Can groups solve the problem of over-bidding in contests?

This study reports an experiment that examines whether groups can better comply with theoretical predictions than individuals in contests. Our experiment replicates previous findings that individual players significantly overbid relative to theoretical predictions, incurring substantial losses. There is high variance in individual bids and strong heterogeneity across individual players. The new findings of our experiment are that groups make 25% lower bids, their bids have lower variance, and group bids are less heterogeneous than individual bids. Therefore, groups receive significantly higher and more homogeneous payoffs than individuals. We elicit individual and group preferences toward risk using simple lotteries. The results indicate that groups make less risky decisions, which are possible explanations for lower bids in contests. Most importantly, we find that groups learn to make lower bids from communication and negotiation between group members.     

Role-reversibility, stochastic ignorance, and social cooperation

This paper studies the effect of role-reversibility and stochastic ignorance, conditions that minimize the strategic bias of individual choice, on social cooperation. Under role-reversibility, each agent maximizes her expected payoff, knowing the status quo at the time of the action as well as the ex ante probabilities about her future roles. In contrast, under stochastic ignorance, players make their choices under a Harsanyi-type veil of uncertainty. Without the role-specific context influencing the judgment of the individual, cooperative norms emerging under stochastic ignorance are more likely to be close to first-best than are norms chosen under conditions of role-reversibility.     

Voluntary Limit Setting and Player Choice in Most Intense Online Gamblers: An Empirical Study of Gambling Behaviour

Social responsibility in gambling has become a major issue for the gaming industry. The possibility for online gamblers to set voluntary time and money limits are a social responsibility practice that is now widespread among online gaming operators. The main issue concerns whether the voluntary setting of such limits has any positive impact on subsequent gambling behaviour and whether such measures are of help to problem gamblers. In this paper, this issue is examined through data collected from a representative random sample of 100,000 players who gambled on the win2day gambling website. When opening an account at the win2day site, there is a mandatory requirement for all players to set time and cash-in limits (that cannot exceed 800 € per week). During a 3-month period, all voluntary time and/or money limit setting behaviour by a subsample of online gamblers (n = 5,000) within this mandatory framework was tracked and recorded for subsequent data analysis. From the 5,000 gamblers, the 10 % most intense players (as measured by theoretical loss) were further investigated. Voluntary spending limits had the highest significant effect on subsequent monetary spending among casino and lottery gamblers. Monetary spending among poker players significantly decreased after setting a voluntary time limit. The highest significant decrease in playing duration was among poker players after setting a voluntary playing duration limit. The results of the study demonstrated that voluntary limit setting had a specific and significant effect on the studied gamblers. Therefore, voluntary limits appear to show an appropriate effect in the desired target group (i.e., the most gaming intense players).     

Die Analyse sozialer Kontexte

Individual behaviour is always embedded in social contexts such as networks, companies, neighbourhoods. They constitute a central condition to explain individual behaviour. We discuss major problems of context analysis. We first define context to then explore how contexts affect behaviour—the social mechanisms. We specify a multilevel model to demonstrate theoretical problems linking levels and the associated problems of adequate statistical modelling. An example is the explanation of individual behaviour by country level data.We then discuss cross pressures between contexts; here, we show how similar theoretical approaches of Simmel and Lazarsfeld are. Finally, we turn to two other problems of context analyses: non-linear effects and selection bias. We resume our arguments by suggesting a preliminary theory of contexts and strategies for future research.     

Contests with group-specific public-good prizes

We examine the equilibrium effort levels of individual players and groups in contests in which n groups compete to win a group-specific public-good prize, the individual players choose their effort levels simultaneously and independently, and the probability of winning for each group depends on the groups’ effort levels. In the basic model, we show that, in each group, only the highest-valuation players expend positive effort and the rest expend zero effort; there is underinvestment in the contest for the group as a whole. Next, in the main model in which the players are budget-constrained, we show that low-valuation players free ride on high-valuation players’ contributions, not vice versa, but the free-rider problem is “alleviated” as compared with the basic model.     

