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Personal experience matters. In a field setting with longitudinal data, we disentangle the effects of learning new information from the effects of personal experience. We demonstrate that experience with a fine, controlling for the effect of learning new information, significantly boosts future compliance. We also show that experience with a large fine boosts compliance more than experience with a small fine, but that the influence of experience with both large and small fines decays sharply over time.
behavioral economics, decision making, backward-looking behavior, decisions following descriptions versus experience, learning
Haselhuhn, M. P., Pope, D. G., Schweitzer, M. E., & Fishman, P. (2012). The Impact of Personal Experience on Behavior: Evidence From Video-Rental Fines. Management Science, 58 (1), 52-61. http://dx.doi.org/10.1287/mnsc.1110.1367
Date Posted: 27 November 2017