The effect of peer observation on consumption choices: experimental evidence

Arbeitspapier

This paper investigates the impact of peer observation on the consumption decisions of rural households in Thailand using a lab-in-the-field experiment. We find that those groups that observe each other show lower within group standard deviation in their decisions. Thus, we find evidence for conformity. Further, we find that individual's consumption choice is influenced by the group choice controlling for large number of individual, household, and village characteristics. We find that unfamiliarity of the product is counteracted by peer effects. Finally, we find evidence of treatment heterogeneity with regards to cognitive ability and village size.

Object Details

• ISBN: 978-3-95729-226-1
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Bundesbank Discussion Paper ; No. 01/2016

Classification and Topics

• Classification: Wirtschaft ; Consumer Economics: Empirical Analysis ; Single Equation Models; Single Variables: Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions ; Design of Experiments: Laboratory, Group Behavior
• Subject: Consumption ; Peer Effects ; Conformity

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Sakha, Sahra ; Grohmann, Antonia
• Event: Veröffentlichung
• (who): Deutsche Bundesbank
• (where): Frankfurt a. M.
• (when): 2016

Further information

• Handle: http://hdl.handle.net/10419/128643
• Last update: 10.03.2025, 11:44 AM CET