Economic Experiments that You Can Perform at Home on Your Children

Abstract

This paper describes some simple economic experiments that can be done using children as subjects. We argue that by conducting experiments on children economists can gain insight into the origins of preferences, the development of bargaining behavior and rationality, and into the origins of "irrational" behavior in adults. Most of the experiments are exploratory, and the objective is as much to learn how to conduct economic experiments on children and suggest avenues for further research as to describe specific results. Preliminary results suggest that while children are very different from adults in some ways, such as their rate of time preference, they are very similar in others, such as their bargaining and altruistic behavior. We also find that children can make choices that generally satisfy the usual transitivity test for rationality, and that in some ways they may even be more rational than adults. The paper includes protocols which can be used to replicate the experiments.

JEL Classification: D00