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MindReader Weekly – 2nd – Westerners are more impulsive, and power is like counterfeit products.

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Potentially MindShifting Papers:*

“According to theories of cultural neuroscience, Westerners and Easterners may have distinct styles of cognition (e.g., different allocation of attention). Previous research has shown that Westerners and Easterners tend to utilize analytical and holistic cognitive styles, respectively. On the other hand, little is known regarding the cultural differences in neuroeconomic behavior. For instance, economic decisions may be affected by cultural differences in neurocomputational processing underlying attention; however, this area of neuroeconomics has been largely understudied. In the present paper, we attempt to bridge this gap by considering the links between the theory of cultural neuroscience and neuroeconomic theory of the role of attention in intertemporal choice. We predict that (i) Westerners are more impulsive and inconsistent in intertemporal choice in comparison to Easterners, and (ii) Westerners more steeply discount delayed monetary losses than Easterners. We examine these predictions by utilizing a novel temporal discounting model based on Tsallis’ statistics (i.e. a q-exponential model). Our preliminary analysis of temporal discounting of gains and losses by Americans and Japanese confirmed the predictions from the cultural neuroeconomic theory. Future study directions, employing computational modeling via neural networks, are briefly outlined and discussed.”

A personal note: What a coincidence, the other day I read in an amazing article written by Dinesh Bhugra, Dmitri Popelyuk, and Isabel McMullen (2010): “… in most cultures, sexual intercourse is preceded by some degree of foreplay … Kissing as part of sexual foreplay is common in the West but virtually unknown in other parts of the world.” (p. 247-8), how does it correspond to the notion about “more steeply discounted Westerners”?

  • Beomsoo Kim, Christopher Ruhm (2009):

We examine how wealth shocks, in the form of inheritances, affect the mortality rates, health status and health behaviors of older adults, using data from eight waves of the Health and Retirement Survey (HRS). Our main finding is that bequests do not have substantial effects on health, although some improvements in quality-of-life are possible. This absence occurs despite increases in out-of-pocket (OOP) spending on health care and in the utilization of medical services, especially discretionary and non-lifesaving types such as dental care. Nor can we find a convincing indication of changes in lifestyles that offset the benefits of increased medical care. Inheritances are associated with higher alcohol consumption, but with no change in smoking or exercise and a possible decrease in obesity.”

“We develop a model of manager–employee relationships where employees care more for their manager when they are more convinced that their manager cares for them. Managers can signal their altruistic feelings towards their employees in two ways: by offering a generous wage and by giving attention. Contrary to the traditional gift-exchange hypothesis, we show that altruistic managers may offer lower wages and nevertheless build up better social-exchange relationships with their employees than egoistic managers do. In such equilibria, a low wage signals to employees that the manager has something else to offer—namely, attention—which will induce the employee to stay at the firm and work hard. Our predictions are well in line with some recent empirical findings about gift exchange in the field.”

The personal note for the Head of Department: An offer of lower wage won’t build up a better relationship with me in any thinkable way.

  • Gerlinde Fellner, Rupert Sausgruber, and Christian Traxler (2009):

We run a large-scale natural field experiment to evaluate alternative strategies to enforce compliance with the law. The experiment varies the text of mailings sent to potential evaders of TV license fees. We find a strong alert effect of mailings, leading to a substantial increase in compliance. Among different mailing conditions a legal threat that stresses a high detection risk has a significant and highly robust deterrent effect. Neither appealing to morals nor imparting information about others’ behavior enhances compliance. However, the information condition has a positive effect in municipalities where evasion is believed to be common. Overall, the economic model of crime performs remarkably well in explaining our data.”

  • Francesca Gino, Michael Norton, and Dan Ariely (2010):

“Although people buy counterfeit products to signal positive traits, we show that wearing counterfeit products makes individuals feel less authentic and increases their likelihood of both behaving dishonestly and judging others as unethical. In four experiments, participants wore purportedly fake or authentically branded sunglasses. Those wearing fake sunglasses cheated more across multiple tasks than did participants wearing authentic sunglasses, both when they believed they had a preference for counterfeits (Experiment 1a) and when they were randomly assigned to wear them (Experiment 1b). Experiment 2 shows that the effects of wearing counterfeit sunglasses extend beyond the self, influencing judgments of other people’s unethical behavior. Experiment 3 demonstrates that the feelings of inauthenticity that wearing fake products engenders—what we term the counterfeit self—mediate the impact of counterfeits on unethical behavior. Finally, we show that people do not predict the impact of counterfeits on ethicality; thus, the costs of counterfeits are deceptive.”

