Whose money is it anyway? Using prepaid incentives in experimental economics to create a natural environment
Author
Abstract
Suggested Citation
DOI: 10.1007/s10683-011-9294-4
Download full text from publisher
As the access to this document is restricted, you may want to search for a different version of it.
References listed on IDEAS
- Kristin M. Jakobsson & Andrew K. Dragun, 1996. "Contingent Valuation and Endangered Species," Books, Edward Elgar Publishing, number 1120.
- Peter Brooks & Horst Zank, 2005. "Loss Averse Behavior," Journal of Risk and Uncertainty, Springer, vol. 31(3), pages 301-325, December.
- Lucy Ackert & Narat Charupat & Bryan Church & Richard Deaves, 2006.
"An experimental examination of the house money effect in a multi-period setting,"
Experimental Economics, Springer;Economic Science Association, vol. 9(1), pages 5-16, April.
- Lucy F. Ackert & Narat Charupat & Bryan K. Church & Richard Deaves & James Tompkins, 2003. "An experimental examination of the house money effect in a multi-period setting," FRB Atlanta Working Paper 2003-13, Federal Reserve Bank of Atlanta.
- Corrigan, Jay R. & Rousu, Matthew C., 2006.
"AJAE Appendix: Posted Prices and Bid Affiliation: Evidence from Experimental Auctions,"
American Journal of Agricultural Economics APPENDICES, Agricultural and Applied Economics Association, vol. 88(4), pages 1-12, November.
- Jay R. Corrigan & Matthew C. Rousu, 2006. "Posted Prices and Bid Affiliation: Evidence from Experimental Auctions," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(4), pages 1078-1090.
- Richard H. Thaler & Amos Tversky & Daniel Kahneman & Alan Schwartz, 1997. "The Effect of Myopia and Loss Aversion on Risk Taking: An Experimental Test," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(2), pages 647-661.
- Halstead, John M. & Luloff, A.E. & Stevens, Thomas H., 1992. "Protest Bidders In Contingent Valuation," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 21(2), pages 1-10, October.
- repec:ken:wpaper:0602 is not listed on IDEAS
- Alvin E. Roth & Axel Ockenfels, 2002.
"Last-Minute Bidding and the Rules for Ending Second-Price Auctions: Evidence from eBay and Amazon Auctions on the Internet,"
American Economic Review, American Economic Association, vol. 92(4), pages 1093-1103, September.
- Alvin E. Roth & Axel Ockenfels, "undated". "Last-Minute Bidding and the Rules for Ending Second-Price Auctions: Evidence from eBay and Amazon Auctions on the Internet," Papers on Strategic Interaction 2002-32, Max Planck Institute of Economics, Strategic Interaction Group.
- Harrison, Glenn W, 1989.
"Theory and Misbehavior of First-Price Auctions,"
American Economic Review, American Economic Association, vol. 79(4), pages 749-762, September.
- Glenn W. Harrison, 1987. "Theory and Misbehavior of First-Price Auctions," University of Western Ontario, Departmental Research Report Series 8710, University of Western Ontario, Department of Economics.
- Jeremy Clark, 2002. "House Money Effects in Public Good Experiments," Experimental Economics, Springer;Economic Science Association, vol. 5(3), pages 223-231, December.
- Shogren, Jason F. & Cho, Sungwon & Koo, Cannon & List, John & Park, Changwon & Polo, Pablo & Wilhelmi, Robert, 2001.
"Auction mechanisms and the measurement of WTP and WTA,"
Resource and Energy Economics, Elsevier, vol. 23(2), pages 97-109, April.
- Sungwon Cho & Cannon Koo & John List & Changwon Park & Pablo Polo & Jason Shogren & Robert Wilhelmi, 2001. "Auction mechanisms and the measurement of WTP and WTA," Natural Field Experiments 00516, The Field Experiments Website.
- Philip Brown & Nick Chappel & Ray Da Silva Rosa & Terry Walter, 2006. "The Reach of the Disposition Effect: Large Sample Evidence Across Investor Classes," International Review of Finance, International Review of Finance Ltd., vol. 6(1‐2), pages 43-78, March.
- Jorgensen, Bradley S. & Syme, Geoffrey J., 2000. "Protest responses and willingness to pay: attitude toward paying for stormwater pollution abatement," Ecological Economics, Elsevier, vol. 33(2), pages 251-265, May.
- Richard H. Thaler & Eric J. Johnson, 1990. "Gambling with the House Money and Trying to Break Even: The Effects of Prior Outcomes on Risky Choice," Management Science, INFORMS, vol. 36(6), pages 643-660, June.
- Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
- Martin Weber & Heiko Zuchel, 2005. "How Do Prior Outcomes Affect Risk Attitude? Comparing Escalation of Commitment and the House-Money Effect," Decision Analysis, INFORMS, vol. 2(1), pages 30-43, March.
- Shefrin, Hersh M & Thaler, Richard H, 1988. "The Behavioral Life-Cycle Hypothesis," Economic Inquiry, Western Economic Association International, vol. 26(4), pages 609-643, October.
- Daniel Read, 2005. "Monetary incentives, what are they good for?," Journal of Economic Methodology, Taylor & Francis Journals, vol. 12(2), pages 265-276.
- Larry Davis & B. Joyce & Matthew Roelofs, 2010. "My money or yours: house money payment effects," Experimental Economics, Springer;Economic Science Association, vol. 13(2), pages 189-205, June.
- Shyamsundar, Priya & Kramer, Randall A., 1996. "Tropical Forest Protection: An Empirical Analysis of the Costs Borne by Local People," Journal of Environmental Economics and Management, Elsevier, vol. 31(2), pages 129-144, September.
- P. Calia & E. Strazzera, 1999. "A Sample Selection Model for Protest Non-Response Votes in Contingent Valuation Analyses," Working Paper CRENoS 199905, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
- Krahnen, Jan Pieter & Rieck, Christian & Theissen, Erik, 1997. "Inferring risk attitudes from certainty equivalents: Some lessons from an experimental study," Journal of Economic Psychology, Elsevier, vol. 18(5), pages 469-486, September.
- Timothy Haab, 1999. "Nonparticipation or Misspecification? The Impacts of Nonparticipation on Dichotomous Choice Contingent Valuation," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 14(4), pages 443-461, December.
- Frino, Alex & Grant, Joel & Johnstone, David, 2008. "The house money effect and local traders on the Sydney Futures Exchange," Pacific-Basin Finance Journal, Elsevier, vol. 16(1-2), pages 8-25, January.
- Friedman, Daniel, 1992. "Theory and Misbehavior of First-Price Auctions: Comment," American Economic Review, American Economic Association, vol. 82(5), pages 1374-1378, December.
- Ert, Eyal & Erev, Ido, 2008. "The rejection of attractive gambles, loss aversion, and the lemon avoidance heuristic," Journal of Economic Psychology, Elsevier, vol. 29(5), pages 715-723, November.
- Merlo, Antonio & Schotter, Andrew, 1992. "Theory and Misbehavior of First-Price Auctions: Comment," American Economic Review, American Economic Association, vol. 82(5), pages 1413-1425, December.
- Eyal Ert & Ido Erev, 2010. "On the Descriptive Value of Loss Aversion in Decisions under Risk," Harvard Business School Working Papers 10-056, Harvard Business School.
- Glenn Harrison, 2007. "House money effects in public good experiments: Comment," Experimental Economics, Springer;Economic Science Association, vol. 10(4), pages 429-437, December.
- William Vickrey, 1961. "Counterspeculation, Auctions, And Competitive Sealed Tenders," Journal of Finance, American Finance Association, vol. 16(1), pages 8-37, March.
- E. Strazzera & R. Scarpa & P. Calia & G. Garrod & K. Willis, 2000. "Modelling zero bids in contingent valuation surveys," Working Paper CRENoS 200006, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
- Kagel, John H & Roth, Alvin E, 1992. "Theory and Misbehavior in First-Price Auctions: Comment," American Economic Review, American Economic Association, vol. 82(5), pages 1379-1391, December.
- Fiore, Annamaria, 2009. "Experimental Economics: Some Methodological Notes," MPRA Paper 12498, University Library of Munich, Germany.
- Kachelmeier, Steven J & Shehata, Mohamed, 1992. "Examining Risk Preferences under High Monetary Incentives: Experimental Evidence from the People's Republic of China," American Economic Review, American Economic Association, vol. 82(5), pages 1120-1141, December.
- Don L. Coursey & John L. Hovis & William D. Schulze, 1987. "The Disparity Between Willingness to Accept and Willingness to Pay Measures of Value," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 102(3), pages 679-690.
- Whitehead, John C. & Groothuis, Peter A. & Blomquist, Glenn C., 1993. "Testing for non-response and sample selection bias in contingent valuation : Analysis of a combination phone/mail survey," Economics Letters, Elsevier, vol. 41(2), pages 215-220.
- Cox, James C & Smith, Vernon L & Walker, James M, 1992. "Theory and Misbehavior of First-Price Auctions: Comment," American Economic Review, American Economic Association, vol. 82(5), pages 1392-1412, December.
