Experimental and Behavioural Economics
Experimental and Behavioural Economics
The Experimental and Behavioural Economics Research Group (EBERG) draws its membership from economists based at the Economics Department at Warwick who work in the fields of Experimental Economics, Behavioural Economics and/or Subjective Wellbeing (“Happiness Economics”). Experimental methods are used in many fields of economics, including behavioural economics, public economics, labour economics, political economy, game theory, and financial economics. Behavioural economics is an attempt to understand decision-making in the context of the many psychological, cognitive and emotional factors that influence behaviour. Behavioural economists typically build on traditional economic models with insights from psychology or neuroscience. Since behavioural economics concerns the underlying motivations for behaviour it can be hard (though not impossible) to find data to support or develop behavioural theories without the use of experimental methods which explains the close relationship between the two fields.
Experimental and behavioural research are fundamentally interdisciplinary and this is reflected in the fact that the group is linked to other similar groups across the University of Warwick and beyond. DR@W is the overarching interdisciplinary group of all behavioural scientists in Warwick which, together with EBERG, also takes members from the Behavioural Science Group at Warwick Business School and behavioural and experimental psychologists based in the Psychology Department, and hosts a weekly seminar, the DR@W Forum. Many members of EBERG are also affiliated with Bridges, an interdisciplinary centre that includes behavioural and experimental work in its remit that also hosts regular seminars and workshops. Behaviour, Brain and Society is one of the University of Warwick’s global research priorities (GRPs) and the co-ordinator of EBERG sits on the board of the GRP. Several group members are actively involved in the ESRC CAGE centre. Theme 3 of CAGE is led by the co-ordinator of EBERG and has a special focus on subjective wellbeing.
People
Academics
Academics associated with the Reseach Group Name research group are:
Events
DR@W Forum (Hybrid Session): Giovanni Burro (IGIER, Milan)
Investing in the stock market is a pivotal decision in households finance. Stock investment is substantially more profitable than investment in other asset classes. We experimentally test stock market participation and how financial memories influence it. Participants invest in a stock and they are compensated based on the actual price realization of that stock. We conduct two experiments. In the first experiment we elicit participants’ memories about the stock market before or after the investment task. We find that eliciting memories before the investment decreases the level of the amount invested on the stock, on average. However, the net effect depends on individuals' memories: positive memories increase the level invested compared to recalling non-positive ones. In the second experiment we elicit memories before the investment for all participants. After eliciting memories and before the investment task we provide participants with positive financial information about the stock they are about to invest in. Information increases the level of the amount invested on the stock. It also increases beliefs (and confidence) about the probability that the stock will rise in price. While information provision increases investment, it only does so for those that recall non-personal memories, as opposed to personal ones. We rationalize the first finding in the light of the similarity principle of memory recall and the second one in the light of interference.
Meeting ID: 935 8612 7854
Passcode: 942066