CREED Seminars Amsterdam

Jason Dana (Yale University, United States),
Thursday, 19 October 2017

Field evidence of gender discrimination has been demonstrated in a variety of contexts, but linking discrimination to tastes has proven notoriously difficult. We address this gap using evidence from the One Bid game on The Price Is Right television show. One Bid contestants bid sequentially in an attempt to win a prize by coming closest to its price without exceeding it. The last bidder in the game has a dominant “cutoff” strategy of bidding $1 more than another contestant, leaving the target contestant with almost no chance to win. Despite high stakes for playing impartially and arbitrary assignment of players to contestant groups and bidding orders, our analysis of over 5,000 One Bid rounds shows that for last bidders of both genders, same-gender opponents are less likely to be cut off. For rounds in which the last bid is not the lowest, cutoffs remain significantly more likely when the next lowest bidder is of the opposite-gender. Because the last bidder’s revealed belief is that the next lowest bid is the best to cut off, our results demonstrate gender favoritism while holding constant beliefs about the effectiveness of cutting off a given opponent, suggesting that the pattern of cutoffs we observe is due to tastes rather than gender stereotypes about ability. We estimate that final bidders transfer an average of $147 in expected prize winnings to same-gender opponents by cutting them off less often, and as much as $522 in the second to last round of the show.