The Economics of Self-Control
At first, it may be difficult to see the similarities between research in economics and psychology. For Marissa Lepper, a PhD student in the Dietrich School’s Department of Economics, the parallels are clear.
“Economics is much broader than many people realize,” explains Lepper. “I enjoy how it allows you to model how people make decisions in such a rigorous fashion.”
Lepper’s work is in the field of behavioral economics, where she incorporates psychological principles into economic models and questions.
“I find questions about self-control particularly interesting, as these are situations where people are potentially making decisions they know are sub-optimal in the long run, and even if they know they shouldn’t, they’ll still choose to do so,” she says.
Lepper’s research is focused on excuse-seeking behavior, which describes individuals who appear to be altruistic or patient acting selfish or myopically when an “excuse” is present. Lepper equates the behavior to a person who needs to get up early for work but likes to sleep in.
“They set their alarm each day at the last moment they can wake up before they would be late,” states Lepper. “However, one night there is a storm. As they sit in traffic, they think to themselves, ‘If only I had known there was a storm, I would’ve woken up early!’ This thought may be completely true—if they had known there was a storm, they would’ve woken up early. However, they chose not to look at the weather in order to allow themselves [the excuse] to sleep in guilt-free.”
“In daily life,” Lepper continues, “individuals face situations in which they are tempted to act in a way that benefits their current-self to the detriment of their future-self—even if they know they shouldn’t do so. In such situations, individuals may be driven to use excuses to lower the current cost of not having self-control.”
Lepper’s work extends the self-control literature by identifying excuse-seeking behavior: people who appear to care about their future-self in the absence of an excuse, but act differently, prioritizing their current-self, when an excuse is present.
“I then classify participants as 'patient' (always have self-control), 'unconditionally myopic' (always prioritize their current self), and 'conditionally myopic' (have self-control when no excuse is present, but take the excuse to give in to temptation) based on their decisions with and without the presence of excuses,” says Lepper. This classification has important policy implications, as conditionally myopic people appear identical to patient people when there is an excuse present, and identical to unconditionally myopic people when there is not an excuse present. Each group can react differently to policies, explains Lepper.
Through her experiments, Lepper was surprised to find very few people who always act in a way that benefits their current self.
“I was expecting to find a more equal distribution of the types,” says Lepper. “This is suggestive evidence that excuse-seeking behavior plays a large role in lapses in self-control. Moreover, this suggests that people tend to value exerting self-control, which is why they look for excuses to give into temptation, rather than people simply not valuing their future self.”
As an experimental economist, Lepper collects data from experiments run in the Pittsburgh Experimental Economics Laboratory (PEEL), which uses University of Pittsburgh undergraduate students as the subject pool, and through Amazon’s Mechanical Turk, where the workers come from all over the United States and from a wider demographic. Participants make paid decisions in an incentivized environment with no deception.
Offers Lepper, “Running experiments involves a lot of preparation and work prior to ever getting the data. A lot of time is spent on designing an experiment—figuring out a way, in a lab setting, you can isolate what you are trying to study without any other confounds. There is a large time commitment that then goes into coding and running all of the sessions, as well as even writing instructions in which every word matters—all with the fear in the back of your mind that the data isn’t going to come out the way you want it to.”
To overcome these concerns, Lepper takes every opportunity to discuss the design of her experiments with others.
“Discussing the idea and the design with people with a fresh set of eyes can help improve it and figure out confounds that you might have missed. All of the thought that goes into it prior does make it more likely that experiments work out in the way you hope, and it’s definitely an amazing feeling to look at the results after running and see what you expected!”
These discussions often occur with her departmental colleagues, which Lepper says she is grateful to have.
“I am very happy that I chose Pitt!” says Lepper. “There is a supportive department culture within the graduate students which helped ease the transition into a PhD program and into doing research. … it has been incredible to be at a place which has access to a lab, especially a lab like PEEL.” Lepper notes that the benefits of PEEL include the large subject pool, careful experimental design, and good incentives to keep participants involved in research.
Next year, Lepper will enter the job market to embark on her next adventure.
“Behavioral and experimental research has changed the way that I view the world around me, so I would like to continue quantifying these biases that impact the way that people make their decisions and interact with the world around them,” Lepper says. “My hope is that my research helps people understand the way choices are made and can help lead to meaningful changes in the world.”