Assignment\/Coursework Remit
\nProgramme Title Master Programs
\nModule Title LM Behavioral and Experimental Economics
\nModule Code 27184
\nAssignment Title Experimental and Behavioural Economics
\nLevel LM
\nWeighting 100%
\nLecturers Amalia Di Girolamo
\nHand Out Date Enter date here 25\/03\/24
\nDeadline Date & Time Enter date here 25\/04\/24 12pm
\nFeedback Post Date Enter date here 20\/05\/x24
\nAssignment Format Essay
\nAssignment Length 2000 words absolute maximum
\nSubmission Format Online Individual
\nAssignment:
\nPlease answer ONE of the following TWO possible questions. Each question has three subparts
\n(a, b, c) \u2013 please answer all parts of the question you attempt.
\nWhichever question you select, you will write three short essays. It is up to you how you use
\nthe words at your disposal, but the total word count should not exceed 2000 words. This is a
\nstrict maximum word limit. Note that in-text referencing is included in the word count, but
\nthe reference list at the end is not. All referencing should be in a Harvard style. Weightings
\nappear after each sub-part.
\nQuestion 1
\na) Consider the article by Harrison and List (2004). The authors propose a taxonomy in
\nthe article to categorize the different types of experiments. For each category you
\nshould provide a detailed description of the type of experiment, explaining the
\ndifferences in terms of subject pool, information set, task, commodity, stakes and
\nenvironment where the experimental subjects operate in. For each type of experiment,
\nprovide an example of a study (published), shortly describe the experimental design of
\nthe article and how it fits the category you chose to represent. You should support your
\ndiscussion with examples from the Experimental Economics literature. (40%)
\nb) Consider the Gift Exchange Game (Fehr et al., 1993). Explain the Fair Wage-Effort
\nHypothesis as defined by Akerlof and Yellen (1990). Describe how the Fair Wage-
\nEffort hypothesis can be tested in a lab setting by means of the Gift Exchange Game.
\nYou should discuss the pros and the cons of running a Gift Exchange game in a lab
\nsetting. You should support your discussion using the experimental economics
\nliterature. (30%)
\nc) In their article “Putting Behavioral Economics to Work: Testing for Gift Exchange in
\nLabor Markets Using Field Experiments\u201d Gneezy and List (2006) examine the fair
\nwage-effort hypothesis by means of a Field Experiment. Describe the Experimental
\nDesign used in the Field Experiment. You should explain the type of experiment used
\nby the authors, the treatments chosen, and the tasks undertaken by the participants.
\nCompare the results between the \u201cLibrary Task\u201d and the \u201cFundraising Task\u201d,
\nhighlighting common points and main differences. Discuss the contribution that the
\npaper by Gneezy and List (2006) makes to the Experimental Economics literature on
\nthe Fair Wage-Effort Hypothesis. You should reflect on the difference between Lab and
\nField Experiments in the context of the Fair Wage-Effort Hypothesis, supporting your
\ndiscussion with evidence from the experimental economics literature. (30%)
\n\u2212 Akerlof, G. A., & Yellen, J. L. (1990). \u201cThe Fair Wage-Effort Hypothesis and
\nUnemployment,\u201d The Quarterly Journal of Economics, 105(2), 255\u2013283.
\n\u2212 Fehr, E., Kirchsteiger, G., & Riedl, A. (1993). Does Fairness Prevent Market
\nClearing? An Experimental Investigation. The Quarterly Journal of Economics,
\n108(2), 437-459.
\n\u2212 Gneezy, U. & List, J. A. (2006) “Putting Behavioral Economics to Work: Testing
\nfor Gift Exchange in Labor Markets Using Field Experiments,” Econometrica,
\nvol. 74(5), pages 1365-1384.
\n\u2212 Harrison, G. W. and List, J. A. (2004) \u201cField Experiments\u201d, Journal of Economic
\nLiterature, Vol. 42, No. 4., pp. 1009-1055.
\nQuestion 2
\na) Provide a definition of Social Norms: you should concisely summarize the economic
\nliterature on the topic trying to combine the different shades of the concept provided by
\ndifferent authors (Hint: Bicchieri and Ostrom are the most prominent economists
\nworking on the topic, but you can also refer to other authors publishing in economics).
\nWith reference to Krupka and Weber (2013) describe how it is possible to elicit social
\nnorms by means of a lab experiment. Describe the experimental design, the treatments,
\ntasks, and stakes. Critically discuss the results of the experiment(s). (40%)
\nb) Kahneman and Tversky (1979) criticize Expected Utility Theory as a descriptive model
\nof decision making under risk, and they propose Prospect Theory as an alternative
\nmodel for describing risk preferences of individual decision makers. Discuss the
\nCertainty Effect and the Reflection Effect. Illustrate the main characteristics of the
\nValue Function, explaining how the reference point is determined and how gains and
\nlosses are evaluated under this theory. You should graphically support your explanation
\nof the Value Function. (30%)
\nc) Consider the article by Imas et al. (2016). Discuss the experimental design. You should
\nexplain the type of experiment used by the authors, the treatments chosen, and the tasks
\nundertaken by the participants. Compare the results between Experiment 1 and
\nExperiment 2 reflecting on the underlying theoretical predictions.
\n(30%)
\n\u2212 Imas, A., Sadoff, S. &, Samek, A. (2016) \u201cDo People Anticipate Loss Aversion?\u201d
\nManagement Science 63(5):1271-1284.
\n\u2212 Kahneman, D., & Tversky, A. (1979). \u201cProspect Theory: An Analysis of Decision
\nunder Risk.\u201d Econometrica, 47(2), 263-291.
