briq Newsroom

Mark Fallak

Gender differences in preferences increase with economic development and gender equality

Higher levels of economic development and gender equality are associated with larger gender differences in economic preferences across countries, according to a new study published in Science. The analysis by Armin Falk (briq and University of Bonn) and Johannes Hermle (University of California, Berkeley) is based on a globally representative dataset on risk and time preferences, positive and negative reciprocity, altruism, and trust.

Previous research has shown that gender differences in these fundamental economic preferences are important in explaining gender differences in economic outcomes, such as for occupational choice, financial investment, or educational decisions, among many others. However, gaps remain in understanding the sources of gender differences in preferences and their variation.

Falk and Hermle contrasted two hypotheses that make opposite predictions. The “social role hypothesis” posits that the attenuation of gender-specific social roles in more developed and gender-egalitarian countries will alleviate differences in preferences between women and men. In contrast, the “resource hypothesis” is based on the notion that greater availability of material and social resources creates the scope for gender-specific ambitions and desires, potentially leading to an expansion of gender differences in more developed and gender-egalitarian countries.

To test these competing hypotheses, the authors used the Global Preferences Survey. Initiated by Armin Falk, this survey contains data on experimentally validated measures of willingness to take risks, patience, altruism, positive and negative reciprocity, and trust for 80,000 individuals in 76 representative country samples. The dataset includes all continents and a broad range of cultures and economic development levels, representing about 90% of both the world population and global income.

The data analysis provides evidence in favor of the resource hypothesis: Gender differences were found to be strongly positively associated with economic development as well as gender equality. These relationships held for each preference separately as well as for a summary index of differences in all preferences jointly (see figure). The findings remained robust in several validation tests, such as accounting for potential culture-specific survey response behavior.

“Our results highlight that a more gender-egalitarian distribution of material and social resources allows women and men to independently express gender-specific preferences,” says Armin Falk. The authors stress, however, that their findings do not rule out an influence of gender-specific roles as cross-culturally universal drivers of gender differences in preferences, nor do they preclude a role for biological or evolutionary determinants.

briq is part of the University Bonn’s new cluster of excellence

Euphoric excitement in Bonn last week: With six “Clusters of Excellence” to receive funding under the Excellence Strategy of the German federal and state governments, the University of Bonn is the most successful university in Germany.

In total, 57 cluster initiatives received funding commitments of up to ten million euros per year for an initial period of seven years. The cluster “ECONtribute: Markets and Public Policy” – a joint initiative of the Universities of Bonn and Cologne, briq, and the MPI Collective Goods – is the only predominantly economics-focused application that made it into the second round of the Excellence Strategy.

The researchers, including briq CEO Armin Falk as one of the principal investigators, aim to analyze the causes and policy implications of market failure. Combining theoretical with behavioral approaches, the cluster will seek answers to important policy-relevant questions such as the following:

  • How do you measure and deal with market power in the digital age when many offers are virtually free of charge but paid for by the provision of data?
  • What are the consequences for consumer protection?
  • How do preferences for fairness or justice influence the design of minimum wages or inheritance taxes?
  • Can (and should) individuals be “nudged” into behavior to their own benefit?

“Our research at briq on the foundations of decision-making, behavioral applications to public and labor economics, the study of discrimination and the malleability of moral behavior perfectly fit the cluster’s research plan. We look forward to contributing our expertise,” said Armin Falk.

Two prize-winning papers by Chris Roth


Chris Roth, post-doc at briq since May 2018, and his respective co-authors won two prestigious prizes. At the EEA-ESEM Congress in Cologne, his work with Lukas Hensel, Johannes Hermle and Anselm Rink was honored with the Young Economist Award of the European Economic Association.  A few days later his paper with Johannes Wohlfart received the Reinhard Selten Award (Young Author Best Paper Award) presented by the German Economic Association (VfS) at their annual meeting in Freiburg.

Political activists as free-riders

The first paper asks whether political activists’ effort choices depend on their beliefs about the effort of their peers and how they do so. To shed light on this issue, the authors present evidence from a field experiment in a Western European country which randomizes among party members the provision of true information about intentions of other party members to contribute to the party’s campaign. The data show that the information successfully shifted supporters’ self-stated intentions to help in the door-to-door campaign as well as their actual canvassing effort.

Specifically, the authors find that activists who learn that fellow party members engage in more canvassing than they thought reduce their canvassing activities. Effects are particularly large among first-time canvassers, suggesting that informational treatments work more strongly among inexperienced party members.

In sum, the authors find that political activists’ effort choices exhibit strategic substitutability. This is a clever field experiment answering an important question on political participation. The presence of a free riding effect is novel, as several other studies have instead documented in different settings the importance of positive spillovers coming from peer effects. Thus, this paper offers valuable evidence on the mechanisms of political participation.

Macroeconomic forecasts and personal expectations

The second paper uses a representative online panel from the US to examine how individuals’ macroeconomic expectations causally affect their personal economic prospects and their behavior. Provided with different professional forecasts about the likelihood of a recession, respondents update their aggregate economic outlook in response to the forecasts, extrapolate to expectations about their personal economic circumstances and adjust their consumption behavior and stock purchases.

The findings are consistent with models of “sticky information”: First, consumers are initially uninformed about relevant signals about the macroeconomy. Second, people update their economic expectations in response to news about the macroeconomic environment. Third, updating of personal expectations indicates that respondents have an understanding of how the economy works.

At a practical level, the findings identify specific groups that policymakers can expect to react to an improved macroeconomic outlook if they succeed in making people more optimistic. Specifically, groups with the largest exposure to aggregate risk, such as individuals working in cyclical industries, are most likely to respond to an improved macroeconomic outlook, while a large fraction of the population is unlikely to react.