Understanding Stress and Redistributive Choice

Ingvild Lindgren Skarpeid’
Ingvild Lindgren Skarpeid investigates two crucial issues in economic decision-making: the impact of stress on behavior and the role of redistributive preferences in shaping income inequality. On Monday 11 November, she will defend her thesis for the PhD degree at NHH.
PhD Defense

28 October 2024 10:15

Understanding Stress and Redistributive Choice

On Monday 11 November 2024 Ingvild Skarpeid will hold a trial lecture on a prescribed topic and defend her thesis for the PhD degree at NHH.

Ingvild Lindgren Skarpeid’ s PhD thesis investigates two crucial issues in economic decision-making: the impact of stress on behavior and the role of redistributive preferences in shaping income inequality. By combining lab-based and online experiments, her work spans diverse populations, including low-income individuals in Nairobi, Kenya, and a representative sample of Americans.

Many of the world's poor are entrepreneurs who often must make decisions about whether to compete with others. At the same time, people often make decisions under stress, and this is especially true for the poor, who often experience high exposure to stress. The first paper shows that stress reduces competitiveness in men, in a lab experiment on urban poor population in Nairobi. The findings from the controlled lab environment suggest that stress does not improve decision-making, highlighting potential barriers to entrepreneurship in low-income settings.

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The second paper explores gender differences in performing under pressure: It has been suggested that a fundamental reason behind men outperforming women on examinations is choking under pressure. To date, there is no direct evidence that choking causes underperformance in test-taking, nor that women are more impacted than men. We put this to the test in a randomized experiment, in a large-scale experiment and find that the increase in pressure does not significantly impact average performance, neither for the pooled sample nor differentially for women. However, an exploratory analysis reveals that the large incentives reduce performance among a subset of female test takers who, based on findings in previous literature, are "at risk" of choking. Our insights highlight the importance of investigating how pressure may differentially impact gender and minorities in high-stakes environments.

The final paper examines how Americans differentiate between inequality arising from talent versus luck, despite talent being at least partly a lucky draw in the "genetic lottery". The study shows that people are more tolerant of inequality linked to talent, as it is viewed as partially under individual control. This distinction sheds light on public attitudes towards inequality and the fairness of economic outcomes, with implications for the policy debates on meritocracy.

Prescribed topic for the trial lecture:

Decision Quality in the Hot versus Cold State: Causal Evidence from Empirical Studies and Reflections on Research Validity

Trial lecture:

Karl Borch

Title of the thesis:

Understanding Stress and Redistributive Choice: Evidence from Three Economic Experiments

Defense:

Karl Borch

Members of the evaluation committee:

Assistant Professor Heidi Christina Thysen (leader of the commitee), Department of Economics, NHH

Associate Professor Åshild Auglænd Johnsen, OsloMet

Assistant Professor Ian Levely, King’s College London

Supervisor:

Professor Erik Ø. Sørensen, Department of Economics and FAIR, NHH

The trial lecture and thesis defense will be open to the public.                   

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