The document provides instructions for a decision exercise where participants can earn money by making investment decisions. Participants will be randomly assigned to a group of 5 and must complete the 30-40 minute exercise without interruptions. They can earn $1 for viewing instructions, $1.5 for completing it, and up to $8 more based on decision outcomes. The exercise involves allocating tokens between private economic activities near or far from a river, and public infrastructure to control flooding from the river. Participants' earnings will depend on their group's collective decisions.

1. Instructions for
the Decision Exercise

2. You have an opportunity to earn some money by
engaging in today’s decision exercise.
Keep these in mind:
Please follow all instructions—this may help the chance of
earning more money.
Please focus on the decision exercise.
You will play in a group together with four other REAL people.

3. It is important that you complete this exercise until the end
without interruptions.
NEVER click 'Go back' or 'Reload' button.
DO NOT close this window/browser or leave this exercise’s web
pages during the exercise.
Will take about 30 to 40 minutes to complete.

4. Your earnings:
 $1 for watching the video instruction and taking a quiz.
 $1.5 bonus for completing until the end.
 You can earn more! Up to an extra of about $8 by making
decisions.
- The more tokens you earn, the more money you will be paid at the
end of the decision exercise.

5. Your earnings:
Each token in this exercise is worth 5 cents.
Example: 100 tokens = $ 5 (+ participation fee
+ quiz earnings
+ completion bonus)

6.  You will play as part of a group of five participants who have
been randomly assigned.
 The amount of money you earn will depend on the decisions
made by you AND the other members of your group.
 You will remain anonymous.
You
Your group

7. Decisions people make in
economic activities around a river.
This exercise is about…

8. Peak river height (ft)
The basic setup of the
decision exercise:
• The river provides certain benefits such as
water supply, transportation, and accessibility
to trade opportunities.
• By being near the river, one can more easily
access these benefits and, thus, have greater
potential for economic gain.
HOWEVER
There is also UNPREDICTABLE
FLUCTUATIONS in the peak water
level of the river during wet season.
So, being near the river also means-
--although not always---a possibility
of exposure to flooding.

9. Near the river
Far from the river
River Levee
You
NO FLOOD FLOOD
Decision Making
• Invest in economic activities in an area
FAR from the river.
• Modest fixed economic return
• Unaffected by the fluctuations in the
peak river height.
• Invest in the riverside or NEAR the river.
• Much higher economic return
• Can be affected by the fluctuations in the
peak river height.
You need to decide how to allocate the
investment between the maintenance
of a public levee infrastructure AND
your own economic activities for private
earnings.
• The public levee infrastructure can contain the unpredictable
fluctuations in the peak river height to an extent during wet
season.
• The better maintained the public levee infrastructure is, the
better protected is EVERYONE’s investment to the riverside.

10. Near the river
Far from the river
River Levee
INVEST FAR
INVEST NEAR- PUBLIC INVEST NEAR- PRIVATE
10 tokens 10 tokens
10 tokens 10 tokens 10 tokens
- Infrastructure “wears down” with time  Regular maintenance needed.
- Multiple players need to invest to counter the wear down.
Return:
11 tokens
(fixed)
Return:
Tokens invested x 4
(with uncertainty)
Increases levee
height
Decision Choices
Slider between 0 to 10 All 10 tokens
Public Private
10 tokens

11. Public Levee Infrastructure
EXAMPLE:
Current Levee Stock: 55 tokens
Tokens INVESTED: 25 tokens
Updated Levee Stock: 80 tokens [=55+25]
Decrease by 20 tokens
EXAMPLE:
Round t: 70 tokens (10 ft)
Natural decline: 20 tokens
Round t+1: 50 tokens [=70-20] (6 ft)
Round t Round t+1
Infrastructure Decline
Levee Stock vs. Levee Height
(6 ft in height)
(12 ft in height)

12. Peak River Height & Flood Severity
River Levee
NO FLOOD FLOOD
Earnings from
INVEST NEAR-PRIVATE
will remain intact.
Depending on the flood
severity, earnings from
INVEST NEAR-PRIVATE will be
reduced.
LEVEE
HEIGHT
RIVER
HEIGHT
Flood Severity = River Height – Levee Height
50 % reduction to
earnings from
INVEST NEAR-PRIVATE
EXAMPLE:
Peak River Height: 18 ft
Levee Height: 12 ft
Flood Severity: 18 – 12 = 6 ft
Fluctuations in Peak River Height

13. Endowed with 10 tokens
(each round)
INVEST FAR
INVEST NEAR-
PRIVATE
Decision Earnings
11 tokens
If NO FLOODING (peak river height ≤ levee height)
Invested Tokens x 4
(e.g., 5 tokens invested  5x4=20 tokens)
Player’s Earning
Player
INVEST NEAR-
PUBLIC
If FLOODING (peak river height > levee height)
Invested Tokens x 4 x (1 - Flood Loss %)
(e.g., 5 tokens invested AND flood severity of 6 ft
 5x4x(1-0.5)=10 tokens)
Zero direct earnings (but protection for all)
(Invest 10 tokens)
(Invest 0-10 tokens)
(Invest 0-10 tokens)

14. Note: Time Constraint
 Make your decision within 1 min
 After this, you will see a warning message for 1 min
 If you need more time, please click Continue and get extra 1 min

16. Next, you will…
 take a short quiz and
After that, you and 4 other players will play
the actual rounds of this decision exercise
 play 2 practice rounds of the
decision exercise