Angelino Viceisza

Breaking the Norm: An Empirical Investigation into the Unraveling of Good Behavior

We present results from an artefactual field experiment conducted in rural Peru that considers whether observing non-reciprocal behavior influences an individuals decision to reciprocate. Specifically, we consider the behavior of second movers in a trust game, assessing whether their decision to reciprocate is influenced by the observed reciprocity of others. In documenting the impact of an external shock to observed reciprocity, this paper shows that small increases in non-reciprocal behavior result in an unraveling of the norm of reciprocity. Survey data is used to explore mechanisms by which this occurred. Results are not consistent with learning effects, suggesting that preferences may be changed by observing others deviating from a norm of reciprocity. These results suggest that investing in encouraging trustworthy behavior can have large benefits in situations where individuals are observing each others behavior, such as may be the case in a new market institution.

Three Risk-elicitation Methods in the Field: Evidence from Rural Senegal

In the past decade, it has become common to use simple laboratory games and decision tasks as a device for measuring risk preferences in the developing world. In this paper, we build on existing taxonomies for risk-elicitation and discuss pros and cons of using such methods in developing-country contexts. We use three distinct riskelicitation mechanisms (the Holt–Laury task, the Gneezy–Potters mechanism, and a non-incentivized willingness-to-risk scale) and subjects from rural Senegal. Our study provides some guidance to researchers wishing to use risk-elicitation mechanisms in the rural developing world.

CREATING A LAB IN THE FIELD: ECONOMICS EXPERIMENTS FOR POLICYMAKING

In this paper, I focus on the role that artefactual and certain framed field experiments (what I term “lab‐like field experiments” or LFEs) play in informing policymaking. Using examples, primarily from rural contexts in developing countries, I identify four main purposes of LFEs: (1) to test theories or heuristic principles; (2) to identify and estimate parameters associated with characteristics; (3) to explore the structural nature of parameters derived from empirical methods including other types of experiments; and (4) to assess methodological difficulties associated with LFEs and how these can impact parameter estimates. I address the importance of generalizability for LFEs that are intended to inform policymaking and in the process, emphasize the complementary role between LFEs and other empirical methods, in particular other experiments. Finally, I discuss nine basic principles for conducting LFEs and suggest four directions for future research.

LOST IN THE MAIL: A FIELD EXPERIMENT ON CRIME

Crime in the mail sector can hamper the development of electronic markets. We use a field experiment to detect crime and measure its differential impacts. We subtly, and realistically, manipulate the content and information available in mail sent to households and detect high levels of shirking and stealing. Eighteen percent of the mail never arrived at its destination, and even more was lost if there was even a slight hint of something additional inside the envelope. Our study demonstrates that privatization has been unable to extricate moral hazard and that crime is strategic and not equally distributed across the population.

The Effect of Irrelevant Information on Adverse Selection in a Signaling Game

We find an effect of irrelevant information on adverse selection in a laboratory signaling game. This effect occurs via two channels: the principal is more (less) likely to adversely reject signals from “good” (“bad”) types. The findings suggest that “perception (or perhaps, misperception) of correlation” is sufficient for people to process information. Failure to recognize information as “irrelevant” is costly: Principals in our experiment are worse off by 3.75 percent. This suggests a “curse of (irrelevant) information.” Our findings could explain why buyers fall “victim” to irrelevant information in markets that are subject to adverse selection such as “lemon’s markets.”