Posted by: Gabriele Paolacci | February 22, 2012

Are Low Stakes on AMT a Problem for Economic Games?

(Guest post by Ofra Amir, David Rand, and Kobi Gal)

A growing body of work is showing the reliability of data collected using AMT. Classical findings such as framing and priming have been replicated on AMT, and quantitative agreement has been shown in behavior in economic games between AMT and the physical laboratory. Yet concerns remain among some, particularly in the experimental economics community, regarding the low stakes typically used in AMT studies. To address this concern, we performed a set of experiments that directly examined the effect of such low stakes by comparing un-incentivized play with play involving typical AMT sized stakes (up to $1) in four canonical economic games – the Dictator Game, Ultimatum Game, Trust Game and Public Goods Game.

We recruited 756 subjects using AMT and randomly assigned each subject to play one of the four games, either with or without stakes. In the stakes conditions, subjects had the opportunity to earn up to an additional $1.00 based on their score in the game. In the no-stakes conditions, subjects were informed of the outcome of the game, but the score in the game did not affect subjects’ earnings.

Figure 1 shows the average behavior across games and conditions. As can be seen in the figure, introducing stakes altered the distribution of offers in the Dictator Game, significantly reducing the average offer (no-stakes = 43.8%, stakes = 33.2%, p = 0.022). In all other three games, we found little or no effect of stakes on subjects’ behavior. These results are consistent with prior studies in the physical laboratory: playing for real money matters a lot in the Dictator Game, but does not make much difference in other games. Furthermore, we found that the average behavior on AMT is within the range of behaviors observed previously in the physical laboratory with higher stakes.

These findings provide evidence that the low stakes typical of economic game experiments on AMT do not compromise the quality of the resulting data. Find the full paper here.

Figure 1: The effect of stakes on average behavior across games.

References

Amir, O., Rand, D. G., Gal, Y. (2012) Economic games on the Internet: the effect of $1 stakes. PLoS ONE 7(2): e31461.doi:10.1371/journal.pone.0031461.

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