VTechWorks Repository :: Browsing by Author "Ball, Sheryl B."

Browsing by Author "Ball, Sheryl B."

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Activity-Based Costing & Warm Fuzzies - Costing, Presentation & Framing Influences on Decision-Making ~ A Business Optimization Simulation ~
Harrison, David Shelby (Virginia Tech, 1998-04-08)
Activity-Based Costing is presented in accounting text books as a costing system that can be used to make valuable managerial decisions. Accounting journals regularly report the successful implementations and benefits of activity-based costing systems for particular businesses. Little experimental or empirical evidence exists, however, that has demonstrated the benefits of activity-based costing under controlled conditions. Similarly, although case studies report conditions that may or may not favor activity-based costing decision making, controlled studies that measure the actual influence of those conditions on the usefulness of activity-based costing information are few. This study looked at the decision usefulness of activity-based costing information under controlled, laboratory settings. An interactive computer simulation tested the ability of 48 accounting majors to optimize profits with and without activity-based costing information and tested to see if presentation format or decision framing would influence their outcomes. The research showed that the activity-based costing information resulted in significantly better profitability decisions and required no additional time. Presentation in graphic (bar charts) or numeric (tabular reports) format did not influence profitability decisions but the graphs took longer for analysis and decision making. Decision framing influences were shown to beneficially affect profitability decisions but did not require additional time. Decision framing was especially helpful with the non-activity based costing information; it had no significant effect on activity-based costing performance.
Application of Artificial Intelligence to Wireless Communications
Rondeau, Thomas Warren (Virginia Tech, 2007-09-20)
This dissertation provides the theory, design, and implementation of a cognitive engine, the enabling technology of cognitive radio. A cognitive radio is a wireless communications device capable of sensing the environment and making decisions on how to use the available radio resources to enable communications with a certain quality of service. The cognitive engine, the intelligent system behind the cognitive radio, combines sensing, learning, and optimization algorithms to control and adapt the radio system from the physical layer and up the communication stack. The cognitive engine presented here provides a general framework to build and test cognitive engine algorithms and components such as sensing technology, optimization routines, and learning algorithms. The cognitive engine platform allows easy development of new components and algorithms to enhance the cognitive radio capabilities. It is shown in this dissertation that the platform can easily be used on a simulation system and then moved to a real radio system. The dissertation includes discussions of both theory and implementation of the cognitive engine. The need for and implementation of all of the cognitive components is strongly featured as well as the specific issues related to the development of algorithms for cognitive radio behavior. The discussion of the theory focuses largely on developing the optimization space to intelligently and successfully design waveforms for particular quality of service needs under given environmental conditions. The analysis develops the problem into a multi-objective optimization process to optimize and trade-of of services between objectives that measure performance, such as bit error rate, data rate, and power consumption. The discussion of the multi-objective optimization provides the foundation for the analysis of radio systems in this respect, and through this, methods and considerations for future developments. The theoretical work also investigates the use of learning to enhance the cognitive engine's capabilities through feed-back, learning, and knowledge representation. The results of this work include the analysis of cognitive radio design and implementation and the functional cognitive engine that is shown to work in both simulation and on-line experiments. Throughout, examples and explanations of building and interfacing cognitive components to the cognitive engine enable the use and extension of the cognitive engine for future work.
