Sunday, April 26, 2015

Workshop on "The Behavioural Science of Self-Control" (December 4, 2015)


On December 4th 2015, we will host a workshop on “The Behavioural Science of Self-Control: Integrating Economic and Psychological Perspectives”. The workshop is funded by the Scottish Institute for Research in Economics (SIRE).

Self-control is an important human capacity that prevents people from acting on impulses. It has been identified as a key variable in both economics and psychology. This workshop aims to bring together researchers from both disciplines in order to discuss different perspectives on self-control, overcome artificial disciplinary boundaries, and integrate perspectives into a more coherent behavioural science of self-control. 


Figure 1: The Behavioural Science of Self-Control
In economics, self-control is often defined as the ability to stick to prior plans and thus have dynamically consistent time preferences. The methods typically used in economics to analyse self-control problems are mathematical formalisations, secondary data, and incentivised delay discounting questions in experiments or large scale surveys. In psychology, self-control is defined as the ability to regulate one's behaviours, emotions, and thoughts. Psychologists typically use scales in surveys and experimental manipulations to analyse self-control (see Figure 1).


We would like to explore possibilities to combine theoretical and methodological approaches from economics and psychology in novel ways in order to generate new hypotheses, find new ways to test existing hypothesis, compare different theoretical and methodological approaches, figure out new ways to formalise self-control problems, and take the first step toward a behavioural science of self-control. Themes that might be discussed at the workshop include:
  • Different measurements of self-control in economics and psychology.
  • The roles of temptation and willpower in economics and psychology.
  • Economic and psychological consequences of different degrees of self-control.
  • The effectiveness of interventions to improve self-control.
  • The mathematical formalisation of insights from self-control research.

Below are the speakers who have already agreed to participate including their tentative presentation titles:

Saturday, April 25, 2015

World Happiness Report

The World Happiness Report was released recently. The main findings are based on the analyses of the Gallup World Poll. A basic overview is below.
The World Happiness Report is a landmark survey of the state of global happiness. The first report was published in 2012, the second in 2013, and the third on April 23, 2015. Leading experts across fields – economics, psychology, survey analysis, national statistics, health, public policy and more – describe how measurements of well-being can be used effectively to assess the progress of nations. The reports review the state of happiness in the world today and show how the new science of happiness explains personal and national variations in happiness. They reflect a new worldwide demand for more attention to happiness as a criteria for government policy. 
The report is published by the Sustainable Development Solutions Network (SDSN).  It is edited by Professor John F. Helliwell, of the University of British Columbia and the Canadian Institute for Advanced Research; Lord Richard Layard, Director of the Well-Being Programme at LSE’s Centre for Economic Performance; and Professor Jeffrey D. Sachs, Director of the Earth Institute at Columbia University, Director of the SDSN, and Special Advisor to UN Secretary General Ban ki-Moon
Details of the seven key chapters are below.
Chapter 2, by John Helliwell, Haifang Huang, and Shun Wang, contains our primary rankings of and explanations for life evaluations.
Chapter 3, by Nicole Fortin, John Helliwell, and Shun Wang, presents a far broader range of happiness measures, and shows how they differ by gender, age and global region.
Chapter 4, by Richard Layard and Gus O’Donnell, advocates and explains the use of happiness as the measure of benefit in cost-benefit analysis.
Chapter 5, by Richard Davidson and Brianna Schuyler, surveys a range of important new results from the neuroscience of happiness.
Chapter 6, by Richard Layard and Ann Hagell, is aimed especially at the happiness of the young – the one-third of the world population that is under the age of 18 years.
Chapter 7, by Leonardo Becchetti, Luigino Bruni, and Stefano Zamagni, digs deeper into the ethical and community-level supports for happiness.
Chapter 8, by Jeffrey Sachs, discusses importance of social capital for well-being and describes ways that societies may invest in social capital in order to promote well-being.

Friday, April 24, 2015

Irish Economics and Psychology One-Day Conferences

Below are the programmes for the seven Irish workshops that have been organised so far. The 8th in the series will take place in the ESRI on November 27th. The call for papers is here.

Seventh Economics and Psychology One-Day Conference

The seventh annual one day conference on Economics and Psychology, co-organised by researchers from UCD, ESRI and NUIM, took place on October 31st in the UCD Geary Institute. The purpose of these sessions is to develop the link between Economics, Psychology and cognate disciplines in Ireland. A special theme of these events is the implications of behavioural economics for public policy though the workshops have covered work across all areas of intersection of Economics and Psychology. Programmes from the previous six events are here.

Programme:

09.00-09.20: Registration

09:20-09:30: Introduction

09:30-10:00: Dr. Michael Daly (Stirling)
Time preferences predict inflammation in later life
Abstract: 
Prominent economic and psychological models suggest that impatient individuals with high discount rates invest less in their health leading to adverse physiological consequences (Grossman, 1972; Hall & Fong, 2007). The aim of this study is to test, for the first time, whether time discount rates elicited from an incentivised experiment become biologically embedded via changes in C-reactive protein (CRP) and fibrinogen levels over time. The sample was drawn from the population-based English Longitudinal Study of Ageing. Those who completed a preference module and provided blood plasma samples at two time-points for analysis were included in the study (n=427; Age=63.6 (SD=5.7); 52.8% Female). Discount rates were calculated from a set of 12 choices between smaller sooner and larger later rewards (e.g. £25 in two weeks or £30 in one month) where the participant won the value of a randomly selected choice (median reward £28). Our results indicate a substantial relationship between high discount rates and high levels of inflammation two years later as gauged by CRP (β=.18; p<.001) and fibrinogen (β=.1; p<.05) in analyses which adjusted for age, gender, marital status, wealth and prior inflammation levels. This pattern was robust to the inclusion of controls for BMI, cardiovascular disease, arthritis, other long-term illnesses, smoking, physical activity, and alcohol consumption. Further adjustment for cognitive functioning and the Big Five personality traits did not affect the associations observed. This study provides strong evidence that incentivised elicited discount rates robustly predict longitudinal changes in inflammation in a national sample.

