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Identity and Choice Under Risk
Last registered on October 22, 2018

Pre-Trial

Trial Information
General Information
Title
Identity and Choice Under Risk
RCT ID
AEARCTR-0003438
Initial registration date
October 18, 2018
Last updated
October 22, 2018 12:47 AM EDT
Location(s)
Region
Primary Investigator
Affiliation
Boston College
Other Primary Investigator(s)
Additional Trial Information
Status
Completed
Start date
2012-01-15
End date
2016-11-15
Secondary IDs
Abstract
Preferences and beliefs vary systematically across space, gender, and age. In the context of non-competitive choice under risk, men take on more risk than women. Researchers have shown biological characteristics help explain this fact. Cultural factors may additionally contribute to an explanation, whether consistent with expected utility theory or not. Other characteristics that correlate with gender are a third potential explanation.

This project builds on identity theory to derive a set of predictions that constitute a theory of choice under risk. Identity theory posits that individuals commit to several role identities, each prescribing norms of behavior that are common knowledge in society. Individuals conform their choices to these norms of behavior to verify their identity. Verifying a role-based identity ``means engaging in the behavioral requirements of the role, that is, enacting behavior consistent with the role'' (Burke, 1991). Identity verification increases individuals' (self-)utility, whereas incongruence to one's identity reduces (self-)utility. In this setting, maintaining self-views involves trading off costs and benefits. In the context of gender identity, male identity verification affects men's utility more than female identity verification affects women's utility, because ``manhood, in contrast to womenhood, is seen as a precarious state requiring continual social proof and validation" (Vadello et al., 2008).

Individuals commit to several identities based on their societal roles, but they conform to the norms prescribed by their role identity that is most salient based on the situation or decision frame. Thus a basic prediction of identity theory for choice under risk is that men whose male identity is salient should make riskier choices, because male identity prescribes risky and aggressive norms of behavior. Moreover, this framework supports both conformity and overcompensation in choice -- men should take on more risk not only when their identity is primed, but also when it is threatened, because in both cases, conforming to male-identity norms allows identity verification.

Identity theory also has a set of unique predictions on choice under risk. First, the effects of identity salience on decision-making should involve a beliefs channel -- motivated beliefs arise to allow men taking more risk than would otherwise be warranted based on their risk preferences and known objective probability of success in risky outcomes. Second, any identity that prescribes the same normative behaviors as male identity should affect decisions under risk similarly as male identity. Third, identity should affect choice under risk similarly for positive and negative net present value (NPV) risky opportunities, which might contribute to explain why risk averse agent invest in negative NPV projects. Fourth, identity should affect direct and delegated choices under risk similarly. Finally, the effects of identity on choice should vary with the commitment of individuals to social identity and its norms. Systematic variation in commitment to identity across space and cohorts should therefore predict the size of the effect of the same identity shock on choice under risk of different individuals.
External Link(s)
Registration Citation
Citation
D'Acunto, Francesco. 2018. "Identity and Choice Under Risk." AEA RCT Registry. October 22. https://doi.org/10.1257/rct.3438-1.0.
Former Citation
D'Acunto, Francesco. 2018. "Identity and Choice Under Risk." AEA RCT Registry. October 22. https://www.socialscienceregistry.org/trials/3438/history/35996.
Experimental Details
Interventions
Intervention(s)
Intervention 1: salience of gender identity for male and female subjects
Intervention 2: threatening of gender identity for male and female subjects
Intervention Start Date
2012-02-22
Intervention End Date
2016-10-15
Primary Outcomes
Primary Outcomes (end points)
Change in Risk Tolerance within subject, Better-than-average-beliefs measure (see description in "Intervention"), Decision to Invest in Risky opportunities (extensive margin), Amount of experimental dollars invested in the Risky opportunities (intensive margin).
Primary Outcomes (explanation)
Secondary Outcomes
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Experimental Design
Experimental Design
This trial consists of 5 artefactual field experiments run on the online platform Amazon Mechanical Turk (mTurk). The aim of the trial is to manipulate the salience of gender identity cues in subjects so as to test the predictions of identity theory on choice under risk.

