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Three new Visiting Professors at briq

The briq Visiting Professor Program aims to promote international networking in the fields of behavioral economics and inequality research. All briq Visiting Professors have signed up for five years and will stay at briq for up to four weeks per year. During their research stays, they present their current work at public events and offer office hours for local researchers. Our goal is to foster an environment of dynamic academic collaboration, especially with the Department of Economics at the University of Bonn.

The program started last year with five outstanding scholars: Roland Bénabou (Princeton University), Stefano DellaVigna (UC Berkeley), Botond Kőszegi (Central European University), George Loewenstein (Carnegie Mellon University) and Ulrike Malmendier (UC Berkeley).

We are very happy to welcome three new briq Visiting Professors this year:

Flávio Cunha is a Professor of Economics at Rice University. He received his PhD from the University of Chicago in 2007 and taught at the University of Pennsylvania before joining the economics faculty at Rice. Flávio’s most recent research program focuses on the causes and consequences of inequality and poverty, especially the extent to which labor income inequality is the result of the preexisting heterogeneity present across workers before they enter the labor market versus how much is due to labor market shocks. He is also studying the importance of investments in cognitive and non-cognitive skills in explaining the heterogeneity that determines labor market inequality. His ongoing research project, the Philadelphia Human Development Study, aims to understand the role played by parental expectations about the returns to investing in children affect actual investment decisions.

Paul Heidhues is Professor of Behavioral and Competition Economics at the University of Düsseldorf. He received his PhD in Economics from Rice University in 2000, was a visiting scholar at MIT and Berkeley, and taught at the University of Bonn and ESMT Berlin. Paul worked on numerous topics in Industrial Organization and Competition Policy such as input-market bargaining power, merger control, and collusion. Much of his recent work focuses on the functioning of markets when consumers are partly driven by psychological factors – such as social preferences, loss aversion, time-inconsistency, or naivete – that the classic consumer model abstracts from. He has written on how firms optimally price products and design credit contracts in response to consumers’ psychological tendencies, and he has investigated the implications of various consumer mistakes for the functioning of markets and for consumer-protection regulation.

Ran Spiegler is Professor of Economics at Tel Aviv University and University College London. He obtained his PhD from Tel Aviv University in 1999. Ran is a microeconomic theorist whose main line of research involves modeling departures from the standard rational-choice paradigm in various contexts: interaction between players with justifiability motives, strategic policy making when the public employs naive attribution heuristics to evaluate reforms, a dynamic search-matching model of the labor market with reference-dependent workers, etc. Ran has written extensively on market models with non-rational consumers, culminating in the textbook “Bounded Rationality and Industrial Organization” (OUP, 2011). In recent years, his main research agenda incorporates ideas from the “Bayesian networks” literature to model decision makers with flawed causal reasoning.

For information on upcoming visits see the briq researchers page!

Chris Roth wins dissertation prize and project grant

After winning two prestigious science prizes last year, briq researcher Chris Roth has now also been awarded the 2019 Edgeworth prize for his outstanding doctoral thesis entitled “Essays on Beliefs and Economic Behaviour”. The topics covered in his dissertation include labor market concerns and support for immigration; measuring and bounding experimenter demand effects; public debt and the demand for government spending and taxation; and conspicuous consumption and peer effects.

Chris also received a project grant from the Fritz Thyssen Foundation worth 160,000 euros for a project that aims at gaining insights from a field experiment on how households adjust their consumption expenditures in response to changes in their expected future income. This is a joint project with Johannes Wohlfart, with whom Chris also co-authored the paper “Experienced Inequality and Preferences for Redistribution”, which was recently cited in the New York Times.

briq student fellow portraits: Sven Walter

The briq scholarship program supports about 25 Ph.D. students at the Bonn Graduate School of Economics. Some of them are directly involved in briq research activities. In a series of short portraits, the briq newsroom introduces our student fellows and what they do. Our first interview partner is Sven Walter, who has been at briq since August 2016.

What was your motivation to go into academic research?

When I worked as a student assistant during my bachelor studies, I got in touch with research in behavioral economics. From the very beginning, I was fascinated to learn more about what drives human behavior in economic contexts, but also in more general situations. That’s why it quickly became clear to me that I want to become a researcher in this area myself.

What are you currently working on?

My current research is concerned with the fragmentation and polarization of societies. It is based on the idea that members of more polarized societies interact less with contrary-minded people. We investigate what can be done to counter this trend by looking at a large-scale intervention program that brings together people with contrary opinions.

What are your research plans for the future?

I believe it’s really important to understand polarization in more depth, as it may have huge effects on all members of society. My aim is to further explore why and under what circumstances polarization is happening – and what can be done against it.

Paola Giuliano on the origins and persistence of gender roles

Paola Giuliano at briq, August 31, 2018

A recent strand of the economics literature tried to understand the origin of cultural norms and beliefs. Different studies have documented the continuity of cultural norms over remarkably long periods of time.

In her first of two lectures she recently gave at briq, Paola Giuliano (UCLA Anderson School of Management) reviewed work on the origin of differences in gender norms, with particular emphasis on differences in agricultural technologies. Look to history and you will find plenty of examples of farming communities where women worked as much as men. But in plough-intensive societies, where cultivation and planting relied on physical strength, men were the primary farmers. Today many of these societies still show the same division of labor.

Paola Giuliano reviewed her work which shows that at present the descendants of societies that traditionally practiced plough agriculture have lower rates of female participation in the workplace, in politics and in entrepreneurial activities, as well as greater prevalence of attitudes favoring gender inequality, and even a higher male-to-female sex ratio in every age group.

In the same lecture she more broadly reviewed the most recent empirical evidence on various historical determinants of contemporary difference in gender roles and how these differences are transmitted from parents to children and therefore persist until today. This included work on female labor force participation, fertility, education, marriage arrangements, competitive attitude and even domestic violence.

Although cultural beliefs can be quite persistent, there are also many examples of dramatic changes. This raises the natural question: When does culture change and does it persist? In particular, what determines a society’s willingness to adopt new customs and beliefs rather than hold on to traditions?

In her second lecture, Paola examined a determinant that has been put forth in the anthropology literature to answer this question: the variability of the environment from one generation to the next. She shows that populations with ancestors who lived in an environment with more stability from one generation to the next not only place a greater importance on maintaining tradition today, but they also exhibit more persistence in their traditions over time.

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.