10:00-10:30: Marek Bohacek (ESRI)
The Integration of Visual, Numeric and Categorical Information in Judgements of Value
Pete Lunn, Marek Bohacek*, & Jason Somerville, ESRI and Trinity College Dublin
Abstract:
We investigate how accurately consumers can integrate information about multiple product attributes into judgements of value, while manipulating the nature of the attributes. Using a 2AFC “objective valuation” (OV) task, we compare performance in multi-attribute judgements when attribute magnitudes are provided as visual cues, numeric magnitudes, or between two and four categories of quality. Across three experiments with different products, we find no improvement in the accuracy of judgements when attribute magnitudes are provided as numbers, rather than as visual cues. We do find small improvements when an attribute consists of just two categories (good versus bad), or when categories are correlated with the likelihood of obtaining a surplus relative to a price. Overall, our results suggest that: (1) precise numeric attribute scales do not improve multi-attribute judgement; (2) it is the difficulty of integrating information from incommensurate attribute scales determines performance in multi-attribute judgement.
10:30-11:00: Coffee

11:00-11:45:  Prof. Rowena Pecchenino (NUIM)
The Economic Consequences of Despair
Abstract: 
This paper examines despair, the total loss of hope, from the perspectives of many disciplines to characterize the despairing individual, his motivations, and his capacity for decision-making.  It then examines the extent to which economics has recognized despair and whether economics should incorporate despair into its theoretical and policy analyses, and, if so, how.

11:45-12:30: Dr. Pete Lunn (ESRI)
Do Consumers Value Products they are Familiar with more Accurately? (with Marek Bohacek & Féidhlim McGowan).
Abstract: 
We investigate how the precision of consumer valuations is affected by familiarity with the product. Using a within-subject design, we compare performance in a 2AFC "objective valuation" task across four products: houses, contracts for broadband services, and two unfamiliar computer-generated products. Participants decide whether each product, with a given set of attributes at a particular price, represents good or bad value. The value of the familiar products is objectively defined by two statistical models relating attributes to prices in the market. The same models also determine the mathematical relationship between attributes and prices of the two unfamiliar products, allowing us to identify the effect due to familiarity. Data collection is to be completed by end-September. We will present an initial analysis of the experimental data at the conference.

12:30 - 13:30: Lunch

13:30-14:00: Prof. Liam Delaney (Stirling)
Behavioural Economics and Irish Public Policy 
Abstract: 
This presentation will outline the relevance of the last ten years of behavioural economics and behavioural science for research across a number of domains including pensions policy, financial regulation, education, health and consumer policy.

14:00-14:45: Dr. Edel Walsh, (School of Economics, University College Cork)
An Examination of Life Satisfaction in Ireland: Evidence from the European Social Survey 5 (2010)

Abstract: 
The aim of this research is to establish the most significant factors affecting life satisfaction, at an individual level, in Ireland during the recent economic recession. The global financial crisis significantly impacted the Irish economy and by 2010 Ireland was experiencing its third consecutive year of negative growth. During the period 2007 to 2010 the level and rate of unemployment increased substantially in Ireland with an average unemployment rate of 13.8 per cent being reported in 2010. In addition, unemployment affected men more than women and in particular the 20-24 year age group. Given the well-established link between life satisfaction, income and unemployment, the economic conditions in Ireland in 2010 make it an interesting case to study. The data used in this analysis were obtained from the Irish component of the European Social Survey 5 (2010).

Using both OLS and ordered probit models the determinants of life satisfaction are estimated. The paper also tests if there are significant gender differences in the results but find no significant differences in the determinants of male and female life satisfaction in Ireland at that time. The main findings suggest that unemployment has a statistically significant effect on reducing life satisfaction. Income is found to have a significant, but modest effect on improving life satisfaction. The results also suggest that being young (24 or younger) or old (over 65) and having social connections have the largest positive effects on life satisfaction. Other findings suggest that having children positively impacts on one’s life satisfaction. Living in a rural area of Ireland is a positive factor affecting an individual’s satisfaction with their life. Further significant results indicate that life satisfaction is largely, negatively influenced by marital status (being divorced or separated) and suffering from a disability. The overall findings are important in the context of the current policy focus on well-being in Ireland.

14:45-15:30pm: Dr. Ronan Lyons (Trinity College Dublin & Spatial Economics Research Centre, LSE)
What house price equation do households use? Insights from the Irish housing market, 2003-2014
Abstract: 
Housing is the most important good in the typical household’s consumption basket and the largest asset in its portfolio. Given this, and given that expectations about house prices act as a demand shifter, the measurement of house price expectations is a topic of importance for economic policy. This research attempts to answer two related questions. Firstly, to what extent are expectations backward-looking, rather than based on perceptions of future fundamentals? And secondly, how do households believe that changes in fundamentals will affect house prices? These questions are answered combining national surveys (2003-2008), national and local surveys (2011-2014) and an experimental survey, drawing on methods from the willingness-to-pay literature.

15:30-16:00: Coffee 

16:00-17:00:  Prof. Ruth Byrne (TCD)
The Cognitive Science of the Human Imagination
Abstract: 
The human imagination remains one of the last uncharted terrains of the mind. In everyday imaginative thought, people often create alternatives to reality and imagine how events might have turned out ‘if only’ something had been different. People engage in such flights of the imagination for more than entertainment – psychological experiments show that the alternatives to reality that people create ensure that they learn the causes of outcomes and how to prevent them in the future; they contribute to the experience of emotions such as regret, guilt, relief and hope; and they underlie social ascriptions of blame, responsibility, and fault. The loss of these imaginative thoughts following certain sorts of brain injury has devastating consequences for normal cognition.

New discoveries suggest that, just as experiments have shown that rational thought is more imaginative than previously supposed, so too imaginative thought is more rational than previously supposed.  Cognitive scientists have established that people tend to change the same sorts of things in their ‘if only’ thoughts, such as events within their control, actions rather than inactions, exceptions rather than usual events. These ‘fault-lines’ in the human imagination provide important clues about its logic and its limitations, and indicate that imaginative thoughts are guided by the same principles that underlie rational thoughts. 

