Luca Henkel

I am a Ph.D. student in economics at the University of Bonn. My research fields are behavioral economics and behavioral finance, where I focus on individual decision-making. My advisors are Armin Falk and Florian Zimmermann.

I will be on the 2022/23 job market. Here is my CV .

Twitter: @Henkel_Lu
Google Scholar: here

Luca Henkel

Job Market Paper

Proud to Not Own Stocks: How Identity Shapes Financial Decisions | with Christian Zimpelmann

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This paper introduces a key factor influencing households' decision to invest in the stock market: how people view stockholders. Using survey data from the US and the Netherlands, we document that the overwhelming majority of respondents view stockholders negatively - they are perceived as greedy, gambler-like, and selfish individuals. We then provide experimental evidence that these perceptions of identity-relevant characteristics causally influence decision-making: if people view stockholders more negatively, they are less likely to choose stock-related investments. Furthermore, by linking survey and administrative data, we show that negative perceptions strongly predict households' stock market participation, more so than leading alternative determinants. Beyond investment decisions, perceptions predict individuals' polarized behavior towards stockholders, support for taxation and regulation of financial markets, and misreporting in surveys. Our findings provide a novel explanation for the puzzlingly low stock market participation rates around the world, new perspectives on the malleability of financial decision-making, and evidence for the importance of identity in economic decisions.

Working Papers

Eliciting Moral Preferences: Theory and Experiment | with Roland Bénabou, Armin Falk and Jean Tirole

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We study the extent to which a person’s moral preferences can be inferred from their choices, and how behaviors that appear deontologically motivated should be interpreted. Comparing direct elicitation (DE) and multiple-price list (MPL) mechanisms, we characterize how image motives inflate the extent of prosocial behavior. The resulting signalling bias is shown to depend on the interaction between elicitation method and visibility level: it is greater under DE for low reputation concerns, and greater under MPL for high ones. We test the model’s predictions in an experiment with life-saving donations and find the key crossing effect predicted by the theory.

Experimental Evidence on the Relationship between Perceived Ambiguity and Likelihood Insensitivity

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Observed individual behavior in the presence of ambiguity is characterized by insufficient responsiveness to changes in subjective likelihoods. Such likelihood insensitivity under ambiguity is integral to theoretical models and predictive of behavior in many important domains such as financial decision-making. However, there is little empirical evidence on its causes and determining factors. This paper investigates the role of beliefs in the form of ambiguity perception - the extent to which a decision-maker has difficulties assigning a single probability to each possible event - as a potential determinant. Using an experiment, I exogenously vary the degree of ambiguity while eliciting measures of likelihood insensitivity and ambiguity perception. The results provide strong support for an ambiguity perception based explanation of likelihood insensitivity. Not only are the two measures highly correlated on the individual level, but changes in ambiguity perception due to the exogenous variation also directly induce changes in likelihood insensitivity. My evidence thus substantiates the perception based interpretation of likelihood insensitivity brought forward by multiple prior models in contrast to preference based explanations of other commonly used models.

Ends versus Means: Kantians, Utilitarians and Actual Moral Decisions | with Roland Bénabou and Armin Falk

Coming soon

Work on COVID-19

Payments and freedoms: Effects of monetary and legal incentives on COVID-19 vaccination intentions in Germany | with Philipp Sprengholz and Cornelia Betsch | PLOS ONE, 2022, 17(5): 1-11

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Monetary and legal incentives have been proposed to promote COVID-19 vaccination uptake. To evaluate the suitability of incentives, an experiment with German participants examined the effects of payments (varied within subjects: 0 to 10,000 EUR) and freedoms (varied between subjects: vaccination leading vs. not leading to the same benefits as a negative test result) on the vaccination intentions of previously unvaccinated individuals (n = 782). While no effect could be found for freedoms, the share of participants willing to be vaccinated increased with the payment amount. However, a significant change required large rewards of 3,250 EUR or more. While monetary incentives could increase vaccination uptake by a few percentage points, the high costs of implementation challenge the efficiency of the measure and call for alternatives. As experimental data suggest that considering vaccination as safe, necessary, and prosocial increases an individual’s likelihood of wanting to get vaccinated without payment, educational campaigns should emphasize these features when promoting vaccination against COVID-19.

The association between vaccination status identification and societal polarization | with Philipp Sprengholz, Lars Korn, Cornelia Betsch and Robert Böhm | Nature Human Behaviour, Accepted

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Public discord between those vaccinated and those unvaccinated for COVID-19 has intensified globally. Theories of intergroup relations propose that identifying with one’s social group plays a key role in the perceptions and behaviors that fuel intergroup conflict. We test whether identification with one’s vaccination status is associated with current societal polarization. The study draws on panel data from samples of vaccinated (n = 3,267) and unvaccinated (n = 2,038) respondents in Germany and Austria that were collected in December 2021, February, March, and July 2022. The findings confirm that vaccination status identification (VSI) explains substantial variance in a range of polarizing attitudes and behaviors. VSI was also related to higher psychological reactance toward mandatory vaccination policies among the unvaccinated. Higher levels of VSI reduced the gap between intended and actual counter-behaviors over time by the unvaccinated. VSI appears to be an important measure for predicting behavioral responses to vaccination policies.

Different interventions for COVID-19 primary and booster vaccination? Effects of psychological factors and health policies on vaccine uptake | with Philipp Sprengholz, Robert Böhm and Cornelia Betsch | Medical Decision Making, Revise and Resubmit

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Background: Mitigation of the COVID-19 pandemic requires continued uptake of SARS-CoV-2 vaccines. To increase vaccination intention and uptake, key determinants of primary and booster vaccination need to be understood and potential effects of vaccination policies must be examined. Design: Using experimental data collected in Germany in February 2022 (N = 2,701), this study investigated (a) predictors of primary and booster vaccination, and (b) potential effects of policies combining vaccination mandates and monetary incentives. Results: Compared to unvaccinated participants, those with primary vaccination were less complacent, more often understood the collective protection afforded by vaccination, and less often endorsed conspiracy-based misinformation. Compared to participants with primary vaccination, boosted individuals were even less complacent, exhibited fewer conspiracy-based beliefs, perceived fewer constraints by prioritizing vaccination over other things, and more often favored compliance with official vaccination recommendations. Support for and reactance about vaccination mandates depended on vaccination status rather than policy characteristics, regardless of mandate type or incentives (up to 500 euro). While unvaccinated individuals rejected policy provisions and declined vaccination, boosted individuals indicated mid-level support for mandates and showed high vaccination intention. Among vaccinated individuals, higher incentives of up to 2,000 EUR had a considerable positive effect on the willingness to get boosted, especially in the absence of a mandate. Conclusions: While mandates may be needed to increase primary vaccination, our results indicate that financial incentives could be an alternative to promote booster uptake. However, combining both measures for the same target group seems inadvisable in most cases.