Being the best or doing the right thing? An investigation of positional,prosocial and conformist preferences in provision of public goods

Based on a simple theoretical framework, we show that when individuals exhibit positional, prosocial or conformist preferences which are endogenous, the end outcomes in terms of private provision of public goods can differ significantly from traditional neo-classical predictions. Indeed, when a given individual selects a specific subset of preferences according to what others do, he/she will contribute positively to the public good provision. We provide anecdotal evidence to support our theoretical analysis by using data from an Internet survey on a sample of French individuals. Analyses of individual responses confirm our theoretical arguments. For instance, we show that relative concerns matter, that is, for several environmental goods, people might prefer polluting more in absolute terms but less than others in society. Moreover, we also test whether people exhibit a social desirability bias and show that they attribute more (less) positional (prosocial) concerns to others in society.     

Social choice,optimal inference and figure skating

We approach the social choice problem as one of optimal statistical inference. If individual voters or judges observe the true order on a set of alternatives with error, then it is possible to use the set of individual rankings to make probability statements about the correct social order. Given the posterior distribution for orders and a suitably chosen loss function, an optimal order is one that minimises expected posterior loss. The paper develops a statistical model describing the behaviour of judges, and discusses Markov chain Monte Carlo estimation. We also discuss criteria for choosing the appropriate loss functions. We apply our methods to a well-known problem: determining the correct ranking for figure skaters competing at the Olympic Games.     

Do what (you think) the rich will do: Inequality and belief heterogeneity in public good provision

Beliefs about others’ cooperativeness are among the strongest determinants of cooperative behaviours. Beliefs about different others, however, are not necessarily uniform, nor necessarily related to past behaviours: Different expectations about different others might solely originate from differences in observed individual characteristics. Finally, not all such beliefs need drive conditional behaviour alike.In a public good game with heterogeneous endowments, I find that rich subjects are expected to cooperate more by both rich and poor individuals, and that behaviours of both the rich and poor correlate only with beliefs about the rich. An intervention aimed at increasing perceived group cohesion has no impact on beliefs and mixed impacts on cooperation. I conclude with implications for information dissemination about uncooperative behaviour in the mass media and avenues for further research.     

The partnered core of a game with side payments

An outcome of a game is partnered if there are no asymmetric dependencies between any two players. For a cooperative game, a payoff is in the partnered core of the game if it is partnered, feasible and cannot be improved upon by any coalition of players. We show that the relative interior of the core of a game with side payments is contained in the partnered core. For quasi-strictly convex games the partnered core coincides with the relative interior of the core. When there are no more than three partnerships, the sums of the payoffs to partnerships are constant across all core payoffs. When there are no more than three players, the partnered core satisfies additional properties. We also illustrate our main result for coalition structure games.     

Austerity plan announcements and the impact on the employees’ wellbeing

This study investigates the impact of austerity plan announcements on employees’ wellbeing. We exploit the unexpected announcement of a drastic wage cut (25%) related to public sector employees in Romania. Using data from the Eurobarometer Surveys and the European Quality of Life Survey, we employ a difference-in-difference research design combined with matching, based on entropy balancing, to identify the causal effects. Our results reveal that the mere announcement of austerity measures leads to an overall drop in life satisfaction among those working in the public sector. We also show that men, and especially married individuals, are most affected by the substantial wage cut announcement. Contrary to previous research, we find that public sector employees with higher levels of education are more likely to be affected by this policy communication compared to those with only secondary or primary levels of education. Our results also suggest that the negative effect of the announcement is not persisting over time.     

