Fall 2014 Lectures and Seminars
Solidarity Among the Poor: Risk Sharing in Three Texas Communities
Professor of Economics
Texas A&M University
Thursday, September 18, 2014
337 Cohen Hall
Catherine C. Eckel, Angela de Oliveira, Haley Harwell
Abstract: Risk-sharing plays an important role in less developed economies, and helps alleviate the impact of major negative events on individuals and households that lack access to credit. Little attention has been paid to the potential role of risk sharing in poorer communities within developed countries. Using data from an incentivized game, we examine informal risk sharing in three low- to moderate-income communities in the United States. Subjects participate in a version of the “solidarity game,” which was developed by Selten and Ockenfels (1998) in order to gauge indirect reciprocity among individuals. In the game subjects are placed in groups of three, and make decisions about how much they are willing to transfer to other members of the group who are disadvantaged by chance. We find that individuals will share risks by making contingent transfers to less-well-off members of their group, and these transfers vary systematically by individual and community. In two additional treatments we show that the availability of insurance crowds out informal risk sharing, even among those who do not take up the market alternative, and that profitable investment is hampered by the expectation that gains will be shared. This research illustrates how lab experiments can be used as a window on the field, providing insights that can be used to improve policy development and implementation.
Fairness and Coordination: The Role of Fairness Principles in Coordination Failure and Success
Assistant Professor of Management
Columbia Business School
Thursday, October 23, 2014
337 Cohen Hall
Abstract: We study the role of fairness principles as focal points in coordination problems in homogeneous and heterogeneous groups. To this end, we first elicit normative beliefs concerning how the coordination game should be played. We find that in homogeneous groups people share a unique belief of how to fairly play the game while in heterogeneous groups multiple well-defined but conflicting normative beliefs prevail. In the subsequent coordination game, homogeneous groups are more likely than heterogeneous groups to successfully sustain coordination on efficient equilibria. Interestingly, in both types of groups, equilibria consistent with fairness principles are stable. Hence, the difference between groups occurs because heterogeneous groups find it much harder to reach such fair equilibria. Individual level analysis reveals that subjects who are not playing in accordance to their normative beliefs are more likely to change their behavior, unless their group is coordinating on a fairness principle.
Explanatory Judgment, Moral Offense and Value-Free Science. An Empirical Study
(Joint work with Leandra Bucher and Yoel Inbar)
Tilburg Center for Logic and Philosophy of Science
Thursday, November 6, 2014
337 Cohen Hall
Abstract: A popular view in philosophy of science contends that scientific practice is objective to the extent that the appraisal of scientific hypotheses is not influenced by moral, political, economic, or social values, but only by the available evidence. A large body of results in psychology have put pressure on the psychological adequacy of this view. The present study extends this body of results by providing direct evidence that the moral offensiveness of a scientific hypothesis biases folks’ explanatory judgment along several dimensions, even when prior credence in the hypothesis is controlled for. Furthermore, it is shown that this bias is insensitive to an economic incentive to be accurate in the evaluation of the evidence. These results contribute to call into question the ideal of a value-free science.