Sonal Barve
Welcome!
I'm a PhD Economics candidate at the University of California, Santa Barbara. My research uses experimental and applied methods to explore how people make decisions under cognitive limitations, uncertainty, and imperfect knowledge, and how these shape institutional effectiveness and welfare. In my job market paper, I study whether people's mistakes under nonlinear incentives are associated with their failure to understand/comprehend the decision-making principle of marginal reasoning, or their failure to reliably implement/execute it in practice, even when they do understand it.
- I run an experiment where participants make choices under simple and more complex piecewise-linear tax schedules. The schedules differ both in the number of brackets and in the number of marginal tax rates a person must consider when deciding what is best. I measure how well people understand marginal reasoning using a short conceptual test and their written explanations, and I measure how well they can use the rule through the errors they make in their choices.
- Participants' understanding of marginal reasoning varies a lot. The average test score is about 55 percent, and roughly only 1 in 5 participants earns a perfect score. Participants who face more brackets tend to show weaker comprehension, while asking people to deal with more marginal rates does not change how well they understand the rule.
- The two kinds of complexity affect behavior in different ways. Comprehension is more sensitive to the number of brackets, while implementation is more sensitive to how many marginal rates one has to keep track of.
- These findings suggest that information-provision interventions alone may be insufficient, as even people who understand the optimal rule often struggle to apply it consistently in cognitively demanding environments.
I am on the 2025–2026 job market and available for interviews.
Research
Job Market Paper (Link to draft)
Failures in Marginal Reasoning under Nonlinear Incentives
Despite the central role of marginal reasoning in economic theory, individuals frequently make mistakes under nonlinear incentives. I develop an elicitation framework that separately measures subjects' comprehension of the optimal marginal decision rule and their implementation of this rule in choices over piecewise-linear tax schedules. Substantial heterogeneity in comprehension emerges: 22% of subjects exhibit perfect comprehension, whereas 43% display limited comprehension. Experimental variation in schedule complexity identifies distinct cognitive channels. Increasing the number of tax brackets reduces measured comprehension by 6.3 percentage points, while increasing the number of relevant marginal tax-rate slopes raises error rates without affecting comprehension, consistent with greater implementation difficulty. Conditional on comprehension, higher slope count increases errors by 4.9 percentage points among Low-comprehension subjects and by 19 percentage points among High-comprehension subjects. Although error rates remain high even among subjects with perfect comprehension, those with imperfect comprehension exhibit substantially higher errors across all environments. The results highlight that both comprehension and implementation challenges contribute to suboptimal behavior under such complex incentives.
This paper analyzes whether the process of expanding awareness affects subsequent beliefs and behavior once awareness is complete. Specifically, the paper examines whether the experience of discovering new outcomes changes how individuals form and act on beliefs about uncertainty over those outcomes when making risky investments. I design a two-part experiment where, in an initial sampling task, participants either discover new possible outcomes gradually (Unawareness condition) or know all possibilities from the outset (Full Awareness condition). In a subsequent investment task, I find that participants who previously experienced a growth in their awareness of outcomes display lower risk aversion than those who did not, even when objective probabilities are clearly revealed. I control for sampling experience and elicited beliefs to isolate the impact of growing awareness from belief heterogeneity. The findings suggest that growing awareness alters confidence and familiarity rather than the underlying probabilistic expectations.
Globalization, commercialization, modernization, erratic climatic conditions, individual expectations, contagion, and government policies are some of the reasons attributed to farmers' suicides. This study hypothesizes that farmer suicides in India are primarily linked to loss in agricultural productivity which in turn is affected by adverse weather and low penetration of irrigation networks. Using panel data of 16 major states in India, from 1996 to 2015 and Control Function (CF) approach, the study shows that keeping all other factors fixed, a one degree rise in temperature results in 4.8% higher farmer suicides through a 3.6% decline in agricultural productivity. Further, the study highlights the significant role played by the contagion factors influencing farmer suicides. The study argues for policy responses that address covariate shocks arising from weather vagaries, price volatility, and liquidity constraint as well as idiosyncratic shocks arising from farmer-specific characteristics.
Teaching Experience
I've served as a teaching assistant for eight undergraduate courses across microeconomics, industrial organization, behavioral and experimental economics. My classes have ranged from about 80 students to large cohorts of over 700. I've also enjoyed teaching a wide mix of students, from high-schoolers in UCSB's summer research program to advanced undergraduates at UCSB, from different majors and background.
- ECON 120 - Urban Economics (Fall 2025)
- ECON 187 - Topics in Personnel Economics (Spring 2025)
- ECON 116A - Industrial Organization (Fall 2024-Winter 2025)
- Summer Research Academy - Strategic Choices: The Power of Behavioral Economic Theory in Explaining Human (Mis)Behavior (Summer 2024)
- ECON 10A - Intermediate Microeconomics (Summer 2023)
- ECON 150B - Labor Economics (Summer 2022)
- ECON 1 - Principles of Economics-Micro (11 quarters)
- ECON 2 - Principles of Economics-Macro (2 quarters)