Ing. Ondřej Dohnal
Advanced experimental approach to bank runs
Current research proves that despite deposit insurance bank runs are severe problem which can occur anywhere in the world. Experimental literature suggests that bank runs can be random events unrelated to changes in real economy and should rather be attributed to non-fundamental economic factors as described in seminal Diamond and Dybvig model (1983) recently awarded with Nobel prize.
My research follows afore-mentioned experimental research of bank runs and enhance it with advanced analysis of loss aversion and sunspots. Sunspots, often present in environment with great strategic uncertainty, are events or factors, which influence the outcome of the game even if they are completely unrelated to economic fundaments. Further, our previous research inspired by Arifovic and Jiang (2019) suggested that loss aversion can be an instrument to mitigate influence of sunspots and even prevent bank runs itself. Therefore, we will conduct laboratory experiment through which we will assesses the impact of loss aversion incorporated directly into the payoff function on the occurrence of bank runs. If such an impact will be proven it can have significant implications for policy makers and it could substantially lower the power of sunspots in modern world.
Ing. Petr Frejlich
An Experimental Testing of the Barro-Ricardo Equivalence Theorem
Ricardian equivalence, in which case consumers postpone consumption under lower taxation, is a basic assumption of many studies, dealing with intertemporal decision making and has important implications for government tax policy. In my research I focus on verification of validity of Ricardian equivalence using CARA (constant absolute risk aversion) utility function. Investigation is primarily focused on experimental investigation of Ricardian equivalence phenomena.
In order to increase validity of acquired results, I will conduct also analysis based on relevant field data, which might describe behaviour of consumers on Czech banking market facing changes in taxes. Verification of Ricardian equivalence based on different methods will significantly enhance robustness of results with derivation of adequate economic implications.
Mgr. Ing. Radim Šimák
Determining the amount of compensation for damages and non-pecuniary damage in the decision-making practice of courts entails significant economic costs, considering that judges make decisions based on their subjective assessment, either “fair judgment” or “principles of decency” (89/2012 Coll. of the Civil Code (hereinafter referred to as the “Civil Code”). The complexity and inconsistency of the approach leads to the unpredictability of the interpretation of the provisions of the law, conflicting court decisions and frequent appeals by the parties to the dispute. This entails substantial transaction costs. How could judicial interpretation be “outsourced” and handed over to a simpler, more predictable, and most likely also cheaper process in order to reduce economic costs? My intention is to verify, through a field experiment, whether this “research method”, i.e. quantitative analysis, could be an economically more suitable alternative to current decision-making practice or a suitable basis for court decision-making. The goal of my research is to provide an alternative method to the contemporary interpretation of courts in cases of vague legal terms that should reflect societal consensus. My research aims to achieve this goal with help of economics, as a set of tools that facilitates the analysis of the social impacts of judicial interpretation of legal norms. Research conclusions could also be used in practice and thus contribute to the reduction of economic costs for the parties to the dispute and the judicial system. The research will be based on specific court decisions on the determination of the amount of damage and non-property damage, when the decisions of the courts are confronted with the results of an economic experiment.
Ing. Berenika Tužilová
The Czech Republic and Slovakia are dealing with an unknown number of abandoned animals. The law clearly assigns the care of abandoned, stray and abused animals to the hands of the state and municipalities. Dog shelters replace this role, but their costs are not compensated from the state and they must find their own source of funding. Their communication with public is often emotional and may evoke strong good or bad feelings in potential donors. We plan to conduct a lab experiment, which will help to identify whether positive or negative emotions are correlated with an increase (or a decrease) of willingness to help. Based on the data obtained, we will be able to analyze the effect of the messages on subjectively reported emotions and with a face-reader even compare that to an objective measurement. Obtained insights may help dog shelters to nudge helping behavior by proper framing of their posts and messages. More generally, this project will contribute to our understanding of charitable behaviors where the recipients of donations are non-profit organizations, dealing with animals instead of people and with the factors influencing the adoption of animals, instead of standard one-time monetary gifts.