Third-party Contexts Research Articles

Navigating the data economy : Key considerations for decision makers in banking

The European Commission (EC) is advancing the data economy through a series of regulatory reforms aimed at giving customers control of their data and fostering innovation in third-party contexts. While the costs of developing existing banking infrastructures and creating open application programming interfaces have largely fallen on banks, third-party service providers have benefitted from new revenue streams and increased customer relevance. As a result, banks risk disintermediation with some customer segments. The impending Financial Data Access (FiDA) regulation is set to expand these dynamics by extending the range of financial data made accessible for third parties. Simultaneously, the entry into force of the Electronic Identification Authentication and Trust Services 2.0 (eIDAS2) introduces a digital wallet that allows consumers and businesses to share their identity credentials in online customer journeys, offering banks the potential to engage more effectively in the data economy. The key question is whether the new reforms will encourage banks to seek opportunities beyond compliance; more so than with the Revised Payment Services Directive (PSD2) and open banking. This paper analyses the opportunities arising from FiDA, eIDAS2 and the Data Acts, providing strategic considerations for banks navigating the data economy. It emphasises that banks are ideally positioned to become data custodians by offering customers tools for the secure and reliable exchange of data-driven digital transactions across all sectors. Ultimately, this approach will unlock new value and enhance the relevance of banks in the data economy.

Infants’ imitative learning from third-party observations

Abstract In two separate experiments, we examined 17-month-olds’ imitation in a third-party context. The aim was to explore how seeing another person responding to a model’s novel action influenced infant imitation. The infants watched while a reliable model demonstrated a novel action with a familiar (Experiment 1) or an unfamiliar (Experiment 2) object to a second actor. The second actor either imitated or did not imitate the novel action of the model. Fewer infants imitated the model’s novel behavior in the non-imitation condition than in the imitation condition in Experiment 1. In Experiment 2, infants’ likelihood of imitating was not influenced by whether they had watched the second actor imitating the model’s novel action with the unfamiliar object. The findings indicate that infants take into account a second adult’s actions in a third party context when infants receive information that contradicts their existing knowledge and when it corresponds with their own experiences. If infants do not have prior knowledge about how to handle a certain object, then the second adult’s actions do not seem to matter.

Intention affects fairness processing: Evidence from behavior and representational similarity analysis of event-related potential signals.

In an ultimatum game, the responder must decide between pursuing self-interest and insisting on fairness, and these choices are affected by the intentions of the proposer. However, the time course of this social decision-making process is unclear. Representational similarity analysis (RSA) is a useful technique for linking brain activity with rich behavioral data sets. In this study, electroencephalography (EEG) was used to measure the time course of neural responses to proposed allocation schemes with different intentions. Twenty-eight participants played an ultimatum game as responders. They had to choose between accepting and rejecting the fair or unfair money allocation schemes of proposers. The schemes were offered based on the proposer's selfish intention (monetary gain), altruistic intention (donation to charity), or ambiguous intention (unknown to the responder). We used a spatiotemporal RSA and inter-subject RSA (IS-RSA) to explore the connections between event-related potentials (ERPs) after offer presentation and intention presentation with four types of behavioral data (acceptance, response time, fairness ratings, and pleasantness ratings). The spatiotemporal RSA results revealed that only response time variation was linked with the difference in ERPs at 432-592 ms after offer presentation on the posterior parietal and prefrontal regions. Meanwhile, the IS-RSA results found a significant association between inter-individual differences in response time and differences in ERP activity at 596-812 ms after the presentation of ambiguous intention, particularly in the prefrontal region. This study expands the intention-based reciprocal model to the third-party context and demonstrates that brain activity can represent response time differences in social decision-making.

Preverbal infants’ reactions to third-party punishments and rewards delivered toward fair and unfair agents

Rewarding individuals who distribute resources fairly and punishing those who distribute resources unfairly may be very important actions for fostering cooperation. This study investigated whether 9-month-olds have some expectations concerning punishments and rewards that follow distributive actions. Infants were shown simple animations and were tested using the violation-of-expectation paradigm. In Experiment 1, we found that infants looked longer when they saw a bystander delivering a corporal punishment to a ‘fair distributor,' who distributed some windfall resources equally to the possible recipients, rather than to an ‘unfair distributor,' who distributed the resources unequally. This pattern of looking times was reversed when, in Experiment 2, punishments were replaced with rewards. These findings suggest an early emergence of expectations about punishing and rewarding actions in third-party contexts, and they help to evaluate competing claims about the origins of a sense of fairness.