- Shavit, Tal & Sonsino, Doron & Benzion, Uri, 2001. "A comparative study of lotteries-evaluation in class and on the Web," Journal of Economic Psychology, Elsevier, vol. 22(4), pages 483-491, August.
- Goeree, Jacob K. & Offerman, Theo, 2003. "Winner's curse without overbidding," European Economic Review, Elsevier, vol. 47(4), pages 625-644, August.
- Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
Most related items
These are the items that most often cite the same works as this one and are cited by the same works as this one.- Vincent P. Crawford & Nagore Iriberri, 2007.
"Level-k Auctions: Can a Nonequilibrium Model of Strategic Thinking Explain the Winner's Curse and Overbidding in Private-Value Auctions?,"
Econometrica, Econometric Society, vol. 75(6), pages 1721-1770, November.
- Crawford, Vincent P. & Iriberri, Nagore, 2005. "Level-k Auctions: Can a Non-Equilibrium Model of Strategic Thinking Explain the Winner's Curse and Overbidding in Private-Value Auctions?," University of California at San Diego, Economics Working Paper Series qt12586197, Department of Economics, UC San Diego.
- Vincent P. Crawford & Nagore Iriberri, 2006. "Level-k Auctions: Can a Non-Equilibrium Model of Strategic Thinking Explain the Winner's Curse and Overbidding in Private-Value Auctions?," Levine's Bibliography 321307000000000256, UCLA Department of Economics.
- Vincent P. Crawford & Nagore Iriberri, 2005. "Level-k Auctions: Can a Non-Equilibrium Model of Strategic Thinking Explain the Winner's Curse and Overbidding in Private-Value Auctions?," Levine's Bibliography 784828000000000604, UCLA Department of Economics.
- Vincent P Crawford & Nagore Iriberri, 2007. "Level-k Auctions: Can a Non-Equilibrium Model of Strategic Thinking Explain the Winner's Curse and Overbidding in Private-Value Auctions?," Levine's Bibliography 321307000000001005, UCLA Department of Economics.
- repec:ken:wpaper:0601 is not listed on IDEAS
- Maximilian Rüdisser & Raphael Flepp & Egon Franck, 2017.
"Do casinos pay their customers to become risk-averse? Revising the house money effect in a field experiment,"
Experimental Economics, Springer;Economic Science Association, vol. 20(3), pages 736-754, September.
- Maximilian Rüdisser & Raphael Flepp & Egon Franck, 2015. "Do Casinos Pay their Customers to Become Risk-averse? Revising the House Money Effect in a Field Experiment," Working Papers 360, University of Zurich, Department of Business Administration (IBW).
- Fiore, Annamaria, 2009. "Experimental Economics: Some Methodological Notes," MPRA Paper 12498, University Library of Munich, Germany.
- Jinkwon Lee, 2007. "Repetition And Financial Incentives In Economics Experiments," Journal of Economic Surveys, Wiley Blackwell, vol. 21(3), pages 628-681, July.
- Goeree, Jacob K. & Holt, Charles A. & Palfrey, Thomas R., 2002.
"Quantal Response Equilibrium and Overbidding in Private-Value Auctions,"
Journal of Economic Theory, Elsevier, vol. 104(1), pages 247-272, May.
- Palfrey, Thomas R. & Goeree, Jacob & Holt, Charles, 2000. "Quantal Response Equilibrium and Overbidding in Private-value Auctions," Working Papers 1073, California Institute of Technology, Division of the Humanities and Social Sciences.
- Thomas Palfrey, 2002. "Quantal Response Equilibrium and Overbidding in Private Value Auctions," Theory workshop papers 357966000000000089, UCLA Department of Economics.
- Jacob K. Goeree & Charles A. Holt & Thomas R. Palfrey, 2000. "Quantal Response Equilibrium and Overbidding in Private-Value Auctions," Virginia Economics Online Papers 345, University of Virginia, Department of Economics.
- Paul Pezanis-Christou & Andres Romeu, 2002. "Structural Inferences from First-Price Auction Experiments," UFAE and IAE Working Papers 531.02, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Yu Yvette Zhang & Rodolfo M Nayga Jr. & Dinah Pura T Depositario, 2019. "Learning and the possibility of losing own money reduce overbidding: Delayed payment in experimental auctions," PLOS ONE, Public Library of Science, vol. 14(5), pages 1-19, May.
- Hauke Jelschen & Ulrich Schmidt, 2023. "Windfall gains and house money: The effects of endowment history and prior outcomes on risky decision–making," Journal of Risk and Uncertainty, Springer, vol. 66(3), pages 215-232, June.
