Neutral framing is a standard tool of experimental economics. However, overly neutral instructions, which lack any contextual clues, can lead to strange behavior. In a contextless second price auction for a meaningless good, a majority of subjects enter positive bids - a case of cognitive experimenter demand effect. Subjects bid positive amounts because this is what they think they are tasked with in the experiment. Adding a second auction that has a context drastically reduces the positive bids in the meaningless first auction by reducing the cognitive experimenter demand effect.
# 14-063/I (2014-05-25)
- Peter Dürsch, University of Heidelberg, Germany; Julia Muller, Erasmus University Rotterdam, the Netherlands.
- Context, Neutral Framing, Experimenter Demand Effect, Experiment, Second-Price Auction
- JEL codes:
- C90, D44