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Use of Controlled Experiments to Empirically Investigate Economic Behavior
Field Experiments (Randomized Control Trials) in Economics
Field experiments, also known as randomized control trials (RCTs), are a method used by economists to observe how people's behavior changes in response to deliberately altered economic conditions in real-world settings. This approach moves beyond the university lab to study individuals making authentic decisions in their everyday lives. As demonstrated by economists like Juan Camilo Cárdenas and Nobel laureate Esther Duflo, this methodology enhances the real-world applicability of findings and can be used to influence government policy.
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Introduction to Microeconomics Course
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CORE Econ
Ch.4 Strategic interactions and social dilemmas - The Economy 2.0 Microeconomics @ CORE Econ
Related
Laboratory Experiments on Cooperation in the Prisoners' Dilemma
Evidence from Economic Games: Self-Interest is a Minority Behavior
Source Study: Antisocial Punishment Across Societies (Herrmann, Thoni, & Gachter, 2008)
Analogy Between Economic Experiments and Mendel's Method
University Laboratories as a Setting for Economic Experiments
Key Research and Researchers in Experimental Economics
Field Experiments (Randomized Control Trials) in Economics
Ultimatum Game
Use of Monetary Stakes in Economic Experiments to Ensure Realistic Behavior
Influence of Game Rules (Structural Power) on Bargaining Outcomes
Interpreting Experimental Economic Data
An economist develops a new theory about how individuals decide whether to contribute to a shared resource. What is the primary reason for using a controlled laboratory experiment to investigate this theory?
Designing an Experiment to Test Fairness
Match each key feature of a controlled economic experiment with its primary purpose in understanding human decision-making.
A researcher conducts an experiment where participants are given $10 and can anonymously give any amount to a stranger. Most participants give some money away. A critic argues this result is meaningless for understanding real-world economics because the experiment takes place in an artificial lab, not in a real market. The critic's argument is valid because the primary goal of such economic experiments is to perfectly replicate naturally occurring situations.
Analyzing Experimental Results to Understand Behavior
Analyzing the Impact of Rule Changes in an Economic Experiment
Evaluating an Experimental Design
In a controlled experiment, two anonymous participants are assigned roles. Player 1 is given 10/5 are almost always rejected by Player 2. What is the most logical conclusion that can be drawn from these results?
An economist wants to study how small-scale farmers decide whether to adopt a new, more expensive but potentially more profitable type of seed. They are considering two research methods:
- Method A: A controlled experiment in a university computer lab where farmers are given information and a sum of money, and they play a game that simulates the risks and rewards of choosing the new seed versus their traditional seed.
- Method B: A field study where a random group of farmers in a village is offered a discount on the new seed, and their adoption rate is compared to another random group in the same village that was not offered the discount.
Which statement best evaluates the primary trade-off between these two methods for understanding the farmers' decision-making?
Learn After
Design of Cárdenas's First Field Experiment (1998)
Influence of Inequality on Cooperation in Social Dilemmas
Erosion of Intrinsic Cooperation by External Regulation
Deterring Late Pick-ups at Daycare Centers
Source Study: 'A Fine Is a Price' (Gneezy & Rustichini, 2000)
An economist wants to test the hypothesis that providing small, performance-based cash bonuses to teachers can improve student test scores. Which of the following research designs best exemplifies a field experiment to investigate this question?
Evaluating Research Methods for Economic Policy
Classifying an Economic Intervention Study
Rationale for Field Experiments
A study is conducted by analyzing pre-existing government data to determine if there is a correlation between the introduction of a new public transit line and changes in local employment rates. This study qualifies as a field experiment because it examines economic behavior in a real-world setting.
A team of economists is designing a field experiment to test whether providing free tutoring services improves the final exam scores of university students. Arrange the following key steps of their research process into the correct logical order.
Match each key component of a field experiment (also known as a randomized control trial) with its primary role in the study's design.
To isolate the causal impact of an economic intervention in a real-world setting, a field experiment crucially relies on the process of ______ to divide participants into treatment and control groups, thereby ensuring that the groups are statistically comparable before the intervention begins.
Evaluating a Proposed Economic Study on Job Training
Critique of an Employment Program Study