AbstractThis thesis uses economic experiments to examine the mechanisms behind decision-making for others; namely, reputational lying costs, ideals projective paternalism and preference differences between the decision-maker and their recipient, and increased responsibility for more money and more recipients.
Chapter 1 gives an overview of the literature on decision-making for others and outlines how the studies in Chapters 2, 3, and 4 contribute to that literature.
Chapter 2 reports the first experiment, which investigates whether reputational lying costs are lower when lying for someone else because lying for another is deemed more socially acceptable. We measured lying behaviour, whilst varying the payoff recipient; either the participant themselves or another random participant, and the likelihood of drawing the maximum outcome; either a 10% chance or a 55% chance. We find that reputational costs are lower when lying for another person and may even switch to providing a reputational benefit.
Chapter 3 reports the second experiment, which examines whether agents paternalistically impose their risk preferences onto investments for others and whether they impose them more, the more the recipient’s risk preference differs from their own. In an online investment game, we manipulate the recipient of an investment decision; either participants themselves or another random participant, and the difference between the agent and recipient’s known risk preference within-subjects using the strategy method. We find that even when agents know their recipient’s risk preference, they impose their own onto the others’ investments paternalistically, and impose them more, the more the recipient’s risk preference differs from their own.
Chapter 4 reports the third experiment, which tests whether agents become more risk-averse when investing on behalf of a larger number of recipients and with a larger amount of money, both in total and per recipient. We use an online investment game, where we vary the number of recipients that agents invest for; either one or ten, and also the amount of money that each recipient has to invest; either £1 or £10 each. We find that the number of recipients has no effect on behaviour, but agents become more risk-averse when investing a larger amount for each recipient.
Chapter 5 summarises the findings, draws general conclusions from the research overall, and suggests possible avenues for future research.
|Date of Award||30 Aug 2022|
|Supervisor||Wolfgang Luhan (Supervisor), Federica Alberti (Supervisor) & Andy Thorpe (Supervisor)|