Randomization to treatment failure in experimental auctions

The value of data from training rounds

Teresa Briz, Andreas C. Drichoutis, Rodolfo M. Nayga, Jr

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

In the experimental auctions literature, it is common practice to train subjects, who are often unfamiliar with the auction procedure, by conducting a few training (often hypothetical) auctions. Data from these practice auctions are rarely reported in scientific papers. We argue that valuable information can be garnered by looking at data coming from the training rounds of experimental auctions. We provide evidence that if we had neglected insights gained from the training auction data, we would not have been able to detect a failure of randomization to treatment that rendered us biased estimates of the true causal effects due to unobserved heterogeneity. As a case study, we use data from an experiment that seeks to elaborate on the mediating role of mood states on projection bias. Following a mood induction procedure, subjects are found to bid more under negative mood (as compared to positive mood) for products that are delivered in the future but bid less under negative mood for products that are delivered in present time. We show that information from the training auction rounds render the observed effect a biased estimate, which is likely a consequence of the failure of randomization to treatment.

Original languageEnglish
Pages (from-to)56-66
Number of pages11
JournalJournal of Behavioral and Experimental Economics
Volume71
DOIs
Publication statusPublished - 2017 Dec 1
Externally publishedYes

Fingerprint

auction
Random Allocation
Treatment Failure
mood
Values
Mood
Experimental auctions
Randomization
Auctions
induction
projection
present
experiment
trend
evidence
Bid

Keywords

  • Balance tests
  • Experimental auctions
  • Mood induction
  • Placebo tests
  • Projection bias
  • Randomization to treatment

ASJC Scopus subject areas

  • Applied Psychology
  • Economics and Econometrics
  • Social Sciences(all)

Cite this

Randomization to treatment failure in experimental auctions : The value of data from training rounds. / Briz, Teresa; Drichoutis, Andreas C.; Nayga, Jr, Rodolfo M.

In: Journal of Behavioral and Experimental Economics , Vol. 71, 01.12.2017, p. 56-66.

Research output: Contribution to journalArticle

@article{b2d74bfe3e2d4cb9a19529ce3b798788,
title = "Randomization to treatment failure in experimental auctions: The value of data from training rounds",
abstract = "In the experimental auctions literature, it is common practice to train subjects, who are often unfamiliar with the auction procedure, by conducting a few training (often hypothetical) auctions. Data from these practice auctions are rarely reported in scientific papers. We argue that valuable information can be garnered by looking at data coming from the training rounds of experimental auctions. We provide evidence that if we had neglected insights gained from the training auction data, we would not have been able to detect a failure of randomization to treatment that rendered us biased estimates of the true causal effects due to unobserved heterogeneity. As a case study, we use data from an experiment that seeks to elaborate on the mediating role of mood states on projection bias. Following a mood induction procedure, subjects are found to bid more under negative mood (as compared to positive mood) for products that are delivered in the future but bid less under negative mood for products that are delivered in present time. We show that information from the training auction rounds render the observed effect a biased estimate, which is likely a consequence of the failure of randomization to treatment.",
keywords = "Balance tests, Experimental auctions, Mood induction, Placebo tests, Projection bias, Randomization to treatment",
author = "Teresa Briz and Drichoutis, {Andreas C.} and {Nayga, Jr}, {Rodolfo M.}",
year = "2017",
month = "12",
day = "1",
doi = "10.1016/j.socec.2017.09.004",
language = "English",
volume = "71",
pages = "56--66",
journal = "Journal of Behavioral and Experimental Economics",
issn = "2214-8043",
publisher = "Elsevier Inc.",

}

TY - JOUR

T1 - Randomization to treatment failure in experimental auctions

T2 - The value of data from training rounds

AU - Briz, Teresa

AU - Drichoutis, Andreas C.

AU - Nayga, Jr, Rodolfo M.

PY - 2017/12/1

Y1 - 2017/12/1

N2 - In the experimental auctions literature, it is common practice to train subjects, who are often unfamiliar with the auction procedure, by conducting a few training (often hypothetical) auctions. Data from these practice auctions are rarely reported in scientific papers. We argue that valuable information can be garnered by looking at data coming from the training rounds of experimental auctions. We provide evidence that if we had neglected insights gained from the training auction data, we would not have been able to detect a failure of randomization to treatment that rendered us biased estimates of the true causal effects due to unobserved heterogeneity. As a case study, we use data from an experiment that seeks to elaborate on the mediating role of mood states on projection bias. Following a mood induction procedure, subjects are found to bid more under negative mood (as compared to positive mood) for products that are delivered in the future but bid less under negative mood for products that are delivered in present time. We show that information from the training auction rounds render the observed effect a biased estimate, which is likely a consequence of the failure of randomization to treatment.

AB - In the experimental auctions literature, it is common practice to train subjects, who are often unfamiliar with the auction procedure, by conducting a few training (often hypothetical) auctions. Data from these practice auctions are rarely reported in scientific papers. We argue that valuable information can be garnered by looking at data coming from the training rounds of experimental auctions. We provide evidence that if we had neglected insights gained from the training auction data, we would not have been able to detect a failure of randomization to treatment that rendered us biased estimates of the true causal effects due to unobserved heterogeneity. As a case study, we use data from an experiment that seeks to elaborate on the mediating role of mood states on projection bias. Following a mood induction procedure, subjects are found to bid more under negative mood (as compared to positive mood) for products that are delivered in the future but bid less under negative mood for products that are delivered in present time. We show that information from the training auction rounds render the observed effect a biased estimate, which is likely a consequence of the failure of randomization to treatment.

KW - Balance tests

KW - Experimental auctions

KW - Mood induction

KW - Placebo tests

KW - Projection bias

KW - Randomization to treatment

UR - http://www.scopus.com/inward/record.url?scp=85033556372&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85033556372&partnerID=8YFLogxK

U2 - 10.1016/j.socec.2017.09.004

DO - 10.1016/j.socec.2017.09.004

M3 - Article

VL - 71

SP - 56

EP - 66

JO - Journal of Behavioral and Experimental Economics

JF - Journal of Behavioral and Experimental Economics

SN - 2214-8043

ER -