Four Contributions to Experimental Economics

Abstract

Over the last thirty years findings from economic experiments substantially contributed to a better understanding of a wide variety of phenomena in different branches of economics. In areas like industrial organization, game theory, public choice or labor economics controlled laboratory experiments became commonplace (Plott and Smith 2008).<br /> In contrast, in health economics the use of laboratory experimentation is rather in its infant stages. This is somewhat surprising as prominent proponents, like the US health economist Victor R. Fuchs, have already argued that incorporating methods of experimental economics into health economic research might lead to great benefits for the latter (Fuchs 2000).<br /> Similarly, very little experimental research has focussed on individual risk attitudes of higher orders, like prudence and temperance, so far. Various experimental methods have been developed to investigate risk aversion (e.g., Holt and Laury 2002) and to test theories of decision-making under risk (e.g., Camerer 1989, Hey and Orme 1994). It is, thus, surprising that an appropriate method to test for higher-order risks is still lacking. The four experimental studies presented in the dissertation at hand aim to fill this gap in the two respective research areas. The first two chapters present novel experimental methods to explore individual attitudes towards higher-order risks. In the third chapter, a laboratory experiment is introduced in order to study the influence of payment incentives on physician behavior. The final chapter analyzes the link between other-regarding motivations and physician payment incentives for two different subject pools.