David M. Bruner

Multiple switching behaviour in multiple price lists

A common mechanism to elicit risk preferences requires a respondent to make a series of dichotomous choices. A recurring problem with this mechanism is a frequently observed tendency to switch from the less to the more risky choice multiple times, multiple switching behaviour. We introduce an instructional variation which our evidence suggests practically eliminates such behaviour. We read a script emphasizing only one decision will determine earnings before providing written instructions. Emphasizing the incentive compatibility of the payment rule reduces observed multiple switching behaviour from 13.3% to 2.3% in one format and from 25.8% to 6.7% in another.

Consumer Valuation of Food Safety: The Case of Postharvest Processed Oysters

Consumers’ willingness to pay for postharvest-processed (PHP) raw oysters—oysters without health risks—is studied in experimental auction markets. The experimental design decomposes the effects of taste, objective risk information, and information on four PHP technologies on consumer valuations. Results show that relatively uninformed consumers are willing to pay equivalent amounts for PHP and traditional raw oysters. However, after a blind taste test, consumers are willing to pay a significant premium for traditional raw oysters, and the premium persists after objective information on risk and processing technologies is provided. The results are robust across PHP technologies.

Investment under Anarchy

This paper presents an experimental test of a 2-player, one-shot game of conflict in which we vary the strength of property rights and the return on investment. Our results suggest that stronger property rights reduce conflict and increase investment. Contrary to intuition, we find increasing the rate of return has practically no effect on investment and that this failure to stimulate investment is largely due to deficiencies in property right institutions.