Investigating the detection of parent-child relationships in early childhood: The role of partiality in resource distributions.

By early childhood, children possess clear expectations about how resources should be, and typically are, distributed, expecting and advocating for equal resource distributions to recipients. Moreover, recent evidence suggests that children may be able to use deviations from equality in resource distributions to make inferences about the nature of social relationships. Here, we investigated whether children use partiality in resource distributions displayed by adults toward children in third-party contexts to identify parent-child relationships, whether children anticipate preferential treatment based upon knowledge of third-party parent-child relationships, and whether children anticipate different emotional reactions to impartiality in resource distributions in parent-child interactions compared to neighbor-child interactions. Four-to seven-year-old children were presented with hypothetical vignettes about an adult character who distributed resources to two children either equally, or systematically favoring one child. By the age of 4, children used resource distribution partiality to identify an adult as a child’s parent, and also used these expectations to guide their anticipated emotional reactions to impartiality. By the age of 6, children were also more likely to anticipate partiality to be displayed in parent-child compared to neighbor-child relationships. The findings from the current study reveal that partiality in resource distributions acts as a valuable cue to aid in identifying and understanding social relationships, highlighting the integral role that resources play in children’s understanding of their social world. More broadly, our findings support the claim that children use cues that signal interpersonal investment to specify and evaluate parent-child relationships in third-party contexts.

Alexa, Who Am I Speaking To?: Understanding Users’ Ability to Identify Third-Party Apps on Amazon Alexa

Many Internet of Things devices have voice user interfaces. One of the most popular voice user interfaces is Amazon’s Alexa, which supports more than 50,000 third-party applications (“skills”). We study how Alexa’s integration of these skills may confuse users. Our survey of 237 participants found that users do not understand that skills are often operated by third parties, that they often confuse third-party skills with native Alexa functions, and that they are unaware of the functions that the native Alexa system supports. Surprisingly, users who interact with Alexa more frequently are more likely to conclude that a third-party skill is a native Alexa function. The potential for misunderstanding creates new security and privacy risks: attackers can develop third-party skills that operate without users’ knowledge or masquerade as native Alexa functions. To mitigate this threat, we make design recommendations to help users better distinguish native functionality and third-party skills, including audio and visual indicators of native and third-party contexts, as well as a consistent design standard to help users learn what functions are and are not possible on Alexa.

Toddlers' expectations of third-party punishments and rewards following an act of aggression.

Rewarding someone who defends the victim of an unjust aggression and punishing someone who chose not to defend her may be very important acts of reciprocation in social life. This study investigates whether 21-month-olds have some expectations concerning such punishing and rewarding actions. Infants were shown simple puppet shows and were tested using the violation-of-expectation paradigm. In Experiment 1, we found that infants looked longer when they saw a bystander puppet punishing the puppet who defended the victim rather than the puppet who did not defend her. This pattern of looking times was reversed when the punishing action was replaced with a rewarding action (Experiment 2). These findings reveal early-emerging expectations about punitive and reward motivations in third-party contexts, and provide some support for theoretical claims about the hardwiring of the human mind for cooperation and prosociality.

Infant imitation in a third-party context

Abstract The present study examined 17-month-olds’ imitation in a third-party context. In four experiments, the infants watched while a reliable or an unreliable model demonstrated a novel action with an unfamiliar (Experiments 1 and 3) or a familiar (Experiments 2 and 4) object to another adult. In Experiments 3 and 4, the second adult imitated the model’s novel action. Neither the familiarity of the object or whether or not the second adult copied the model’s behavior influenced the likelihood of infant imitation. Findings showed that the infants in the reliable model condition were more willing to imitate the model’s action with the unfamiliar object. The results suggest that infants take into account the reliability of a model even when the model has not directly demonstrated her reliability to the infant.

The Roles of Group Status and Group Membership in the Practice of Hypodescent.

Hypodescent emerged in U.S. history to reinforce racial hierarchy. Research suggests that among contemporary U.S. adults, hypodescent continues to shape social perception. Among U.S. children, however, hypodescent is less likely to be endorsed. Here, we tested for hypodescent by introducing U.S. children (ages 4-9) and adults (N=273) to hierarchically ordered novel groups (one was high status and another was low status) and then to a child who had one parent from each group. In Study 1, we presented the groups in a third-party context. In Study 2, we randomly assigned participants to the high-status or the low-status group. Across both studies, participants did not reliably endorse hypodescent, raising questions as to what elicits this practice.