Sixth Economics and Psychology One-Day Conference

The 6th in the series of conferences on economics and psychology in Ireland took place on November 29th in NUI Maynooth co-organised by Liam Delaney (Stirling) and Richard Roche (NUIM). The event took place in the Glenroyal hotel which is adjacent to the Maynooth campus. Below is a summary of the day. Thanks to all the attendees and we will contact in the New Year about next year's workshop. 

Programme and Summary


The conference was opened at 9am by Liam Delaney.


9am - 9.30am 


Title: A behavioural examination of the forward rate unbiasedness hypothesis in precious metals markets
Author: Fergal O'Connor, (Trinity College Dublin)

Abstract:
We offer the first examination of whether the gold forward market is an unbiased predictor of the future gold spot rate and find evidence that it is not, especially at longer maturities. We then examine whether this can be explained by behavioural factors such as market optimism and the strength of the market’s reaction to news, developing Aggarwal and Zong’s (2008) approach to allow for investor risk aversion.We show that the gold market generally suffers from overreaction to historical spot price changes over the full period of our sample. The forward premium is found to be optimistic. The market’s forecast errors are sometimes found to be pessimistic but this disappears once we allow for investor risk aversion. Revisions to the market’s forecasted spot price consistently overreact to observed forecast errors. Finally, some of these findings are shown to be dependent on the sample length used.

930am - 10am 
Title: Policy vs Politics in voluntary recycling
Author: Marie Briguglio, (Behavioural Science Centre, Stirling Management School, University of Stirling)



Abstract:
The study explores the role of politics in determining voluntary contributions to public goods, using voluntary recycling in Malta as a case study. Earlier literature provides us with some fairly robust findings on the determinants of recycling:  voluntary participation is driven by moral motives and is suppressed by constraints that households may face. Although some studies have explored the role of political orientation as a determinant of voluntary contributions to the environment, none have attempted to parse out the effect of political attachment to the party in government from ideology. We test the hypothesis that loyalty to the party in government matters, and that it does so independently of ideology or environmental moral motives:  individuals give more to public goods, if their political party is in government and responsible for providing such goods. This, in turn, may be underpinned by stronger efficacy beliefs, trust, in-group identification or even feelings of reciprocity and gratitude to one’s own party. To test this hypothesis, we generate data on recycling behaviour and  intent as well as political behaviour and attitudes from a dedicated nation-wide representative survey (n=1000) conducted in Malta (using Computer-Assisted Telephone Surveys) shortly after the change in government in 2013.  We set out to measure political attachment, political orientation, and environmental moral motives along with other controls necessary to identify their separate impact on voluntary contribution. We also embed a randomised experiment to test the impact on recycling intent (among different political groups) of a 7-word political statement.  These findings start to unpack what much of the literature to date has referred to as “moral motives” and offer practical insights for interventions targeting voluntary participation in the recycling interventions.

10.00am - 10.30am
Title: Notches as Nudges: arbitrary thresholds operate as meaningful targets for promoting home energy efficiency
Authors: David Comerford, Mirko Moro and Ian Lange, (Behavioural Science Centre, Stirling Management School, University of Stirling)



Abstract:
For reasons of efficiency, public health and environmental protection, improving home energy efficiency is a policy goal. Previous research has analyzed the effectiveness of subsidies and tax breaks as incentives. This paper considers the effect of a policy change that was purely informational - the introduction of energy performance certificates (EPCs) for houses from 2007. Before the introduction of EPCs, energy performance was measured in SAP (Standard Assessment Procedure) scores, on a 0-100 scale that gives no normative information. EPCs converted SAP scores to a colour-coded letter grade scale, from A-G. We find using the English Housing Survey that there has been an upward shift in home energy efficiency since the introduction of EPCs, with a disproportionate number of houses clustering at the lowest point on the D scale.

COFFEE BREAK 

10.45am - 11.30am 
Title: Money, Well-Being, and Loss Aversion: Does an Income Loss Have a Greater Effect on Well-Being Than an Equivalent Gain? 
Author: Christopher Boyce, (Behavioural Science Centre, Stirling Management School, University of Stirling)



Abstract:
Higher income is associated with greater well-being, but do income gains and losses affect well-being differently? Loss aversion, whereby losses loom larger than gains, is typically examined in relation to decisions about anticipated outcomes. Here, using subjective-well-being data from Germany (N = 28,723) and the UK (N = 20,570), we found that losses in income have a larger effect on well-being than equivalent income gains and that this effect is not explained by diminishing marginal benefits of income to well-being Our findings show that loss aversion applies to experienced losses, challenging suggestions that loss aversion is only an affective-forecasting error. By failing to account for loss aversion, longitudinal studies of the relationship between income and well-being may have overestimated the positive effect of income on well-being. Moreover, societal well-being might best be served by small and stable income increases, even if such stability impairs long-term income growth.

Link to paper

11.30am to 12.15pm 
Title: Price your Vice: The Action Dynamics of Delay Discounting in a Public Setting
Authors: Denis O'Hora, Maciej Dabrowski, David Crowley, Rachel Carey, Aoife Kervick, (NUI Galway)


Abstract:
Delay discounting, the tendency to discount rewards or losses that occur in the future, is a reliably observed characteristic of human behaviour and the degree to which an individual discounts future rewards and losses has been linked to many behavioural and health problems including smoking, over-eating and alcohol abuse. The current experiment was based in the RISK lab exhibition hosted by the Science Gallery at Trinity College Dublin.  Over 700 participants played a short computer game in which they chose first between amounts of euro and later between amounts of a chosen vice at various delays.  Participants completed the domain-specific risk-taking scale (DOSPERT) and provided demographic details to facilitate an investigation into whether or not degree of discounting predicted risky behaviour.  Participant movement during choice was also tracked to investigate whether conflict during initial decisions was sensitive to the discounted value of the delayed euro/vice reward.  Findings will be discussed in the context of dynamic models of decision making.

