Central banks have increased their official communications. Previous literature measures complexity, clarity, tone and sentiment. Less explored is the use of fact versus emotion in central bank communication. We test a new method for classifying factual versus emotional language, applying a pretrained transfer learning model, fine-tuned with manually coded, task-specific and domain-specific data sets. We find that the large language models outperform traditional models on some occasions; however, the results depend on a number of choices. We therefore caution researchers from depending solely on such models even for tasks that appear similar. Our findings suggest that central bank communications are not only technically but also subjectively difficult to understand.

To be effective, central bankers must project expertise and an anti-inflation commitment. However, those attributes are usually male-coded, which may undermine female central bankers. We assess gender bias using a survey experiment fielded in Japan in September 2022, when, for the first time in decades, the Bank of Japan appeared to struggle with inflation. We exposed individuals to simplified Bank of Japan communication and randomly assigned attribution to male (Mr. Adachi) or female (Ms. Nakagawa) Policy Board members. Respondents trusted the Bank of Japan less and were more sceptical of its capacity to handle inflation when Ms. Nakagawa represented it.

This article studies whether people want to control what information on their own past pro-social behavior is revealed to others. Participants are assigned a color that depends on their past pro-social behavior. They can spend money to manipulate the probability with which their color is revealed to another participant. The data show that participants are more likely to reveal colors with more favorable informational content. This pattern is not found in a control treatment in which colors are randomly assigned, thus revealing nothing about past pro-social behavior. Regression analysis confirms these findings, also when controlling for past pro-social behavior. These results complement the existing empirical evidence, confirming that people strategically and, therefore, consciously manipulate their social image.

We compare different implementations of the Stochastic Becker–DeGroot–Marschak (SBDM) belief elicitation mechanism, which is theoretically elegant but challenging to implement. In a first experiment, we compare three common formats of the mechanism in terms of speed and data quality. We find that all formats yield reports with similar levels of accuracy and precision, but that the instructions and reporting format adapted from Hao and Houser (J Risk Uncertain 44(2):161–180 2012) is significantly faster to implement. We use this format in a second experiment in which we vary the delivery method and quiz procedure. Dropping the pre-experiment quiz significantly compromises the accuracy of subject’s reports and leads to a dramatic spike in boundary reports. However, switching between electronic and paper-based instructions and quizzes does not affect the accuracy or precision of subjects’ reports.

This paper provides a close conceptual replication of the study by Di Tella et al. (Am Econ Rev 105: 3416–42, 2015) on self-serving beliefs. The design differs in some aspects from the original study, but maintains its fundamental structure and uses a larger sample size. The main findings of the original study are not replicated. If anything, beliefs seem to be biased in the opposite direction. These results are discussed jointly with two other replication efforts by Ging-Jehli et al. (Games Econ Behav 122–341, 2020) and Ahumada et al. (Well excuse me! replicating and connecting excuse-seeking behaviors, 2022). The main conclusion is that self-serving beliefs about others in strategic settings seem to be quite sensitive and hard to capture.

Our research addresses the effect of shared vs. mixed group identities in an information cascade game. We vary whether subjects always choose after a decision maker who shares the same identity or after a decision maker with a different identity. We find that subjects’ inclination to follow their predecessor is stronger in groups uniquely consisting of ingroup members compared to mixed groups. We relate this result to recent social cognition research.

Neoclassical theory holds that different sources of income are fungible at the margin. In contrast, mental accounting holds that appropriate uses for income vary by source, making them infungible. This study investigates which theory better describes giving at the margin when income may have multiple sources. Dictators accrue differing amounts of (1) earned income from a real-effort task, (2) windfall income, or (3) both. I find that dictators treat marginal earned and windfall income as partially infungible, supporting mental accounting. Dictators who had a single income source gave 14% of a marginal windfall token and 5% of a marginal earned token. Strikingly, dictators who had income from both sources were sharply less generous with each, giving only 2% and 1%, respectively. Multiple accounts enabled greater selfishness at the margin. A follow-up experiment shows that two accounts must be qualitatively different, not just multiple in number, to produce this effect.

We investigate how different forms of scrutiny affect dishonesty, using Gneezy’s [Am Econ Rev 95:384–394 (2005)] deception game. We add a third player whose interests are aligned with those of the sender. We find that lying behavior is not sensitive to revealing the sender’s identity to the observer. The option for observers to communicate with the sender, and the option to reveal the sender’s lies to the receiver also do not affect lying behavior. Even more striking, senders whose identity is revealed to their observer do not lie less when their interests are misaligned with those of the observer.

