Methods in Experimental Economics: An Introduction
by Joachim Weimann (Author), Jeannette Brosig-Koch (Author)

About the Author
Joachim Weimann is a professor at the Otto von Guericke University Magdeburg, executive director of the Magdeburg Laboratory for Experimental Economic Research (MaXLab) and chairman of the Society for Experimental Economic Research, the world's oldest association of experimental econo-mists. In addition to experimental economic research, his scientific interests include labor market research, happiness research and environmental economics.
Jeannette Brosig-Koch is a professor at the University of Duisburg-Essen, founding director of the Essen Laboratory for Experimental Economic Research (elfe) and chairwoman of the Social Sciences Committee of the Verein für Socialpolitik. Her research deals with various issues in the field of experimental health economics and market design.

About this book
This textbook provides a hands-on and intuitive overview of the methodological foundations of experimental economics. Experimental economic research has been an integral part of economic science for quite some time and is gaining more and more attention in related disciplines.
The book addresses the design and execution of experiments, the evaluation of experimental data and the equipment of an experimental laboratory. It illustrates the challenges involved in designing and conducting experiments and helps the reader to address them in practice.

Brief contents
1 The Study of Behavior 1
    1. 1 Introduction 2
    1. 2 Normative Theory and Behavioral Economics 5
    1. 3 The History of Economic Experiments 7
    1. 4 The History of the Neoclassical Rational Choice Model and the Return of Psychology 13
    1. 5 External Validity 22
    1. 6 Behavioral Research: An Interdisciplinar y Issue 33
    References 38
2 Methodological Foundations 41
    2. 1 Introduction 43
    2. 2 It’s About Money 44
        2. 2. 1 The Induced Value Method 44
        2. 2. 2 The Size of Payoffs 49
        2. 2. 3 Is It Okay to Take Money from Subjects of Experiments?  52
        2. 2. 4 The House Money Effect 55
    2. 3 The Subjects of the Experiment 57
        2. 3. 1 Is It Permissible to Lie to Subjects of Experiments?  57
        2. 3. 2 Are Students the Right Subjects?  60
        2. 3. 3 What Role Does the Student’s Subject of Study Play?  65
        2. 3. 4 Cultural Differences 68
    2. 4 Preferences, Payoffs and Beliefs 70
        2. 4. 1 Risk Behavior in the Laboratory 70
        2. 4. 2 Selecting the Payoff Mechanism 75
        2. 4. 3 Eliciting Beliefs 78
    2. 5 The Influence of the Experimenter 83
        2. 5. 1 The Experimenter Demand Effect 83
        2. 5. 2 Double-Blind Design 92
        2. 5. 3 The Frame of the Experiment 95
        2. 5. 4 Instructions and Comprehension Tests 101
    2. 6 Interactions Between the Subjects 104
        2. 6. 1 Reputation Effects and Social Distance 105
        2. 6. 2 Communication Effects 107
        2. 6. 3 Possible Causes of Communication Effects 115
    2. 7 Decisions Made by the Subjects 118
        2. 7. 1 Strategy Method Versus Direct Response 119
        2. 7. 2 Experiments with Real Effort 122
        2. 7. 3 Within- Versus Between-Subject Design 125
    2. 8 The Repetition of Games 128
        2. 8. 1 Repetition Within a Session 129
        2. 8. 2 The Repetition of Sessions 133
    2. 9 The Reproducibility of Experiments 136
    References 138
3 Experimental Practice 147
    3. 1 Setting Up an Experimental Laboratory 148
    3. 2 Preparing an Experiment 154
        3. 2. 1 Choosing the Design and the Treatments 154
        3. 2. 2 Instructions, Recruiting, Plan of Procedure und Pilot Experiment 159
    3. 3 Conducting an Experiment 163
        3. 3. 1 Access to the Laboratory, Instructions, Unusual Incidents 163
        3. 3. 2 Organizing the Payments to the Subjects 165
    References 168
4 The Experiment from a Statistical Perspective 169
    4. 1 Introduction 171
    4. 2 Operationalizing the Research Question 174
        4. 2. 1 Construct Validity 174
        4. 2. 2 Types of Variables 175
        4. 2. 3 Control, Randomization and Sample Size 176
        4. 2. 4 Scales of Measurement 177
        4. 2. 5 Random Variables and Their Distribution 178
    4. 3 Creating the Statistical Design 182
        4. 3. 1 Compiling the Observation Units 182
        4. 3. 2 How Do Experimental Treatments Differ?  184
    4. 4 Statistical Tests 188
        4. 4. 1 Formulating Testable Hypotheses 188
        4. 4. 2 How Inferential Statistics Works 191
        4. 4. 3 Possible Errors and Power of a Test 194
    4. 5 Power Analysis 196
        4. 5. 1 Basics 196
        4. 5. 2 BEAN and the Optimal Sample Size 202
        4. 5. 3 Power Analysis and the “Hard Truth” of its Results 205
        4. 5. 4 Misapplications and Misunderstanding s in Power Analyses 207
    4. 6 Choosing Statistical Tests 210
        4. 6. 1 What Should be Taken into Consideration?  210
        4. 6. 2 Classifying Test Methods 211
        4. 6. 3 How Do I Choose a Specific Test?  213
        4. 6. 4 The z -Test und t -Test for One Sample  214
        4. 6. 5 t -Test for Two Independent Samples (Between-Subject Comparison)  216
        4. 6. 6 t -Test for Two Dependent Samples (Within-Subject Comparison)  217
        4. 6. 7 Kolmogorov Test 218
        4. 6. 8 The Wilcoxon Rank-Sum Test and the Mann-Whitney U Test  219
        4. 6. 9 Wilcoxon Signed-Rank Test (Two Dependent Samples) 223
        4. 6. 10 The Binomial Test 227
        4. 6. 11 The Multinomial Test (1 × k )  230
        4. 6. 12 Fisher’s Exact Test (2 × 2) 233
        4. 6. 13 χ 2 Test (2 × k )  237
        4. 6. 14 McNemar Test 241
    4. 7 Statistical Models 244
        4. 7. 1 The Fundamentals 244
        4. 7. 2 Using Statistical Models 249
        4. 7. 3 The Linear Model (LM) 251
        4. 7. 4 Models for Discrete and/ or Non-Normally Distributed Dependent Variables 255
        4. 7. 5 Models for Statistically Dependent Observations 259
        4. 7. 6 Models with Limited Dependent Variables 281
    4. 8 Statistics Software 285
    References 286
Appendix 290
References 300
Index 303

Series: Springer Texts in Business and Economics
Pages: 307 pages
Publisher: Springer; 1st ed. 2019 edition (July 13, 2019)
Language: English
ISBN-10: 3319933620
ISBN-13: 978-3319933627

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