The subject pool is restricted to mTurk Workers with a US tax identification number and who have been reviewed positively Requesters in at least 95% of the tasks they completed on mTurk. At sign up, subjects answer a few demographic questions, which include the country of residence to verify the US restriction is works.

Experiment 1 and Experiment 3 have a within-subject design. The experimental procedure consists of three steps. In the first step, subjects' risk tolerance is elicited using lottery choices a la Holt and Laury (2002). In the second step, subjects face the experimental manipulations. The design is a 2 (male, female) X 3 (control state, priming state, threatening state) experimental design. After facing the manipulations, which consist in reading online blog excerpts that include gender identity role cues, subjects recall and describe in detail in a short essay (5-10 sentences) a situation in which they behaved in line with the blog description. The content of the short essays is used to (i) verify subjects are not automated bots, and (ii) provide a manipulation check for the experimental procedure. In the third step, risk tolerance is elicited again at the subject level.

Experiment 2, Experiment 4, and Experiment 5 have a between-subject design. The experimental procedure consists of two steps -- exposure to the experimental manipulations and performance of a set of choices. In Experiment 2, the design is a 2X3 factorial design as discussed above. The choices aim to elicit subjects' own beliefs about winning if they take part in a lottery whose objective probabilities of winning are common knowledge. In Experiment 4, the design is a 2X3 factorial design, but the two treatment states are both priming states. Choices here are framed as investment games a la Gneezy and Potters (2009) with varying levels of risk and expected value. In Experiment 5, the design is a 2 (male, female) X 2 (control, priming) factorial design. Choices are also investment games a la Gneezy and Potters (2009) but framed as delegated investment opportunities.