12.15pm - 1pm 
Title: How accurately can people resolve trade-offs? 
Authors: Pete Lunn and Marek Bohacek, (ESRI)


Abstract:
We develop and experimentally test an idealised model of how people judge trade-offs between two product attributes, where overall value is determined by their linear combination.  The experimental method employs the standard techniques of forced-choice psychophysics. Subjects value a hypothetical product (a golden egg) the value of which is objectively determined by a consistent formula, i.e. experimental subjects are effectively price-takers. Performance is measured for forced-choice comparisons between the product and a price, where subjects must decide which is worth more, and between two simultaneously presented products. The experiment requires subjects initially to judge the product based on a single dimension (e.g. larger size means higher value), then to judge the product based on a second dimension (e.g. finer texture means higher value), and finally to judge the product based on both dimensions simultaneously. The results reveal that product attributes are mapped onto prices imprecisely and, furthermore, that precision decreases sharply once a trade-off is involved. The accuracy of valuations further deteriorates with the size of the trade-off. Overall, our findings suggest capacity limits in the ability to make apparently simple trade-offs.

LUNCH BREAK 
2pm - 2.45pm 
Title: Dimensional Limits in Multi-Attribute Valuations
Authors: Marek Bohacek and Pete Lunn, (ESRI)


Abstract:
How many attributes can decision-makers simultaneously combine into an overall assessment of value? This question is investigated using a novel experimental design that employs a hypothetical product (a golden egg) the value of which is objectively determined, i.e. experimental subjects are effectively price-takers. The product’s attributes consist of standard visual stimuli, such as size, texture, shape etc., where overall value is determined by a simple linear equation that assigns a weight to each attribute. The task is to learn to value these products over repeated forced-choice trials in which the subject compares a product against a price and must decide which is worth more. We measure performance as a function of the number of attributes that subjects must simultaneously consider. Experiment 1, which employs a representative sample of Dublin consumers (n=36), uses a within-subject design to show that the accuracy of valuations declines rapidly once value is determined by more than one attribute. The results show that it is the number of attributes that governs performance, rather than the nature of them. Experiment 2 then uses a between-subject design to examine whether a group of highly educated and financially literate individuals (n=24) can learn to value these multi-attribute products given exposure to one consistent task, with plenty of practice and feedback. The results confirm the difficulty of combining information across multiple dimensions and reveal that learning is modest. Overall, our findings suggest that there may be important cognitive limits to the ability to make multidimensional judgements of value.

2.45pm - 3.15pm 

Title: "Childhood self-control and unemployment over the lifespan"

Authors: Michael Daly, Liam Delaney, Mark Egan



Abstract: The capacity for self-control may underlie successful entry into the labor force and job retention, particularly in times of economic uncertainty. In an analysis of two large-scale, nationally representative cohort studies of British children (N = 16,676), we found that childhood self-control influenced the emergence and persistence of patterns of unemployment across four decades. A 1 SD increase in self-control reduced unemployment by a quarter or 1.5 percentage points and led to a substantial reduction in the lifetime duration of unemployment, after adjustment for intelligence and social class. Our analysis of monthly unemployment data from before and after the onset of the UK early 1980s recession showed that those with low childhood self-control suffered the greatest increases in unemployment during this period. Whilst the self-controlled avoid unemployment and are resilient to the labor market effects of recession, this group were found to suffer the largest aversive well-being effects from prolonged periods of unemployment. Our results uncover a critical role of self-control in shaping lifespan trajectories of occupational success and in determining how macroeconomic conditions shape population unemployment levels. Accordingly, we recommend a better integration of self-control into labor market activation programmes and a greater focus on self-control in research that aims to understand individual differences in responses to existing programmes.

COFFEE BREAK 

3.30pm - 4.15pm 
Title: “Measuring Investment in Human Capital Formation: An Experimental Analysis of Early Life Outcomes”
Authors:
Orla Doyle (University College Dublin)
Colm Harmon (University of Sydney and IZA)
James J. Heckman (University of Chicago, University College Dublin, NBER and IZA)
Caitriona Logue (University College Dublin)
Seong Hyeok Moon (University of Chicago)


Abstract:
The literature on skill formation and human capital development clearly demonstrates that early investment in children is an equitable and efficient policy with large returns in adulthood.  Yet little is known about the mechanisms involved in producing these long-term effects. This paper presents early evidence on the nature of skill formation based on an experimentally designed, five-year home visiting program in Ireland targeting disadvantaged families - Preparing for Life (PFL). We examine the impact of investment between utero to 18 months of age on a range of parental and child outcomes. Using the methodology of Heckman et al. (2010a), permutation testing methods and a stepdown procedure are applied to account for the small sample size and the increased likelihood of false discoveries when examining multiple outcomes. The results show that the program impact is concentrated on parental behaviors and the home environment, with little impact on child development at this early stage. This indicates that home visiting programs can be effective at offsetting deficits in parenting skills within a relatively short timeframe, yet continued investment may be required to observe direct effects on child development. While correcting for attrition bias leads to some changes in the precision of estimates, overall the results are quite similar.

Link to paper 

4.15pm - 5pm 
Title: The Person in Context: How the individual interacts with their socio-economic environment to determine behaviour and wellbeing
Authors:
Alex M. Wood, (Behavioural Science Centre, Stirling Management School, University of Stirling)
Christopher J. Boyce, (Behavioural Science Centre, Stirling Management School, University of Stirling)
Gordon D. A. Brown, (Department of Psychology, University of Warwick)
Silvio Aldrovandi, (Department of Psychology, University of Warwick)
Michael Daly, (Behavioural Science Centre, Stirling Management School, University of Stirling)



Abstract:
This talk promotes better understanding of the socio-economic determinants of well-being and behaviour through studying how the person interacts with their environment. The programme presented aims to integrate behavioural science which focuses on the person (e.g., psychology) with the social sciences which focus on the structure of society (e.g., economics and management). First, defining "the person" through measurable individual differences, three prospective analyses of  over 6,000 people show that personality characteristics prior to major life events affect reaction and adaptation (e.g., conscientious people gain more happiness following increases in income, but lose greater well-being following unemployment, and more agreeable people recover well-being faster after the onset of disability). Second, defining "the person" through core characteristics that everyone share, evidence is presented from evolutionary biology and cognitive science showing that people have an inherent sensitivity to rank position within a hierarchy. This core rank sensitivity is then used to explain phenomena across economics, health policy, and marketing. The converging evidence shows (a) how people make judgments in each of these fields, (b) why apparent relative judgements effects such as anchoring occur, (c) why income is related to health and well-being, (d) how this research can be used in interventions to promote healthy behaviour. Taken together, the talk illustrates why it is important to incorporate a focus on how individual differences and core human characteristics interact with environment in both research and practice, and more broadly, why it is important to integrate the behavioural and social sciences.