Regret aversion often compels individuals to undertake extensive searches before making a choice. Yet, donors hardly search among charitable alternatives prior to giving. It is unclear if donors search little because there is no regret to avoid as they rarely learn the outcome of their donations, or they simply do not care as donation outcomes do not directly impact them. To investigate if absence of regret is a contributing factor behind this lack of search, the current study develops an online experiment wherein subjects can research available charities before donating. While the control group does not receive any regret-inducing feedback (such as relative effectiveness of their donation) ex-post of decision-making, the treatment group is ex-ante aware of receiving charity rankings ex-post. While the control subjects donate without gathering information on charities, the treatment subjects research substantially more and consequentially donate to better ranked charities without decreasing donations.

We examine the ability of eye movement data to help understand the determinants of decision-making over risky prospects. We start with structural models of choice under risk, and use that structure to inform what we identify from the use of process data in addition to choice data. We find that information on eye movements does significantly affect the extent and nature of probability weighting behavior. Our structural model allows us to show the pathway of the effect, rather than simply identifying a reduced form effect. This insight should be of importance for the normative design of choice mechanisms for risky products. We also show that decision-response duration is no substitute for the richer information provided by eye-tracking.

We experimentally study how mutual payoff information affects strategic play. Subjects play the Prisoner's Dilemma or Stag Hunt game against randomly re-matched opponents under two information treatments. In our partial-information treatment, subjects are shown only their own payoff structure, while in our full-information treatment they are shown both their own and their opponent's payoff structure. In both treatments, they receive feedback on their opponent's action after each round. We find that mutual payoff information initially facilitates reaching the socially optimal outcome in both games. Play in the Prisoner's Dilemma converges toward the unique Nash equilibrium of the game under both information treatments, while in the Stag Hunt mutual payoff information has a substantial impact on play and equilibrium selection in all rounds of the game. Belief-learning model estimations and simulations suggest these effects are driven by both initial play and the way subjects learn.

Organizations are utilizing digital technologies to modernize their innovations in today’s competitive and rapidly changing market environment. This study’s goal is to explore the influence of open innovation on firms’ digital technology integration, aiming to enhance their innovation skills and produce competitive, adaptable digital solutions. The methods used include analysis, synthesis, and generalization. Organizations can enhance open innovation by acquiring knowledge, capabilities, ideas, technologies, and information for new products and services, with the relationship between open innovation and digital innovation accelerating their capabilities. The study emphasizes the challenges organizations face in modern IT, emphasizing open innovation, access to external knowledge, and the need for improved internal production efficiency and competitiveness. The practical value of this study is manifested in the identification of strategies for optimizing open innovation for their transformation into digital solutions.

This review article explores the role of land-grant Extension amidst an escalating epistemic crisis, where misinformation and the contestation of knowledge severely impact public trust and policymaking. We delve into the historical mission of land-grant institutions to democratize education and extend knowledge through Cooperative Extension Services, highlighting their unique position to address contemporary challenges of information disorder and declining public confidence in higher education. Land-grant universities can reaffirm their relevance and leadership in disseminating reliable information by reasserting their foundational principles of unbiased, objective scholarship and deep engagement with diverse stakeholders. This reaffirmation comes at a critical time when societal trust in science and academia is waning, necessitating a recommitment to community engagement and producing knowledge for the public good. The article underscores the necessity for these institutions to adapt to the changing information landscape by fostering stakeholder-engaged scholarship and enhancing accessibility, thus reinforcing their vital role in upholding the integrity of public discourse and policy.

This paper examines the effects of heterogeneous biased expectations between the young and old on business cycles and explores its policy implications. Empirical findings reveal that individuals, particularly the young, can have more optimistic or pessimistic views about the future state of the economy compared to the data-generating measure. This study relates these results to the learning-from-experience literature, which suggests that individuals, particularly the young, place greater weight on recent observations when forming their expectations. Incorporating household weighting schemes into a life-cycle learning model, I show that household sensitivity to recent observations amplifies the effects of economic shocks. However, the amplification effects become less extensive as the population ages due to the lower sensitivity of the old. My simulation results indicate that a 10 percentage point increase in the old population ratio leads to a 16 percent decrease in output volatility. Regarding policy implications, this paper suggests that the government spending multiplier declines by approximately 10 percent when the old population ratio rises by 10 percentage points due to weak amplification effects. Moreover, the weakened output effects deteriorate the welfare of the population, particularly that of the young.