Autonomous Link-Adaptive Schemes for Heterogeneous Networks with Congestion Feedback
Ahmad, Syed Amaar (Virginia Tech, 2014-03-19)
LTE heterogeneous wireless networks promise significant increase in data rates and improved coverage through (i) the deployment of relays and cell densification, (ii) carrier aggregation to enhance bandwidth usage and (iii) by enabling nodes to have dual connectivity. These emerging cellular networks are complex and large systems which are difficult to optimize with centralized control and where mobiles need to balance spectral efficiency, power consumption and fairness constraints. In this dissertation we focus on how decentralized and autonomous mobiles in multihop cellular systems can optimize their own local objectives by taking into account end-to-end or network-wide conditions. We propose several link-adaptive schemes where nodes can adjust their transmit power, aggregate carriers and select points of access to the network (relays and/or macrocell base stations) autonomously, based on both local and global conditions. Under our approach, this is achieved by disseminating the dynamic congestion level in the backhaul links of the points of access. As nodes adapt locally, the congestion levels in the backhaul links can change, which can in turn induce them to also change their adaptation objectives. We show that under our schemes, even with this dynamic congestion feedback, nodes can distributedly converge to a stable selection of transmit power levels and points of access. We also analytically derive the transmit power levels at the equilibrium points for certain cases. Moreover, through numerical results we show that the corresponding system throughput is significantly higher than when nodes adapt greedily following traditional link layer optimization objectives. Given the growing data rate demand, increasing system complexity and the difficulty of implementing centralized cross-layer optimization frameworks, our work simplifies resource allocation in heterogeneous cellular systems. Our work can be extended to any multihop wireless system where the backhaul link capacity is limited and feedback on the dynamic congestion levels at the access points is available.
The Behavioral and Neural Bases of Social Economic Decision-Making
Li, Zhuncheng (Virginia Tech, 2019-04-22)
Social economic decision-making considers the well-being and emotions of others. Unlike traditional economics which routinely assumes that individuals care only about their own outcomes, behavioral economics and neuroeconomics offer research strategies which help us explore our social motivations. This dissertation consists of three essays studying the underlying behavioral and neural mechanisms of individuals' social economic decision-making. The analyses focus on investigating experimentally how humans make decisions in three distinct social economic environments. Chapter 2 examines how individuals react to hold-up when explicit promises are available. Hold-up happens when two parties can form an incomplete contract to cooperate, but the agreement may fall apart due to concerns about the other party gaining bargaining power. We propose that a belief-dependent frustration anger model can explain behavior about investment, cooperation, and costly punishment in a hold-up environment. We show experimentally that communication improves cooperation and increases efficiency. Promises lead to cooperation, and broken promises lead to costly punishment. Chapter 3 explores threats' deterrence effect and credibility in an ultimatum bargaining environment where two parties can both benefit over trade but have a conflict of interests. We show that a belief-dependent frustration anger model captures the relationship among messages, beliefs, and behavior. Our design permits the observation of communicated threats, credibility, and deterrence. As we hypothesize, messages convey intention to punish the opponents (threats) changes players' expectations, that first movers are largely deterred by the threats and second movers' threats are credible. Threats lead to deterrence and greater propensity for costly punishment. Chapter 4 investigates the neural basis of individuals' charity donation behavior in a modified dictator game. The right temporoparietal junction (rTPJ) has been associated with social decision-making, but the exact neural mechanism of charitable giving remains unknown. In our experiment, participants allocate money between themselves and a charity in a graphical revealed preference task, that measures both parameterized other-regarding preferences and economic rationality (Monotonicity, WARP, and GARP). We find evidence for a causal role of the rTPJ in determining fairness preferences and economic rationality.
The Betrayal Aversion Elicitation Task: An Individual Level Betrayal Aversion Measure
Aimone, Jason A.; Ball, Sheryl B.; Casas, Brooks (PLOS, 2015-09-02)
Research on betrayal aversion shows that individuals’ response to risk depends not only on probabilities and payoffs, but also on whether the risk includes a betrayal of trust. While previous studies focus on measuring aggregate levels of betrayal aversion, the connection between an individual’s own betrayal aversion and other individually varying factors, including risk preferences, are currently unexplored. This paper develops a new task to elicit an individual’s level of betrayal aversion that can then be compared to individual characteristics. We demonstrate the feasibility of our new task and show that our aggregate individual results are consistent with previous studies. We then use this classification to ask whether betrayal aversion is correlated with risk aversion. While we find risk aversion and betrayal aversion have no significant relationship, we do observe that risk aversion is correlated with non-social risk preferences, but not the social, betrayal related, risk component of the new task.
