Toronto Experimental Economics Laboratory - TEEL

10/15/2024

Yi-Tsung (Hugo) Hsieh presents his Job Market Paper “Integrating Risk in the Timing of Outcomes” at the Behavioral Economics Seminar! Abstract: This study investigates human behavior when individuals make choices that are uncertain in both realization timings and outcomes. Individuals’ choice patterns are explored in controlled experiments through a new type of lottery, “two stage compound time-lottery,” in which the first stage determines the realization timing and the second stage determines the realization outcome. We first examine the validity of the standard expected utility (EU) model and find that EU fails to account for the majority of our subjects. As the alternative, we examine three non-expected utility models developed from rank dependent utility: recursive rank dependent utility (RRDU), intertemporal certainty equivalent (ICE) and rank dependent utility on discounted payments (RDUDP). The results show that individuals are heterogeneous and two choice patterns emerge. Approximately two-thirds of subjects do not reduce compound time-lotteries and their choices can be rationalized by RRDU. For the rest one-third of subjects who employ reduction, their choices can be rationalized by RDUDP. Only fewer than 7% of subjects can be rationalized by ICE or discounted expected utility.

10/07/2024

Alex Ballyk presents her Job Market Paper “Paternalistic Persuasion” at the Behavioral Economics Seminar! Date: October 9, 2024. Time: 12:10-13:30. Location: GE106 at Max Gluskin House. Abstract: Paternalistic experts ("Advisors") often seek to make decision-makers ("Choosers") better off by persuading them to change their behavior. Choosers, however, are often reluctant to make certain behavioral changes. To successfully persuade a Chooser to change their behavior, an Advisor should therefore give the Chooser a recommendation that accounts for this reluctance. In a setting where Choosers are wary of recommenders' incentives, I experimentally investigate whether Advisors send recommendations that account for this wariness, and why they may fail to do so. I find that up to 79% of Advisors send sub-optimal recommendations. Instead, up to two-thirds of Advisors send recommendations that would only be optimal if Choosers were not wary. I show, however, that prompting Advisors to think about Choosers' likely response to a recommended change is an effective way to correct this mistake. Advisors' initial mistake is thus consistent with a failure to focus on recommendations that Choosers are likely to accept.

10/12/2022

Quick explanation of experimental economics. If you’re interested in participating in an experiment, please check out teel.economics.utoronto.ca

10/25/2019

10/22/2019

09/20/2019

September 16, 2019 by Jovana Jankovic - A&S News September 16, 2019 Photo credit: ©iStock | tifonimages. To understand how people behave in games or markets, economists build mathematical models that aim to explain or predict choices and ou...

09/10/2019

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12/03/2018

10/16/2018

10/16/2018

Erkut Ozbay presents at the Behavioural Economics Seminar!