The Participation of Civil Society Organizations in Public Policies in Latin America

Throughout Latin America, the relationship between government and civil society organizations (CSOs) has been characterized by opposition, substitution, and submission; and, the incipient path to cooperation is barely noticeable. For their part, participatory public policies make sense within a theory of democratic governance. Democratic governance seeks two propositions: (a) participation from other social actors will give rise to more efficient government action; and (b) citizen support will emerge from the said government action. This paper criticizes the current relationships between the governments and CSOs in this region. In addition, it explores the potential strategies that could be adopted were there a cooperation between these two entities. The paper is supported by theoretical literature as well as by a revision of some cases of participatory public policies that are currently active in the region. The paper proposes that the strategies of opposition to government and government substitution have to be abandoned in this region. The paper focuses on civil organizations (CSOs). It is true that they do not constitute the entirety of civil society; however, they are frequently the most organized compared with other civic actors, such as social movements, families, and individual initiatives. CSOs form only a part of the diversity known as civil society; however, they significantly contribute to the discussion about the public good, and very often they participate in providing such goods. The future of participatory democracy in Latin America is related to our ability to achieve a more complete participation of CSOs in the entire process of participatory public policies—from the formation of public agendas to their design, implementation, and evaluation.     

Asset Markets and Equilibrium Selection in Public Goods Games with Provision Points: An Experimental Study

We report experimental results on the effects that auctioning the right to play a public goods game with a provision point may have on equilibrium selection and individual behavior. Auctioning off such a right among a larger population of players strikingly enhances public good provision. Once public good provision is obtained, the auction price at the preliminary stage increases to its upper limit, dissipating all players' gains associated with the provision of the public good. Individual deviations from the equilibrium strategy are neither able to force lower market prices nor to affect provision of the public good in subsequent periods. (JEL C72 , C92 , H41 )     

Sociologists in the Press

Stimulated by debates on public sociology in the recent years I studied contributions of sociologists in daily newspapers in Austria. Although sociologists are rather present in the Austrian press, I argue this remains without noticeable effects on public opinion formation; the topics sociologists write and talk about are rather arbitrary and they lack factual content. Although my data refers to sociologists in the Austrian press, the study’s conclusions might be true to the wider sociological community: Through such exposure, a public profile of sociology cannot evolve. Furthermore, the article discusses criteria that prevent and complicate the relationship between sociologists and the press: avoidance of publicity, the problem of values and ideology, incompatibilities of language-games, divergence of relevance criteria, and deficient cultural empathy.     

THE BIAS TOWARDS ZERO IN AGGREGATE PERCEPTIONS: AN EXPLANATION BASED ON RATIONALLY CALCULATING INDIVIDUALS

We show that individuals' errors in identifying the relationships among variables cause downward biases in the aggregate that are equivalent to the public underestimating the strengths of the true relationships. We argue that rational expectations has considered only the "misestimation" type of error, which can "cancel out" in the aggregate, but that with errors in identifying relationships, there is no similar cancelling-out effect. The result is that the public appears "irrationally" to underestimate the strength of relationships among variables even when all individual agents behave rationally. Empirical evidence that forecasts are systematically biased is reinterpreted using our discussion.     

Role‐Playing and Playing Roles: The Person,Player, and Persona in Fantasy Role‐Playing

In fantasy role‐playing games, participants collectively create and play fantasy personas in an imaginary universe by using a vast system of rules that function as guidelines for make‐believe action and interaction. Consequently, role‐playing games obligate participants to occupy a liminal role located in the boundaries of persona, player, and person. This study, based on approximately ninety hours of participant observation and forty interviews with thirty role‐players, explores how role‐players actively negotiate these symbolic boundaries: how role‐players carve out distinct spheres of meaning between themselves, their fantasy personas, and status as players of these games. It also illustrates how these distinctions fail. Boundaries erupt and role‐players prove unable to compartmentalize themselves so discretely. Through the lens of these games, we can examine simplified and exaggerated dynamics and entertain the possibility that we are all players located at the liminal margins between the people we believe ourselves to be and the personas we perform in situated social encounters.     

