Elemental Financial Decisions

Last registered on January 28, 2022

Pre-Trial

Trial Information

General Information

Title
Elemental Financial Decisions
RCT ID
AEARCTR-0008913
Initial registration date
January 28, 2022

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
January 28, 2022, 10:29 AM EST

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

Locations

There are documents in this trial unavailable to the public. Use the button below to request access to this information.

Request Information

Primary Investigator

Affiliation
Justus-Liebig-Universität Giessen

Other Primary Investigator(s)

PI Affiliation
Justus-Liebig-Universtität Giessen

Additional Trial Information

Status
In development
Start date
2022-01-28
End date
2022-10-31
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
We investigate elemental financial decisions such as "You can invest some money. Do you prefer to invest in a (safe) asset with 5% returns or in a (safe) asset with 10% returns, all else equal and no additional strings attached?" Such decisions are fundamental for all financial decisions, yet to the best of our knowledge they have not been investigated experimentally. We expect that people misallocate money, and that this misallocation increases with cognitive uncertainty. We try to manipulate misallocation by using framing, negative interest rates, the valence of the decision (investing vs. borrowing) and divisible vs. indivisible money - the three former UVs in a within design, the latter UV in a between design.
External Link(s)

Registration Citation

Citation
Gärtner, Florian and Darwin Semmler. 2022. "Elemental Financial Decisions." AEA RCT Registry. January 28. https://doi.org/10.1257/rct.8913
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2022-02-15
Intervention End Date
2022-03-31

Primary Outcomes

Primary Outcomes (end points)
Misallocation, i.e. money not transfered to the optimal solution as deduced by rational choice.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Two experiments with 3 identical independent variables:
- Investment vs. borrowing
- Positive vs. negative interest rates
- Two different frames

The experiments themselves differ in an additional independent variable, the divisibility of money.
Experimental Design Details
Not available
Randomization Method
Computer
Randomization Unit
Individual participants; 16 randomized decisions per participant
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
480 participants
Sample size: planned number of observations
7680 decisions
Sample size (or number of clusters) by treatment arms
240 participants per experiment
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials

There are documents in this trial unavailable to the public. Use the button below to request access to this information.

Request Information
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB of the German Association for Experimental Economic Research e.V.
IRB Approval Date
2022-01-24
IRB Approval Number
5AF8vKhI