A06
Educational Choices, Market Design, and Student Outcomes
Discussion Papers

Discussion Paper No. 354
January 4, 2023

Behavioral Forces Driving Information Unraveling

Author:

Volker Benndorf (Goethe-Universität Frankfurt)
Dorothea Kübler (WZB Berlin, TU Berlin, CESifo)
Hans-Theo Normann (Universität Düsseldorf)

Abstract:

Information unraveling is an elegant theoretical argument suggesting that private information may be fully and voluntarily surrendered. The experimental literature has, however, failed to provide evidence of complete unraveling and has suggested senders' limited depth of reasoning as one behavioral explanation. In our novel design, decision-making is essentially sequential, which removes the requirements on subjects' reasoning and should enable subjects to play the standard Nash equilibrium with full revelation. However, our design also facilitates coordination on equilibria with partial unraveling which exist with other-regarding preferences. Our data confirm that the new design is successful in that it avoids miscoordination entirely. Roughly half of the groups fully unravel whereas other groups exhibit monotonic outcomes with partial unraveling. Altogether, we nd more information unraveling with the new design, but there is clear evidence that other-regarding preferences do play a role in impeding unraveling.

Keywords:

data protection; inequality aversion; information revelation; level-k reasoning;

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Discussion Paper No. 353

The Endowment Effect in the General Population

Author:

Dietmar Fehr (University of Heidelberg, CESifo)
Dorothea Kübler (WZB Berlin, TU Berlin, CESifo)

Abstract:

We study the endowment effect and expectation-based reference points in the field leveraging the setup of the Socio-Economic Panel. Households receive a small item for taking part in the panel, and we randomly assign respondents either a towel or a notebook, which they can exchange at the end of the interview. We observe a trading rate of 32 percent, consistent with an endowment effect, but no relationship with loss aversion. Manipulating expectations of the exchange opportunity, we find no support for expectation-based reference points. However, trading predicts residential mobility and is related to stock-market participation, i.e., economic decisions that entail parting with existing resources.

Keywords:

exchange asymmetry; reference-dependent preferences; loss aversion; field experiment; SOEP;

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Discussion Paper No. 349
November 30, 2022

Keep Calm and Carry On: The Short- vs. Long-Run Effects of Mindfulness Meditation on (Academic) Performance

Author:

Lea Kasser (University of Regensburg, CESifo, CEPR)
Mira Fischer (WZB Berlin, IZA)
Vanessa Valero (Loughborough University, CeDEx)

Abstract:

Mindfulness-based meditation practices are becoming increasingly popular in Western societies, including in the business world and in education. While the scientific literature has largely documented the benefits of mindfulness meditation for mental health, little is still known about potential spillovers of these practices on other important life outcomes, such as performance. We address this question through a field experiment in an educational setting. We study the causal impact of mindfulness meditation on academic performance through a randomized evaluation of a well-known 8-week mindfulness meditation training delivered to university students on campus. As expected, the intervention improves students' mental health and non-cognitive skills. However, it takes time before students' performance can benefit from mindfulness meditation: we find that, if anything, the intervention marginally decreases average grades in the short run, i.e., during the exam period right after the end of the intervention, whereas it significantly increases academic performance, by about 0.4 standard deviations, in the long run (ca. 6 months after the end of intervention). We investigate the underlying mechanisms and discuss the implications of our results.

Keywords:

performance; mental health; education; meditation; field experiment;

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Discussion Paper No. 334

Aversion to Hiring Algorithms: Transparency, Gender Profiling, and Self-Confidence

Author:

Marie-Pierre Dargnies (University of Paris Dauphine, PSL)
Rustamdjan Hakimov (University of Lausanne, WZB Berlin)
Dorothea Kübler (WZB Berlin, TU Berlin)

Abstract:

We run an online experiment to study the origins of algorithm aversion. Participants are either in the role of workers or of managers. Workers perform three real-effort tasks: task 1, task 2, and the job task which is a combination of tasks 1 and 2. They choose whether the hiring decision between themselves and another worker is made either by a participant in the role of a manager or by an algorithm. In a second set of experiments, managers choose whether they want to delegate their hiring decisions to the algorithm. In the baseline treatments, we observe that workers choose the manager more often than the algorithm, and managers also prefer to make the hiring decisions themselves rather than delegate them to the algorithm. When the algorithm does not use workers' gender to predict their job task performance and workers know this, they choose the algorithm more often. Providing details on how the algorithm works does not increase the preference for the algorithm, neither for workers nor for managers. Providing feedback to managers about their performance in hiring the best workers increases their preference for the algorithm, as managers are, on average, overconfident.

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Discussion Paper No. 311
January 18, 2022

Income Contingency and the Electorate’s Support for Tuition

Author:

Ludger Woessmann (LMU Munich, ifo Institute)
Philipp Lergetporer (ifo Institute, TU Munich)

Abstract:

We show that the electorate’s preferences for using tuition to finance higher education strongly depend on the design of the payment scheme. In representative surveys of the German electorate (N>18,000), experimentally replacing regular upfront by deferred income-contingent payments increases public support for tuition by 18 percentage points. The treatment turns a plurality opposed to tuition into a strong majority of 62 percent in favor. Additional experiments reveal that the treatment effect similarly shows when framed as loan repayments, when answers carry political consequences, and in a survey of adolescents. Reduced fairness concerns and improved student situations act as strong mediators.

Keywords:

tuition; higher education finance; income-contingent loans; voting;

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Discussion Paper No. 309
January 3, 2022

Can Schools Change Religious Attitudes? Evidence from German State Reforms of Compulsory Religious Education

Author:

Ludger Woessmann (ifo Institute, LMU Munich)
Benjamin W. Arold (ifo Institute, LMU Munich)
Larissa Zierow (ifo Institute, LMU Munich)

Abstract:

We study whether compulsory religious education in schools affects students’ religiosity as adults. We exploit the staggered termination of compulsory religious education across German states in models with state and cohort fixed effects. Using three different datasets, we find that abolishing compulsory religious education significantly reduced religiosity of affected students in adulthood. It also reduced the religious actions of personal prayer, church-going, and church membership. Beyond religious attitudes, the reform led to more equalized gender roles, fewer marriages and children, and higher labor-market participation and earnings. The reform did not affect ethical and political values or non-religious school outcomes.

Keywords:

religious education; religiosity; school reforms;

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Discussion Paper No. 307
December 22, 2021

Strategy-Proof and Envy-Free Random Assignment

Author:

Christian Basteck (WZB Berlin)
Lars Ehlers (Université de Montréal)

Abstract:

We study the random assignment of indivisible objects among a set of agents with strict preferences. We show that there exists no mechanism which is unanimous, strategy-proof and envy-free. Weakening the first requirement to q-unanimity – i.e., when every agent ranks a different object at the top, then each agent shall receive his most-preferred object with probability of at least q – we show that a mechanism satisfying strategy-proofness, envy-freeness and ex-post weak non-wastefulness can be q-unanimous only for q ≤ n2 (where n is the number of agents). To demonstrate that this bound is tight, we introduce a new mechanism, Random-Dictatorship-cum-Equal-Division (RDcED), and show that it achieves this maximal bound when all objects are acceptable. In addition, for three agents, RDcED is characterized by the first three properties and ex-post weak efficiency. If objects may be unacceptable, strategy-proofness and envy-freeness are jointly incompatible even with ex-post weak non-wastefulness.

Keywords:

random assignment; strategy-proofness; envy-freeness; q-unanimity;

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Discussion Paper No. 303
November 29, 2021

Aiding Applicants: Leveling the Playing Field within the Immediate Acceptance Mechanism

Author:

Christian Basteck (WZB Berlin)
Marco Mantovani (University of Milan-Bicocca)

Abstract:

In school choice problems, the widely used manipulable Immediate Acceptance mechanism (IA) disadvantages unsophisticated applicants, but may ex-ante Pareto dominate any strategy-proof alternative. In these cases, it may be preferable to aid applicants within IA, rather than to abandon it. In a laboratory experiment, we first document a substantial gap in strategy choices and outcomes between subjects of higher and lower cognitive ability under IA. We then test whether disclosing information on past applications levels the playing field. The treatment is effective in partially reducing the gap between applicants of above- and below-median cognitive ability and in curbing ability segregation across schools, but may leave the least able applicants further behind.

Keywords:

laboratory experiment; school choice; immediate acceptance; strategy-proofness; cognitive ability; mechanism design;

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Discussion Paper No. 294
November 15, 2021

Earnings Information and Public Preferences for University Tuition: Evidence from Representative Experiments

Author:

Ludger Woessmann (LMU Munich, ifo Institute, CESifo)
Philipp Lergetporer (TU Munich, ifo Institute, CESifo)

Abstract:

Higher education finance depends on the public’s preferences for charging tuition, which may be partly based on beliefs about the university earnings premium. To test whether public support for tuition depends on earnings information, we devise survey experiments in representative samples of the German electorate (N>15,000). The electorate is divided, with a plurality opposing tuition. Providing information on the university earnings premium raises support for tuition by 7 percentage points, turning the plurality in favor. The opposition-reducing effect persists two weeks after treatment. Information on fiscal costs and unequal access does not affect public preferences. We subject the baseline result to various experimental tests of replicability, robustness, heterogeneity, and consequentiality.

Keywords:

tuition; higher education; information; earnings premium; public opinion; voting;

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Discussion Paper No. 291
November 10, 2021

The Legacy of Covid-19 in Education

Author:

Katharin Werner (LMU Munich, CESifo)
Ludger Woessmann (LMU Munich, CESifo)

Abstract:

If school closures and social-distancing experiences during the Covid-19 pandemic impeded children’s skill development, they may leave a lasting legacy in human capital. To understand the pandemic’s effects on school children, this paper combines a review of the emerging international literature with new evidence from German longitudinal time-use surveys. Based on the conceptual framework of an education production function, we cover evidence on child, parent, and school inputs and students’ cognitive and socio-emotional development. The German panel evidence shows that children’s learning time decreased severely during the first school closures, particularly for low-achieving students, and increased only slightly one year later. In a value-added model, learning time increases with daily online class instruction, but not with other school activities. The review shows substantial losses in cognitive skills on achievement tests, particularly for students from disadvantaged backgrounds. Socio-emotional wellbeing also declined in the short run. Structural models and reduced-form projections suggest that unless remediated, the school closures will persistently reduce skill development, lifetime income, and economic growth and increase inequality.

Keywords:

Covid-19; school closures; education; students; schools; educational inequality;

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