Cloud-Sourcing: Using an Online Labor Force to Detect Clouds and Cloud Shadows in Landsat Images
Yu, Ling; Ball, Sheryl B.; Blinn, Christine E.; Moeltner, Klaus; Peery, Seth; Thomas, Valerie A.; Wynne, Randolph H. (MDPI, 2015-02-26)
We recruit an online labor force through Amazon.com’s Mechanical Turk platform to identify clouds and cloud shadows in Landsat satellite images. We find that a large group of workers can be mobilized quickly and relatively inexpensively. Our results indicate that workers’ accuracy is insensitive to wage, but deteriorates with the complexity of images and with time-on-task. In most instances, human interpretation of cloud impacted area using a majority rule was more accurate than an automated algorithm (Fmask) commonly used to identify clouds and cloud shadows. However, cirrus-impacted pixels were better identified by Fmask than by human interpreters. Crowd-sourced interpretation of cloud impacted pixels appears to be a promising means by which to augment or potentially validate fully automated algorithms.
The Context-Dependence of the Process of Risky Choice
Alsharawy, Abdelaziz Mohammed (Virginia Tech, 2021-08-17)
The evaluation of risk is a fundamental aspect of decision-making and influences important outcomes, such as in the domain of financial and health behavior. In many economic applications, risk attitudes are assumed to be inherently stable. Nonetheless, behavioral tasks that elicit risk preferences have shown temporal inconsistencies. The instability of risk preferences can be attributed to several factors such as the way information is presented (framing effects), personal past experiences, and experienced emotions. We conduct four studies in this dissertation to shed light on the state dependency of risk attitudes and on the decision process of risky choice. Chapter 2 examines, using a laboratory experiment, how high stakes in risky choices influence physiological arousal, as measured via skin conductance, pulse rate and pupil size, and attention, as measured via gaze bias and saccades. We link the changes in arousal and attention accompanying high stakes to changes in risk aversion. Moreover, we develop and test a Sequential Sampling Model (SSM), the arousal-modulated Attentional Drift Diffusion Model (aADDM), linking reaction time and choice while allowing attention and its interaction with arousal to modulate the evaluation process of risky alternatives. High stakes caused changes in attention toward the safe option's attributes, heightened physiological arousal, and increased risk aversion. Results from the aADDM, demonstrate that the values of the high attributes are discounted when participants attend to the low attributes, with arousal amplifying this process further. Chapter 3, using a laboratory experiment, investigates how incentives and emotional experiences influence the adaptation process across high and low volatility contexts in risky choice. Due to the brain's computational capacity limitations, perception is optimized to detect differences within a narrow range of stimuli. We show that this adaptation process is itself context-dependent, with stronger incentives, heightened arousal, or more unpleasant feelings increasing payoff responsivity under high volatility. Chapter 4, using survey data, focuses on fear responses during the COVID-19 pandemic and risk perception of the health- and financial-related consequences of the crisis. We show that women report higher fear of the COVID-19 pandemic compared to men, modulating the gender differences in preventative health behaviors. Women also perceive the health risks of COVID-19, and not financial risks, to be greater than men. Chapter 5, using vignette experiments, demonstrates that betrayal aversion, or hesitancy regarding the risk of being betrayed in an environment involving trust, is an important preference construct in the decision to become vaccinated and is not accounted for by widely used vaccine hesitancy measures. We show that people are significantly less willing to get vaccinated when the associated risk involved the vaccine actively contributing to the cause of death. We also find that betrayal aversion is amplified with an active role of government or scientists. Moreover, we test an exogenous intervention that increases willingness to vaccinate without mitigating betrayal aversion. JEL codes: D81, D83, D87, D91, I12, J16
Crowds for Clouds: Using an Internet Workforce to Interpret Satellite Images
Yu, Ling; Ball, Sheryl B.; Blinn, Christine E.; Moeltner, Klaus; Peery, Seth; Thomas, Valerie A.; Wynne, Randolph H. (2014)
A chronologically ordered sequence of satellite images can be used to learn how natural features of the landscape change over time. For example, we can learn how forests react to human interventions or climate change. Before these satellite images can be used for this purpose, they need to be examined for clouds and cloud shadow that may hide important features of the landscape and would lead to misinterpretation of forest conditions. Once clouds and their shadow have been identified, researchers can then look for other images that include the feature of interest, taken a bit earlier or later in time, to fill in the "missing information" for the original image. Therefore, the task of identifying clouds and their shadow is extremely important for the correct and efficient use of each image. Computer algorithms are only imperfectly suited for this task. The aim of this project is to outsource the cloud interpretation task to a global internet community of "turkers" -workers recruited via amazon.com's online job market known as "Mechanical Turk."
Economies with public projects: theory and experimental evidence
Hahn, Kyungdong (Virginia Tech, 1995-08-05)
This dissertation concerns economies with public projects. Public projects are a special case of public goods which size is not necessarily measured by units and which are either built at some fixed cost or not built at all. Our theoretical studies of public projects are based on personalized prices for access to the public project rather than personalized prices for the units consumed of public goods as in the literature on Lindahl equilibrium. Furthermore, the private provision of public projects is experimentally investigated with a double oral auction market for assets that are required in order to produce public projects. The first paper (Chapter 2), "Economies with Multiple Public Projects" (joint work with Robert P. Gilles), discusses an economy with multiple public projects each separately produced by a distinct provider operating under a different cost function. In an economy with the non-Euclidean representation of multiple public projects space we show that the two welfare theorems hold for valuation equilibria in which a public project is financed through a (non-linear) system of taxes or subsidies, called a valuation system, and that the core allocations are equivalent to the set of valuation equilibria with a nonnegative valuation system. Furthermore, if a Euclidean space is used to describe the public projects specified to the standard case of public goods, every Pareto efficient allocation is supported as an affine valuation equilibrium which is characterized with a price per unit of public good and a lump sum tax or subsidy. The second paper (Chapter 3), "Market Provision of Public Projects: Some Experimental Results" (joint work with Sheryl B. Ball), presents experimental evidence on the provision of a public project which is produced by a coalition of economic agents in the population. A double oral auction asset market is employed as the trading institution for assets that are required in order to produce the public project. The experimental environments differ by rules about who can produce the project, information about the benefits to the other agents of the project, and parameters which include the symmetry and size of individual valuations of the assets and the magnitude of social benefits from the project. We find that individually rational client outcomes which are identified by a theoretical analysis based on Chapter 2, are more likely in some environments than others, and suggest that these findings may have implications for the usefulness of this mechanism for public project provision. The third paper (Chapter 4), "Economies with Costly Trade Links," is an application of the model of economies with public projects to the case of an economy with endogenous formation of costly trade links between industries in different sectors of the economy. The trade links reduce transaction costs, but inevitably incur set-up costs. We prove that the two welfare theorems hold for trade equilibria in which each trade link is separately financed with budget neutrality as well as profit maximization. Furthermore, we introduce an industry-wise efficiency concept which requires that no industry can insure itself a better outcome for the industry itself by changing the industry's trade structure, and show that Pareto efficiency strictly implies industry-wide efficiency. The fourth paper (Chapter 5), "Efficiency and Egalitarian-Equivalence in Economies with a Public Project" (joint work with Robert P. Gilles), is an application of the model of economies with public projects to the equity concept of egalitarian-equivalence. An allocation is egalitarian-equivalent if there exists a fixed commodity bundle (the same for each agent) that is considered by each agent to be indifferent to the bundle that he/she actually gets in the allocation under consideration. A public project is also produced by a coalition of economic agents as in Chapter 3. We prove that there exist efficient egalitarian-equivalent allocations, which are not equivalent to the set of valuation equilibria and also may not be in the core.
