An Experimental Approach to Relative Income and Happiness

Last registered on August 30, 2018

Pre-Trial

Trial Information

General Information

Title
An Experimental Approach to Relative Income and Happiness
RCT ID
AEARCTR-0003272
Initial registration date
August 29, 2018

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
August 30, 2018, 2:59 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Region

Primary Investigator

Affiliation
Barnard College

Other Primary Investigator(s)

PI Affiliation
George Mason University
PI Affiliation
George Mason University
PI Affiliation
Santa Clara University

Additional Trial Information

Status
Completed
Start date
2014-05-23
End date
2017-12-12
Secondary IDs
Abstract
John Stuart Mill claimed that “men do not desire merely to be rich, but richer than other men.” Do people desire to be richer than others? Or is it that people desire favorable comparisons to others more generally, and being richer is merely a proxy for this ineffable relativity? We conduct an online experiment absent choice in which we measure subjective well-being (SWB) before and after an exogenous shock that reveals to subjects how many experimental points they and another subject receive, and whether or not points are worth money. We find that subjects like receiving monetized points significantly more than non-monetized points but dislike being “poorer” than others in monetized and non-monetized points equally, suggesting relative money is valued only for the relative points it represents. We find no evidence that subjects like being “richer” than others. Subgroup analyses reveal women have a strong(er) distaste for being “richer” and “poorer” (than do men), and conservatives have a strong(er) distaste for being “poorer” (than do progressives). Our experimental-SWB approach is easy to administer and can provide some insights a revealed-preference approach cannot, suggesting that it may complement choice-based tasks in future experiments to better estimate preference parameters.
External Link(s)

Registration Citation

Citation
, et al. 2018. "An Experimental Approach to Relative Income and Happiness." AEA RCT Registry. August 30. https://doi.org/10.1257/rct.3272
Former Citation
, et al. 2018. "An Experimental Approach to Relative Income and Happiness." AEA RCT Registry. August 30. https://www.socialscienceregistry.org/trials/3272/history/33602
Experimental Details

Interventions

Intervention(s)
It was revealed to participants how much money they and another participant would be given for participating in the experiment. These amounts varied by treatment. Subjective well-being was measured before and after the revelation.
Intervention Start Date
2017-12-11
Intervention End Date
2017-12-12

Primary Outcomes

Primary Outcomes (end points)
Subjective well-being: whether it is impacted by the revelation of own and others' payments.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The main experiment is as follows (with Discovery and Pilot studies designed similarly):
In the instructions each subject was informed that:
● She would be randomly assigned to a two-person group.
● The other subject in the group (hereafter Participant X) could be any other subject in the study.
● She and Participant X would be allotted 2 or 10 experimental points each, creating four possible allocations of points:
○ She receives 2 points, and Participant X receives 2 points.
○ She receives 2 points, and Participant X receives 10 points.
○ She receives 10 points, and Participant X receives 2 points.
○ She receives 10 points, and Participant X receives 10 points.

Subjects were randomized such that half were informed that for each point they received, they and Participant X would receive $1, and half were informed that they and Participant X would receive a flat payment of $6, no matter how many points they received. This yields 8 distinct cells from a 4 (allocations of 2 or 10 pts to the subject and 2 or 10 pts to Participant X) X 2 (points-worth-dollars versus not) design
Experimental Design Details
Randomization Method
Computerized randomization.
Randomization Unit
Individual randomization only
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
1000
Sample size: planned number of observations
1000
Sample size (or number of clusters) by treatment arms
125 per cell
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
Study has received IRB approval. Details not available.
IRB Approval Date
Details not available
IRB Approval Number
Details not available

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
Yes
Intervention Completion Date
December 12, 2017, 12:00 +00:00
Data Collection Complete
Yes
Data Collection Completion Date
December 12, 2017, 12:00 +00:00
Final Sample Size: Number of Clusters (Unit of Randomization)
1180 in main experiment, 399 in discovery study (12 cells) and 199 in pilot (8 cells)
Was attrition correlated with treatment status?
No
Final Sample Size: Total Number of Observations
Final Sample Size (or Number of Clusters) by Treatment Arms
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials