The Making of Homo Honoratus: From Omission to Commission / Michael Hallsworth, John A. List, Robert D. Metcalfe, Ivo Vlaev.

Format:

Book

Author/Creator:

Hallsworth, Michael.

Contributor:

National Bureau of Economic Research.

List, John A.

Metcalfe, Robert D.

Vlaev, Ivo.

Series:

Working Paper Series (National Bureau of Economic Research) no. w21210.

NBER working paper series no. w21210

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Making of Homo Honoratus

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2015.

Summary:

Framing remains one of the pillars of behavioral economics. While framing effects have been found to be quite important in the lab, what is less clear is how well evidence drawn from naturally-occurring settings conforms to received laboratory insights. We use debt obligation to the UK government as a case study to explore the 'omission bias' present in decision making with large stakes. Using a natural field experiment that generates nearly 40,000 observations, we find that repayment rates are roughly doubled when the act is reframed as one of commission rather than omission. We estimate that this reframing of the perceived nature of the action generated over $1.3 million of new yield. We find evidence that this behavior may result from a deliberate 'omission strategy', rather than a behavioral bias, as is often assumed in the literature. Our natural field experiment highlights that behavioral economics is much more than a series of empirical exercises to quench the intellectual curiosity of academics.

Notes:

Print version record

May 2015.