Effects of Principles vs. Rules Based Accounting Standards and Increased Audit Reporting on Investors' Perceptions of Management's Reporting Credibility
Ozlanski, Michael Edward (Virginia Tech, 2013-04-23)
The purpose of this study is to investigate how the effects of principles vs. rules based accounting standards and a potential change in the audit reporting model will affect investors' perceptions of management's reporting credibility. The Securities and Exchange Commission is currently considering the adoption of International Financial Reporting Standards, which is considered to be a set of principles based accounting standards. Whereas, U.S. Generally Accepted Accounting Principles are considered rules based. Additionally, the Public Company Accounting Oversight Board is considering a possible change to the existing audit reporting model. The audit reporting change currently under consideration would require the use of additional emphasis of matter paragraphs within the audit report to discuss areas of higher risk in the financial statements. A sample of 196 nonprofessional investors completed an on-line 2 X 2 between subjects experiment that manipulated accounting standard type and level of auditor reporting. Participants assessed direct and indirect measures of reporting credibility, obtained the experimental manipulations, and provided revised credibility assessments. Changes in credibility served as the dependent variable. The results suggest that expanded auditor reporting resulted in lower perceptions of management\'s reporting credibility. Additionally, the effects of expanded auditor reporting appear stronger under rules based accounting standards. No main effects, however, of accounting standard type were observed. These results contribute to the existing literature on accounting standard type, the information content of audit reports, and reporting credibility.
Empirical Analyses of a Spatial Model of Voter Preferences
Matje, Thorsten (Virginia Tech, 2016-12-06)
To properly analyze the advantages and disadvantages of voting rules, and how well the outcomes that they yield reflect voters' preferences, one needs very large data sets, since paradoxes that occur very rarely may have large impacts. Since such amounts of election data are currently unavailable, it is important to be able to use random procedures to generate data that have the same statistical characteristics as real election data. It is the purpose of this work to identify a statistical characterization of voting data, to empower researchers to use random procedures to generate data that is statistically indistinguishable from real voting data.
Empirical Essays in Industrial Organization: Application in Airline and Automobile Industries
Bhattacharjee, Prasun (Virginia Tech, 2011-05-24)
This dissertation consists of three essays in empirical industrial organization with applications in U.S. airline and automobile industries. Chapter 1 motivates the aim of this dissertation with a brief summary of the main goals and findings of the subsequent chapters. The main focus of this dissertation is to higlight the changing environments in the U.S. airline and automobile industries in recent years and investigate their implications for the nature of industry competitiveness. Following the recession of 2000 and post 9/11 events, the U.S. airline industry has undergone major restructuring which has defined the way airlines compete today. Chapter 2 of this dissertation explores the impact of the presence of Low Cost Carriers (LCCs) on consumer welfare in this newly restructured market environment. Previous studies on LCC competition have not addressed the welfare issue and have only been limited to impact of LCC entry on average airfare. Departing from previous literature, this question is posed using a discrete choice model of demand for differentiated products. In chapter 3 we use a structural oligopoly model for differentiated products similar to chapter 2 to unveil the nature of conduct that exists in markets with endpoints which qualify as hubs of legacy carriers. In contrast to previous literature on airline hub market conduct, this chapter investigates the nature of conduct that exists in markets defined exclusively by network carrier hubs as a whole group incorporating product differentiation in the model framework. Finally chapter 4 uses the same methodological framework outlined in chapter 3 to explore the importance of frequent incidence of manufacturer incentives in shaping market conduct in the automobile industry. Unlike past literature on automobile market conduct, this is achieved using proprietary dealer level average transaction price data obtained from J.D. Power and Associates (JDPA) with a focus on the Big Three automakers. Specifically we use the widely successful Employee Discount Pricing (EDP) promotional program of 2005, the first of its kind, as a backdrop to identify changes in the nature of short run conduct among the Big Three that might be signalled by such promotional programs.
Essays in Educational Economics and Industry Structure
McLeod, Mark Alexander (Virginia Tech, 2003-07-14)
My dissertation contains two separate components. One part is a theoretical examination of the effect of ownership structure on format choice in the radio industry. I use a Hotelling type location model to study the effects of mergers in the radio industry. I find that common ownership of two radio stations results in format choices that are more similar than under competitive ownership, and also that the stations will advertise more if they are operated under common ownership. Welfare results are ambiguous, but there is evidence that total welfare might decrease as the result of a merger, with obvious policy implications for the Federal Trade Commission and the Antitrust Division of the Department of Justice who evaluate and regulate mergers in all industries. The second component is an empirical study designed to assess the effectiveness of a mathematical tutorial that I authored in conjunction with colleagues in the Math department here at Virginia Tech. I taught four large sections of Principles of Macroeconomics in the spring and fall of 2001. Each class met on MWF; two sections at 8 AM, one at 10:10 AM, and one at 1:25 PM. I required one of the sections (8 AM Spring) to review the module and take a proficiency quiz to demonstrate their skill level in basic math that is used in the Economics Principles course. Final average in the course is the dependant variable in a regression designed to discover which variables have explanatory power in determining performance in introductory economics. Besides exposure to the math module, I include other independent variables describing class time, semester, demographics and effort. In addition, I collected qualitative information about the students' perceptions of the module's effectiveness and administration. I find that exposure to the Math module does not have a significant effect on performance in the course. However, within the treatment group, there is a positive significant effect of time spent using the module on performance. Also, being registered for an 8 AM section has a significant negative effect. Overall, student comments indicate a dislike for the module. Students report that they prefer learning math skills through lectures by the professor and use of textbooks.
Essays on Applied Game Theory and Public Economics
Yang, Tsung-Han (Virginia Tech, 2018-05-01)
The first chapter presents a theoretical model of electoral competition where two parties can increase campaign contributions by choosing policies benefiting a significant interest group. However, such decision will shrink their hardcore vote base where voters are well informed about the policy. The parties can then allocate the funds between campaigning and personal wealth. Different from the core voters, independent voters can be attracted by advertisements funded by campaign spending. Using a multi-stage extensive form game, I investigate how electoral competition interacts with diversions and policy distortions. My result shows that a higher level of electoral competition helps mitigate policy distortions but prompts the parties to divert more funds. Perfectly informed signal senders need to communicate their true type (productivity or ability) which is often private information to potential receivers. While tests are commonly used as measures of applicants' productivity, the accuracy of them has been questioned. Beginning with the framework of a two-type labor market signaling game, the second chapter investigates how tests of limited reliability affect the nature of equilibria in signaling games with asymmetric information. Our results show that, if a test is inaccurate and costly, only pooling PBE exists given certain conditions. Different forms of test inaccuracy may allow a separating PBE to exist. We also study the case of three types and find different PBEs. The central issue of siting noxious facilities is that the host community absorbs potential costs, while all others can share the benefits without paying as much. The third chapter presents a modified Clarke mechanism to facilitate the siting decision, taking into account all residents' strategies. Suppose that the social planner is able to reasonably estimate the possible costs, depending on the host location, to each resident created by the facility. Our proposed Clarke mechanism is characterized by strategy-proofness and yields an efficient siting outcome. The issue of budget imbalance is mitigated when the compensation scheme is fully funded with the tax revenue based on the benefits. We then use a simple example to show that a weighted version of the Clarke mechanism may yield a different outcome.
Essays on Contest Theory Experiments and Revealed Time Preference Models
Zou, Yanyang (Virginia Tech, 2022-08-22)
In this series of essays, we study the influence of weight and group size in the sequential multi-battle contest with laboratory experiences (Chapter 2 and Chapter 3). We then develop an empirical method to model perceptual present and time inconsistency (Chapter 4). Chapter 2 examines how the weight and the ordered weights in battles affect the behavior in sequential multi-battle contests with an experiment. We find robustly that the weight of the current battle consistently influences contestants' efforts. Additionally, we discover the math-point-oriented behavior despite differences in history. In other words, the weight effect is expressed in two ways: influencing the effort of the current battle and transferring a contest to the next battle with a designated intensity. Chapter 3 explores the group size effect and how the contest success functions influence the group size effect in sequential multi-battle contests with an experiment. We capture the negative group size effect on the leaders' efforts, participation and dropout rates; contrarily, the positive effect on the non-leaders' efforts. Compared to the Tullock lottery, the all-pay auction intensifies the group size effect of the high effort in the initial battle. It also enlarges the observed group size effects of the effort gaps between the leaders and the non-leaders. Chapter 4 develops the quasi-hyperbolic discounting model into the general beta-delta model to parametrically detect and measure the inconsistency in revealed time preference. This method empirically classifies time preference into four categories, i.e., time consistent, present bias, future bias, and mixed inconsistent. Then we applied this method to the convex time budget data of seven experiments, including 3670 subjects. We discover empirical evidence supporting perceptual differences in the present-future threshold. Traditional present bias models may interpret the time preference imprecisely.
An Examination of the Effectiveness of Sanction Based Tax Compliance Persuasive Messages over Repeated Periods
Adams, Mollie (Virginia Tech, 2010-03-15)
Prior tax compliance literature has examined the use of persuasive messages that emphasize audit and sanctions as a way to increase compliance. This work has been done in single period experiments using either survey or field study methodologies. Results from the prior studies are mixed. The theory of reasoned action is a theory of social behavior that promotes emphasizing direct consequences of actions to motivate specific behavior. Persuasive messages based on this theory have been found to be effective in a number of different disciplines. The theory of reasoned action has been used in the field of tax compliance to explain compliance behavior and examine the behavioral beliefs related to compliant reporting, but has not been used to design persuasive messages aimed at increasing compliance. In this dissertation, I conduct a laboratory experiment that examines the effects of two types of messages - a traditional message consisting of a simple reminder of audit risk and a message designed based on the theory of reasoned action. Consistent with prior research on tax compliance, I test the messages in an initial single period but I extend prior research by also examining the effects of the messages over repeated periods. Neither the traditional message nor the message based on the theory of reasoned action have a significant effect on initial period compliance. The interaction effect of the traditional message and time on tax compliance is positive and significant and the interaction effect of the theory of reasoned action message and time on tax compliance is positive and marginally significant. These results provide evidence that the messages may be effective in increasing an individual's tax compliance over time. In the repeated period data, the theory of reasoned action message exhibits a positive and significant impact on the amount of income reported when an individual reports less than 100% of their earned income, providing evidence that messages designed based on the theory of reasoned action may be an effective tool in reducing the tax gap.
Experiential and Neurobiological Influences on Economic Preferences and Risky Decision Making
Zhang, Xiaomeng (Virginia Tech, 2020-07-16)
Economic preferences are fundamental to risky decision making and other economic decision- making. Unlike traditional economics, which routinely assumes that individuals are endowed with stable preferences and try to maximize the expected utility when facing risky decision-making problems, behavioral economics and neuroeconomics offer research strategies that help us explore the factors that influence economic preferences and risky decision-making process. This dissertation consists of three essays studying the underlying experiential influences on economic preferences and neurobiological effects on risky decision making. Chapter 2 examines whether experiences during adolescence have a long-term effect on economic preferences. Between 1966 and 1976, China's Sent-Down Movement required seventeen million urban teenagers to spend several years living and working in rural areas. The program had a number of goals for participants, including learning empathy for rural laborers and developing collectivist values. The sent-down movement can be regarded as a natural experiment, which allows us to investigate whether this government policy was successful in effecting a lasting change to economic preferences. Using a modified Global Preference Survey and employing a regression discontinuity design, we find that the experience of being Sent-Down significantly changed participants' risk preferences, other-regarding preferences, and attitudes toward government. Chapter 3 explores how the arousal system modulates attention and investment behavior. Experimental research shows that human decision making is shaped by emotions associated with an outcome's success or failure. Regret, for example, is a powerful predictor of future investment decisions in asset markets. Using a fictive learning model to capture regret, we examine changes in pupil diameter of participants performing a sequential investing task. By manipulating task uncertainty, we show that pupil dilation is positively correlated with both asset price variance and regret. In addition, pupil linked arousal is positively associated with the learning rate. We conclude that the pupil–linked arousal system helps regulate investment behavior in a dynamic market environment. Chapter 4 explores the complex process by which people make risky choices. While traditional models, like expected utility theory, model choice as the selection of the outcome with the highest probability-weighted value, research shows that in some environments these models do a poor job of describing behavior. This study explores the role of attention, pupil-linked arousal, and salience in risky choice. First, we replicate earlier findings that those choices are consistent with expected utility theory when the calculation is easy, however, as the calculation becomes harder, they make decisions by comparing unweighted payoffs and are attend to the salient option. Further, we find that pupil-linked arousal is associated with the level of cognitive effort needed to calculate expected utility. Finally, we show that arousal reflects cognitive effort associated with resisted selecting a more salient option.