At the end of each experiment, subjects face a debriefing procedure, obtain their payment, which include a fixed and a random component based on luck that guarantees choices throughout the experiments are incentive compatible. No subjects are recruited to take part in more than one experiment.
Experimental Design Details
This trial consists of 5 artefactual field experiments run on the online platform Amazon Mechanical Turk (mTurk). The aim of the trial is to manipulate the salience of gender identity cues in subjects so as to test the predictions of identity theory on choice under risk. The subject pool is restricted to mTurk Workers with a US tax identification number and who have been reviewed positively Requesters in at least 95% of the tasks they completed on mTurk. At sign up, subjects answer a few demographic questions, which include the country of residence to verify the US restriction is works. Experiment 1 and Experiment 3 have a within-subject design. The experimental procedure consists of three steps. In the first step, subjects' risk tolerance is elicited using lottery choices a la Holt and Laury (2002). In the second step, subjects face the experimental manipulations. The design is a 2 (male, female) X 3 (control state, priming state, threatening state) experimental design. After facing the manipulations, which consist in reading online blog excerpts that include gender identity role cues, subjects recall and describe in detail in a short essay (5-10 sentences) a situation in which they behaved in line with the blog description. The content of the short essays is used to (i) verify subjects are not automated bots, and (ii) provide a manipulation check for the experimental procedure. In the third step, risk tolerance is elicited again at the subject level. Experiment 2, Experiment 4, and Experiment 5 have a between-subject design. The experimental procedure consists of two steps -- exposure to the experimental manipulations and performance of a set of choices. In Experiment 2, the design is a 2X3 factorial design as discussed above. The choices aim to elicit subjects' own beliefs about winning if they take part in a lottery whose objective probabilities of winning are common knowledge. Beliefs are elicited by asking subjects to report how many times they think they would win if participating 10 times in a lottery that on average wins 50% of the time. Subjects should then report how many times they think their peers would win if participating 10 times in the same lottery. The difference between the beliefs of self-success and peer-success constitute a measure of subjects' "better-than-average" beliefs. In Experiment 4, the design is a 2X3 factorial design, but the two treatment states are both priming states. Choices here are framed as investment games a la Gneezy and Potters (2009) with varying levels of risk and expected value. In particular, subjects are provided with 100 experimental dollars (whose exchange rate with actual dollars is known by subjects throughout the experiment) in each of three period. Each period, subjects decide if they want to allocate any money to the opportunity, and if yes how much. Subjects can only allocate values between 0 (cannot pay to avoid making a choice) or 100 (cannot invest more than their endowment in each period). Gains and losses across periods cannot be reinvested in other opportunities. The first opportunity has a probability of success of 1/2 and gains 3 times the invested amount in the case of success, zero otherwise. The second opportunity has a probability of success of 1/3 and gains 2.5 times the invested amount in case of success, zero otherwise. The third opportunity has a probability of success of 1/6 and gains 8 times the invested amount in case of success, zero otherwise. In Experiment 5, the design is a 2 (male, female) X 2 (control, priming) factorial design. Choices are also investment games a la Gneezy and Potters (2009) like the ones described above but framed as delegated investment opportunities. Despite the delegation frame, the compensation of subjects is a pre-specified fraction of the principal's outcome and hence the interests of the agent and the principal are perfectly aligned. At the end of each experiment, subjects face a debriefing procedure, obtain their payment, which include a fixed and a random component based on luck that guarantees choices throughout the experiments are incentive compatible. No subjects are recruited to take part in more than one experiment.
Randomization Method
Across all 5 experiments, randomization is performed by a random generating process embedded in the survey platform used to administer the intervention (Qualtrics).
Randomization Unit
The randomization unit is the individual
Was the treatment clustered?
No
Experiment Characteristics
Sample size: planned number of clusters
Experiment 1: 300
Experiment 2: 300
Experiment 3: 300
Experiment 4: 200
Experiment 5: 200
Sample size: planned number of observations
Experiment 1: 300 Experiment 2: 300 Experiment 3: 300 Experiment 4: 200 Experiment 5: 200
Sample size (or number of clusters) by treatment arms
Experiment 1: 120 control, 120 priming, 60 threatening
Experiment 2: 100 control, 100 priming, 100 threatening
Experiment 3: 100 control, 100 priming, 100 threatening
Experiment 4: 70 control, 65 priming 1, 65 priming 2
Experiment 5: 100 control, 100 threatening
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB
INSTITUTIONAL REVIEW BOARDS (IRBs)
IRB Name
Committee for the Protection of Human Subjects, University of California at Berkeley
IRB Approval Date
2014-01-03
IRB Approval Number
2013-11-5805
Post-Trial
Post Trial Information
Study Withdrawal
Intervention
Is the intervention completed?
Yes
Intervention Completion Date
November 15, 2016, 12:00 AM +00:00
Is data collection complete?
Yes
Data Collection Completion Date
October 15, 2016, 12:00 AM +00:00
Final Sample Size: Number of Clusters (Unit of Randomization)
Experiment 1: 320
Experiment 2: 323
Experiment 3: 322
Experiment 4: 234
Experiment 5: 212
Was attrition correlated with treatment status?
No
Final Sample Size: Total Number of Observations
Experiment 1: 320
Experiment 2: 323
Experiment 3: 322
Experiment 4: 234
Experiment 5: 212
Final Sample Size (or Number of Clusters) by Treatment Arms
Experiment 1: 129 control, 125 priming, 66 threatening Experiment 2: 108 control, 102 priming, 109 threatening Experiment 3: 106 control, 107 priming, 109 threatening Experiment 4: 78 control, 79 priming 1, 82 priming 2 Experiment 5: 108 control, 104 priming
Data Publication
Data Publication
Is public data available?
No

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Program Files
Program Files
No
Reports and Papers
Preliminary Reports
Relevant Papers
Abstract
I test a set of predictions that constitute an identity theory of choice under risk in a set of large-scale artefactual field experiments. Male identity produces motivated beliefs and hence increases men's risk taking even in pure games of chance with no scope for ability or skills, because confirming men's identity increases their utility. The effects are stronger for men that are more likely to commit to male identity -- older subjects and subjects in the Southern US. I show identity theory can contribute to explain why overconfidence arises even in pure games of chance, overcompensation in choice, investment in negative NPV projects by risk-averse agents, overinvestment in delegated choice under risk, as well as why risk attitudes vary systematically across cohorts and space. Because the motivated beliefs male identity induces have a self-serving scope, departures from expected utility theory are not necessarily suboptimal in this identity theory of choice under risk.
Citation
D'Acunto, F. 2018. Identity and Choice Under Risk. Working Paper