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Do you do what you say or do you do what you say others do?

Author

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  • Carlsson, Fredrik

    () (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Daruvala, Dinky

    () (Department of Economics, Karlstad University)

  • Jaldell, Henrik

    () (Department of Economics, Karlstad University)

Abstract

We design a donations vs. own money choice experiment comparing three different treatments. In two of the treatments the pay-offs are hypothetical. In the first of these, a short cheap talk script was used, and subjects were required to state their own preferences in this scenario. In the second, subjects were asked to state how they believed an average student would respond to the choices. In the third treatment the pay-offs were real, allowing us to use the results to compare the validity of the two hypothetical treatments. We find a strong hypothetical bias in both hypothetical treatments where the marginal willingness to pay for donations are higher when subjects state their own preferences but lower when subjects state what they believe are other students preferences. The explanation is probably a self-image effect in both cases. We find that it is mainly women who are prone to hypothetical bias in this study.

Suggested Citation

  • Carlsson, Fredrik & Daruvala, Dinky & Jaldell, Henrik, 2008. "Do you do what you say or do you do what you say others do?," Working Papers in Economics 309, University of Gothenburg, Department of Economics.
  • Handle: RePEc:hhs:gunwpe:0309
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    File URL: http://hdl.handle.net/2077/10296
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    Cited by:

    1. Ladenburg, Jacob & Olsen, Søren Bøye, 2014. "Augmenting short Cheap Talk scripts with a repeated Opt-Out Reminder in Choice Experiment surveys," Resource and Energy Economics, Elsevier, vol. 37(C), pages 39-63.

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    More about this item

    Keywords

    Stated preferences; cheap talk; hypothetical bias; third person approach; choice experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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