Nathan Shih ’25, Charlie Wan ’26

Benjamin Ho, Professor of Economics

This summer, I had the pleasure of working with Professor Benjamin Ho and fellow scholar Charlie Wan ’25 on three behavioral economics projects: Big Lies, Trading Favors, and Altruism and Attachment. Our research involved analyzing data to explore the reception to and detection of lies, the factors that influence the reciprocity of favors, and the relationship between altruism and material attachment. These projects provided us with valuable insights into the complex interplay between human behavior and economic principles. The sections below outline a brief summary of each project.

Big Lies (Charlie Wan ’26)

This study aimed to look at the human ability to detect lies and how we perceive them. I began by reading “Is Journalistic Truth Dead? Measuring How Informed Voters Are About Political News” by Charles Angelucci and Andrea Prat, which provided essential data on voters’ ability to distinguish between true and fake political news. Using the data they collected, I developed various GPT prompts and APIs to categorize their fake news stories into big lies, near-maximum lies, and small lies, using sample data from Politifact.com for training. After refining the prompts for accuracy, I analyzed the categorized data, revealing a balanced distribution across lie types. Logistic regression analyses then showed that big lies and near-maximum lies were less likely to be perceived as true compared to small lies. In addition, reflection scores suggested participants were more skeptical of big lies and reflected more positively on near-maximum lies.

Trading Favors (Charlie Wan ’26)

In this study, I investigated how the passage of time influences the likelihood of reciprocating a favor, and whether introducing additional “high cost” or “high benefit” incentives further mediates the effect of time. Basic regression analyses on survey-collected data revealed that while the passage of time significantly decreased the probability of returning a favor, “high cost” and “high benefit” incentives can counteract this effect. Including additional controls like altruism, risk, and trust – as well as performing stratified analyses based on factors such as context, gender, and student status – further validated the initial results. I then also explored whether the amount of time taken to request a follow-up favor influenced the completion of such follow-up requests. As expected, the results indicated that the amount of time taken to request a follow-up favor significantly affected whether an individual would actually complete it.

Altruism and Attachment (Nathan Shih ’25)

This final study explored the relationship between altruism and the endowment effect. Specifically, we examined whether altruistic behavior could mitigate the cognitive bias of overvaluing owned objects, and looked at whether other factors, such as high altruistic benchmarks and outward-focused framing, could further moderate this effect. Extensive data cleaning and analysis on survey-collected data confirmed the existence of the endowment effect and revealed that altruism, as well as a reminder of social norms and an outward change in perspective, does indeed play a small but significant role in reducing material attachment. This reduction in the endowment effect appears to be specifically due to a decrease in the amount individuals are willing to accept to part with their belongings, rather than an increase in the amount people are willing to pay for similar items. Furthermore, this finding seems to be more prominent with age, and abstract thinkers are particularly likely to experience this reduction in ownership bias.