ECON2060 Research Proposal

Summary of task

The goal of this assessment is to write an original and interesting proposal for a research project related to behavioural economics. You will come up with your own research question and describe a practical and feasible method for how you would go about answering it. The word limit is 1,500 words, which excludes the title page, abstract, tables and figures, references, and any appendixes. This is a hard word limit, and you will be penalised for exceeding it. Submission will be through Turnitin.

In addition to the detailed instructions below, please note two mandatory components to the assessment that were introduced in 2023, and which must be followed by all students:

1.   In the Related Literature section, students are required to reference, in a substantial way, at least one academic journal article that has been published since 2023.

2.   In the Method section, students must include at least one table or figure. This could be a flow chart of the proposed experimental design or data collection process, or a table of summary statistics on preliminary data. The table or figure must be labelled and contain a full caption that provides a self-contained explanation of the table   or figure. (“Self-contained” means that a new reader could jump straight to the table  or figure and its caption, and still understand its meaning.)

We have uploaded some examples of high-scoring research proposals from past students.   Please note that some of these assignments were marked using the legacy marking criteria, and as such did not include the above additional components.

Getting started

Your first step is to decide your topic, and specifically, your research question. For example, it could be a test of a mainstream economics concept, an extension of a behavioural economics concept, or the application of a behavioural economics theory to a novel population or setting (such as a behavioural ‘nudge’). Typically (but not always), a good question can be rewritten in the form “Does X cause Y?”, where X and Y are some characteristics or outcomes of interest. Table 1 gives a summary of such rephrasing of the questions in some of the papers discussed in this course.

There is quite some flexibility with the format of your proposal, and you should not feel constrained by the guidelines below if you think you can do it better with your particular topic. These guidelines are there to help improve the quality of your proposal, but if you can write a high-quality paper in another way, you will not be penalised for unorthodoxy.

Likewise, feel free to include anything in an appendix that is not an appropriate fit in the main document but that you do refer to in the text, such as specific experiment instructions, a variable dictionary for an existing dataset, or other background information or material. Most proposals will not need an appendix, but, seeing as it does not count for your word limit, you may wish to exploit it for material that is relevant but not critical to your research proposal.

Regardless of your preferred format, however, your structure must include the following sections:

1.   Title page

2.   Abstract

3.   Introduction

4.   Related literature (with mandatory recent journal article reference)

5.   Method (with mandatory inclusion of a table or figure)

6.   Conclusion

7.   References

You may add other sections or subheadings for readability if you wish, but be careful of your word limit.

Details of each section

1. Title page

Your title page should contain your proposal’s Title, your name and student number, date of submission, your abstract, and an accurate word count (which excludes the title page, abstract, tables and figures, references, and any appendixes).

2. Abstract

The abstract (placed on your title page) should be a four-sentence summary of your entire

research proposal, so make sure it includes what you believe are the absolute key ingredients of your paper. The structure and content are flexible, but a typical format would be:

.    First sentence: jump right into the topic or research question. (In some cases, you

might prefer a first sentence of motivation instead.) It would typically start with something like “This research proposal…” followed by what it is you are proposing to investigate/answer.

.    Second sentence: State what the contribution is of your research proposal. What has the previous literature proposed or found, and what will your proposal contribute to fill the gaps in our knowledge? E.g. “While previous literature has found that/assumes that/predicts that […], this proposal contributes to our knowledge of this issue by testing whether […]”

.    Third sentence: This should be about how you plan to answer your question.  State your method (or ‘empirical’ approach). E.g.: “I propose…” followed by the method,  e.g. “I propose to run a lab experiment in which I will test how changing X affects people’s behaviour towards Y.” If there is a treatment/explanatory variable and an outcome variable (and there should be!), or details of a specific context or sample that is being tested, they should be clearly specified.

.    Fourth sentence: Add any remaining critical details of the method, and/or include

the bare minimum of your analysis plan: what do you plan to test, how do you plan to test it (e.g. a t-test between control and treatment groups, or a linear regression on your data), and what conclusions will you draw depending on these results? E.g. “I will run a t-test to determine whether there are differences in [Y] between the treatment and control groups, and if the treatment group’s [Y] is significantly larger, this would support the hypothesis that […]” .

3. Introduction

This section should be started on a new page to your title page/abstract, and should be short, typically 1-3 paragraphs. Provide a motivation for the broad topic and why you think the reader should be interested in it, and introduce any relevant economic theories (mainstream or behavioural). You may wish to highlight where there is currently a gap in our knowledge (which your research proposal will aim to fill). But don’t dwell for too long on setting up the  context; make sure your research question clearly appears by the end of the first paragraph. If different school of academic thought predict different answers to your research question, you  may then want to spend 1-2 sentences outlining these predictions, and/or to briefly introduce   which method you are proposing to use to test these predictions.

In terms of your writing, try to avoid flowery language, embellishments, or ambiguities. Write clearly and matter-of-factly. Academic papers are often considered ‘dry’ in style, which can be true; the purpose of an academic paper is not to entertain with the writing, but to convey the material as clearly as possible; how ‘interesting’ an academic paper is will be typically judged on the worthiness of the topic and the quality of the research.