\n\u2212 Krupka, E.L. and Weber, R.A. (2013). Identifying Social Norms Using Coordination
\nGames: Why Does Dictator Game Sharing Vary? Journal of the European Economic
\nAssociation, 11: 495-524.
\nGrading Criteria:
\nMark awarded The higher mark (100, 88, 78, etc.) should be awarded if criteria in any mark
\nband are fully or nearly fully met. The lower marks (62, 33, etc.) should be
\nawarded to scripts that are above the highest standard for the category below
\nbut fail to meet all the criteria for the selected mark band. The middle marks
\n(45, 55, 65, 75) can also be used when marking between 40 and 80%.
\n100 (93) An outstanding essay, as good as can be reasonably expected, must show excellent
\nunderstanding of the topic and synthesis of material from a range of relevant
\nsources. Presentation and structure excellent with effective use of diagrams and
\nformulas (where appropriate). Reference material cited and listed appropriately.
\n88 (83) An excellent answer demonstrates full understanding of the topic. Good use of
\nmaterial from a wide range of relevant sources. Extremely well written and structured
\nwith effective use of diagrams and formulas (where appropriate). Reference material
\ncited and listed appropriately.
\n78 (75) (72) A very good essay that includes all the major points required to address the topic,
\ndemonstrates a thorough understanding of the topic. Good use of material from
\nseveral sources. Presentation and structure good with good use of diagrams and
\nformulas (where appropriate). Reference material cited and listed appropriately.
\n68 (65) (62) A good essay that includes most of the major points required to address the topic,
\nshows a good understanding of the subject area. Good use of material from several
\nsources. Presentation and structure generally good with good use of diagrams and
\nformulas (where appropriate). Reference material cited and listed appropriately.
\n58 (55) (52) A satisfactory essay that includes the basic information required to address the topic,
\nshows understanding of the topic. Material may be from a limited range of sources
\nor too reliant on the slides provided in the module. Insufficient thought given to
\nstructure, some use of diagrams and formulas (where appropriate). Some errors in
\nciting and listing reference material.
\n48 (45) (42) Essay incomplete with serious omissions, some sound knowledge and evidence that
\nthe topic has, at least partly, been understood. Material may be from a limited range
\nof sources or too reliant on the slides provided in the module. Poorly structured with
\npoor use of diagrams and images. Errors in citing and listing reference material.
\n38 (33) Unsatisfactory essay with major omissions and errors; lacks evidence of
\nunderstanding. Material from a limited range of sources or too reliant on the slides
\nprovided in the module but some material relevant to the topic. Poorly structured with
\npoor use of diagrams and formulas. Errors in citing and listing reference material.
\n28 (23) Poor essay but contains some relevant points. Material from a limited range of
\nsources or too reliant on the slides provided in the module. Poorly structured, little
\nuse of appropriate images or diagrams. Errors in citing and listing reference material.
\n18 (13) Little of value, one major or a small number of minor points which may be just
\nrelevant. Fails to address the question.
\n8 (3) Virtually nothing of value, maybe one or two very minor points, phrases or words that
\nare barely relevant. No evidence of understanding the question.
\n0 Answer contains nothing relevant to the question.
\nFeedback to Students:
\nBoth Summative and Formative feedback is given to encourage students to reflect on their
\nlearning that feed forward into following assessment tasks. The preparation for all
\nassessment tasks will be supported by formative feedback within the tutorials\/seminars.
\nWritten feedback is provided as appropriate. Please be aware to use the browser and not
\nthe Canvas App as you may not be able to view all comments.
\nPlagiarism:
\nIt is your responsibility to ensure that you understand correct referencing practices. You are
\nexpected to use appropriate references and keep carefully detailed notes of all your
\ninformation sources, including any material downloaded from the Internet. It is your
\nresponsibility to ensure that you are not vulnerable to any alleged breaches of the
\nassessment regulations. More information is available at
\nhttps:\/\/intranet.birmingham.ac.uk\/as\/registry\/policy\/conduct\/plagiarism\/index.aspx.
\nUse of Generative AI:
\nUnless explicitly stated otherwise, students should assume that the use of generative AI
\nwithin an assessment or assignment is not permitted. Any assessment submitted that is not
\na student\u2019s own work, including that written by generative AI tools, are in breach of the
\nUniversity\u2019s Code of Practice on Academic Integrity
\n(https:\/\/intranet.birmingham.ac.uk\/as\/registry\/policy\/conduct\/plagiarism\/index.aspx
\nWellbeing Extenuating Circumstances:
\nThe process for Extenuating Circumstances is to support students who have experienced
\nunforeseen issues that have impacted their ability to engage with their studies and\/or
\ncomplete assessments. Students should notify Wellbeing of any extenuating circumstances
\nas soon as possible via the online form, following the guidance provided.
\nhttps:\/\/intranet.birmingham.ac.uk\/social-sciences\/college-services\/wellbeing\/index.aspx
\nAssignment Instructions
\n\u2022 Submit your assignment through Canvas.
\n\u2022 All papers mentioned in the questions are uploaded on the relevant topic pages in
\nCanvas. Wider reading and referencing other literature is welcome but only if
\nstrictly relevant for the topic. This means that if you provide support to your
\nargument with more literature this will be evaluated positively as long as it is
\nrelevant for the discussion.
\n\u2022 Please type your answer. You should produce your own equations, tables and
\ndiagrams where relevant, either by hand (and uploaded\/scanned) or digitally.
\nFigures copied directly from the slides or online sources will receive lower marks.
\nThe exception is plots of data taken from published articles, which can be included
\ndirectly as long as they are appropriately referenced.
\n\u2022 Refer to the marking criteria for further guidance and write to me
\n(a.digirolamo@bham.ac.uk) if anything is unclear.<\/p>\n","protected":false},"excerpt":{"rendered":"