Nanjing Audit University, Economics Experimental Laboratory
Nanjing Audit University, Economics Experimental Laboratory
Monash University, Department of Economics
Stony Brook University, Department of Political Science
Ph.D. in Economics
University of Nottingham
M.Sc. in Behavioural Economics
University of Nottingham
B.A. in Economics
B.S. in Mathematics
Shanghai Jiaotong University
Employees typically work on multiple tasks that require unrelated skills and abilities. While past research strongly supports that relative performance feedback influences employee performance and effort allocation, little is known about the effect of relative performance feedback on employee competitiveness. Using a lab experiment, we study and confirm a complementary feedback spillover effect——relative performance feedback in the first task positively affects competitiveness in the unrelated second task. Furthermore, we find that the effect operates jointly and independently through belief- and taste-altering mechanisms. The results have important implications for organizations to understand both the power and the limitations of using relative performance feedback as an intervention policy in the design of accounting, control, and reporting systems.
Individuals may respond differently to their own past performance than to their teammates' performance in a multi-battle competition. Using field data from professional squash team tournaments, we show that while previous individual success begets more success, teammates' past performance has little impact on players' immediate and overall battle performance. It could be argued that players follow the heuristic of doing their best for their teams while at the same time succumbing to a psychological momentum effect, which suggests that responses to their own previous performance depend on the full history of previous battle outcomes. Our analysis, however, cannot reject that players are motivated by a strategic momentum effect, which predicts that responses only depend on the current state of battle outcomes irrespective of its precise realization in history.
We experimentally study how people resolve a tension between favoritism and fairness when allocating a profit in a team production setting. Past research shows that people tend to favor their ingroup at the cost of an outgroup when allocating a given amount of money. However, when the money to be allocated depends on joint production, we find that most players allocate proportionally according to others' relative contributions, irrespective of their social identity affiliations. We discuss the implications of our findings on how distributive norms could shape team cooperation.
We present an experiment to investigate the source of disappointment aversion in a sequential real-effort competition. Specifically, we study the contribution of social comparison effects to the disappointment aversion previously identified in a two-person real-effort competition (Gill and Prowse, 2012). To do this we compare "social" and "asocial" versions of the Gill and Prowse experiment, where the latter treatment removes the scope for social comparisons. If disappointment aversion simply reflects an asymmetric evaluation of losses and gains we would expect it to survive in our asocial treatment. Alternatively, if losing to or winning against another person affects the evaluation of losses/gains, as we show would be theoretically the case under asymmetric inequality aversion, we would expect treatment differences. We find behavior in social and asocial treatments to be similar, suggesting that social comparisons have little impact in this setting. Unlike in Gill and Prowse we do not find evidence of disappointment aversion.
We introduce the "ball-catching task", a novel computerized task, which combines a tangible action ("catching balls") with induced material cost of effort. The central feature of the ball-catching task is that it allows researchers to manipulate the cost of effort function as well as the production function, which permits quantitative predictions on effort provision. In an experiment with piece-rate incentives we find that the comparative static and the point predictions on effort provision are remarkably accurate. We also present experimental findings from three classic experiments, namely, team production, gift exchange and tournament, using the task. All of the results are closely in line with the stylized facts from experiments using purely induced values. We conclude that the ball-catching task combines the advantages of real effort tasks with the use of induced values, which is useful for theory-testing purposes as well as for applications.
I examine a game-theoretical model of two variants of double- elimination tournaments, and derive the equilibrium behavior of symmetric players and the optimal prize allocation assuming a designer aims to maximize total effort. I compare these theoretical properties to the well-known single-elimination tournament.
This thesis presents an empirical investigation of individual and team contests using both lab experiments and field data. The thesis is comprised of five chapters. Chapter 1 introduces the overarching theme of this thesis and the common methodological tool, which is a novel real effort task used in the lab experiments. Chapter 2 discusses this real effort task in more detail and shows its usefulness in studying behavioural responses to incentives by presenting a series of experiments, including individual production with piece-rate incentives, team production, gift exchange, and tournament, using the task. All of the results are closely in line with theoretical predictions and, where applicable, the stylised facts from experiments using purely induced values. Chapter 3 experimentally examines the role of interpersonal comparisons in an individual contest. The experiment follows Gill and Prowse (2012) and is designed to investigate the source of disappointment aversion, that is, whether it is purely an asocial concept, akin to loss aversion, or fuelled by interpersonal comparisons. The new evidence however rejects predictions of the disappointment aversion model, both when interpersonal comparisons are possible and when they are not. Chapter 4 empirically examines strategic behaviour of contestants in a dynamic "best-of-three" team contest. I find evidence of "strategic neutrality" in both field data from high-stakes professional squash team tournaments and lab data from an experiment: the outcomes of previous battles do not affect the current battle. The lab data however reveal that the neutrality prediction does not perfectly hold at the level of individual efforts. Chapter 5 concludes the thesis by summarising all findings in previous chapters, discussing the limitations, and pointing to directions for future research.