Non-exclusive group contests: An experimental analysis

We experimentally study a non-exclusive group contest in which contestants actively participate in multiple groups simultaneously. We compare the results of this contest to those of an exclusive group contest in which each contestant belongs to a single group. In contrast to theoretical predictions, we find that the non-exclusive group contest generates less aggregate effort than the equivalent exclusive group contest. We hypothesize that groups in the non-exclusive group contest are less responsive to their rival group’s effort than those in the exclusive group contest. Likewise, on the individual level, players in the non-exclusive group contest are more likely to free-ride on their group members’ contributions. Our data indicate that non-free-riders in the non-exclusive group contest are more likely, over time, to allocate their effort toward a single group. This finding is consistent with previous findings that players facing a complex strategy space tend to focus on specific winning combinations. Moreover, given that players are affected by their group members’ contributions, they tend to exert their effort primarily toward a single group. Taken together, our findings suggest that a non-exclusive group contest may evolve, over time, into an exclusive group contest.     

Strategic Groups and Rent Dissipation

We consider a rent-seeking contest in which players can form strategic groups before expending their outlays. We examine the profitability of endogenous group formation and the effect of such group formation on rent dissipation. We show the following: When just one strategic group is formed in equilibrium, group formation is beneficial both to the group members and to the nonmembers, and rent dissipation is smaller than with usual individual rent seeking. However, when more than two strategic groups are formed in equilibrium, group formation is never profitable to any players, and rent dissipation is greater than with individual rent seeking.     

The effect of recommended contributions in the voluntary provision of public goods

Recommended contributions are often observed in fundraising campaigns for charitable and other public goods. We present an experiment investigating the impact of recommended contributions in a voluntary threshold public goods process. We find that when valuations for the public good are heterogeneous, recommended contributions significantly increase the likelihood of efficient provision, although when valuations are homogeneous, the effect of recommendations is less compelling. This article represents a first step in understanding recommended contributions and other nonbinding, cheap-talk announcements in public goods provision and charitable contributions.     

Modelling of how lotto players select their number combinations dynamically

By examining a unique dataset, the authors build a time series model that can describe the dynamics of lotto players’ betting behaviour. The results are derived from a database maintained by a lottery operator in Taiwan, which consists of number combinations selected by players for 203 consecutive draws in 2 years, including those placed through certain systematic schemes. The dynamic models that the authors established show that the players’ number selection over time is influenced by three factors: the numbers that they chose in the last draw, the winning numbers of the previous draw and the numbers with the highest observed winning frequencies in the past. The first factor reflects the mean-reverting nature of the lotto players’ selection behaviour. The second reaffirms the well-known gambler’s fallacy in which players believe that they can improve their chances of winning by avoiding numbers that recently won. The third exhibits the players’ bias towards certain numbers with an above-average probability to be drawn. The two latter types of misconceptions are found to be more predominant in systematic betters, which suggests that the extent of the lotto players’ behavioural biases may vary according to how they place their bets.     

Subject-specific performance information can worsen the tragedy of the commons: Experimental evidence

The main aim of this article is to investigate the behavioral consequences of the provision of subject-specific information in the group effort levels chosen by players in an experimental CPR game. We examine two basic treatments, one with incomplete information and the other with complete information. In the former, subjects are informed only about their own individual payoffs and the aggregate extraction effort level of the group, and in the latter they are also informed about the individual effort levels and payoffs of each subject. Given this setting, the basic question we attempt to answer is: Will the provision of subject-specific performance information (i.e. individual’s effort levels and payoffs) improve or worsen the tragedy of the commons (i.e. an exploitation effort level greater than the socially optimum level)? In order to motivate our hypotheses and explain our experimental results at the individual level, we make use of the theory of learning in games, which goes beyond standard non-cooperative game theory, allowing us to explore the three basic benchmarks in the commons context: Nash equilibrium, Pareto efficient, and open access outcomes. We use several learning and imitation theoretical models that are based on contrasting assumptions about the level of rationality and the information available to subjects, namely: best response, imitate the average, mix of best response and imitate the average, imitate the best and follow the exemplary learning rules. Finally, in order to econometrically test the hypotheses formulated from the theoretical predictions we use a random-effects model to assess the explanatory power of the different selected behavioral learning and imitation rules.