Policy and Complex Systems
Comparing Individual decisions
In this section , we break up pollution by production decisions , adoption decisions , and size of the farms . We look at each information treatment separately .
No Information
Recall that under no information baseline , the aggregate simulated pollution level is mostly over the target level , but the deviation does not appear to be large . However , when we break up pollution into production and adoption decisions by farm size , we observe huge deviations in these decisions ( Figure 9 ). The small farms are significantly over adopting the technology ( blue lines ), and the large farms are widely under adopting , even though it is not in their best interest to do so ( as depicted by the blue lines ). Similarly , the small farms are also over producing and large farms are under producing .
Individual Level Information
When we provide participants with individual level information on what people like them have done in the past , we observe that the deviations from participants ’ behavior to the target levels are much smaller ( Figure 10 ). This clearly demonstrates that the individual level information induces participants to make better decisions , and improves policy efficiency .
Figure 9 . Adoption and production decisions by size under no information treatment . The red lines indicate target levels and the blue lines indicate experiment simulated results .
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