Incentivized Lab Game Behavioral Forecasting
Financial institutions struggle to accurately forecast consumer demand for novel financial commitment products prior to deployment. Standard stated-preference survey questions frequently suffer from hypothetical bias, overestimating actual real-world adoption.
Picture this
Before launching a new banking product, researchers test it using a game where participants make decisions with real cash prizes. Because actual money is on the line during the game, the choices participants make accurately reflect how they will behave when offered the real-world financial product later on.
What the evidence says
Every 100 € allocated to direct payment in the game increased real-world EduPay take-up by 2.07 percentage points (p < 0.01; an 8.7 percentage point increase per 1 SD, representing a 32% increase relative to the 27.1% mean take-up rate).
- Who
- N = 483 Filipino migrant workers in Rome evaluated for EduPay authorization form signing (out of N = 501 baseline participants; 73% female, 68% domestic workers).
- How
- Probit regression modeling real-world product take-up (signing an authorization letter for EduPay) as a function of prior allocation choices made in a 1,000 € incentivized dictator game.
What to do
Use real-stakes, incentivized experimental allocation games to test user demand and forecast adoption rates for new financial products before full commercial rollout.
From the source
"We find that choices in these games are significant predictors of take-up of the EduPay product: individuals who allocate more of the 1000 € to this product in the game are more likely to want to use it in practice."
Directing remittances to education with soft and hard commitments: Evidence from a lab-in-the-field experiment and new product take-up among Filipino migrants in Rome