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Ambient-Based Policy Instruments: The Role of Recommendations and Presentation

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  • Spraggon, John M.
  • Oxoby, Robert J.

Abstract

We explore the effects of recommended play and the presentation of payoff information on behavior in an ambient-based policy instrument experiment. Specifically, we test the effects of recommended play (via a description of marginal decision making) and a payoff table on the behavior of individuals facing an ambient-based policy instrument. We find that recommended play and the presentation of a payoff table increases the use of the socially optimal strategy, thereby increasing efficiency. These results suggest that providing decision makers with a richer description of the decision making environment significantly reduces decision error, significantly improving the efficiency of ambient-based policy instruments.

Suggested Citation

  • Spraggon, John M. & Oxoby, Robert J., . "Ambient-Based Policy Instruments: The Role of Recommendations and Presentation," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 39(2), pages 1-13.
  • Handle: RePEc:ags:arerjl:90832
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    References listed on IDEAS

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    1. Francisco Alpízar & Till Requate & Albert Schram, 2004. "Collective versus Random Fining: An Experimental Study on Controlling Ambient Pollution," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 29(2), pages 231-252, October.
    2. Anderson, Simon P. & Goeree, Jacob K. & Holt, Charles A., 1998. "A theoretical analysis of altruism and decision error in public goods games," Journal of Public Economics, Elsevier, vol. 70(2), pages 297-323, November.
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    Cited by:

    1. Hamet SARR & Mohamed Ali BCHIR & François COCHARD & Anne ROZAN, 2016. "Nonpoint source pollution: An experimental investigation of the Average Pigouvian Tax," Working Papers 2016-05, CRESE.
    2. Messer, Kent D. & Murphy, James J., 2010. "FOREWORD: Special Issue on Experimental Methods in Environmental, Natural Resource, and Agricultural Economics," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 0(Number 2), pages 1-4, April.
    3. Cason, Timothy N. & Gangadharan, Lata, 2013. "Empowering neighbors versus imposing regulations: An experimental analysis of pollution reduction schemes," Journal of Environmental Economics and Management, Elsevier, vol. 65(3), pages 469-484.
    4. François Cochard & Julie Le Gallo & Laurent Franckx, 2015. "Regulation Of Pollution In The Laboratory: Random Inspections, Ambient Inspections, And Commitment Problems," Bulletin of Economic Research, Wiley Blackwell, vol. 67(S1), pages 40-73, December.
    5. Hamet Sarr & Mohamed Bchir & Francois Cochard & Anne Rozan, 2016. "Nonpoint source pollution: An experimental investigation of the Average Pigouvian Tax," Working Papers hal-01375078, HAL.

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    Keywords

    Environmental Economics and Policy;

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