Link to Professor Wood's webpage with many of the papers 

Fifth Economics and Psychology One-Day Conference

This year's conference is being co-organised by researchers in the ESRI and the UCD Geary Institute and will be held in the ESRI. The purpose of the conference is to strengthen the link between Economics, Psychology and cognate disciplines in Ireland. As with previous conferences, a special theme is the implications of behavioural economics for public policy.

The growing interest in and practical application of behavioural economics across the EU, US and UK increases the importance of Irish public policy makers engaging with this literature and this event will provide an important platform for such engagement.  Previous keynote speakers have included international experts such as Arie Kapteyn (RAND), David Laibson (Harvard) and John O'Doherty (Calttech). Papers from the 2011 session on implications of behavioural economics for public policy in Ireland will be published in a special issue of the Economic and Social Review in November 2012.

The two keynote speakers for this year’s conference are:

Professor Robert Sugden and Dr. David Halpern.

Programme (Provisional):

9am - 10.40: Contributed session on behavioural economics  

Michael Dowling (DCU):   "Female Directors and UK Company Acquisitiveness"
Valeria di Cosmo (ESRI): "Estimating the impact of time-of-use pricing on Irish electricity demand"
Richard Roche (NUIM): "Contribution of Neuroscience to Society" 
Denis O’Hora (NUIG): "Cognitive conflict in “Decision Space”: Using Action Dynamics to investigate Decision Making"

BREAK 

11am - 12.30pm: Contributed session on behavioural economics

Brendan Kennely (NUIG): "Assessment systems in economics: A discrete choice experiment"
Michael Daly (Stirling): "Self-Control and Smoking Policy"
David Comerford (Duke and Stirling): "Consumer Sentiment" 

LUNCH 

1.30pm - 2.45pm: Contributed session on behavioural economics


Liam Delaney (Stirling): "Behavioural Economics and Pension Autoenrolment" 
Pete Lunn (ESRI): "Behavioural Economics and Market Failure" 
Keith Walsh (Revenue) "Influencing Taxpayer Behaviour – Applying Behavioural Research in Tax Administration"

BREAK 

3.00pm - 4.00 pm: Keynote session on behavioural economics: I Professor Robert Sugden 
 

4.00pm - 5.00pm: Keynote session on behavioural economics II: Dr. David Halpern  

Economics, Psychology and Neuroscience Fourth Annual One Day Session:

The final programme for November 25th is below. The speakers are a mix of PhD students, researchers in public institutions and academics. This year’s main session take place at the Geary Institute on Friday November 25th. All are welcome. Please RSVP to geary@ucd.ie There will be a special issue of the ESR based on some of the papers from this year’s session. The panel session will be used to discuss how developments in the recent literature have policy relevance. There is no registration charge.

Programme:

9.00: REGISTRATION


9.15: Organ Donation and Individual Consent- The role of Family Consent in Donation Systems.
Clare Delargy- UCD Geary Institute

9.45: Credit Cards: Friend or Foe.
Yvonne McCarthy - Central Bank of Ireland.

10.15: Understanding Taxpayer Behaviour – New Opportunities for Tax Administration.
Keith Walsh- Revenue Commissioners

10.45: BREAK

11.30: The Role of Economic Psychology in Students’ Term-Time Employment and Academic Achievement.
Martin Ryan- UCD Geary Institute

12.00: LUNCH

13.00: Corruption and Well-Being
Rob Gillanders - University College Dublin

13.30: Subcultures in Household Financial Decision-Making: An Exploratory Study of Risky Asset Ownership in the Netherlands.
Michael Dowling- DCU

14.00:BREAK

14.15: Behavioural Economics and participation in recycling programmes
Marie Brugligio- University of Malta

14.45: Behavioural Economics and Policymaking: Learning from the Early Adopters.
Pete Lunn, ESRI

15.15: BREAK

15.30: Behavioural Economics and the Irish Pension System
Liam Delaney- Stirling University and Geary Institute

16.00: Is the health impact of socioeconomic status explained by objective financial resources or subjective social status?
Michael Daly - Manchester and Aberdeen.

16.30: Panel Discussion

Economics, Psychology and Neuroscience Third Annual One Day Session:

10.00am - 10.30am

Martin Ryan (UCD)  "The Role of Economic Psychology and Non-Cognitive Skill in Students' Lecture Attendance and Academic Achievement"

10.30am - 11am

Liam Delaney (UCD)  "Automatic Enrollment and the Irish Pension System"

11am - 11.20am: Coffee

11.30am - 12pm

Cormac O'Dea (IFS and UCL). "Cognitive function, numeracy and retirement saving trajectories"

12pm - 12.30pm

Marie Briguglio (University of Malta). "Voluntary Pro-Environmental Behaviour".

1230pm - 1pm

Michael Daly(TCD) "How income relates to life satisfaction and daily emotional experience: Evidence from the American Life Panel"

LUNCH

2pm - 2.30pm

Mick O'Connell (UCD) "Variation in 'Returns to Education' and academic performance by country in OECD's PISA science scores"

3pm - 3.30pm

Peter Lunn (ESRI) "What Can I Get For It? A theoretical and empirical re-analysis of the endowment effect."

3.30pm - 4pm Coffee

4pm - 5.30pm: Keynote Speaker.

David Laibson (Harvard) "Natural Expectations and Economic Behavior"

Second Annual Economics and Psychology One-Day Conference

The 2009 conference will take place at the Institute of Bankers in Ireland (IFSC, Dublin) on Friday November 6th 2009. The Institute of Bankers in Ireland is located at 1 North Wall Quay, Dublin 1. 

The purpose of this conference is to provide a forum for the discussion of work at the interface of economics, psychology and cognate disciplines such as neuroscience.

In particular, the event aims to complement existing international forums by providing a platform for discussion among people working in these areas in Irish universities. We welcome applications from Ph.D. students working in this area.