The development of corporal third-party punishment

Previous research has demonstrated that toddlers are willing to punish those who harm others. This work, however, has predominantly focused on punishment in the form of resource reduction—taking away a resource or withholding access to a resource from an antisocial other. Here, in two studies, we examined whether 4- to 7-year-old children (N = 141) engage in direct, corporal punishment against antisocial others in third-party contexts. Children were given the opportunity to press buttons so that antisocial and prosocial puppets would be hit with a hammer. In Study 1, younger children (∼4-year-olds) hit the antisocial and prosocial puppets indiscriminately, whereas older children (∼7-year-olds) tended to preferentially hit the antisocial puppet. In Study 2, we tested a larger sample of 4- to 7-year-olds, and found that none of the children engaged in corporal punishment. Collapsing across both Studies 1 and 2 also indicated a null effect—children did not engage in third-party corporal punishment. We observed these findings even though children evaluated the antisocial puppet as mean and understood that pressing the hit button hurt the puppets. These findings suggest that children lack a strong desire to corporally punish third-party social wrongdoers. Our results illustrate the importance of considering different types of punishment in assessing the development of third-party punishment, and raise questions about the development of corporal third-party punishment.

Social Dominance Orientation Predicts Opposition to Hierarchy-Attenuating Intergroup Apologies.

People who value social hierarchy may resist giving intergroup apologies because such apologies may attenuate the very hierarchies that these people value. We tested this claim across four studies (total N = 541) by examining associations between social dominance orientation (SDO)-a measure of preference for social hierarchy-and support for intergroup apologies. We found that higher SDO scores, and specifically the antiegalitarianism subdimension (social dominance orientation-egalitarianism [SDO-E]), predicted less apology support among U.S. residents in both domestic (Study 1) and international (Study 2) contexts. In Study 3, we found that the effect generalizes to an Australian cultural context. In Study 4, we demonstrated that the negative effect of SDO-E can extend to third-party contexts and is only observed when apologizing would be hierarchy attenuating. These studies show that the desire to maintain social hierarchies is an important driver of opposition to hierarchy-attenuating intergroup apologies.

The Development of a Preference for Procedural Justice for Self and Others

Adults prefer fair processes (“procedural justice”) over equal outcomes (“distributive justice”). This preference impacts their judgments of others in addition to their willingness to cooperate, raising questions about whether similar preferences drive judgments and behavior in children. The present study examines the development of this preference for procedural justice by testing children’s attitudes towards procedural justice using a resource allocation task in both first- and third-party contexts, and in contexts in which the procedurally just process does versus does not create distributional injustice. Results from children 4 to 8 years of age demonstrate that children robustly attend to and prefer procedural justice over distributive justice. However, younger children are less likely to prefer methods that are procedurally just or that create distributively just outcomes in first-party contexts, when distributive injustice might favor them. Results suggest an interplay between abstract justice concerns and the emerging ability to override selfishness.

From imitation to implementation: How two- and three-year-old children learn to enforce social norms.

Young children enforce social norms from early on, but little research has examined how this enforcement behaviour emerges. This study investigated whether observing an adult's norm enforcement influences children's own enforcement of that norm compared with observing an action demonstration without enforcement. Additionally, children experienced enforcement either following their own (second-party) or a third-party's transgression (N=120). Results revealed that observing enforcement increased two- and three-year-old children's protest against the sanctioned action regardless of second- or third-party context. However, only three-year-olds generalized their enforcement to a novel action not matching the norm, whereas two-year-olds only protested against the previously sanctioned action. Importantly, without any enforcement demonstration, two-year-olds rarely protested at all while three-year-olds did so quite frequently. Thus, providing an opportunity to imitate enforcement seems to give rise to enforcement behaviour in two-year-olds while three-year-olds already understand normative implications following a variety of cues and even apply norm enforcement without any demonstration of how to do it. Statement of contribution What is already known on this subject? Children conform to social norms from early in development. Young children from 2 to 3years of age also enforce social norms on third parties. What does this study add? Observing enforcement by an adult increases two- and three-year-olds' protest against the sanctioned action. It does not matter whether children experienced enforcement on their own or a third party's action. Three-, but not two-year-olds, generalize their enforcement to novel actions that do not match the norm.

