Nudge or Sludge? An In-Class Experimental Auction Illustrating How Misunderstood Scientific Information Can Change Consumer Behavior

Simple item page
Author(s)Paul, Laura A.
Author(s)Savchenko, Olesya M.
Author(s)Kecinski, Maik
Author(s)Messer, Kent D.
Date Accessioned2022-04-13T15:09:41Z
Date Available2022-04-13T15:09:41Z
Publication Date2022-03-16
DescriptionThis article was originally published in Applied Economics Teaching Resources. The version of record is available at: https://www.aaea.org/UserFiles/file/AETR_2021_006RRRProofFINAL.pdfen_US
AbstractScientific information can be used to help people understand and describe the world. For example, consumers regularly seek out information about their food and drink to help inform their purchasing decisions. Sometimes, however, consumers can respond negatively to this information, even when the information did not intend to convey a negative signal. These negative responses can be the result of misunderstandings or strong, visceral, emotional behavior, that can be challenging to foresee and once arisen, difficult (and expensive) to mitigate. In this paper, we show how educators can use an in-class economic experiment to introduce the power of a sludge—a small behavioral intervention that leads to worse outcomes. We provide a step-by-step guide to take students through a demand revealing design using a second-price, willingness-to-accept (WTA) auction that tests preferences for tap water and bottled water when students receive total dissolved solids (TDS) information. Additional classroom discussion topics are presented, including comparing nudges and sludges, the public response to the treatment of tap water, and the role of safety information in consumer response.en_US
SponsorThis research was supported by the U.S. Department of Agriculture National Institute of Food and Agriculture, #2019-67023-29854.en_US
CitationPaul, Laura A, Olesya M Savchenko, Maik Kecinski, and Kent D Messer. “Nudge or Sludge? An In-Class Experimental Auction Illustrating How Misunderstood Scientific Information Can Change Consumer Behavior” 4 (2022): 10.en_US
ISSN2688-5999
URLhttps://udspace.udel.edu/handle/19716/30776
Languageen_USen_US
PublisherApplied Economics Teaching Resourcesen_US
KeywordsBehavioral economicsen_US
Keywordsclassroom gameen_US
Keywordsexperiential learningen_US
Keywordsinformational nudgeen_US
Keywordssecond- price auctionen_US
Keywordswillingness-to-accepten_US
TitleNudge or Sludge? An In-Class Experimental Auction Illustrating How Misunderstood Scientific Information Can Change Consumer Behavioren_US
TypeArticleen_US
Files
Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
Nudge or Sludge An In-Class Experimental Auction.pdf
Size:
2.43 MB
Format:
Adobe Portable Document Format
Description:
Main article
Download
License bundle
Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
2.22 KB
Format:
Item-specific license agreed upon to submission
Description:
Download
Collections
Open Access Publications