Session1: 10:00-11:20
Chair: Dr. Richard Roche

Martin Ryan, UCD, The Psychology of Survey Responses on Skills-Matching
David Comerford, UCD, Experimental Tests of Survey Expenditure Measures
Eibhlin Hudson, UCD, Measuring Socioeconomic Differences in Child Health
Michael Daly, TCD, Cortisol, Morningness and Well-Being

Session2: 11:40-1:00
Chair: Prof. Rowena Pecchenino

Dr. Richard Roche, NUIM, Neuroeconomics of Time Discounting
Dr. Pete Lunn, ESRI, What's In It For Me? A Computational Theory of Economic Exchange
Dr. Stephen Kinsella, UL, Electricity Price Auctions: An Experimental Analysis

1:00 – 2:00: Lunch

Session3: 2:00-3:20
Chair: Dr. Liam Delaney

Katherine Carman, Tilburg, Health Risks and the Perception of Probabilities
Dr. Marcel Das, Tilburg, The Dutch MESS Panel

4:00: Keynote – Arie Kapteyn, Director, RAND Labor and Population

Economics and Psychology One-Day Conference

A one-day conference on Economics and Psychology will take place in NUIM on November 7th (Exact Venue to be confirmed). The purpose of this event is to provide a forum for the discussion of work at the interface of economics, psychology and cognate disciplines such as neuroscience. The event is co-organized by the Department of Economics, Finance and Accounting in Maynooth and the UCD Geary Institute. The International Association for Research in Economic Psychology (IAREP) is the relevant international body and we would encourage attendees to consider joining this group. All are welcome and there is no registration fee. Please contact Liam Delaney (Liam.Delaney@ucd.ie ) to confirm attendance.

Programme 


10.00 – 10.15: Welcome: Professor Rowena Pecchenino

10.15-10.45: Liam Delaney (UCD). “Psychological and Biological Foundations of Time Preferences”.

10.45-11.15: Orla Doyle (UCD). “Early Childhood Differences in Time Preferences: Evidence from the Millennium Cohort Study” 

11.15-11.30: Coffee

11.30 – 12.00: Stephen Kinsella (UL). “Computable and Experimental Economics at UL”

12.00 – 12.30: Mirko Moro (UCD). “Spatial Heterogeneity in Well-Being” 

12.30- 1.00: Kevin Denny (UCD). “A continuum of handedness predicts behaviour”

1.00 – 2.00: Lunch

2.00 – 2.30: Richard Roche (NUIM). “Neuroeconomics and Time Preferences”

2.30-3.00: Rowena Pecchenino (NUIM). “Becoming: Identity and Spirituality”

3.00 – 3.30: Martin Ryan (UCD). “Time Use and Time Preferences” 

3.30-3.45: Coffee 

3.45 – 4.15: David Comerford (UCD). “Transport Mode Choice: Decision and Experienced Utility” 

4.15 – 4.45: Peter Lunn (ESRI). “What’s it Worth? Can uncertainty in the perception of value explain loss aversion?” 

4.45 – 5.15: John O’Doherty (TCD) “Neuroeconomics of human decision making: from simple choice to social interactions”

Call for papers: Stirling PhD Conference in Behavioural Science (25th of June 2015)




Call for papers: Stirling PhD Conference in Behavioural Science

25th of June 2015

Stirling Behavioural Science Centre (StirBSC)
 

The Stirling Behavioural Science Centre is pleased to announce its 2015 PhD Student Conference in Behavioural Science. The PhD conference will be held at the University of Stirling on the 25th of June 2015 and will be followed by our Workshop on Behavioural Science and Public Policy on June 26. Attendees to the PhD conference on June 25 are also welcome to attend the June 26 workshop.

The June 25 PhD conference aims to give PhD students in Behavioural Science the opportunity to meet other researchers, to present their work, and get feedback from peers and researchers in the field. The PhD conference will deal with all areas of behavioural science (or behavioural economics, economic psychology, judgement and decision making, depending on your terminological preference). Topics include, but are not limited to

  • Nudging and Behavioural Policies 
  • Evaluation of Behavioural Policies
  • Mechanisms of Behavioural Interventions
  • Inter-temporal Choice
  • Self-control
  • Risk Preferences
  • Social Preferences
  • Heuristics
  • Personality and Economics
  • Subjective Well-Being
  • Identity in Economics
  • Emotions and Decision Making 
  • Behavioural Medicine
  • Early Influences on Later Life Outcomes
  • Behavioural Science and the Labour Market
  • Research Methods in Behavioural Science 
Speakers will have 25 minutes to present followed by 20 minutes of discussion. Speakers have the opportunity to send their papers/slides to their discussant about 2 weeks before the conference in order to get more detailed feedback. Discussants who will be available to give feedback on the 25th are listed below. Further discussants will be added shortly.

Located in the heart of Scotland’s central belt, Stirling is a 45 minute journey from both Glasgow and Edinburgh airports. There will be no conference fee and a social dinner will be provided for attendees on the evening of June 25. 


For affordable accommodation in Stirling, we recommend booking.com and airbnb. Accommodation may fill up relatively soon due to graduation ceremonies taking place on the same day. In this case it is also feasible to stay in Edinburgh or Glasgow and take a 40 minute train to Stirling in the morning.

Important dates:

  • April 30th: Abstract submission deadline (up to 500 words).
  • May 7th: Notification of acceptance.
  • May 25th: Registration deadline.
  • June 10th: Submission of paper/more detailed abstract to the discussant.

We welcome you to submit an abstract for your paper using the link below. 


We look forward to welcoming you to Stirling. If you have questions, feel free to send an email to l.k.lades@stir.ac.uk.

We thankfully appreciate support from the ESRC. 






Other helpful links:

1. Stirling Behavioural Science Centre
2. How to get to Stirling
3. List of recent conferences run by Stirling Behavioural Science Centre
4. The Stirling Court Hotel on campus

Thursday, April 23, 2015

Using the Maryland Scientific Method Scale to grade study quality

Introduced by Farrington et al. in the 2002 book "Evidence-Based Crime Prevention", the Maryland Scientific Method Scale (SMS) is a tool for rating the quality of studies. It ranges from Level 1 (worst quality) to Level 5 (best) and can be adapted to evaluate studies outside of criminology.