- Maximilian Rüdisser & Raphael Flepp & Egon Franck, 2017. "When do reference points update? A field analysis of the effect of prior gains and losses on risk-taking over time," Working Papers 369, University of Zurich, Department of Business Administration (IBW).
- Emel Filiz & Erkut Y. Ozbay, 2005. "Auctions with Anticipated Regret," Experimental 0511006, University Library of Munich, Germany.
- Elisabetta Strazzera & Margarita Genius & Riccardo Scarpa & George Hutchinson, 2003. "The Effect of Protest Votes on the Estimates of WTP for Use Values of Recreational Sites," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 25(4), pages 461-476, August.
- Deaves, Richard & Kluger, Brian & Miele, Jennifer, 2018. "An exploratory experimental analysis of path-dependent investment behaviors," Journal of Economic Psychology, Elsevier, vol. 67(C), pages 47-65.
- Malul, Miki & Rosenboim, Mosi & Shavit, Tal, 2013. "So when are you loss averse? Testing the S-shaped function in pricing and allocation tasks," Journal of Economic Psychology, Elsevier, vol. 39(C), pages 101-112.
- Grundl, Serafin & Zhu, Yu, 2023. "Robust inference in first-price auctions: Overbidding as an identifying restriction," Journal of Econometrics, Elsevier, vol. 235(2), pages 484-506.
- Andreas Roider & Patrick W. Schmitz, 2012.
"Auctions with Anticipated Emotions: Overbidding, Underbidding, and Optimal Reserve Prices,"
Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(3), pages 808-830, September.
- Schmitz, Patrick W. & Roider, Andreas, 2007. "Auctions with Anticipated Emotions: Overbidding, Underbidding, and Optimal Reserve Prices," CEPR Discussion Papers 6476, C.E.P.R. Discussion Papers.
- Nathalie Etchart-Vincent & Olivier l’Haridon, 2011.
"Monetary incentives in the loss domain and behavior toward risk: An experimental comparison of three reward schemes including real losses,"
Journal of Risk and Uncertainty, Springer, vol. 42(1), pages 61-83, February.
- Nathalie Etchart-Vincent & Olivier L'Haridon, 2011. "Monetary incentives in the loss domain and behavior toward risk: An experimental comparison of three reward schemes including real losses," Post-Print hal-00742027, HAL.
- Nathalie Etchart-Vincent & Olivier L'Haridon, 2011. "Monetary incentives in the loss domain and behavior toward risk: An experimental comparison of three reward schemes including real losses," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00742027, HAL.
- Roman M. Sheremeta, 2016.
"Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests,"
Working Papers
16-21, Chapman University, Economic Science Institute.
- Roman Sheremeta, 2018. "Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests," Working Papers 18-03, Chapman University, Economic Science Institute.
- Sheremeta, Roman, 2016. "Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests," MPRA Paper 73731, University Library of Munich, Germany.
- Patrick Bajari & Ali Hortacsu, 2005.
"Are Structural Estimates of Auction Models Reasonable? Evidence from Experimental Data,"
Journal of Political Economy, University of Chicago Press, vol. 113(4), pages 703-741, August.
- Patrick Bajari & Ali Hortacsu, 2003. "Are Structural Estimates of Auction Models Reasonable? Evidence from Experimental Data," NBER Working Papers 9889, National Bureau of Economic Research, Inc.
- Patrick Bajari & Ali Hortacsu, 2003. "Are Structural Estimates of Auction Models Reasonable? Evidence from Experimental Data," Working Papers 03002, Stanford University, Department of Economics.
- Kim, Dong-Hyuk & Ratan, Anmol, 2022. "Disentangling risk aversion and loss aversion in first-price auctions: An empirical approach," European Economic Review, Elsevier, vol. 150(C).
- Nicolas Pasquier & Olivier Bonroy & Alexis Garapin, 2022.
"Risk aversion and equilibrium selection in a vertical contracting setting: an experiment,"
Theory and Decision, Springer, vol. 93(4), pages 585-614, November.
- Nicolas Pasquier & Olivier Bonroy & Alexis Garapin, 2022. "Risk aversion and equilibrium selection in a vertical contracting setting: an experiment," Post-Print hal-03604049, HAL.
More about this item
Keywords
Second-price auction; Loss aversion; Trust game; Monetary incentive; Experiment; Financial decision making; Reward; C91; D03;All these keywords.
JEL classification:
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
Statistics
Access and download statisticsCorrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:expeco:v:15:y:2012:i:1:p:145-157. See general information about how to correct material in RePEc.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .
Please note that corrections may take a couple of weeks to filter through the various RePEc services.