At every level of politics, people form groups to compete for power and resources, including political parties, special interest groups, and international coalitions. Here we use economic experiments to investigate how people balance the desire for their group's victory versus their own expenditure of effort. We design an economic tug of war in which the side that exerts greater effort wins a reward. In Experiment 1, participants compete individually or in teams, which were assigned arbitrarily. In Experiment 2, participants compete individually or in teams based on their political party, Democrats against Republicans. In both experiments, we find that people shirked on teams: Participants exerted less effort in teams than in individual competition. The results support theories about free-riding in groups, and they depart from theories about the automatic potency of partisan motives. We discuss why it is difficult for groups, including political partisans, to mobilize toward a common goal.
Communication has been regarded as one of the most effective devices in promoting team cooperation. But asymmetric communication sometimes breeds collusion and is detrimental to team efficiency. Here, we present experimental evidence showing that excluding one member from team communication hurts team cooperation: the communicating partners collude in profit allocation against the excluded team member, and the latter reacts by refraining from exerting effort. We further show that allowing the partners to reach out to the excluded member helps to restore cooperation and fairness in profit allocation. But it does not stop the partners from talking behind the other member. They sometimes game the system by tricking the excluded member to contribute but then grabbing all profits for themselves.
We study escalation and aggression in an experimental first-strike game in which two participants play multiple rounds of a money-earning task. In each round, both players can spend money to accumulate weapons. The player with more weapons can spend money to strike against the other player, which almost totally eliminates the victim’s earnings potential and removes their capacity to strike. Weapons can serve as a means of deterrence. In four treatments, we find that deterrence is strengthened if weapon stocking cannot be observed, that a balance of power is effective in maintaining peace, and that mutually beneficial trade decreases the risk of confrontation, but not necessarily the likelihood of costly arms races.
People who compete alone may entertain different psychological motivations from those who compete for a team. We examine how psychological motivations influence individual competitive behavior in response to a head start or a handicap when competing alone or competing for a team. We find that contestants' behavior in both individual and team contests exhibits a psychological momentum effect, whereby leaders fight harder than trailers. However, the momentum effect is significantly larger in individual contests than in team contests and further disappears in team contests that are enriched with pre-play communication. The rational model, which predicts neither momentum effects nor treatment differences, fails to explain our findings. The findings can be better explained by a combination of two behavioral models: disappointment aversion and the responsibility-alleviation effect.
We study children's cheating by conducting a field experiment in a local primary school. Children graded either their own or another student's test, and they could cheat by misreporting the overall score. Unbeknownst to them, the test-taker's original answers were recorded by carbonless copy paper. As expected, we find that children were generally more likely to cheat for themselves compared to cheating for others. To investigate cheating for others, we vary whether children graded their friend or an acquaintance and whether the grading pairs could discuss the test while grading. For the friend, children cheated little with or without discussion. For the acquaintance, they also rarely cheated without discussion; but with discussion, they cheated frequently, nearly as much as when grading themselves. We discuss implications of these findings on social cheating for theories about reciprocity and reputation.
We examine how peer effects can impact public support for Pigouvian taxation in a market experiment with negative externalities. Our experimental data indicate that the support rate increases significantly when tax supporters are selected to communicate with voters. Nonetheless, left to their own devices, people are generally reluctant to communicate with and influence others. Among those who are willing, both tax supporters and objectors are equally likely to volunteer and are equally persuasive. As a result, the overall positive peer effect disappears. These findings offer an explanation for the continuing low public support for social-welfare enhancing tax policies.
Experimental research has shown that consumers are more likely to oppose taxes if their benefits occur only in the future. In other experiments participants display a tax-shifting bias, i.e., they prefer taxes levied on the other market side. This paper tests whether the negative delay effect is mitigated when the tax is levied on the supply side. Data from our experiment show a robust delay effect regardless of the market side the tax is levied on.