The below description of the SMS is taken from a recent paper called "Guide to scoring methods using the Maryland Scientific Methods Scale" by Madaleno & Waights:

"Level 1: Either (a) a cross-sectional comparison of treated groups with untreated groups, or (b) a before-and-after comparison of treated group, without an untreated comparison group. No use of control variables in statistical analysis to adjust for differences between treated and untreated groups or periods.

Level 2: Use of adequate control variables and either (a) a cross-sectional comparison of treated groups with untreated groups, or (b) a before-and-after comparison of treated group, without an untreated comparison group. In (a), control variables or matching techniques used to account for cross-sectional differences between treated and controls groups. In (b), control variables are used to account for before-and-after changes in macro level factors.

Level 3: Comparison of outcomes in treated group after an intervention, with outcomes in the treated group before the intervention, and a comparison group used to provide a counterfactual (e.g. difference in difference). Justification given to choice of comparator group that is argued to be similar to the treatment group. Evidence presented on comparability of treatment and control groups. Techniques such as regression and (propensity score) matching may be used to adjust for difference between treated and untreated groups, but there are likely to be important unobserved differences remaining.

Level 4: Quasi-randomness in treatment is exploited, so that it can be credibly held that treatment and control groups differ only in their exposure to the random allocation of treatment. This often entails the use of an instrument or discontinuity in treatment, the suitability of which should be adequately demonstrated and defended.

Level 5: Reserved for research designs that involve explicit randomisation into treatment and control groups, with Randomised Control Trials (RCTs) providing the definitive example. Extensive evidence provided on comparability of treatment and control groups, showing no significant differences in terms of levels or trends. Control variables may be used to adjust for treatment and control group differences, but this adjustment should not have a large impact on the main results. Attention paid to problems of selective attrition from randomly assigned groups, which is shown to be of negligible importance. There should be limited or, ideally, no occurrence of ‘contamination’ of the control group with the treatment."

Wednesday, April 22, 2015

Behavioural policy readings updated

I have a habit when giving talks or lectures of promising to put up a blogpost with links afterwards and given I have given a lot of talks and lectures recently, below updates a previous post and hopefully fulfills the bulk of those promises.

For general books about behavioural economics see below

Popular texts:
1. Ariely (2008), Predictably irrational
2. Kahneman (2011), Thinking, fast and slow
3. Thaler & Sunstein (2008), Nudge: Improving Decisions About Health, Wealth, and Happiness
4. Akerlof & Kranton (2010), Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being.
5. Sunstein (2013) Simpler: The Future of Government 
6. Akerlof and Shiller (2009) Animal Spirits 
7. Lunn (2008) Basic Instincts: Human Nature and the New Economics

Textbooks:
1. Camerer, Loewenstein & Rabin (2004) Advances in Behavioral Economics
2. Frey & Stutzer (2007), Economics and Psychology: A Promising New Cross-Disciplinary Field
3. Loewenstein (2007), Exotic Preferences: Behavioral Economics and Human Motivation
4. Shafir (2013), The Behavioral Foundations of Public Policy
5. Angner (2012), A Course in Behavioural Economics
6. Wilkinson & Klaes (2012) An Introduction to Behavioural Economics
7. Varian (2008), Intermediate Microeconomics


Selected Policy Readings


(i) The book Nudge by Thaler and Sunstein outlines a strong view of how behavioural economics might influence the shaping of policy. (blog with link to the book here). A recent UK paper outlines the Cabinet Office approach developed with many UK academics (MINDSPACE paper and Journal of Economic Psychology paper). Haynes et al. (2012), Test, Learn, Adapt: Developing Public Policy with Randomised Controlled Trials, Cabinet Office. Work of Olivier Ouiller and others at Centre d’analyse stratégique another good example of development of behavioural economics in areas such as environmental policy (see, for example, Green Nudges document). Sunstein's recent "Empirically informed regulation" very detailed overview. The Brookings Institute publication “Policy and Choice: Public Finance through the lense of behavioural economics” is one of the best available introductions to this area.

(ii) Some of the papers on libertarian paternalism are very useful in understanding from a more formal perspective the link between behavioural economics and government policy. (key paper here).

(iii) The well-known UK scholar Robert Sugden has written a number of articles critical of the idea that failures in self-control and information processing are sufficient rationales for paternalistic policy. 

(iv) Mark White teaches at the intersection of Law Philosophy and Economics and has written a number of critiques: 


(v) Kyle Whyte  has written a lot on the ethics of "nudging".

-"Nudging cannot solve complex policy problems"

(vi) Adam Curtis takes a sceptical view of nudge and the Cabinet Office unit in a lengthy blogpost 

(vii) Luc Bovens (LSE) on ethics of nudge 

(viii) Gilles St. Paul's recent PUP book "The Tyranny of Utility" takes the argument below. He also has a recent IZA paper on the topic  

"The general assumption that social policy should be utilitarian--that society should be organized to yield the greatest level of welfare--leads inexorably to increased government interventions. Historically, however, the science of economics has advocated limits to these interventions for utilitarian reasons and because of the assumption that people know what is best for themselves. But more recently, behavioral economics has focused on biases and inconsistencies in individual behavior. Based on these developments, governments now prescribe the foods we eat, the apartments we rent, and the composition of our financial portfolios. The Tyranny of Utility takes on this rise of paternalism and its dangers for individual freedoms, and examines how developments in economics and the social sciences are leading to greater government intrusion in our private lives.  
Gilles Saint-Paul posits that the utilitarian foundations of individual freedom promoted by traditional economics are fundamentally flawed. When combined with developments in social science that view the individual as incapable of making rational and responsible choices, utilitarianism seems to logically call for greater governmental intervention in our lives. Arguing that this cannot be defended on purely instrumental grounds, Saint-Paul calls for individual liberty to be restored as a central value in our society.
Exploring how behavioral economics is contributing to the excessive rise of paternalistic interventions, The Tyranny of Utility presents a controversial challenge to the prevailing currents in economic and political discourse"
(ix)  Hausman and Welch "Debate: To Nudge or Not to Nudge". (h/t Dr. Ben Saunders from Stirling)

(x) Why We Should Reject ‘Nudge’ by Tom Goodwin  (h/t Dr. Ben Saunders from Stirling)

(xi)  "Obesity: Towards a System of Libertarian Paternalistic Public Health Interventions"

(xii) Ciriolo, E. (2011). "Behavioural economics in the European Commission: past, present and future".

