We provide the first, in experimental economics, consistent estimates of a dynamic learning model with a continuous outcome. The econometric approach we propose can be used in many experimental studies including auctions, bargaining with transfers, and gift exchange experiments. We focus on affiliated private value auctions, where subjects are generally assumed to converge to the rule-of-thumb bidding, but our general approach is applicable to many other settings. Our IV estimates suggest that subjects become significantly less aggressive over time; specifically, they decrease their bids in proportion to the previous period’s signal minus bid. However, the inconsistent OLS and FE estimators imply that subjects become significantly more aggressive over time—they raise their bids in proportion to the previous period’s signal minus bid. Our instruments are randomly generated by the experiment, and pass popular weak instrument tests.

In Africa, rangeland ecosystems have been exploited due to heavy and unsustainable grazing. Policy and institutional mechanisms such as integrating silvopastoral systems with sustainable grazing practices have been devised to mitigate the negative effects. In this study, we investigated whether the uptake of sustainable grazing management in the form of controlled grazing spurs investment in multipurpose trees (MPTs) and enhances income. Using instrumental variable regression, we find that controlled grazing increases not only the propensity to plant MPTs but also the number of tree species. More importantly, IV and treatment effect results indicate that controlled grazing enhances income from MPTs.

This paper investigates whether the availability of breastfeeding facilities at the workplace helps to reconcile breastfeeding and work commitments, and whether it has beneficial effects for the health of the child. Using data from the UK Infant Feeding Survey, we find that the availability of breastfeeding facilities at work is associated with longer breastfeeding durations for all women and shorter maternity leave spells for higher educated women. We also find that children born to mothers whose employer offers breastfeeding facilities experience significantly fewer sickness in the first 6 months of life.

Modern economic theory gives an important role to expectations as an influence on outcomes. This paper reviews evidence on how well measures of expectations conform to outcomes. It confirms earlier results that measures taken from financial markets perform poorly as predictors of outcomes. Looking at the individual responses to the Confederation of British Industry’s Industrial Trends Survey, it does find, however, that there are significant correlations between expected and realised outcomes of wages, prices, costs orders and employment. It also finds some evidence that actual prices reflect expected future prices, but with a coefficient much lower than economic theory predicts. There is evidence that forecast errors are explained by past forecasts, as well as revisions to the economic outlook, casting doubt on the idea that firms’ forecasts make the best use of the information available at the time. The paper concludes by observing that, while expectations are undoubtedly important, economists need to build on work looking at how they are derived instead of simply assuming they are rational.

Many farmers face borrowing limits that depend on their household income and net worth. Given such credit constraints, an increase in off-farm income should allow farmers to borrow more, thus influencing production decisions and productivity. To test this hypothesis, the education level of the farm operator’s spouse is used to identify exogenous variation in off-farm income. Findings indicate that higher off-farm income leads to more borrowing, capital expenditures, capital input intensity, farm labor use, output, farm income, and productivity. Results suggest that Federal programs that promote access to credit for limited-resource farmers may increase farm investment and productivity.

We study the effects of food safety awareness on consumers’ milk purchasing behavior in Nepal. We conducted consumer survey and employed an instrumental variable regression. We find education, income, and social network to influence food safety consciousness (FSC). Our results indicate the positive impact of FSC on weekly milk expenditure and probability of purchasing milk from milk cooperatives. Any policy that helps to improve the FSC levels will likely increase the purchase of safe milk from the modern market outlet, and lack of such awareness raising policies has prevented the market for safe food from evolving and expanding.

This paper asks whether the level of integration of world countries in the international network of temporary human mobility can explain differences in their per-capita income and labor productivity. We disentangle the role played by global country centrality in the network from traditional openness measures, which only account for local, nearest-neighbor linkages through which ideas and knowledge can flow. Using 1995-2010 data, we show that global country centrality in the international temporary human-mobility network enhances both per-capita income and labor productivity. Our results hold cross-sectionally, as well as in a dynamic-panel estimation, and take into account potential endogeneity issues. Our findings imply that how close a country is to the theoretical technological frontier, depends not only on how much she is open to temporary human mobility, but mostly on whether she is embedded in a web of relationships connecting her with other influential partners in the network. Our exercises also suggest that most of the gain in income and productivity can be attained if country centrality in the network comes mostly from influential partners that lie not too far away from, but neither too close to them in the network.