28/04/2015 FIE LD E XPE RIME NTS Ganna Pogrebna G.Pogrebna@warwick.ac.uk www.gannapogrebna.com April 28, 2015 Where to find lecture materials? Website: www.gannapogrebna.com Section: “Teaching” Item: EC984 ‐ 2015 Password: expec0n0m2015 Seminar: May 1 from 3.30 p.m. to 5.30 p.m. in S0.11 Aldo Rustichini (University of Minnesota) “Sequential Choice and Memory” 3.30 p.m. – 5 p.m. in M2 (Warwick Business School, Teaching Centre) 2 Outline What are field experiments? Brief history of field experiments Types of field experiments: Artefactual field experiments Framed field experiments Natural field experiments Natural experiments Natural experiments in TV shows Big Data (short note) Summary: how field experiments compare with other kinds of experiments? 3 1
28/04/2015 E xperiments in E conomics Laboratory Field Natural Thought Experiments Experiments Experiments Experiments Laboratory One of the first experiments In 1738 Daniel examples of date back to The youngest Bernoulli was field 1930s*, are and a rapidly the first to run a experiments in “said to be” developing thought economics was pioneered by approach in experiment – conducted by Chamberlin experimental St. Petersburg Michael Levine (1948) and economics. Paradox. and Charles popularized by Plott (1977). Smith and Plott. 4 E xperiments in E conomics A great paper to read on History of Experimentation: Ortmann, Andreas, “Episodes from the Early History of Experimentation in Economics” (December 12, 2013). UNSW Australian School of Business Research Paper No. 2013 ‐ 34. Available at SSRN: http://ssrn.com/abstract=2368596 or http://dx.doi.org/10.2139/ssrn.2368596 5 E xperiments in E conomics Thought Laboratory Field Natural Experiments Experiments Experiments Experiments Pros: Pros: controlled Pros: more Pros: naturally hypothetical experimental representative randomized problem with conditions; subject pool; treatments, suggested easy to replicate field context large stakes, solution representative subject pool Cons: Cons: non ‐ Cons: loss of Cons: loss of hypothetical representative (some) control (some) control incentives; subject pool; over treatments over treatments one subject low incentives; (reader) abstract context 6 2
28/04/2015 What Are Field E xperiments? Field experiment refers to a study which makes use of the natural environment or specific attributes of natural environment to investigate a phenomenon of interest. Harrison & List (2004) Like laboratory experiments, “… field experiments use randomization, but do so in naturally ‐ occurring settings, in certain cases using experienced subjects who might not be aware that they are participants in an experiment…” Levitt & List (2009) p. 2 7 Why Field E xperiments? Starting from 1980s laboratory experiments became criticized by skeptics who argued that it is not correct to make conclusions about the “real world” phenomena from laboratory experiments because: These experiments are conducted in a “sterile environment” [ critique of environment ] With commodities and stakes which are not realistic and often do not vary [ critique of context ] With undergraduate students who are not “real people” [ critique of subject pool ] 8 Critique of the Laboratory E xperiments Cross (1980) has famously written: “it seems to be extraordinarily optimistic to assume that behavior in an artificially constructed “market” game would provide direct insight into actual market behavior.” Numerous skeptics have pointed out that laboratory experiments use unrealistically low monetary stakes, cannot impose time variations (short ‐ run versus long ‐ run). A White House official has once written a famous comment on one of John List’s field studies: “even though [your] results appear prevalent, they are suspiciously drawn…….by methods similar to scientific numerology…..because of students…….who are not ‘real’ people” 9 3
28/04/2015 The Birth of the Field E xperiment Smith responded to all three critiques (1980 AER): “Experiments are sometimes criticized for not being ‘realistic’….are there field data to support the criticism, i.e., data suggesting that there may be differences between laboratory and field behavior? If not, then the criticism is pure speculation.” Therefore, it was necessary to test empirically whether laboratory is different from the field To answer the criticisms, field experiments were conducted One of your discussion topics is related to critiques and ways of answering them 10 Brief History of Field E xperiments 11 from Card et al. (2011) Main Concentration of Field E xperiments from Card et al. (2011) 12 4
