Contract Enforcement in a Stateless Economy - Pilot

Last registered on March 07, 2022

View Trial History

Pre-Trial

Trial Information

General Information

Title

Contract Enforcement in a Stateless Economy

RCT ID

AEARCTR-0009050

Initial registration date

March 04, 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

March 07, 2022, 1:54 PM EST

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

Locations

Country

Pakistan

Region

South Asia

Primary Investigator

Name

Sultan Mehmood

Affiliation

New Economic School Moscow

Contact Primary Investigator

Other Primary Investigator(s)

PI Name

Bakhtawar Ali

PI Affiliation

World Bank

Contact Investigator

PI Name

Daniel Chen

PI Affiliation

Toulouse School of Economics

Contact Investigator

Additional Trial Information

Status

Completed

Start date

2022-03-05

End date

2022-03-06

Keywords

Behavior, Crime, Violence, & Conflict, Governance, Other, Welfare

Additional Keywords

JEL code(s)

D03, D49, G13, G14, L83

Secondary IDs

Prior work

This trial does not extend or rely on any prior RCTs.

Abstract

In this paper, we study contract enforcement in the illegal gambling market of Pakistan as gamblers make high-stakes betting decisions without the state enforcing contracts. Our experimental intervention randomly assigns gamblers with book bets –a contract that allows them to pay back later—relative to pay upfront. We observe the pattern of repayment by gamblers in absence of any state authority enforcing these contracts. We also investigate two potential mechanisms 1) black-listing in case of nonpayment 2) threat or actual violence in case of non-payment. Finally, we examine the impact of a much-used decision aid, odds and historical data relevant to the bet, to investigate whether reducing uncertainty about the outcome affect the decision to bet. We observe winnings and losses of gamblers and collect rich set of behavioral data in the form of strategic dilemmas on risk, confidence, cooperation and coordination.

External Link(s)

Registration Citation

Citation

Ali, Bakhtawar, Daniel Chen and Sultan Mehmood. 2022. "Contract Enforcement in a Stateless Economy." AEA RCT Registry. March 07. https://doi.org/10.1257/rct.9050-1.0

Sponsors & Partners

Experimental Details

Interventions

Intervention(s)

T1: Sign a book bet contract with the gambler (an opportunity to pay back later in case of potential losses in a week)
T2: Coalition Salience – Sign a book bet contract with the gambler with black-listing clause added.
T3: Provide for free a decision aid containing odds and historical data relevant to bet provided for free
C: Status quo - upront payment and no decision-aid provided

Intervention Start Date

2022-03-05

Intervention End Date

2022-03-06

Primary Outcomes

Primary Outcomes (end points)

winnings and losses of gamblers, self reported outcomes such as risk apetite, total losses returned to the casino.

Primary Outcomes (explanation)

Winnings and Losses of gamblers, and total losses returned to the gambling den will be our primary outcome variables.

Secondary Outcomes

Secondary Outcomes (end points)

Outcomes on Risk, Confidence, Cooperation, Coordination Games

Secondary Outcomes (explanation)

Outcomes in strategic dilemas of Risk, Confidence, Cooperation and Coordination Games.

Experimental Design

We will randomly allocate 16000 gamblers at the Annual Lahore Race Derby into four groups of 4000 gamblers each:

T1: Sign a book bet contract with the gambler (an opportunity to pay back later in case of potential losses in a week)
T2: Coalition Salience – Sign a book bet contract with the gambler with black-listing clause added.
T3: Provide for free a decision aid containing odds and historical data relevant to bet provided for free
C: Status quo - upront payment and no decision-aid provided

Experimental Design Details

Randomization Method

Randomization done in office by a computer.

Randomization Unit

Individual Gambler

Was the treatment clustered?

Yes

Experiment Characteristics

Sample size: planned number of clusters

16000 individual gamblers

Sample size: planned number of observations

16000

Sample size (or number of clusters) by treatment arms

4000 per treatment arm.

Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Supporting Documents and Materials

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

Request Information

IRB

Institutional Review Boards (IRBs)

IRB Name

New Economic School's Instituional Review Board

IRB Approval Date

2022-03-04

IRB Approval Number

n/a

Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal