal Utility? (with Romain Gauriot & Robert Slonim) [pdf]
Submitted.
We challenge a commonly used assumption in the literature on social preferences and show that this assumption leads to significantly biased estimates of the social preference parameter. Using Monte Carlo simulations, we demonstrate that the literature's common restrictions on the curvature of the decision-makers utility function can dramatically bias the altruism parameter. We show that this is particularly problematic when comparing altruism between groups with well-documented differences in risk aversion or diminishing marginal utility, i.e., men versus women, giving motivated by pure versus warm glow motives, and wealthy versus poor.
The Innovative Personality (with Barton Hamilton) [pdf]
We consider the joint role of individual traits and information/experience in driving innovative behavior. Using a laboratory experiment, we are able to disentangle the role of traits on information demand versus directly on innovation. We find no evidence that individual traits unambiguously drive innovative behavior. Instead, we find evidence of a trait-based comparative advantage; that is, certain traits are assets when paired with some forms of information, but liabilities with others. Further, individuals optimally leverage their trait-based advantage when demanding information. Our results have implications for how we study the role of individual traits in labor markets, particularly entrepreneurship, with various sectors.
In Progress:
The Inter-temporal Effects of a Nudge (with Robert Slonim)
We test the inter-temporal effects of a popular policy ``nudge", the default option, in a charitable giving setting. We find that the nudge is effective: subjects randomly assigned to the ``opt-out" condition are significantly more likely to donate than subjects assigned to the ``opt-in" condition. Next, we test the inter-temporal effects of the nudge. Consistent with a habit formation model, we find evidence of positive, rather than negative, spill-over effects. Not only are subjects in the opt-out condition more likely to donate again at a later period, but estimating a local average treatment effect indicates that the nudge-induced increased propensity to give in ``today" (i.e., Round 1) causes a 40 percentage point increase in the propensity to give in ``tomorrow" (i.e., Round 2). These findings are consistent with a model of habit formation and moral consistency, whereby increased pro-sociality ``today" results in an increased demand for pro-sociality ``tomorrow".
Vice-Virtue Bundles: Substitution and non-Substitution Effects
Parents' Investments in Children and Children's Investment in Themselves (with Robert A. Pollak)
