Using Behavioral Insights For a Better Understanding of Economic Decisions (Regarding Savings, Inequality and Dishonesty)

This dissertation consists of three essays on behavioral economics, with a general aim of enriching our understanding of economic decisions using behavioral insights and experimental methodology. Each essay takes on one particular topic with this general aim.

The first chapter studies savings behavior of the poor. In this project, partnering with a savings product provider in Kenya, we tested the extent to which behavioral interventions and financial incentives can increase the saving rate of individuals with low and irregular income. Our experiment lasted for six months and included a total of twelve conditions. The control condition received weekly reminders and balance reporting via text messages. The treatment conditions received in addition one of the following interventions: (1) reminder text messages framed as if they came from the participant’s kid (2) a golden colored coin with numbers for each week of the trial, on which participants were asked to keep track of their weekly deposits (3) a match of weekly savings: The match was either 10% or 20% up to a certain amount per week. The match was either deposited at the end of each week or the highest possible match was deposited at the start of each week and was adjusted at the end. Among these interventions, by far the most effective was the coin: Those in the coin condition saved on average the highest amount and more than twice as those in the control condition. We hypothesize that being a tangible track-keeping object; the coin made subjects remember to save more often. Our results support the line of literature suggesting that saving decisions involve psychological aspects and that policy makers and product designers should take these influences into account.

The second chapter is related to views towards inequality. In this project, we investigate how the perceived fairness of income distributions depends on the beliefs about the process that generated the inequality. Specifically, we examine how two crucial features of this process affect fairness views: (1) Procedural justice - equal treatment of all, (2) Agency - one's ability to determine his/her income. We do this in a lab experiment by varying the equality of opportunity (procedural justice), and one's ability to make choices, which consequently influence subjects’ ability to influence their income (agency). We then elicit ex-post redistribution decisions of the earnings as a function of these two elements. Our results suggest both agency and procedural justice matter for fairness. Our main findings can be summarized as follows: (1) Highlighting the importance of agency, we find that inequality resulting from risk is considered to be fair only when risk is chosen freely; (2) Highlighting the importance of procedural justice, we find that introducing inequality of opportunity significantly increases redistribution, however the share of subjects redistributing none remain close to the share of subjects redistributing fully revealing an underlying heterogeneity in the population about how fairness views should account for inequality of opportunity.

The third chapter is on morality. In this project, we study whether religious rituals act as an internal reminder for basic moral principles and thus affect moral judgments. To this end, we conducted two survey experiments in Turkey and Israel to specifically test the effect of Ramadan and Yom Kippur. The results from the Turkish sample how that Ramadan has a significant effect on moral judgments to some extent for those who report to believe in God. Those who believe in God judged the moral acceptability of ten out of sixty one actions significantly differently in Ramadan, whereas those who reported not to believe in God significantly changed their judgments only for one action in Ramadan. Our results extends the hypothesis established by lab experiments that religious reminders have a significant effect on morality, by testing it in the field in the natural environment of religious rituals.

This thesis is part of a broader collaborative research agenda with both colleagues and advisors. The programming, analyses, and writing, as well as any errors in this work, are my own.

Genomics research: world survey of public funding.

BACKGROUND: Over the past two decades, genomics has evolved as a scientific research discipline. Genomics research was fueled initially by government and nonprofit funding sources, later augmented by private research and development (R&D) funding. Citizens and taxpayers of many countries have funded much of the research, and have expectations about access to the resulting information and knowledge. While access to knowledge gained from all publicly funded research is desired, access is especially important for fields that have broad social impact and stimulate public dialogue. Genomics is one such field, where public concerns are raised for reasons such as health care and insurance implications, as well as personal and ancestral identification. Thus, genomics has grown rapidly as a field, and attracts considerable interest. RESULTS: One way to study the growth of a field of research is to examine its funding. This study focuses on public funding of genomics research, identifying and collecting data from major government and nonprofit organizations around the world, and updating previous estimates of world genomics research funding, including information about geographical origins. We initially identified 89 publicly funded organizations; we requested information about each organization's funding of genomics research. Of these organizations, 48 responded and 34 reported genomics research expenditures (of those that responded but did not supply information, some did not fund such research, others could not quantify it). The figures reported here include all the largest funders and we estimate that we have accounted for most of the genomics research funding from government and nonprofit sources. CONCLUSION: Aggregate spending on genomics research from 34 funding sources averaged around $2.9 billion in 2003-2006. The United States spent more than any other country on genomics research, corresponding to 35% of the overall worldwide public funding (compared to 49% US share of public health research funding for all purposes). When adjusted to genomics funding intensity, however, the United States dropped below Ireland, the United Kingdom, and Canada, as measured both by genomics research expenditure per capita and per Gross Domestic Product.

HIV-1 envelope gp41 antibodies can originate from terminal ileum B cells that share cross-reactivity with commensal bacteria.

Monoclonal antibodies derived from blood plasma cells of acute HIV-1-infected individuals are predominantly targeted to the HIV Env gp41 and cross-reactive with commensal bacteria. To understand this phenomenon, we examined anti-HIV responses in ileum B cells using recombinant antibody technology and probed their relationship to commensal bacteria. The dominant ileum B cell response was to Env gp41. Remarkably, a majority (82%) of the ileum anti-gp41 antibodies cross-reacted with commensal bacteria, and of those, 43% showed non-HIV-1 antigen polyreactivity. Pyrosequencing revealed shared HIV-1 antibody clonal lineages between ileum and blood. Mutated immunoglobulin G antibodies cross-reactive with both Env gp41 and microbiota could also be isolated from the ileum of HIV-1 uninfected individuals. Thus, the gp41 commensal bacterial antigen cross-reactive antibodies originate in the intestine, and the gp41 Env response in HIV-1 infection can be derived from a preinfection memory B cell pool triggered by commensal bacteria that cross-react with Env.