Work in progress
Behaviour in social networks
Behaviour in social networks
(with C. Gutekunst & A. Riedl) Coordination and Network-based Proximity: Experimental Evidence from the Field
We conduct a field experiment in real-world social networks to analyse the influence of network proximity on the ability of two persons to coordinate costly effort. Using data on the friendship networks of 22 villages in Uganda, we identify the effect of proximity between two participants by experimentally varying the effort costs and the disclosure of their identities. We find that effort in the coordination task is higher if the paired participants are friends and have common friends, i.e., they are part of the same triad. We do not find support for alternative measures of network proximity that involve a different combination of direct and common friends.(with C. Gutekunst & A. Riedl) Do Trade Connections Give Bargaining Power? Experimental Evidence from the Field
We conduct a field experiment in real-world social networks to analyse how the number of trade connections (i.e., individual network degree) influences bargaining demands and outcomes. Combining data from a bilateral bargaining experiment with data on the trade networks in 24 villages in Uganda, we identify the effect of individual degree in the village trade network, by experimentally varying the disclosure of the participants' identities in a bargaining pair. We find that the demands of participants who know whom they interact with increase with their network degree and decrease with their opponent's network degree. This effect, however, disappears if their identity is also disclosed to their opponent. Network degree does not influence individual earnings, but it does influence the likelihood that an agreement is reached.Risk-taking and insurance
Risk-taking and insurance
(with P. Clist & A. Verschoor) Risk Taking with Social Consequences
Do anticipated social consequences influence risky choices? Do people take more, less or the same risk when inequality results from risky choice? We provide experimental evidence. Subjects choose lotteries for themselves and a partner under different risk resolutions, allowing us to identify their type. We find social consequences influence risk taking for most people, as only one-fifth focus on ex-ante equality. Two-fifths are efficiency-seeking, taking more risk when inequality is guaranteed. This possibility is not considered by previous experimental work, but is the largest category for our sample. Only one-third are ex-post inequality averse, reducing inequality of outcomes at a cost to their expected earnings. We show types are robust, and also document large gender-based heterogeneity.(with B. Perez-Viana & A. Verschoor) Informal Risk Sharing and Demand for Index Insurance: Experimental Evidence from Rural Uganda
Index insurance holds promise for smallholder farmers in developing countries but its value is limited by basis risk: the imperfect correlation between the index and actual losses. Theory shows that informal sharing of basis risk may complement index insurance and raise demand or it may substitute for it and lower demand. We designed an experiment to study the effect of basis risk sharing on demand for index insurance and implemented it among Ugandan farmers. We find that demand for index insurance responds negatively to basis risk sharing. The most plausible explanation is the strong informal risk sharing response that results fromthe presence of basis risk.Pro-environmental behaviour
Pro-environmental behaviour
(with H. Fuhrmann-Riebel, K. López Vargas, S. Tonke, and A. Verschoor) Misperceived Trends and Norms: A Field Experiment to Address Weak Collective Action
We study how correcting people’s beliefs about social norms and behavioral trends encourages collective action in a setting where the desired behavior is not yet prevalent. In a field experiment among 1,709 subjects, we test whether low sign-up rates for a recycling program in urban Peru can be increased by providing information that (1) most people regard participation in the program as important, i.e., the “injunctive norm,” (2) an increasing recent trend in sign-up rates. Correcting inaccurate beliefs increases sign-up decisions significantly among people who underestimate either the injunctive norm or the positive trend. Our paper addresses the important and little-understood question of how to stimulate collective action where it is currently weak.(with H. Fuhrmann-Riebel, K. López Vargas, S. Tonke, and A. Verschoor) Using Reminder Messages to Increase Recycling Behavior in Peru
The municipality of Miraflores in Lima, Peru, has established a recycling programme, in which households can participate voluntarily and free of charge. Although households sign up to the programme voluntarily, few recycle regularly, pointing towards a gap between people’s intention to recycle and their actual recycling behaviour. Reminders can help people to follow through with their intentions by addressing the problem of limited attention. In this study, we conduct a randomized controlled trial (RCT) to test whether sms reminders can increase recycling behaviour of households. In particular, we contrast the effect of continuous vs. interrupted vs. restarted reminders on households’ recycling behaviour. We measure recycling behaviour of households over 12 weeks in total. While the first three weeks serve as a baseline measure, the subsequent nine weeks constitute our intervention period where households are randomly assigned to either i) a control group that does not receive any reminders, ii) a group that receives continuous reminders over the whole nine weeks (continuous treatment), iii) a group that receives reminders only for the first three weeks (interrupted treatment), iv) or a group that receives reminders for the first three weeks and for the last three weeks, with a three weeks’ pause in between (restarted treatment). Our design allows us to analyse the effects of continuous reminders on households’ recycling behaviour, persistence of reminder effects after the intervention has ended, as well as restart effects when the intervention is taken up again.Household decision-making and gender
Household decision-making and gender
(with C. Ringdal) Who Decides in the Household when Risk Preferences Conflict
Women's low involvement in household decisions is an important cause of the persistence of gender inequality in developing countries, as it constrains women's access to resources and opportunities. Despite its importance, little is known about the behavioural mechanisms behind women's low involvement. Guided by a simple theoretical model, we hypothesise that women may refrain from participating in household decisions to avoid spousal conflict, the likelihood of which increases with spousal differences in risk preferences. Using survey data from both spouses of 675 couples in rural Tanzania, we find that spousal differences in risk preferences decrease the likelihood that spouses make decisions jointly, and increase the likelihood that decisions are made by the husband alone. We also find that these relations are stronger in couples where women are more conflict averse or recently experienced intimate partner violence.