Policy Evaluation in Behavioral Models

Christian Michel () and Andre Stenzel

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: This paper studies the data requirements to conduct an unambiguous policy evaluation when consumers may exhibit nonstandard preferences. We theoretically analyze how the equilibrium combinations before and after a policy introduction allow to clearly assess different economic indicators. Specifically, we study the data requirements for an unambiguous evaluation of two distinct consumer "cooling off" policies in a model in which consumers may exhibit a projection bias when making consumption decisions. We find that market-level data can help to make simple policy evaluations using baseline statistics and sometimes even discriminate between different classes of consumer preferences. We further discuss the generalizability to other models and the use for ex-ante policy design.

Keywords: Ex-post policy evaluation; Identification of nonstandard preferences; Projection bias; Cooling off; Behavioral economics (search for similar items in EconPapers)
JEL-codes: D04 D18 D90 (search for similar items in EconPapers)
Pages: 46
Date: 2018-12
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Related works:
Journal Article: Model-based evaluation of cooling-off policies (2021)
Working Paper: Model-Based Evaluation of Cooling-off Policies (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2018_061v1

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