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On Uneven Expected Earnings in the Lab

Author

Listed:
  • Jade Wong

    (Australian School of Business, the University of New South Wales)

  • Andreas Ortmann

    (School of Economics, Australian School of Business, the University of New South WalesAuthor-Name: Craig Freedman)

Abstract

We discuss ways to cope with uneven expected lab earnings that are the likely results of role assignments. We identify three problems associated with uneven earnings in the lab: of social preferences, of low marginal return for effort, and of perceived deception. Mining the opinions of respondents from the Economic Science Association’s (ESA) discussion list, the literature, and drawing on our own experience, we present five responses experimenters can use to mitigate the three problems. We discuss the merits and drawbacks of each strategy.

Suggested Citation

  • Jade Wong & Andreas Ortmann, 2014. "On Uneven Expected Earnings in the Lab," Discussion Papers 2014-07, School of Economics, The University of New South Wales.
    • Handle: RePEc:swe:wpaper:2014-07
    as

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    File URL: http://research.economics.unsw.edu.au/RePEc/papers/2014-07.pdf
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    References listed on IDEAS

    as
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    6. 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.
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    10. Rydval, Ondrej & Ortmann, Andreas, 2004. "How financial incentives and cognitive abilities affect task performance in laboratory settings: an illustration," Economics Letters, Elsevier, vol. 85(3), pages 315-320, December.
    11. Gneezy, U. & Rustichini, A., 1998. "Pay Enough - Or Don't Pay at All," Other publications TiSEM 641eb9a4-f245-483b-8c01-6, Tilburg University, School of Economics and Management.
    12. Daniel Zizzo, 2010. "Experimenter demand effects in economic experiments," Experimental Economics, Springer;Economic Science Association, vol. 13(1), pages 75-98, March.
    13. Jade Wong & Andreas Ortman & Alberto Motta & Le Zhang, 2013. "Understanding Social Impact Bonds and Their Alternatives: An Experimental Investigation," Discussion Papers 2013-21, School of Economics, The University of New South Wales.
    14. Jason Dana & Roberto Weber & Jason Kuang, 2007. "Exploiting moral wiggle room: experiments demonstrating an illusory preference for fairness," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 33(1), pages 67-80, October.
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    Cited by:

    1. Voslinsky, Alisa & Azar, Ofer H., 2021. "Incentives in experimental economics," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 93(C).

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    More about this item

    Keywords

    uneven expected lab earnings; social preferences; preferences;
    All these keywords.

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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