  • Joris Lammers, Diederik Stapel, and Adam Galinsky (2010):

“In five studies, we explored whether power increases moral hypocrisy (i.e., imposing strict moral standards on other people but practicing less strict moral behavior oneself). In Experiment 1, compared with the powerless, the powerful condemned other people’s cheating more, but also cheated more themselves. In Experiments 2 through 4, the powerful were more strict in judging other people’s moral transgressions than in judging their own transgressions. A final study found that the effect of power on moral hypocrisy depends on the legitimacy of the power: When power was illegitimate, the moral-hypocrisy effect was reversed, with the illegitimately powerful becoming stricter in judging their own behavior than in judging other people’s behavior. This pattern, which might be dubbed hypercrisy, was also found among low-power participants in Experiments 3 and 4. We discuss how patterns of hypocrisy and hypercrisy among the powerful and powerless can help perpetuate social inequality.”

A personal note: My short comment (in Czech) on a similar topic.

“Kanazawa (2007) offers an explanation for the variation across countries of average intelligence. It is based on the idea human intelligence is a domain specific adaptation and that both temperature and the distance from some putative point of origin are proxies for the degree of novelty that humans in a country have experienced. However the argument ignores many other considerations and is a priori weak and the data used questionable. A particular problem is that in calculating distances between countries it implicitly assumes that the earth is flat. This makes all the estimates biased and unreliable.”

“This paper develops a new empirical approach to uncovering the impact of cultural attitudes on economic development, with an emphasis on trust. We first show that inherited trust of US-immigrants is significantly influenced by the country of origin of their forebears and depends on the timing of arrival of their ancestors. This result allows us to use the inherited trust of US-immigrants as a time-varying measure of the historical evolution of trust in the source country. This strategy enables us to identify the specific impact of inherited trust on economic development relative to other traditional candidates, such as institutions and geography, by controlling for country fixed effects. We show that the level of trust transmistted from the source countries has changed over the 20th century, and this cultural change explains a substantial part of the evolution of economic development in a set of countries from all over the world.”

  • Pierre Azoulay, Joshua Graff Zivin, and Jialan Wang (2010):

“We estimate the magnitude of spillovers generated by 112 academic “superstars” who died prematurely and unexpectedly, thus providing an exogenous source of variation in the structure of their collaborators’ coauthorship networks. Following the death of a superstar, we find that collaborators experience, on average, a lasting 5% to 8% decline in their quality-adjusted publication rates. By exploring interactions of the treatment effect with a variety of star, coauthor, and star/coauthor dyad characteristics, we seek to adjudicate between plausible mechanisms that might explain this finding. Taken together, our results suggest that spillovers are circumscribed in idea space, but less so in physical or social space. In particular, superstar extinction reveals the boundaries of the scientific field to which the star contributes—the “invisible college”.”

““Nudges” are being widely promoted to encourage energy conservation. We show that while the electricity conservation “nudge” of providing feedback to households on own and peers’ home electricity usage works with liberals, it can backfire with conservatives. Our regression estimates predict that a Democratic household that pays for electricity from renewable sources, that donates to environmental groups, and that lives in a liberal neighborhood reduces its consumption by 3 percent in response to this nudge. A Republican household that does not pay for electricity from renewable sources and that does not donate to environmental groups increases its consumption by 1 percent.”

* If you can‘t get any of the mentioned papers, please, contact me. If there is a bunch of curious students interested in discussing the topics published in MindReader, the debate will be held by myself or by Petr Koblovský, Ph.D. in „my“ restaurant every month starting from 19:00, May 3, 2010. Discussion will be in Czech (unless notified otherwise). If you are interested to participate, please send me an e-mail before May 1 (the main topic: “Power (and fake sunglasses) corrupt.”).

Summer Schools:

  • The Summer School “Neuroeconomics: An exciting joint venture”, June 7 – 18, 2010, University of Amsterdam,  Netherlands. Deadline for registration for the Summer School is May 1, 2010. Deadline for registration for the Workshop and Symposium is June 1, 2010 – Costs and registration.
  • IMPRS “Uncertainty Summer School”, July 26 – August 20, 2010, the Max Planck Institute of Economics, Jena, Germany. The application process ends June 1, 2010 – General Information.
  • ENSN “Neuroschool”, October 3 – 8, 2010, University of Würzburg, Germany. Deadline for submission of applications is May 15, 2010 – General Information.
  • “The UCLA Advanced Neuroimaging Summer program”, July 12 – 23, University of California, Los Angeles, USA. Deadline for submission of applications is May 1, 2010 – General Information.