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Field Experiments on Anchoring of Economic Valuations

42 Pages Posted: 29 Apr 2011  

Jonathan E. Alevy

University of Alaska Anchorage

Craig E. Landry

University of Georgia - Department of Agricultural & Applied Economics

John A. List

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Date Written: May 27, 2010

Abstract

A pillar of behavioral research is the view that preferences are constructed during the value elicitation process, but it is unclear whether, and to what extent, such biases influence real market equilibria. This paper examines the "anchoring" phenomenon in the field. The first experiment produces evidence that inexperienced consumers can be anchored in the value elicitation process, yet there is little evidence that experienced agents are influenced by anchors. The second experiment finds that anchors have only transient effects on prices and quantities traded: aggregate market outcomes converge to the intersection of supply and demand after a few market periods.

Keywords: anchoring, valuation, field experiment, experience

JEL Classification: C93, D11

Suggested Citation

Alevy, Jonathan E. and Landry, Craig E. and List, John A., Field Experiments on Anchoring of Economic Valuations (May 27, 2010). Available at SSRN: https://ssrn.com/abstract=1824400 or http://dx.doi.org/10.2139/ssrn.1824400

Jonathan Alevy

University of Alaska Anchorage ( email )

Anchorage, AK 99508
United States

Craig Landry (Contact Author)

University of Georgia - Department of Agricultural & Applied Economics ( email )

Athens, GA 30602-7509
United States

John List

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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