Alec Brandon, Christopher M Clapp, John A List, Robert D Metcalfe, Michael K Price
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Smart-home technologies have been heralded as an important way to increase energy conservation. While in vitro engineering estimates provide broad optimism, little has been done to explore whether such estimates scale beyond the lab. We estimate the causal impact of smart thermostats on energy use via two novel framed field experiments in which a random subset of treated households have a smart thermostat installed in their home. Examining 18 months of associated high-frequency data on household energy consumption, yielding more than 16 million hourly electricity and daily natural gas observations, we find little evidence that smart thermostats have a statistically or economically significant effect on energy use. We explore potential mechanisms using almost four million observations of system events including human interactions with their smart thermostat. Results indicate that user behavior dampens energy savings and explains the discrepancy between estimates from engineering models, which assume a perfectly compliant subject, and actual households, who are occupied by users acting in accord with behavioral economists' conjectures. In this manner, our data document a keen threat to the scalability of new user-based technologies.
Isabelle Brocas, Juan D Carrillo
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Adults do not play the Nash equilibrium in the well known centipede game. While Palacios-Huerta and Volij (2009) argued that behavior results from the failure of backward induction logic, Levitt et al. (2011) found that players who know how to backward induct still do not play Nash. Here, we ask children and adolescents (ages 8 to 16) to play the centipede game in the laboratory and we leverage knowledge about developing abilities to assess the contribution of backward induction logic. In line with the literature, we find that the ability to perform backward induction increases with age. However, it predicts behavior only in elementary school children: those with advanced logical abilities over-apply their skills. Starting in middle school, students who reason logically know that the unraveling argument should not be applied blindly. They utilize Theory-of-Mind (ToM) abilities to form beliefs about others' play and (optimally) refrain from stopping immediately. Their behavior is in line with the deviations observed in adults. Interestingly, developing ToM leads to a gradual decrease in stopping stages with age, which is accompanied by a decrease in payoffs with age. The results indicate that ToM is the key contributor of behavior that helps departing from backward induction when beneficial.
John A List, Rohen Shah
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In organizations, teams are ubiquitous. "Weakest Link" and "Best Shot" are incentive schemes that tie a group member's compensation to the output of their group's least and most productive member, respectively. In this paper, we test the impact of these incentive schemes by conducting two pilot RCTs (one in-person, one online), which included more than 250 graduate students in a graduate math class. Students were placed in study groups of three or four students, and then groups were randomized to either control, Weakest Link, or Best Shot incentives. We find evidence that such incentive approaches can affect test scores, both in-person and online.
Brian Albrecht, Omar Al-Ubaydli, Peter Boettke
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Economists well understand that the work of Friedrich Hayek contains important theoretical insights. It is less often acknowledged that his work contains testable predictions about the nature of market processes. Vernon Smith termed the most important one the 'Hayek hypothesis': that gains from trade can be realized in the presence of diffuse, decentralized information, and in the absence of price-taking behavior and centralized market direction. Vernon Smith tested this prediction by surveying data on laboratory experimental markets and found strong support. We extend Smith's work first by showing how subsequent theoretical advances provide a theoretical foundation for the Hayek Hypothesis. We then test the hypothesis using recent field experimental market data. Using field experiments allows us to test several other predictions from Hayek, such as that market experience increases the realized gains from trade. Generally speaking, we find support for Hayek's theories.
Majid Ahmadi, Nathan Durst, Jeff Lachman, John A List, Mason List, Noah List, Atom Vayalinkal
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Recent models and empirical work on network formation emphasize the importance of propinquity in producing strong interpersonal connections. Yet, one might wonder how deep such insights run, as thus far empirical results rely on survey and lab-based evidence. In this study, we examine propinquity in a high-stakes setting of talent allocation: the Major League Baseball (MLB) Draft. We examine draft picks from 2000-2019 across every MLB club of the nearly 30,000 players drafted (from a player pool of more than a million potential draftees). Our findings can be summarized in three parts. First, propinquity is alive and well in our setting, and spans even the latter years of our sample, when higher-level statistical exercises have become the norm rather than the exception. Second, the measured effect size is important, as MLB clubs pay a real cost in terms of inferior talent acquired due to propinquity bias: for example, their draft picks appear in 25 fewer games relative to teams that do not exhibit propinquity bias. Finally, the effect is found to be the most pronounced in later rounds of the draft (after round 15), where the Scouting Director has the greatest latitude.
Fulya Ersoy
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While distance learning has become widespread, causal estimates regarding returns to effort in technology-assisted learning environments are scarce due to high attrition rates and endogeneity of effort. In this paper, I manipulate effort by randomly assigning students different numbers of lessons in a popular online language learning platform. Using administrative data from the platform and the instrumental variables strategy, I find that completing 9 Duolingo lessons, which corresponds to approximately 60 minutes of studying, leads to a 0.057-0.095 standard deviation increase in test scores. Comparisons to the literature and back-of-the-envelope calculations suggest that distance learning can be as effective as in-person learning for college students for an introductory language course
John A List
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These are the slides from John A. List's keynote at the 2022 AFE conference.
Rafael Jimenez-Duran
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Social media platforms ban users and remove posts to moderate their content. This "speech policing" remains controversial because little is known about its consequences and the costs and benefits for different individuals. I conduct two field experiments on Twitter to examine the effect of moderating hate speech on user behavior and welfare. Randomly reporting posts for violating the rules against hateful conduct increases the likelihood that Twitter removes them. Reporting does not affect the activity on the platform of the posts' authors or their likelihood of reposting hate, but it does increase the activity of those attacked by the posts. These results are consistent with a model in which content moderation is a quality decision for platforms that increases user engagement and hence advertising revenue. The second experiment shows that changing users' perceived content removal does not change their willingness to pause using social media, a measure of consumer surplus. My results imply that content moderation does not necessarily moderate users, but it marginally increases advertising revenue. It can be consistent with both profit- and welfare-maximization if out-of-platform externalities are small
Uri Gneezy, Moshe Hoffman, Mark A. Lane, John A List, Jeffrey A Livingston, Michael J. Seiler
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Recent theoretical work shows that the better-than-average effect, where a majority believes their ability to be better than average, can be perfectly consistent with Bayesian updating. However, later experiments that account for this theoretical advance still find behavior consistent with overconfidence. The literature notes that overoptimism can be caused by either overconfidence (optimism about performance), wishful thinking (optimism about outcomes), or both. To test whether the better-than-average effect might be explained by wishful thinking instead of overconfidence, we conduct an experiment that is similar to those used in the overconfidence literature, but removes performance as a potential channel. We find evidence that wishful thinking might explain overconfidence only among the most optimistic subjects, and that conservatism is possibly more of a worry; if unaccounted for, overconfidence might be underestimated.
John A List
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In 2019 I put together a summary of data from my field experiments website that pertained to framed field experiments. Several people have asked me if I have update. In this document I update all figures and numbers to show the details for 2021. I also include the description from the 2019 paper below.
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