You get what you give: children's karmic bargaining

Do children believe in karma - the notion that life events occur to punish or reward our moral behavior? In three experiments, we investigate 4-6-year-old children's willingness to endorse and engage in the practice of performing good acts in order to secure an unrelated future desired outcome, so-called 'karmic bargaining'. Most children agreed that performing a morally good social behavior, but not a morally negative or morally neutral non-social behavior, would increase the chances that future desired outcomes would occur, in both first-party and third-party contexts. About half of children also engaged in karmic bargaining behavior themselves. We conclude that a belief in karma may therefore reflect a broad, early-emerging teleological bias to interpret life events in terms of agency, purpose, and design.

Stick with your group: Young children’s attitudes about group loyalty

For adults, loyalty to the group is highly valued, yet little is known about how children evaluate loyalty. We investigated children’s attitudes about loyalty in a third-party context. In the first experiment, 4- and 5-year-olds watched a video of two groups competing. Two members of the losing group then spoke. The disloyal individual said she wanted to win and therefore would join the other group. The loyal individual said she also wanted to win but would stay with her group. Children were then asked five forced-choice questions about these two individuals’ niceness, trustworthiness, morality, and deservingness of a reward. The 5-year-olds preferred the loyal person across all questions; results for the 4-year-olds were considerably weaker but in the same direction. The second experiment investigated the direction of the effect in 5-year-olds. In this experiment, children answered questions about either a loyal individual, a disloyal individual, or a neutral individual. Children rated both the loyal and neutral individuals more positively than the disloyal individual across a number of measures. Thus, whereas disloyal behavior is evaluated unfavorably by children, loyal behavior is the expected norm. These results suggest that, at least from 5years of age, children understand that belonging to a group entails certain commitments. This marks an important step in their own ability to negotiate belonging and become trustworthy and reliable members of their social groups.

Are They Worth Reading? An In-Depth Analysis of Online Advertising Companiess Privacy Policies

We analyzed the privacy policies of 75 online tracking companies with the goal of assessing whether they contain information relevant for users to make privacy decisions. We compared privacy policies from large companies, companies that are members of self-regulatory organizations, and non-member companies and found that many of them are silent with regard to important consumer-relevant practices including the collection and use of sensitive information and linkage of tracking data with personally-identifiable information. We evaluated these policies against self-regulatory guidelines and found that many policies are not fully compliant. Furthermore, the overly general requirements established in those guidelines allow companies to have compliant practices without providing transparency to users. Few companies disclose their data retention times or offer users the opportunity to access the information collected about them. The lack of consistent terminology to refer to affiliate and non-affiliate partners, and the mix of practices for first-party and third-party contexts make it challenging for users to clearly assess the risks and make meaningful decisions. We discuss options to improve the transparency and usability of online tracking companies' privacy practices.

Fairness versus favoritism in children

Children respond positively to individuals who favor them and also to individuals who are fair. The present studies examine the interaction between these two preferences by presenting children with two distributors who share resources with the child participant and another recipient. Children are asked whom they like better: the distributor who was unfair but favored the child participant or the distributor who was fair and showed no (or reduced) favoritism. In Study 1, we find that when fairness and favoritism are in conflict, children are split on whom they prefer. In Study 2, we find that placing children in a competitive context leads to a stronger preference for the distributor who favored the child participant. In Study 3, we examine whether children's preference for favoritism persists when both distributors gave the child the same number of rewards, but one distributor gave the child participant relatively more than the other recipient. In this situation, we find that children prefer the fair distributor. However, we again find that creating a competitive context reduces children's preference for the fair distributor. Finally we find that in a third-party context, children value fairness over generosity. Taken together, these results show how children balance competing concerns for fairness and favoritism.

Young children overimitate in third-party contexts

The exhibition of actions that are causally unnecessary to the outcomes with which they are associated is a core feature of human cultural behavior. To enter into the world(s) of their cultural in-group, children must learn to assimilate such unnecessary actions into their own behavioral repertoire. Past research has established the habitual tendency of children to adopt the redundant actions of adults demonstrated directly to them. Here we document how young children will do so even when such actions are modeled to a third person regardless of whether children are presented with the test apparatus by the demonstrating, and assumedly expert, adult or by the observing, and assumedly naive, adult (Experiment 1), whether or not children had opportunity to discover how the apparatus works prior to modeling (Experiment 1), and whether or not children’s attention was drawn to the demonstration while they were otherwise occupied (Experiment 2). These results emphasize human children’s readiness to acquire behavior that is in keeping with what others do, regardless of the apparent efficiency of the actions employed, and in so doing to participate in cultural learning.