Exploring Payoffs and Beliefs in Game Theory
Sarangi, Sudipta (Virginia Tech, 2000-07-31)
This dissertation explores the importance of the payoff structure and beliefs for noncooperative games. Chapter 2 considers instances where the payoffs and the objectives may not be very clear to the players or the analyst. We develop a model for analyzing such games using a vector of reference utilities which are included in the definition of the game and assumed to be shared by all players. These are used to obtain the true utilities in the game. Conditions for the existence of equilibrium are identified by allowing players to have beliefs about the others. The solution concept is applied to the Traveler's Dilemma and a duopoly. In Chapter 3 a non-cooperative model of network formation is developed. Agents form links based on the cost of the link and its assessed benefit. Link formation is one-sided, i.e., agents can initiate links with other agents without their consent, provided the agent forming the link makes the appropriate investment. The model builds on the work of Bala and Goyal, but allows for agent heterogeneity by allowing for different failure probabilities. We investigate Nash networks that exhibit connectedness and redundancy and provide an explicit characterization of star networks. Efficiency and Pareto-optimality issues are discussed through examples. We also explore the consequences of three alternative specifications which address criticisms of such communication networks. Chapter 4 examines noncooperative fuzzy games. Both in fuzzy noncooperative games and in abstract economies, players impose mutual restrictions on their available strategic choices. Here we combine these two theories: A player tries to minimize the restrictions he imposes on others, while respecting the restrictions imposed by others on him, but does not explicitly pursue any other objectives of his own. We establish existence of an equilibrium in this framework. In Chapter 5 normal form game is modeled using tools from fuzzy set theory. We extend the decision theory framework of Bellman and Zadeh (1970) to a game-theoretic setting. The formulation is preliminary
Focal stimulation of the temporoparietal junction improves rationality in prosocial decision‑making
Li, Flora; Ball, Sheryl B.; Zhang, Xiaomeng; Smith, Alexander Charles (Nature Research, 2020)
We tested the hypothesis that modulation of neurocomputational inputs to value-based decisionmaking affects the rationality of economic choices. The brain’s right temporoparietal junction (rTPJ) has been functionally associated with both social behavior and with domain-general information processing and attention. To identify the causal function of rTPJ in prosocial decisions, we administered focal high definition transcranial direct current stimulation (HD-tDCS) while participants allocated money between themselves and a charity in a modified dictator game. Anodal stimulation led to improved rationality as well as increased charitable giving and egalitarianism, resulting in more consistent and efficient choices and increased sensitivity to the price of giving. These results are consistent with the theory that anodal stimulation of the rTPJ increases the precision of value computations in social decision-making. Our results demonstrate that theories of rTPJ function should account for the multifaceted role of the rTPJ in the representation of social inputs into value-based decisions.
Gender Differences in Fear and Risk Perception During the COVID-19 Pandemic
Alsharawy, Abdelaziz Mohammed; Spoon, Ross; Smith, Alexander Charles; Ball, Sheryl B. (Frontiers, 2021-08)
The COVID-19 pandemic has led many people to suffer from emotional distress. Previous studies suggest that women process and express affective experiences, such as fear, with a greater intensity compared to men. We administered an online survey to a sample of participants in the United States that measures fear of COVID-19, perceptions about health and financial risks, and preventative measures taken. Despite the empirical fact that men are more likely to experience adverse health consequences from COVID-19, women report greater fear and more negative expectations about health-related consequences of COVID-19 than men. However, women are more optimistic than men regarding the financial consequences of the pandemic. Women also report more negative emotional experiences generally during the pandemic, particularly in situations where other people or the government take actions that make matters worse. Though women report taking more preventative measures than men in response to the pandemic, gender differences in behavior are reduced after controlling for fear. These results shed light on how differences in emotional experiences of the pandemic may inform policy interventions.

Browsing by Author "Ball, Sheryl B."

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