Development Economics, Behavioral Economics, Experimental Methods
Development Economics: Financial Decisions and Institutions
Kubilay ⓡ Raiber ⓡ Spantig ⓡ Cahlíková ⓡ Kaaria (2023): Can you spot a scam? Measuring and improving scam identification ability. Journal of Development Economics, 165: 103147. Download paper
Common tips on how to spot scams do not significantly improve Kenyan’s scam identification ability, i.e., the distinction of scams from genuine messages.
Czura, Englmaier, Ho & Spantig (2022): Microfinance loan officers before and during Covid-19: Evidence from India. World Development, 152: 105812. Download paper
Loan officers juggle many different tasks and it becomes more difficult during the first year of the pandemic.
Spantig (2021): Cash in hand and saving decisions. Journal of Economic Behavior & Organization, 188: 1206-1220. Download paper
The tangibility of cash does not influence savings deposits of Filipino microfinance clients.
SABE/IAREP/Elsevier Best PhD Student Paper 2018
Behavioral Economics: Morals and Well-Being
Huber et al. (2023): Competition and moral behavior: A meta-analysis of 45 crowd-sourced experimental designs. Proceedings of the National Academy of Sciences, 120 (23) e2215572120. Download paper
Experimental design choices can lead to substantial variation in estimated effect sizes for the same research question, which limits the generalizability of one single experiment.
Etheridge & Spantig (2022): The gender gap in mental well-being at the onset of the Covid-19 pandemic: Evidence from the UK. European Economic Review, 145: 104114. Download paper
Mental well-being of women declined more than men’s in April 2020, which appears to be related to mostly social factors.
Kocher, Schudy & Spantig (2018): I lie? We lie! Why? Experimental evidence on a dishonesty shift in groups. Management Science, 64 (9): 3995-4008. Download paper
Communication in groups makes misreporting in the lab more acceptable.
Recent evidence suggests that more flexible microloan repayment benefits borrowers, but lenders fear diminished repayment morale. We study repayment choices in rigid and flexible loan contracts with discretion in repayment timing. Using a lab-in-the-field experiment with 645 microcredit borrowers in the Philippines, we identify moral hazard and quantify social pressure. Payoff maximization predicts low repayment in our rigid benchmark contract, and increased repayment with flexibility. Results suggest the opposite: Repayment in the rigid contract is high, and drops substantially under flexible repayment. Social pressure decreases. Our results are consistent with a strong social norm for repayment, which is weakened by introducing flexibility. Norms, which may be inculcated by the lender, may help explain several recent puzzles in microfinance research, including high and equal repayment rates across individual and joint-liability contracts, and excessive peer pressure. Importantly, norm-driven behaviour may erode with the introduction of flexibility.
The positive role of transformational leadership on productivity and mental well-being has long been established. Transformational leadership behavior may be particularly suited to navigate times of crisis which are characterized by high levels of complexity and uncertainty. We exploit quasi-random assignment of employees to managers and study the role of frontline managers’ leadership styles on employees’ performance, work style, and mental well-being in times of crisis. Using longitudinal administrative data and panel survey data from before and during the Covid-19 pandemic, we find that frontline managers who were perceived as having a more transformational leadership style before the onset of the pandemic, led employees to better performance and mental well-being during the pandemic.
Economists and management scholars have argued that the scope of incentives to increase cooperation in organizations is limited as their use signals the prevalence of free-riding among employees. This paper tests this hypothesis experimentally, using a sample of managers and employees from a large company. We exogenously vary whether managers are informed about prevailing cooperation levels among employees before they can set incentives to promote cooperation. In addition, employees matched to informed managers learn that the manager could base their incentive choice on cooperation levels. We find no evidence for the hypothesized signaling effect. Having an informed manager set the incentive does not change employees’ beliefs about the cooperativeness of others. Incentives hence have strong positive effects on cooperative beliefs, irrespective of information. The absence of the signaling effect seems related to the perception of managers’ intentions, a mitigating but understudied factor.
Selected Work in Progress
We theoretically and experimentally study how the introduction of a credit registry affects investment and repayment decisions of borrowers. Information sharing between lenders can affect repayment rates via two mechanisms, i) better screening by lenders and ii) an additional incentive for borrowers to repay. In contrast to most previous studies, we can exclude selection effect and potential changes in the borrower pool and cleanly identify the incentive effect of information sharing on borrowers. We conduct an information campaign with 6,000 microfinance clients to exogenously vary the knowledge of the credit registry and possible consequences for borrowers. Our design allows identifying both the effects on ex-ante moral hazard (project and effort choice) and ex-post moral hazard (repayment performance).
Individual Preferences for Truth-Telling, with Susanna Grundmann & Simeon Schudy. Funded by Diligentia Foundation for Empirical Research. First draft available on request.
In many markets, informational asymmetries allow for misreporting of facts unobserved by others. In contrast to the traditional economists’ assumption that individuals are willing to misreport private information if this maximizes their material payoff, recent work has documented robust preferences for truth-telling among many decision makers. Aggregate analyses of incentivized experimental reporting paradigms indicate that such preferences for truth-telling stem from a combination of an intrinsic motivation to be honest and a desire to be seen as honest. As the relative importance of these motivations is largely unknown at the individual level, we propose a novel incentivized measure to independently capture both underlying motives for preferences for truth-telling. We validate the measures’ properties experimentally and show that the measure meaningfully predicts behavior in other commonly studied situations that allow for dishonesty. Classifying individual preference types, we document systematic heterogeneity in preference for truth-telling (in a general population and a student sample). Finally, we design and validate a 2-min-survey module that allows researchers to meaningfully proxy preferences for being and being seen as honest at the individual level.