We propose and experimentally test two tractable methods to incentivize the elicitation of private information: Benchmark and Coordination. Both mechanisms capitalize on the false consensus effect, a well-documented phenomenon that follows Bayesian reasoning. That is, individuals use their own...

We study three fundamental components of financial agency settings: Perception and communication of investment profiles, the interaction of agents’ and clients’ preferences, and the role of (non-)monetary incentives. The perception of investment profile terminology is very heterogeneous,...

We run an experiment that gives subjects the opportunity to hedge away ambiguity in an Ellsberg-style experiment. Subjects are asked to make two bets on the same draw from an ambiguous urn, with a coin flip deciding which bet is paid. By modifying the timing of the draw, coin flip, and decision,...

Many public goods can be provided at different spatial levels. Evidence from social identity theory and in-group favoritism raises the possibility that where higher-level provision is more efficient, subjects’ narrow concern for local outcomes (parochialism) could harm efficiency. Building on...

The well-known Blackwell's theorem states the equivalence of statistical informativeness and economic valuableness. Celen (2012) generalizes this theorem, which is well-known for subjective expected utility (SEU), to maxmin expected utility (MEU) preferences. We demonstrate that the underlying...

The standard Bayesian model implies that information can never have a negative value. We put this implication to the proof. Our paper provides the first test of the value (positive or negative) of information under uncertainty. We show that the "Bayesian implication" stands in conflict with the...

Preventing overfishing at Lake Victoria is a typical situation where policies have to rely on norm-based interventions to improve outcomes. Our lab-in-the-field experiment studies how information about high or low levels of previous cooperation affects the creation of social norms in a...

We test whether the binary lottery procedure makes subjects behave as if they are risk neutral in the Holt-Laury and Eckel-Grossman tasks. Depending on the task we find that at most a third of subjects behave as if risk neutral. In fact, when we compare the distribution of choices we find no...

The Savage and the Anscombe-Aumann frameworks are the two most popular approaches used when modeling ambiguity. The former is more flexible, but the latter is often preferred for its simplicity. We conduct an experiment where subjects place bets on the joint outcome of an ambiguous urn and a...

According to economists, severe legal sanctions deter violations of the law. According to legal scholars, people may obey law backed by mild sancions because of norm-activation. We experimentally investigate the effects of mild and severe legal sanctions in the provision of public goods. The...