Reference-dependent preferences under shock conditions: evidence from the lab

Last registered on June 06, 2022
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Pre-Trial

Trial Information

General Information

Title
Reference-dependent preferences under shock conditions: evidence from the lab
RCT ID
AEARCTR-0009525
Initial registration date
June 03, 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
June 06, 2022, 5:54 AM EDT

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

Locations

Country
Germany
Region

Primary Investigator

Name
Adrian Presse
Affiliation
University of Hamburg
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Other Primary Investigator(s)

PI Name
Markus Nöth
PI Affiliation
University of Hamburg
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Additional Trial Information

Status
In development
Start date
2022-06-03
End date
2022-07-14
Keywords
Behavior, Lab, Labor
Additional Keywords
Reference Dependence, Effort Provision
JEL code(s)
D12, D81, D84, J22
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
In this study, we develop and extent the real-effort experimental design proposed by Abeler et al. (2011) to test reference-dependent preferences under dynamically changing expectations. To that end, we manipulate expectations via positive earnings shocks and analyze how this affects effort provision. We further shed light heterogeneity among participants with a focus on gender-specific differences and gamification factors influencing the perception of work effort.
Our study helps to reconcile contradicting empirical evidence from the field, specifically in the cab driver market (Camerer et al. (1997), Crawford and Meng (2011) and Farber (2005, 2008, 2015)).
External Link(s)

Registration Citation

Citation
Nöth, Markus and Adrian Presse. 2022. "Reference-dependent preferences under shock conditions: evidence from the lab." AEA RCT Registry. June 06. https://doi.org/10.1257/rct.9525-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
Our intervention shifts the expectations of lab participants regarding their earnings. Individuals have to solve randomly generated counting tasks (work effort) and are free to quit anytime. The final payout is determined by a 50-50 lottery: piece rate or fixed payment. Fixed payment amounts vary across treatments.
Intervention Start Date
2022-06-03
Intervention End Date
2022-07-14

Primary Outcomes

Primary Outcomes (end points)
work effort
Primary Outcomes (explanation)
number of correctly solved counting tasks

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The experiment consists of five phases. First, subjects answer socio-demographic questions (gender, age) and make four simple lottery choices to elicit risk preferences. Second, the experimental task is introduced and control questions test subjects’ understanding of the task. Third, subjects perform a real effort task akin to Abeler et al. (2011). Subjects receive for each correct answer a piece rate and are free to quit anytime. The final payout is determined by a computerized 50-50 lottery: subjects either receive their accumulated piece rate or a fixed amount communicated at the beginning of the experiment. Fixed amounts vary (dynamically) across treatments. Fourth, the payout lottery determines the final payout after subjects quit the main task (or exceed task or time limits). Fifth, subjects answer a questionnaire on perceived task difficulty (1-10), work vs. game perception (1-5) as well as two qualitative questions on counting strategies and what factors led to the quitting decision.
Experimental Design Details
Randomization Method
done by computer
Randomization Unit
individual
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
120-240 participants
Sample size: planned number of observations
120-240 participants
Sample size (or number of clusters) by treatment arms
30-60 each
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number
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