HouseholdBench: Evaluating Large Language Models as Predictors of Household Economic Behavior

Do large language models (LLMs) exhibit systematic ideological bias when reasoning about economic causal effects? As LLMs are increasingly used in policy analysis and economic reporting, where directionally correct causal judgments are essential, this question has direct practical stakes. We present a systematic evaluation by extending the EconCausal benchmark with ideology-contested cases - instances where intervention-oriented (pro-government) and market-oriented (pro-market) perspectives predict divergent causal signs. From 10,490 causal triplets (treatment-outcome pairs with empirically verified effect directions) derived from top-tier economics and finance journals, we identify 1,056 ideology-contested instances and evaluate 20 state-of-the-art LLMs on their ability to predict empirically supported causal directions. We find that ideology-contested items are consistently harder than non-contested ones, and that across 18 of 20 models, accuracy is systematically higher when the empirically verified causal sign aligns with intervention-oriented expectations than with market-oriented ones. Moreover, when models err, their incorrect predictions disproportionately lean intervention-oriented, and this directional skew is not eliminated by one-shot in-context prompting. These results highlight that LLMs are not only less accurate on ideologically contested economic questions, but systematically less reliable in one ideological direction than the other, underscoring the need for direction-aware evaluation in high-stakes economic and policy settings.

Assessing the impacts of social policy changes is a widely acknowledged challenge for policymakers. Econometric methods can be unreliable when extrapolating to hypothetical scenarios, while field pilot programs are highly costly. In this paper, we propose using large language models (LLMs) as policy-assessment tools adapted from general-purpose models. We present FlexPension-LLM, the first domain-specialized large language model for a hierarchical pension-enrollment prediction task among flexible workers in China, and introduce DKI-RDistill, which injects policy-grounded cues into the prompt, including Probit-derived marginal effects and hukou-province pension rules. The method then uses LoRA/SFT to distill rationale-augmented supervision into an open-weight MoE student, with teacher errors corrected by regenerating those cases under ground-truth labels. On a CHFS 2019 blind split, FlexPension-LLM achieves 0.9316 Composite F1, surpassing its Claude Sonnet 4.5 teacher and 15 of 17 baselines, and is statistically indistinguishable from Claude Opus 4.6. Across four external surveys, it averages 0.7549 Composite F1 and shows the narrowest performance range among the strongest systems. Component analysis shows that gains come mainly from policy-grounded cue injection and error-filtered supervision, while rationales provide decision traces that can be checked against policy rules.

Large language models (LLMs) are increasingly used to simulate human behavior in business, economics, and the social sciences, offering a low-cost complement to laboratory experiments, field studies, and surveys. This paper evaluates how well LLMs replicate human behavior in operations management. Using nine published behavioral-operations experiments, we assess LLM performance along two dimensions: whether LLM-generated data reproduce the original hypothesis-test outcomes, and whether their full response distributions align with human data, measured by Wasserstein distance. We find that LLMs often replicate hypothesis-level effects, suggesting that they can capture salient decision biases and behavioral regularities. However, their response distributions frequently diverge from human data, even for strong proprietary models, with dispersion mismatch playing an important role. We also examine two lightweight mitigation strategies: chain-of-thought prompting and hyperparameter tuning. Both can reduce distributional misalignment, and appropriate tuning can sometimes allow smaller or open-source models to match or outperform larger proprietary systems.