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Behavioral Scientists Alarmed at Cutbacks in Share of Federal Funding

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The Washington Post

Consider the Ultimatum Game: You are given $10 to divide any way you like with a partner, who must accept your offer or get nothing. A standard economic model--like those used by economists in government and business--assumes that you will offer a penny and your partner will accept.

Behavioral science says the model is wrong.

Consider two small businesses fallen on hard times: The model assumes that Company A’s employees will be as willing (or unwilling) to take a 10% wage cut as Company B’s employees will be to lose annual bonuses that make up 10% of their wages.

Behavioral science says the model is wrong.

Behavioral science sheds light on how people react in a given situation and therefore, its practitioners contend, on almost all the social issues studied, quantified and regulated by the federal government: crime, punishment, poverty, health care, the environment, banking--the list goes on.

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Losing Federal Funds

But after a 3-year survey of the social and behavioral sciences, a committee of the National Research Council has concluded that those disciplines are losing federal science funds, receiving 25% less money in the last 15 years while other sciences received 36% more, in constant dollars.

“Psychological, social and cultural studies pertain to virtually everything that people treat as a problem in our civilization--violence, theft, pollution and illness--and nearly everything hailed as a triumph--justice, plenitude, artistry and freedom.

“Even in events that are nominally quite technical in character, such as the eradication of polio or the explosion of the space shuttle, human factors . . . play a large role,” the committee wrote.

“The United States has been in the forefront of virtually every behavioral and social-sciences field since the 1960s. But if the funding trends of recent years persist . . . these leading roles are likely to be taken by other countries in the 1990s.”

Its 200-page report recommends spending an additional $240 million on five major areas of research:

- Mind, brain and behavior, including ways to improve memory, better techniques for deciphering and mimicking human speech, better techniques for teaching.

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- Motivation and social context, including the study of appetites and drives, the causes and control of crime, the behavior of addicts.

- Choice and allocation, including work on how important social choices are made such as in voting, buying and taking risks.

- Institutions and cultures, including work on fertility, migration, conflict and cooperation between the superpowers and the place of religion in culture.

- Collecting and analyzing information, including work that will improve the data and the methods with which behavioral scientists work, improving statistical methods and dissemination of data among researchers.

At a news conference on the report recently, committee members argued for the practical application of such research and examined the types of research they said should not be slighted.

‘Rational Fools’

In the Ultimatum Game, for instance, the model assumes that people are both “rational” and “selfish”--”rational fools,” as one economist put it--and will therefore keep as much of the $10 as possible. But when an actual game is played, according to Cornell University economist Richard Thaler, most players offer to split the money evenly--and although some offer less, the average is $4 or $5.

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Perhaps more interesting, Thaler said, is that most partners will not take just any offer. “When the offers get down to $2 or $3, people simply say: ‘I’d rather take nothing than take $2 when you have $8.’ They will pass up again if they think the split is unfair.”

“Fortunately,” he said, “it appears that most people are more cooperative than the standard economic model suggests. People are willing to do things like give money to charity and support public television, which the standard economic model says will not happen.”

With two colleagues from other universities, Thaler has studied the implication of humans’ sense of fairness for workers’ attitudes toward their wages, in surveys asking respondents to put themselves in employees’ shoes.

In the scenario involving financially troubled Company A, 61% of employees said the 10% wage cut was unfair and 31% called it acceptable. In Company B’s scenario, 80% of the employees thought losing the annual 10% bonus was fair.

The standard economic model cannot distinguish between the two situations, Thaler said, because in each, employees lose 10% of their pay and the standard model says that people think only of the bottom line. But Thaler said research shows that employers gain flexibility if they use bonuses as part of employees’ wages--and that employees tend to save more when they receive money in lump sums.

Take It Away

If employers use a bonus as a standard part of pay, a lump sum given on a regular annual basis, they could more easily take all or part of it away in hard times, while in good times encouraging savings, always a major goal of national economic policy.

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Behavioral research also can inform the way a doctor describes and prescribes possible treatments. Doctors can inadvertently influence lung-cancer patients to choose radiation or surgery, for example, simply by speaking of chances of survival rather than chances of dying, not only unwittingly leading patients to one option but also affecting how Medicare money is spent.

Patients apparently view surgery as more stressful and difficult than radiation therapy. But when they are told that surgery will give them a two-thirds chance of surviving the next year, they choose surgery 83% of the time and radiation only 17% of the time.

Given exactly the same prediction, but stated more pessimistically--that surgery would give them a one-third chance of dying in the next year--the percentage of patients choosing radiation rose to 43%.

The preference of radiologists themselves rose from 16% to 50% for radiation when the wording was changed.

A few other recent findings in social science are:

- Nearly half of all urban-dwelling American males can expect to be arrested for some non-traffic offense during their lives, but only a very small group of “career criminals” and “violent predators” are responsible for a grossly disproportionate share of the crimes committed.

The work has also shown that most criminals halt their careers by age 25 to 30. Thus, if a 25-year-old burglar whose criminal career is nearly over anyway is imprisoned for 10 years, many years of that imprisonment may be “wasted” on expensive and unnecessary incarceration.

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- The conventional picture of humans’ ancestors as creatures living in strictly hierarchical groups, with males being competitive and aggressive and females being passive and nurturing, is probably wrong.

Behavior among primates, it turns out, varies enormously within and between species. Females often compete as intensely as males, and they actively choose their mates. In some species, such as baboons, males develop long-term relationships and help with infant care.

- There are two classes of poor, those temporarily in poverty and those in it chronically.

A study called the Panel Study on Income Dynamics has followed 5,000 families since 1968 and produced a wealth of information used by researchers and decision-makers from the White House to the welfare office.

It showed, for instance, that in any 10-year period, about 7% of the families fell below the federal “poverty line.” But in at least one of the 10 years, a quarter of all the families had fallen below the line.

In addition to such research, the council report calls for additional funding for the current coin of the realm: computers.

“There is the persisting view that behavioral and social-sciences research can operate as a virtually equipment-free enterprise, a view that is completely out of date for research in many areas,” the committee wrote, adding that an inability to buy the new generations of computers is a “major bottleneck” for scholars.

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