(xiii) The House of Lords report into behavioural interventions was sceptical about the potential for behavioural interventions to act as a substitute to more direct intervention

(xiv) A recent paper by Ben Seymour and Ivo Vlaev -  "Can, and should, behavioral neuroscience influence public policy?" - takes a very cautious stance amid worries about contamination of neuroscience research by policy and business interests.

(xv) The Behavioral Foundations of Public Policy Edited by Eldar Shafir is a comprehensive edited volume with chapters by leading figures in the discipline covering a substantial range of topics.

(xvi) See the SSRN page of Professor Peter John for a number of papers on nudging including on the policy environment in the UK.

(xvii) The Financial Conduct Authority in the UK has written a set of Occasional papers many of which deal directly with the implications of behavioural economics. The first one is particularly useful as an overview. In the US context, this very interesting report by Barr, Mullainathan and Shafir from 2008 outlines a new approach to consumer regulation based partly on the notion of “sticky defaults” whereby firms would be required to default people into the most desirable option based on their characteristics and only move them if they make choices following being provided with clear information.

(xviii) Useful readings on behavioural economics and consumer exploitation below

Mark Armstrong and John Vickers "Consumer protection and contingent charges". A later version of this is available in the Journal of Economic Literature.

The Office of Fair Trading investigation into fees for fitness clubs an interesting example of where a regulator specifically took action on a practice said to be exploiting consumer biases.




(xix) See the very useful database of over 100 studies in the area of nudging compiled by our centre researcher Mark Egan. 

(xx) Sunstein (2011), Empirically informed regulation, University of Chicago Law Review. This is a key paper. Cass Sunstein's recent papers on the ethics of Nudging are superb readings on the more complex ethical aspects of behavioural policy. See also Sunstein, Cass R. (2014). Why Nudge?: The Politics of Libertarian Paternalism (The Storrs Lectures Series).
Based on a series of pathbreaking lectures given at Yale University in 2012, this powerful, thought-provoking work by national best-selling author Cass R. Sunstein combines legal theory with behavioral economics to make a fresh argument about the legitimate scope of government, bearing on obesity, smoking, distracted driving, health care, food safety, and other highly volatile, high-profile public issues. Behavioral economists have established that people often make decisions that run counter to their best interests—producing what Sunstein describes as “behavioral market failures.” Sometimes we disregard the long term; sometimes we are unrealistically optimistic; sometimes we do not see what is in front of us. With this evidence in mind, Sunstein argues for a new form of paternalism, one that protects people against serious errors but also recognizes the risk of government overreaching and usually preserves freedom of choice. Against those who reject paternalism of any kind, Sunstein shows that “choice architecture”—government-imposed structures that affect our choices—is inevitable, and hence that a form of paternalism cannot be avoided. He urges that there are profoundly moral reasons to ensure that choice architecture is helpful rather than harmful—and that it makes people’s lives better and longer.
(xxi) House of Lords Science and Technology Select Committee (2011), Behaviour Change Report This is an important document which sounds a note of caution about the limits of nudge policies to create widespread behavioural change in the absence of hard intervention. 

Links on Self-Control

Via Michael Daly below some useful links for those looking to get a start on the self-control literature. Our own recent piece on childhood self-control and unemployment is available here.

Terrie Moffitt on self-control

http://www.psychologicalscience.org/index.php/publications/observer/obsonline/the-lifetime-effects-of-self-control-in-childhood.html

The obvious one, marshmallow experiment!

http://en.wikipedia.org/wiki/Stanford_marshmallow_experiment

There are various videos on this including this highly viewed one below -

https://www.youtube.com/watch?v=QX_oy9614HQ

It's by Walter Mischel who has written a book on the topic -

They followed the kinds up from late 60's - early 70's to recently

http://www.newyorker.com/science/maria-konnikova/struggles-psychologist-studying-self-control

More recent study that has been covered widely with a larger sample, more comprehensive measures and outcomes:

http://www.pnas.org/content/108/7/2693.full

Commentary by Angela Duckworth:

http://www.pnas.org/content/108/7/2639.full

Piece on this in American Scientist:

http://www.americanscientist.org/issues/feature/2013/5/lifelong-impact-of-early-self-control

Prof Angela Duckworth's page, she researches self-control and 'grit':

https://sites.sas.upenn.edu/duckworth

Prof Duckworth has a TED talk video on grit:

http://www.ted.com/talks/angela_lee_duckworth_the_key_to_success_grit?language=en

Both self-control and related ideas like grit were covered in this v.good book:

http://www.paultough.com/the-books/how-children-succeed/

Roy Baumeister has a book on self-control also and is probably the main self-control researcher worldwide. His research is mainly lab studies and related to the 'depletion' model of self-control or willpower as a limited resource.

http://www.amazon.com/Willpower-Rediscovering-Greatest-Human-Strength/dp/0143122231

Good summary in this video: https://www.youtube.com/watch?v=KfnUicHDNM8

There are a couple of self-control labs in Europe. A prominent one is below. They are looking at the idea that people with high self-control are proactive in avoiding tempting situations and distraction which may explain why they are successful:

http://selfregulationlab.nl/denise-de-ridder/

There is some evidence the Perry Preschool Programme (evaluation led by Nobel winner James Heckman) could have had its positive effect by influencing traits related to self-control:

http://heckmanequation.org/content/resource/research-summary-perry-preschool-and-character-skill-development

One of the most interesting recent studies on training patience is here:

https://sites.google.com/site/salancrossley/

https://drive.google.com/file/d/0Bwo3BHO1RC19SEt6VmlPRjNZYUk/view?usp=sharing

Some other interventions that are effective:

http://www.ncbi.nlm.nih.gov/pubmed/21852486

General evidence based tips for training self-control-

http://www.parentingscience.com/teaching-self-control.html