28/04/2015 How can field experiments be identified? In order to identify a field experiment we need to consider the following 6 factors (Harrison & List, 2004): Subject pool (Who are the study participants?) Information which subjects bring to the task (Which specific experiences participants have?) Experimental commodity (What is used as a commodity to incentivize the task?) Task (What are participants asked to do?) Stakes (How does the incentive mechanism work?) Decision architecture (What are the features of the environment that participants operate in?) 13 Types of Field E xperiments Harrison & List (2004) identify three main types of field experiments in comparison with the conventional laboratory experiments: Conventional laboratory experiment (LAB) uses a standard subject pool of students, an abstract framing, and an imposed set of rules. Artefactual field experiment (AFE) is the same as LAB but with a non ‐ standard subject pool Framed field experiment (FFE) is the same as AFE but with field context in the commodity, task, information, stakes, time frame, etc. Natural field experiment (NFE) is the same as FFE but where the environment is the one that the subjects naturally undertake these tasks, such that the subjects do not know that they are in an experiment. One of your discussion topics is related to Harrison and List (2004) classification 14 Artefactual Field E xperiments (AFE ) Haigh, M. S., & List, J. A. (2005). Do professional traders exhibit myopic loss aversion? An experimental analysis. The Journal of Finance , 60 (1), 523 ‐ 534. 15 5
28/04/2015 Framed Field E xperiments (FFE ) Ungemach, C., Stewart, N., & Reimers, S. (2011). How incidental values from the environment affect decisions about money, risk, and delay. Psychological Science , 22, 253–260. 16 Natural Field E xperiments (NFE ) Lewis, R. A., & Reiley, D. H. (2011) Online Ads and Offline Sales: Measuring the Effects of Retail Advertising via a Controlled Experiment on Yahoo!. Google w orking paper . 17 Natural Field E xperiments vs Natural E xperiments In both NFE and Natural Experiments subjects do not know that they are participating in an experiment. But Natural Field Experiments (NFE) are NOT the same as Natural Experiments. NFE use “manmade” treatments: treatments are constructed by experimenter to test a theoretical hypothesis. Natural Experiments use naturally created randomness across treatments or a naturally created decision problem. Natural experiments allow a researcher to analyze and draw conclusions from naturally occurring data, organized by a neutral force. As a result, in Natural Experiments researchers have less control than in NFE. 18 6
28/04/2015 Natural E xperiments Ockenfels, A., & Roth, A. E. (2002). Last ‐ minute bidding and the rules for ending second ‐ price auctions: Evidence from eBay and Amazon auctions on the Internet. American Economic Review , 92 (4). 19 “Windowing” in Music Spotify looked at the two worst and two best sales ‐ to ‐ piracy ratio albums in the Netherlands in 2012 released fully released fully windowed windowed Spotify (2013) Adventures in the Netherlands: Spotify, Piracy and the New Dutch Experience accessed at https://press.spotify.com/us/2013/07/17/adventures ‐ in ‐ netherlands/ 20 “Windowing” in Music Does “windowing” affect sales? How? 21 7
28/04/2015 Discuss with your neighbour The big question is: WHAT KIND OF EXPERIMENT IS THAT? The small question is: is there anything wrong with it? 22 Inspiration for Natural E xperiments Classical economic theory postulates that tipping (e.g., in restaurants) is irrational. Indeed, why pay if you can get something for free? Famous band Radiohead asked their fans to pay any amount of money for their album “ In Rainbows ” 23 24 8
28/04/2015 25 26 27 9
28/04/2015 28 29 Inspiration for Natural E xperiments Sheena Matheiken (The Uniform Project) 30 10
28/04/2015 Inspiration for Natural E xperiments Karl Stefanovic (Australian morning TV anchor) 31 Inspiration for Natural E xperiments Alfredo Jaar Cupola of the Marché Bonsecours in Montreal Inspiration for Natural E xperiments • 15,000 homeless people in Montreal • 3 shelters (Accueil Bonneau, la Maison Eugénie Bernier and la Maison Paul Grégoire) were located within 500 yards of the Cupola. 11
28/04/2015 Inspiration for Natural E xperiments Inspiration for Natural E xperiments E xperiments in E conomics Field Natural Experiments Experiments Artefactual field Natural natural experiments experiments Framed field Policy experiments experiments Natural Natural field experiments in experiments TV shows One of your discussion topics is related to natural experiments 36 12
Recommend
More recommend