Here are some examples of introductions of behavioural economics papers that broadly follow the structure that is expected of you.

Most children think of their potential future occupations in terms of what they will be (firemen, doctors, etc.), not merely what they will do for a living. Many adults also think of their job as an integral part of their identity. At least in the United States,  “What  do  you  do?”   has  become  as   common  a   component  of   an introduction as the anachronistic “How do you do?” once was, yet identity,pride, and meaning are all left out from standard models of labour supply. This omission is understandable: identity, pride, and meaning are difficult to quantify and are thus hard to incorporate into the empirically driven field of labour economics.

In this article, we focus on minimal perceived meaning by the labour producing force and investigate how it influences labour supply in controlled laboratory experiments. Our intention is to compare situations with no meaning (or as low a level of meaning as we can create) with situations having some small additional meaning. Thus, our investigation will focus not on occupations highly endowed with meaning, like medicine or teaching, but on the least-common denominator of meaningfulness that is shared by virtually all compensated activities.

– Ariely, Kamenica and Prelec (2008)

Neoclassical models include several fundamental assumptions. While most of the main tenets appear to be reasonably met, the basic independence assumption, which is used in most theoretical and applied economic models to assess the operation of markets, has been directly refuted in several experimental settings    (Knetsch 1989; Kahneman, Knetsch, and Thaler 1990; Bateman et al. 1997). These experimental findings have been robust across unfamiliar goods, such as irradiated sandwiches, and common goods, such as chocolate bars, with most authors noting behaviour consistent with an endowment effect. Such findings have induced even the most ardent supporters of neoclassical theory to doubt the validity  of  certain  neoclassical  modelling  assumptions.  Given  the  notable

significance of the anomaly, it is important to understand whether the value disparity represents a stable preference structure or if consumers’ behaviour approaches neoclassical predictions as market experience intensifies.

In this study, I gather primary field data from two distinct markets to test whether individual  behaviour  converges  to  the  neoclassical  prediction   as  market experience intensifies.

– List (2003)

Charitable contributions in the  United States  were estimated to exceed $300 billion annually in 2007, 2008, and 2009. This is roughly $1000for each person in  the   US,  a  not  insignificant  amount.   Given  the  reliance  of  charitable organizations on these contributions, it is quite important to try to identify and implement effective methods for enhancing the revenue received. There has been some recent work on suggested donations to public radio, and some study of the notion of paying-what-you-want as a pricing device.  We  extend both of  these notions to fund-raising in a restaurant venue, exploring whether the suggested amount (if any) mattered with respect to the contributions raised.

Businesses like grocery stores and restaurants often ask customers  (typically through having a donation jar at the check-out register) to donate money to a certain charity organization. One often sees a suggested certain donation level. But there has been little by way of systematic and controlled study regarding how the suggested donation level affects behaviour in this environment. Our research question is to attempt to determine the optimal amount to suggest, or whether it is better to make no suggestion.

– Charness and Cheung (2013)

Improving energy efficiency reduces costs for firms and mitigates CO2  emissions. This is particularly important in the transportation sector, which is responsible for   approximately   25%–28%    of   greenhouse   gas   emissions    in    Western industrialized countries (cf. EEA, 2018, EPA, 2018). Fuel accounts for around 40% of variable costs for transportation companies. We conducted an analysis to determine  if  loss  aversion  helps  motivate  drivers  to  drive  in  a fuel-efficient manner. If successful, this could reduce fuel consumption by about 22%.

– Hoffman and Thommes (2020)

Nudging  has  been found  to  affect  human  behavior  across  a  wide  range  of domains. In particular, it has been used to improve the payment morale of citizens when they owe money to public institutions. While the traditional view (Allingham and Sandmo, 1972) considered citizens’ tax compliance as a matter of audits and harsh fines, it is by now well understood that tax morale is also a very important factor for compliance  (Kirchler, 2007). In fact,  nudging has been frequently applied to improve tax morale, even though with mixed results. In the realm of taxation, taxpayers are very likely to anticipate, however, that the government will ultimately enforce correct tax payments, which is why nudges might have a good chance to work. In other situations, however, public institutions may not want to enforce the collection of citizens’ payments for social or ethical reasons. Whether or not nudging also works in such a setting and whether it can have persistent effects even after abolishing the nudge again are the key questions of this paper.

– Sutter, Rosenberger and Sutter (2020)

4. Related literature

Please make sure that you clearly relate your research question to the existing academic literature. What are the possible answers to your research question that have been discussed in past studies? What papers answer a similar question to yours, and what do they find? (For example, if you are researching “Do tennis players exhibit loss aversion?”, you would want to cite studies that investigate whether other sporting players exhibit loss aversion). It is possible that closely related studies come from fields other than economics, such as psychology or even more specialised fields (for example, in the previous example, papers from sports journals might be relevant). But when in doubt, prioritise economics papers.

What you must definitely avoid is proposing a study that has already been carried out. So, make sure that your literature search is thorough. Google Scholar is the best place to start, and once you find a close paper, use the “Cited by” feature to filter by recent, related papers.

A common question is “How many papers should I cite?” This is hard to answer other than  the general comment “The most important ones, but no more”. While it is important not to   omit any critical paper, it is equally important not to spread yourself too thin such that you   cite many papers but with insufficient detail for the relevance to be clear to the reader. Here are some types of examples.

.    If your proposal is an extension of one specific paper, then you may justify citing only this paper, so that you can go into deep detail about this paper and what your extension contributes to it. For example, you may be adding an original extension to the design of Niederle and Vesterlund’s (2007) competitiveness experiment.

.    If your extension has a very similar design to one study but applies it in a different

domain – for example, you apply the Apesteguia and Palacios-Heurta (2010) paper about soccer penalty kicks to rugby union – you would want to (at least) cite both this paper and the most relevant paper about psychological pressure in your new domain    (rugby union).

.    If your research proposal tries to reconcile two or more papers that reached

contradictory conclusions, then you would want to describe these papers in detail (and you may not need to cite more). For example, Albrecht and Smerdon’s (2022) design references three contradictory theories in its review, and cites the main papers for each theory.

.    If your research proposal covers several topics – for example, you are comparing

whether confirmation bias or the sunk cost fallacy can best explain why people don’t sell their crypto investments – you may need to cite more papers (in this case, ones on both biases in general, and also on broad psychological biases in the crypto market).  Many research topics fall into this category.

At the end of this section, you should state in one sentence what the specific contribution of your research would be to this literature. What is the gap that you are filling in the academic landscape?

Finally, a reminder that this section contains a mandatory component: You must reference,  in a substantial way, at least one academic journal article that has been published since 2023.

5. Method

This should be the longest section of your proposal, roughly half of your allocated word count. Typically, the method for your research proposal will be either an experiment (lab or field) or an empirical study of existing data. Your proposed method must be: (a) able to answer your research question, (b) practical, and (c) ethical. Table 1 gives examples of the methods used in some of the papers discussed in this course.

If you choose an experiment, your proposal must include the following details:

.    The experimental design, including the type and number of subjects, the groups, and how you will administer the treatment(s)

.    The experimental procedure. This can be in broad terms, but all critical information    must be included such that another researcher who reads your proposal would be able to implement the experiment you describe

o You may wish to check the experimental papers assigned as readings in this course for examples of how to describe the experimental design and procedures.

If you choose an empirical study of existing data, your proposal must include the following details:

.    The source of the data (e.g. “OECD PISA data wave 2015”), or how you would plan to collect it (e.g. “Scrape all Champion’s League football games from 2021-22 from  the UEFA website”)

.    The key explanatory variable(s) (this would be the ‘X’ variable) and outcome variables(s) (the ‘Y’ variable) from the data

.    An explanation of how you plan to address any potential statistical biases such as

selection bias in your analysis. This may involve describing additional control variables that you propose to include in your analysis of the data. If your design will make use of a natural experiment, clearly detail the source of the randomisation and  why it means that your proposed method will accurately answer your research question.

o For example, in Apesteguia and Palacios-Huerta (2010), the method of

choosing which football side gets the first penalty kick is random, which prevents selection bias. In Gong (2015), the author made use of an existing program (the VCT) that randomly assigned HIV testing.

No matter which method you use, you should clearly describe your treatment variable (or variables; the ‘X’) and outcome variable (or variables; the ‘Y’).

Next, you should state how you plan to analyse the (experimental or natural) data, including any statistical tests that you propose to use (such as a t-test). If there are other variables that are important in your dataset (either an existing data set or one you will collect from your experiment), describe them and how you will use them.

Finally, you should clearly state your hypotheses as they relate to the variables and tests. This will include any sub-sample effects (also known as “heterogeneous effects”), e.g., does your effect differ for males and females? (and how would you test this)?

A reminder that this section also contains a mandatory component: You must include at least one table or figure.

6. Conclusion

Your conclusion should be short (1 paragraph). You may wish to describe what you will conclude about your hypotheses or the motivating theories depending on which way your results turn out, as well as any limitations of your research or risks for its implementation (and how these might be mitigated). You should also describe the implications that you think your results might have, for either existing economic theories or for policy-makers / industry / other relevant groups.

7. References

Your research proposal should be fully (and correctly) referenced, both within the text and by including a full bibliography. You are free to use any of the standard referencing styles so long as you are consistent (see UQ’s reference guide). To save time and guarantee accuracy, especially if you use a lot of references, you may wish to use a referencing software like

Zoteroor Endnote. For instance, Zotero (free!) can be installed as a web browser extension, which is very handy because once you find a paper online, you can import it into your Zotero library with one click. It also has a Word extension, meaning that you can import your library references into your Word document and also add an automated bibliography of references that updates by itself. (If you don’t use many references, it’s just as easy or easier to do things manually.)