Research
Publications 3
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Does Inequality threaten Stability? Evidence from the Lab
Abstract
We investigate the impact of rising inequality on social instability through a novel multi-period laboratory experiment. In each period, members of two groups are randomly matched to play a battle of the sexes game, in which payoffs are either zero for both or positive but unequal. At the beginning of the game, the implied payoff inequality is low, but it increases over time. Our findings shed light on the effect of inequality on social stability. While under low initial inequality, unequal conventions - where one group is systematically better off - tend to emerge, increasing inequality causes destabilization. This is initiated by the group disadvantaged by the unequal convention and is particularly pronounced when not only the relative, but also the absolute position of the disadvantaged group is worsening. These findings are consistent with a simple model incorporating disadvantageous inequality aversion. Finally, we show that history matters; responses to current inequality depend on past experiences of inequality and stability.
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Too Good to be True – Individual and Collective Decision-Making with Misleading Signals
Abstract
In many situations, an abundance of misleading evidence—such as fake customer reviews—can lead to false or deceptive conclusions. We experimentally investigate individual and collective decision-making in an information structure in which signals can be correlated, depending on the state of the world. In this setting, too much evidence pointing in one direction has the potential to mislead, necessitating a level of sophistication for rational decision-making. Overall, participants' performance is poor with only small differences in collective and individual decision-making accuracy. Interestingly, the more complex environment tends to encourage greater honesty within heterogeneous groups than a benchmark setting with independent signals, thus corroborating a rather subtle game-theoretic prediction.
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Strategic Behavior with Tight, Loose and Polarized Norms
Abstract
Descriptive norms -the behavior of other individuals in one's reference group - play a key role in shaping individual decisions in managerial contexts and beyond. Organizations are increasingly using information about descriptive norms to nudge positive behavior change. When characterizing peer decisions, a standard approach in the literature is to focus on average behavior. In this paper, we argue both theoretically and empirically that not only averages but also the shape of the whole distribution of behavior can play a crucial role in how people react to descriptive norms. Using a representative sample of the U.S. population, we experimentally investigate how individuals react to strategic environments that are characterized by different distributions of behavior, focusing on the distinction between tight (i.e., characterized by low behavioral variance), loose (i.e., characterized by high behavioral variance), and polarized (i.e., characterized by u-shaped behavior) environments. We find that individuals indeed strongly respond to differences in the variance and shape of the descriptive norm they are facing: loose norms generate greater behavioral variance and polarization generates polarized responses. In polarized environments, most individuals prefer extreme actions - which expose them to considerable strategic risk - to intermediate actions that minimize such risk. Furthermore, in polarized and loose environments, personal traits and values play a larger role in determining actual behavior. These nuances of how individuals react to different types of descriptive norms have important implications for company culture, productivity, and organizational effectiveness alike.
Working papers 5
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To hide or not to hide? How fear and futility affect the decision to report a mistake
Abstract
Even though reporting mistakes could substantially improve work processes and productivity within organisations, employees often hesitate to do so. This paper studies the role of fear (of being fired) and futility (i.e. reports being inconsequential) in explaining such employee silence. Drawing on a principal-agent framework with career concerns, we formalise mistakes as noisy signals of both agent quality and the work environment and show that optimal reporting decisions are affected by fear and futility considerations. We then use a novel experiment to exogenously manipulate the degree of fear and futility and test our theoretical predictions. In a 2x2 between-subject design, we vary the anonymity of reporting and the likelihood of organisational response. Results show that reducing fear and futility are complementary actions. Tackling both significantly increases reporting by about 20pp. This improvement in communication is accompanied by better organisational income, highlighting the value of improved reporting structures for firms and employees.
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How Tinted Are Your Glasses? Gender Views, Beliefs and Recommendations in Hiring
Abstract
We study gender gaps in a multi-stage hiring process, focusing on recommendation and recruitment. Across two experiments - one with academic economists and one with a college-educated sample - we show how recommendation letters can cause gender hiring gaps. While recruiters favor female candidates, consistent with efforts to diversify hiring, some groups of recommenders choose less effective letters for women, undermining this advantage. Strategic but erroneous beliefs about letter effectiveness and gender views of recommenders explain these choices. A two-sample prediction exercise using letters from the academic job market supports the experimental finding that gender views drive the language used in recommendations.
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The Stories We Tell: Societal Narratives and the Rise of the Far Right
Abstract
In two studies using AI-assisted qualitative interviews, we ask a representative sample of the German electorate (N=1013) to reflect on the most important societal events of the last 15 years. We document that far-right supporters construct systematically different narratives about the recent past. First, they recall different events - with a strong focus on migration-related issues. Second, even when they do consider the same events, they are more likely to blame the establishment and describe events more negatively and with greater emotional intensity. We further document that these narratives are associated with policy preferences, and that far-right supporters are more inclined than supporters of other parties to prioritize cultural over economic issues. Together, our findings reveal that partisan divides extend to how citizens remember and interpret shared national experiences.
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Divided We Act: The Role of Social Sanctions in a Polarized World
Abstract
Social sanctions sustain social order by reinforcing widely accepted principles. Political polarization may weaken this mechanism by fragmenting these principles, yet causal effects are hard to identify: observational data cannot separate the impact of polarized preferences from exposure to polarization. We test the effectiveness of social sanctions in a representative U.S. experiment (N = 2,400) that exogenously varies the degree of polarization. Participants allocate money between politically opposed recipients privately and publicly. When allocation choices are public, they can be punished by partisan Observers whose values are drawn from one of three distributions: tight (low variance), loose (high variance), or polarized (U-shaped). We find that polarization makes public allocations less equitable because participants (correctly) expect they may be punished even when acting fairly. Our results thus show that polarization causally undermines the disciplining role of social sanctions.
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Negative income shocks and distributive preferences
Abstract
This paper investigates how individuals understand fairness in the presence of negative income shocks. I combine evidence from two dictator-game experiments. In the first, income shocks are randomly assigned within the experiment; in the second, I use information on participants’ real-world income losses during the Covid-19 pandemic. Across both settings, shocks significantly affect distribution decisions. Individuals allocate more to those who lost income, regardless of whether they themselves or another person were affected. This effect cannot be explained by need considerations alone: even if two individuals have the exact same income at the moment of the distribution decision, participants allocate more to the person who suffered a shock. This highlights that the mere experience of shocks matters and is in line with a theoretical framework where past earnings serve as fairness reference points. Finally, I find that if information about shocks or reference points is incomplete, individuals use this ambiguity in a self-serving way.
Work in progress 3
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Meritocracy in firms
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Improving Equity in Education through Youth Mentoring: An Evaluation of a Randomized Intervention in Colombia
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Does rule ambiguity contribute to gender gaps at the work place?