We test the effectiveness of an online interactive pension dashboard in improving pension funds participants' ability to make adequate pension decisions in terms of pension preparation, knowledge, self-efficacy, expectations, and intention-to-act. In a randomized survey experiment, treated participants of two pension funds receive an encouragement to visit an online pension dashboard. Treated individuals have more pension knowledge and an increased self-efficacy in the pension domain, especially so for females. The dashboard does not have a significant impact on the pension preparation or the errors in forecasts of pension income nor does it impact the willingness to act if there is a need to do so.

Experimental evidence shows that human subjects frequently rely on adaptive heuristics to form expectations but their forecasting performance in the lab is not as inadequate as assumed in macroeconomic theory. In this paper, we use an agent-based model (ABM) to show that the average forecasting error is indeed close to zero even in a complex environment if we assume that agents augment the canonical adaptive algorithm with a Belief Correction term which takes into account the previous trend of the variable of interest. We investigate the reasons for this result using a streamlined nonlinear macro-dynamic model that captures the essence of the ABM.

Recent work has argued for a Hayekian behavioural economics, which combines Austrian economics with behavioural economics as developed by Kahneman, Thaler, Sunstein, and others. We suggest that this hybrid is misguided because it relies on individual cognitivism. This view of cognition is incompatible with the Hayekian view of cognition which treats rationality as an emergent phenomenon of social interaction in an institutional environment. This Hayekian view, which we call epistemic institutionalism, is compatible with an alternative prominent perspective in psychology, that of the extended mind, sometimes known as 4E cognition. We demonstrate how the Hayekian perspective on individualism, the price system, and the evolution of rules can be connected to the extended mind programme, through concepts such as the coupling of the individual and their environment, cognitive off-loading, and affordances. We suggest that this alternative combination of Austrian economics and psychology provides a more fruitful way forward, especially because it foregrounds the processes of learning, error-correction, and institutional orders, rather than choice, bias, and individual rationality. To explain why Austrian economists have been receptive to behavioural economics, we distinguish epistemic institutionalism from the (radical) subjectivist approach, which shares key assumptions of individual cognitivism.

Dairy farming in Europe faces profound environmental, social, and economic sustainability challenges, which are of significant policy interest. These challenges support the need for a transition toward the uptake of more sustainable dairy farming practices. This paper examines the effects of an advisory instrument “balanced sustainability information” on farmers’ preferences for more grass-based feeding systems using a between-subjects design and a discrete choice experiment among a sample of Swedish dairy farmers. Conceptually, we develop a state-dependent utility framework with Bayesian updating to motivate the impact pathway. Our results demonstrate that on average, balanced sustainability information has negligible effects on farmers’ feed choices, which could be a consequence of opposing responses to the information, among others. Considering farmer heterogeneity based on their identities and prior knowledge, we find support for some evidence of treatment effects. Our findings highlight important and policy-relevant critical reflections about overoptimistic expectations of information provision as an instrument to nudge behavioral change toward more sustainable farming practices.

Climate change is a complex global issue that requires widespread understanding, support and collaboration for effective solutions. This research delves into the crucial role of communication in tackling climate change and reaching net-zero goals. Leveraging advanced machine learning techniques, we focus on 10 core climate change topics derived from social media conversations over time. This analysis underscores the importance of a holistic and interconnected approach, involving a diverse array of policies at local, national and global levels to combat climate change effectively and attain net-zero objectives. We offer key policy suggestions that can significantly contribute to this vital cause.

We analyze financial literacy regarding interest rates, inflation, and risk diversification in nine Eastern European countries based on survey data collected in the fall 2022. The percentage of individuals with an understanding of all three concepts is generally low but varies strongly among countries, from 13 percent in Romania to 47 percent in the Czech Republic. Financial illiteracy is particularly acute among those with primary or lower secondary education. Among the three concepts, inflation is what people know best in eight out of nine countries – a pattern which has emerged recently and is in contrast to other countries, where interest rate literacy is highest. Differences in lifetime inflation experience, in particular experience of high or hyperinflation, affect inflation literacy. Higher financial literacy is associated with a higher propensity to save and a lower propensity to be financially vulnerable in six out of nine countries.