The Impact of Non-Events on Trust and Risk-Taking

Last registered on April 14, 2022
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Pre-Trial

Trial Information

General Information

Title
The Impact of Non-Events on Trust and Risk-Taking
RCT ID
AEARCTR-0009213
Initial registration date
April 14, 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
April 14, 2022, 12:22 PM EDT

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

Locations

Country
Austria
Region
Vienna
Country
Germany
Region
Hamburg

Primary Investigator

Name
Mey-Ling Sommer
Affiliation
Helmut Schmidt University
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Other Primary Investigator(s)

PI Name
Jan Philipp Krügel
PI Affiliation
Helmut Schmidt University
Contact Investigator
PI Name
Stefan Traub
PI Affiliation
Helmut Schmidt University
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PI Name
Fabian Paetzel
PI Affiliation
TU Clausthal
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Additional Trial Information

Status
In development
Start date
2022-04-20
End date
2022-09-30
Keywords
Behavior, Lab
Additional Keywords
Non-Events, Uncertainty, Risk Communication, Source Credibility, Decision-making
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
The reporting of events belongs to the basic tasks in risk communication. People receive information and behavioral recommendations from public institutions when they are confronted with e.g. consumer health risks. But, how does communication work in the event of a non-event? In particular, how needs risk communication to be carried out if the information received diverges from ex-post observations? This work evaluates the results of an experiment investigating the impact of source credibility on human decision-making under risk and uncertainty. Study participants are randomized to groups and are asked to make individual decisions in a repeated lottery. They receive information by an external source regarding the possibility to win/lose if they participated in the lottery. Assuming risk neutral and rational participants, we expect participants to mistrust the source of communication after experiencing several non-events – even though, there is no incentive for the communicator to lie. In our treatments, we vary both, the source of communication and the degree of uncertainty in the communicated information. Any effect deviating from the baseline treatment will then be associated with mistrust in the source of communication. The experimental results may provide support for effective risk communication in an epidemiological or consumer health-related crisis.
External Link(s)

Registration Citation

Citation
Krügel, Jan Philipp et al. 2022. "The Impact of Non-Events on Trust and Risk-Taking." AEA RCT Registry. April 14. https://doi.org/10.1257/rct.9213-1.0
Sponsors & Partners

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Experimental Details

Interventions

Intervention(s)
We vary the source of communication. In the baseline treatment (T1), risk communication will be announced directly through the computer.
In the first treatment variation (T2), the received information will be announced with uncertainty. In the second treatment variation (T3), an additional person will assume the role of the communicator. The third treatment variation is identical to T3, however, the communicator will have an incentive to announce wrong information to the participants.
Intervention Start Date
2022-04-26
Intervention End Date
2022-08-31

Primary Outcomes

Primary Outcomes (end points)
Trust in the information/source (dummy);
Risk-Taking depending on to the communicated information (dummy) and the experienced non-events in the previous round(s)
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Participants are randomly assigned to groups of 5 players to play a lottery. Each player will also be assigned a color (blue or orange) which will affect the outcome of the lottery: If a player has been assigned the color blue, (s)he will win the lottery if (s)he decides to play. If a player has been assigned the color orange, s(he) will lose the lottery. The players have also the option to refuse to play the lottery, and save their potential payoff. Before the players decide to play or not play the lottery, the communicator provides information regarding the state of the world (either low or high probability of risk). Participants make individual decisions in the lottery. After the lottery, the players receive the information regarding their own outcome in the lottery and, in addtion, they can see how many players in their group have lost the lottery. The game will be repeated over 10 rounds.
Experimental Design Details
Randomization Method
Potential participants show their preferences to participate in scheduled sessions and are than randomly assigned to these sessions.
Group, color assignment and color association (blue-orange vs. orange blue) randomization are done by a computer.
Randomization Unit
Group assignment is randomized at the individual level; position of buttons in the lottery is randomized at the experimental session-level; color assignment is randomized at the group-level; color association (blue-orange vs. orange-blue) is balanced and randomized at the group-level.
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
Clustered at group-level: 40-50 clusters
Sample size: planned number of observations
250-300 students
Sample size (or number of clusters) by treatment arms
T1 = 50; T2 = 90; T3 = 90; T4 = 90
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Gesellschaft für experimentelle Wirtschaftsforschung e.V.
IRB Approval Date
2022-04-12
IRB Approval Number
LAgogH4F
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials