Wednesday, February 8, 2012
From idea to reality
Appetite for destruction: The impact of the September 11 attacks on business founding
Srikanth Paruchuri & Paul Ingram
Industrial and Corporate Change, February 2012, Pages 127-149
Abstract:
It is widely accepted that entrepreneurial creation affects destruction, as new and better organizations, technologies and transactions replace old ones. This phenomenon is labeled creative destruction, but it might more accurately be called destructive creation, given the driving role of creation in the process. We reverse the typical causal ordering, and ask whether destruction may drive creation. We argue that economic systems may get stuck in suboptimal equilibria due to path dependence, and that destruction may sweep away this inertia, and open the way for entrepreneurship. To test this idea, we need an exogenous destructive shock, rather than destruction that is endogenous to the process of economic progress. Our identification strategy relies on the September 11 attacks as an exogenous destructive shock to the economic system centered on New York City. Consistent with our theoretical claim, we find that 15 months after the attacks the rate of business founding close to New York City exceeds the rate before the attacks, even after controlling for the inflow of recovery funds. Furthermore, the increase in the business founding rate after the attacks grows faster closer to Manhattan than it does further away from the epicenter of destruction.
----------------------
People and process, suits and innovators: Individuals and firm performance
Ethan Mollick
Strategic Management Journal, forthcoming
Abstract:
Performance differences between firms are generally attributed to organizational factors rather than to differences among the individuals who make up firms. As a result, little is known about the part that individual firm members play in explaining the variance in performance among firms. This paper employs a multiple membership cross-classified multilevel model to test the degree to which organizational or individual factors explain firm performance. The analysis also examines whether individual differences among middle managers or innovators best explain firm performance variation. The results indicate that variation among individuals matter far more in organizational performance than is generally assumed. Further, variation among middle managers has a particularly large impact on firm performance, much larger than that of those individuals who are assigned innovative roles.
----------------------
Liquidity Constraints, Household Wealth, and Entrepreneurship Revisited
Robert Fairlie & Harry Krashinsky
Review of Income and Wealth, forthcoming
Abstract:
The existence of liquidity constraints for entrepreneurs has been challenged by the finding that business entry rates are invariant throughout most of the asset distribution and increase dramatically only at the top of this distribution. We reexamine the liquidity constraint hypothesis in three ways. First, we separately examine those who do and those who do not experience a job loss to reveal generally increasing entry rates through the wealth distribution for both groups, and show why these groups should be separately analyzed. Second, we use a two-period simulation of the Evans and Jovanovic model to shows how exogenous wealth shocks can accurately identify the presence of liquidity constraints. Third, we provide new evidence from matched Current Population Survey data to show that housing appreciation measured at the MSA-level is a significantly positive determinant of entry into self-employment, after controlling for changes in local economic conditions.
----------------------
Jonathan Masur
Yale Law Journal, December 2011, Pages 470-532
Abstract:
For more than two decades, the Patent and Trademark Office (PTO) and the Federal Circuit have exercised nearly complete institutional control over the patent system. Yet in recent years their stewardship has been widely criticized, largely on the basis of two particular failings. First, the PTO grants significant numbers of invalid patents, patents that impose substantial costs on innovative firms. And second, over time the Federal Circuit has steadily loosened the rules governing patentability, allowing ever more patents over a greater range of inventions. This Article argues that both of these modern trends may be attributable in whole or in part to the asymmetric institutional relationship between the PTO and the Federal Circuit. If a patent applicant is denied a patent by the PTO, she can appeal that denial to the Federal Circuit. However, if the PTO grants the patent, no other party has the right to appeal. Accordingly, the PTO can avoid appeals and reversals, both of which are costly in monetary and reputational terms, simply by granting any patent that the Federal Circuit might plausibly allow. Because the PTO will grant nearly any plausible patent, the vast majority of rejected applications that are appealed to the Federal Circuit will concern boundary-pushing inventions that are unpatentable under current law. Occasionally, a particularly patent-friendly panel of Federal Circuit judges will elect to reverse the PTO and grant a patent that the Agency has denied. The Federal Circuit's decision will create a new, inflationary precedent. The boundaries of patentability will expand slightly, as this new precedent exerts influence on the other circuit judges. And as the Federal Circuit's conception of what may be patented expands, the PTO will similarly inflate its own standards in order to maintain an adequate margin for error and avoid denying a patent that the Federal Circuit is likely to grant on appeal. Patent law will thus be subject to a natural inflationary pressure.
----------------------
The Collapse of the Soviet Union and the Productivity of American Mathematicians
George Borjas & Kirk Doran
NBER Working Paper, February 2012
Abstract:
It has been difficult to open up the black box of knowledge production. We use unique international data on the publications, citations, and affiliations of mathematicians to examine the impact of a large post-1992 influx of Soviet mathematicians on the productivity of their American counterparts. We find a negative productivity effect on those mathematicians whose research overlapped with that of the Soviets. We also document an increased mobility rate (to lower-quality institutions and out of active publishing) and a reduced likelihood of producing "home run" papers. Although the total product of the pre-existing American mathematicians shrank, the Soviet contribution to American mathematics filled in the gap. However, there is no evidence that the Soviets greatly increased the size of the "mathematics pie." Finally, we find that there are significant international differences in the productivity effects of the collapse of the Soviet Union, and that these international differences can be explained by both differences in the size of the émigré flow into the various countries and in how connected each country is to the global market for mathematical publications.
----------------------
Music Piracy: A Case of "The Rich Get Richer and the Poor Get Poorer"
Amedeo Piolatto & Florian Schuett
Information Economics and Policy, forthcoming
Abstract:
There is evidence that music piracy has differential effects on artists depending on their popularity. We present a model of music piracy with endogenous copying costs: consumers' costs of illegal downloads increase with the scarcity of a recording and are therefore negatively related to the number of originals sold. Allowing for a second source of revenues apart from record sales, we show that piracy can hurt some artists while benefiting others. Under plausible assumptions, piracy is beneficial to the most popular artists. However, this does not carry over to less popular artists, who are often harmed by piracy. We conclude that piracy tends to reduce musical variety.
----------------------
Seung-Hyun Hong
Journal of Applied Econometrics, forthcoming
Abstract:
This paper measures the effect of Napster on record sales. I treat the introduction of Napster as a technological event that only Internet users experienced, and use a difference-in-differences (DD) approach. Because of potential compositional changes in Internet users, I examine identifying assumptions for the DD estimator under compositional changes and develop a test for identifying restrictions. To address potential bias due to compositional changes, I extend DD matching estimators to the case of two-variate propensity scores. I find evidence suggesting that file sharing is likely to explain 20% of total sales decline, which is driven by households with children aged 6-17.
----------------------
Music Downloads and the Flip Side of Digital Rights Management
Dinah Vernik, Devavrat Purohit & Preyas Desai
Marketing Science, forthcoming
Abstract:
Digital rights management (DRM) is an important yet controversial issue in the information goods markets. Although DRM is supposed to help copyright owners by protecting digital content from illegal copying or distribution, it is controversial because DRM imposes restrictions on even legal users, and there are many industry practitioners who believe that the industry would be better off without DRM. In this paper, we model consumers' utilities and their incentives to purchase legal products versus pirate illegal ones. This allows us to endogenize the level of piracy and understand how it is influenced by the presence or absence of DRM. Our analysis suggests that, counterintuitively, download piracy might decrease when the firm allows legal DRM-free downloads. Furthermore, we find that a decrease in piracy does not guarantee an increase in firm profits and that copyright owners do not always benefit from making it harder to copy music illegally. By analyzing the competition among the traditional retailer, the digital retailer, and pirated sources of information goods, we get a better understanding of the competitive forces in the market and provide insights into the role of digital rights management.
----------------------
Elves or Trolls? The role of nonpracticing patent owners in the innovation economy
Damien Geradin, Anne Layne-Farrar & Jorge Padilla
Industrial and Corporate Change, February 2012, Pages 73-94
Abstract:
Firm structure and the degree of vertical integration lie at the core of a key intellectual property concern currently under debate: "patent trolls." While court opinions and competition agency decisions have focused on "non-practicing" patent holders as synonymous with trolls and hold up problems, this view of upstream specialists is far too narrow. In fact, patents in the hands of nonpracticing entities can increase competition, increase innovation, lower downstream prices, and enhance consumer choice. We explain why and when and argue for more business-model-neutral policy when it comes to patent licensing. Clearly, patents are a complex subject that cannot be portrayed as either all good or all bad; tradeoffs will always be involved. Likewise, patents in the hands of nonpracticing entities cannot be viewed as either all good or all bad. Without a better understanding of the many complicated effects of patents in high technology markets, we run the very real risk of misguided policy decisions. In light of that risk, we argue that more attention needs to be devoted to finding meaningful ways of identifying harmful behaviors, rather than on categorical labels based on firm structure or business model.
----------------------
The Private and Social Costs of Patent Trolls
James Bessen, Jennifer Ford & Michael Meurer
Boston University Working Paper, November 2011
Abstract:
In the past, non-practicing entities (NPEs) - firms that license patents without producing goods - have facilitated technology markets and increased rents for small inventors. Is this also true for today's NPEs? Or are they "patent trolls" who opportunistically litigate over software patents with unpredictable boundaries? Using stock market event studies around patent lawsuit filings, we find that NPE lawsuits are associated with half a trillion dollars of lost wealth to defendants from 1990 through 2010, mostly from technology companies. Moreover, very little of this loss represents a transfer to small inventors. Instead, it implies reduced innovation incentives and a net loss of social welfare.
----------------------
Intellectual Property Rights Policy, Competition and Innovation
Daron Acemoglu & Ufuk Akcigit
Journal of the European Economic Association, February 2012, Pages 1-42
Abstract:
To what extent and in what form should the intellectual property rights (IPR) of innovators be protected? Should a company with a large technology lead over its rivals receive the same IPR protection as a company with a more limited advantage? In this paper, we develop a dynamic framework for the study of the interactions between IPR and competition, in particular to understand the impact of such policies on future incentives. The economy consists of many industries and firms engaged in cumulative (step-by-step) innovation. IPR policy regulates whether followers in an industry can copy the technology of the leader. We prove the existence of a steady-state equilibrium and characterize some of its properties. We then quantitatively investigate the implications of different types of IPR policy on the equilibrium growth rate and welfare. The most important result from this exercise is that full patent protection is not optimal; instead, optimal policy involves state-dependent IPR protection, providing greater protection to technology leaders that are further ahead than those that are close to their followers. This is because of a trickle-down effect: providing greater protection to firms that are further ahead of their followers than a certain threshold increases the R&D incentives also for all technology leaders that are less advanced than this threshold.
----------------------
The dynamics of social innovation
Peyton Young
Proceedings of the National Academy of Sciences, 27 December 2011, Pages 21285-21291
Abstract:
Social norms and institutions are mechanisms that facilitate coordination between individuals. A social innovation is a novel mechanism that increases the welfare of the individuals who adopt it compared with the status quo. We model the dynamics of social innovation as a coordination game played on a network. Individuals experiment with a novel strategy that would increase their payoffs provided that it is also adopted by their neighbors. The rate at which a social innovation spreads depends on three factors: the topology of the network and in particular the extent to which agents interact in small local clusters, the payoff gain of the innovation relative to the status quo, and the amount of noise in the best response process. The analysis shows that local clustering greatly enhances the speed with which social innovations spread. It also suggests that the welfare gains from innovation are more likely to occur in large jumps than in a series of small incremental improvements.
----------------------
Optimal Copyright Length and Ex Post Investment: A Mickey Mouse Approach
Nodir Adilov & Michael Waldman
Economic Inquiry, forthcoming
Abstract:
This paper considers a theoretical model of copyright protection in which the value of an intellectual work changes over time because of depreciation and value-enhancing ex post investments. The first main finding is that, in the case of a single project, granting infinitely lived copyright protection maximizes social welfare when the return on ex post investments is high relative to the return on the initial investment. We also provide simulation results of our model for the case of multiple heterogeneous projects that show how social welfare varies with the length of copyright protection and the returns on initial and ex post investments. We then consider what our framework says concerning the social-welfare effects of the 1998 Copyright Term Extension Act. Here we show that, depending on the importance of ex post investments, the act may have either increased or decreased social welfare. Our final analysis considers the social-welfare implications of replacing fixed-length copyright protection with Landes and Posner's(University of Chicago Law Review, 70(2), 2003, 471-518) idea of indefinitely renewable copyright protection. We find that implementing indefinitely renewable copyright protection frequently increases social welfare provided the returns on ex post investments are sufficiently large. We also provide a brief history of Disney's Mickey Mouse and argue that the history of that character matches quite well with the predictions of our theoretical approach.
----------------------
Robert Fairlie, Dean Karlan & Jonathan Zinman
NBER Working Paper, February 2012
Abstract:
We use randomized program offers and multiple follow-up survey waves to examine the effects of entrepreneurship training on a broad set of outcomes. Training increases short run business ownership and employment, but there is no evidence of broader or longer run effects. We also test whether training mitigates market frictions by estimating heterogeneous treatment effects. Training does not have strong effects (in either relative or absolute terms) on those most likely to face credit or human capital constraints, or labor market discrimination. Training does have a relatively strong short-run effect on business ownership for those unemployed at baseline, but not at other horizons or for other outcomes.
----------------------
Does Distance Matter Less Now? The Changing Role of Geography in Biotechnology Innovation
Daniel Johnson & Kristina Lybecker
Review of Industrial Organization, February 2012, Pages 21-35
Abstract:
Using patent citation data for the U.S., we test whether knowledge spillovers in biotechnology are sensitive to distance, and whether that sensitivity has changed over time. Controlling for self-citation by inventor, assignee, and examiner, cohort-based regression analysis shows that physical distance is becoming less important for spillovers with time.
----------------------
Measuring the Price of Research and Development Output
Adam Copeland & Dennis Fixler
Review of Income and Wealth, March 2012, Pages 166-182
Abstract:
We construct a price index for the scientific R&D services industry, a significant producer of R&D in the United States. Unlike most previous R&D price indexes, our index is not based on input costs but rather on measures of R&D sales. Consequently, unlike input-cost price indexes, our output-based index is able to account for changes in productivity and markups in the scientific R&D services industry. We compute that scientific R&D services prices increased, on average, by 7.14 percent at an annual rate from 1987 to 2006. Using our index, we find that real revenues grew at an annual average rate of 2.85 percent. We then propose using our index, in combination with an input-cost price index, to deflate total R&D nominal expenditures. We find that real total U.S. R&D expenditures grew at an average annual rate of 1.42 percent from 1987 to 2006.
----------------------
Why are Some Regions More Innovative than Others? The Role of Firm Size Diversity
Ajay Agrawal et al.
NBER Working Paper, January 2012
Abstract:
Large labs may spawn spin-outs caused by innovations deemed unrelated to the firm's overall business. Small labs generate demand for specialized services that lower entry costs for others. We develop a theoretical framework to study the interplay of these two localized externalities and their impact on regional innovation. We examine MSA-level patent data during the period 1975-2000 and find that innovation output is higher where large and small labs coexist. The finding is robust to across-region as well as within-region analysis, IV analysis, and the effect is stronger in certain subsamples consistent with our explanation but not the plausible alternatives.
Tuesday, February 7, 2012
When in Rome
Andrew Lindner & Daniel Hawkins
Sociological Quarterly, Winter 2012, Pages 68-91
Abstract:
This study examines the "culture wars" using the lens of attitudes toward soccer. Despite soccer's increasing popularity in the United States, anti-soccer rhetoric is fairly common. In his widely read book, How Soccer Explains the World (2004), Foer contends that the "culture wars," including divisions over soccer, are better explained by reactions to globalization than social class or political ideology. Using data from a survey of Nebraskans, we find that attitudes about cultural globalization are the best predictor of soccer sentiment. Contrary to popular claims about the "culture wars," most respondents were moderate in their attitudes toward both soccer and globalization.
----------------------
Beware of national symbols: How flags can threaten intergroup relations
Julia Becker et al.
Social Psychology, Winter 2012, Pages 3-6
Abstract:
The present research examined effects of exposure to the German flag on outgroup prejudice in Germany. In agreement with social identity theory, we demonstrated that exposure to the German flag increased outgroup prejudice among highly nationalistic German respondents. This finding seems to contradict prior research illustrating that exposure to the US flag reduced outgroup prejudice among highly nationalistic American respondents. This contradiction is considered the result of various concepts Germans associate with the German flag compared to concepts Americans associate with the US flag. Practical implications for flag exposure are discussed.
----------------------
Yuri Takhteyev, Anatoliy Gruzd & Barry Wellman
Social Networks, January 2012, Pages 73-81
Abstract:
The paper examines the influence of geographic distance, national boundaries, language, and frequency of air travel on the formation of social ties on Twitter, a popular micro-blogging website. Based on a large sample of publicly available Twitter data, our study shows that a substantial share of ties lies within the same metropolitan region, and that between regional clusters, distance, national borders and language differences all predict Twitter ties. We find that the frequency of airline flights between the two parties is the best predictor of Twitter ties. This highlights the importance of looking at pre-existing ties between places and people.
----------------------
Culture, Control, and Illusory Pattern Perception
Cynthia Wang, Jennifer Whitson & Tanya Menon
Social Psychological and Personality Science, forthcoming
Abstract:
Lacking control causes illusory pattern perception, but does culture influence the patterns people perceive? Different cultural contexts invite distinct types of control, with people from Western cultures emphasizing primary control methods (i.e., personal agency) and people from East Asian cultures emphasizing secondary control methods (i.e., adjustment to surroundings). Four experiments suggest that cultural differences in primary versus secondary control orientation shape the patterns people perceive within horoscopes. When lacking (vs. possessing) control, Westerners are relatively more likely to rely on horoscopes that help them understand themselves, whereas East Asians are relatively more likely to rely on horoscopes that help them understand others. The authors isolate underlying mechanisms, demonstrating that, following loss of control, people high on primary control rely on self-focused horoscopes and people high on secondary control rely on horoscopes about friends. Thus, cultural differences in primary versus secondary control create unique signatures in pattern perception.
----------------------
Suicide, Culture, and Society from a Cross-National Perspective
Matteo Lenzi, Erminia Colucci & Harry Minas
Cross-Cultural Research, February 2012, Pages 50-71
Abstract:
In this article, the authors explored the associations between suicide rates and a large number of sociocultural indexes, within the sociological framework provided by Durkheim and taking into account recent sociological theories. The analyses were performed on a sample of 87 nations and a subsample of posttraditional societies. The authors found strong positive (linear) correlations between suicide rates and measures of secularization, and curvilinear relationships between measures of individualization and suicide rates. Negative associations were found between suicide rates and measures of individualization in a subsample of posttraditional countries. Following the postmodernization and reflexive modernization theories, the authors argue that a new form of individualization is in place in secular-rational societies. This form of individualization exercises a negative effect on suicide rates through its positive influence on social integration and regulation.
----------------------
Maja Becker et al.
Journal of Personality and Social Psychology, forthcoming
Abstract:
The motive to attain a distinctive identity is sometimes thought to be stronger in, or even specific to, those socialized into individualistic cultures. Using data from 4,751 participants in 21 cultural groups (18 nations and 3 regions), we tested this prediction against our alternative view that culture would moderate the ways in which people achieve feelings of distinctiveness, rather than influence the strength of their motivation to do so. We measured the distinctiveness motive using an indirect technique to avoid cultural response biases. Analyses showed that the distinctiveness motive was not weaker - and, if anything, was stronger - in more collectivistic nations. However, individualism-collectivism was found to moderate the ways in which feelings of distinctiveness were constructed: Distinctiveness was associated more closely with difference and separateness in more individualistic cultures and was associated more closely with social position in more collectivistic cultures. Multilevel analysis confirmed that it is the prevailing beliefs and values in an individual's context, rather than the individual's own beliefs and values, that account for these differences.
----------------------
Foreign Corporations and the Culture of Transparency: Evidence from Russian Administrative Data
Serguey Braguinsky & Sergey Mityakov
NBER Working Paper, January 2012
Abstract:
Foreign-owned firms from advanced countries carry the culture of transparency in business transactions that is orthogonal to the culture of hiding and insider dealing in many developing economies and economies in transition. In this paper, we document this using administrative data on reported earnings and market values of cars owned by workers employed in foreign-owned and domestic firms in Moscow, Russia. We examine whether closer ties to foreign corporations result in the diffusion of transparency to private Russian firms. We find that Russian firms initially founded in partnerships with foreign corporations are twice as transparent in reported earnings of their workers as other Russian firms, but they are still less than half as transparent as foreign firms themselves. We also find that increased links to foreign corporations, such as hiring more workers from them, raise the transparency of domestic firms. An important channel for this transmission appears to be the need to keep official wages and salaries of incumbent workers close to wages domestic firms have to pay to their newly hired workers with experience in multinationals.
----------------------
The neural basis of cultural differences in delay discounting
Bokyung Kim, Young Shin Sung & Samuel McClure
Philosophical Transactions of the Royal Society: Biological Sciences, 5 March 2012, Pages 650-656
Abstract:
People generally prefer to receive rewarding outcomes sooner rather than later. Such preferences result from delay discounting, or the process by which outcomes are devalued for the expected delay until their receipt. We investigated cultural differences in delay discounting by contrasting behaviour and brain activity in separate cohorts of Western (American) and Eastern (Korean) subjects. Consistent with previous reports, we find a dramatic difference in discounting behaviour, with Americans displaying much greater present bias and elevated discount rates. Recent neuroimaging findings suggest that differences in discounting may arise from differential involvement of either brain reward areas or regions in the prefrontal and parietal cortices associated with cognitive control. We find that the ventral striatum is more greatly recruited in Americans relative to Koreans when discounting future rewards, but there is no difference in prefrontal or parietal activity. This suggests that a cultural difference in emotional responsivity underlies the observed behavioural effect. We discuss the implications of this research for strategic interrelations between Easterners and Westerners.
----------------------
Krishna Savani & Hazel Rose Markus
Journal of Experimental Social Psychology, forthcoming
Abstract:
Analytic visual processing and holistic visual processing have been conceptualized in terms of attention to focal objects vs. the background. We expand the study of perceptual biases associated with these attentional patterns using the multiple object tracking task, which measures people's ability to track multiple moving target objects amidst otherwise identical distractors. We test two competing hypotheses: (1) Asians' more frequent eye saccades will enable them to quickly cycle through the multiple target objects before the objects move too far away, giving them another perceptual advantage; and (2) European Americans' tendency to focus attention on the focal objects while inhibiting attention to less important objects might facilitate tracking of multiple moving objects. We find that European Americans significantly outperform Asians on multiple object tracking. The research expands the conceptualization of analytic processing and holistic processing to include selective attention as a key component, a facet has not been previously identified.
----------------------
Erin O'Mara et al.
Journal of Research in Personality, forthcoming
Abstract:
Intensely debated is whether the self-enhancement motive is culturally relative or universal. The universalist perspective predicts that satisfaction of the motive panculturally promotes psychological well-being. The relativistic perspective predicts that such promotive effects are restricted to Western culture. A longitudinal-randomized-experiment conducted in China and the US tested the competing predictions. Participants completed measures of psychological well-being in an initial session. A week later participants listed a personally important attribute, described (via random assignment) how that attribute is more (self-enhancement) or less (self-effacement) descriptive of self than others, and again reported their psychological well-being. Consistent with the universalist perspective, self-enhancement significantly increased psychological well-being from baseline in the US and China; self-effacement yielded no change in psychological well-being in either culture.
----------------------
Elizabeth Davis et al.
International Journal of Psychology, forthcoming
Abstract:
Culture and gender shape emotion experience and regulation, in part because the value placed on emotions and the manner of their expression is thought to vary across these groups. This study tested the hypothesis that culture and gender would interact to predict people's emotion responding (emotion intensity and regulatory strategies). Chinese (n = 220; 52% female) and American undergraduates (n = 241; 62% female) viewed photos intended to elicit negative emotions after receiving instructions to either "just feel" any emotions that arose (Just Feel), or to "do something" so that they would not experience any emotion while viewing the photos (Regulate). All participants then rated the intensity of their experienced emotions and described any emotion-regulation strategies that they used while viewing the photos. Consistent with predictions, culture and gender interacted with experimental condition to predict intensity: Chinese men reported relatively low levels of emotion, whereas American women reported relatively high levels of emotion. Disengagement strategies (especially distancing) were related to lower emotional intensity and were reported most often by Chinese men. Taken together, findings suggest that emotion-regulation strategies may contribute to differences in emotional experience across Western and East Asian cultures.
----------------------
Dynamic Cultural Modulation of Neural Responses to One's Own and Friend's Faces
Jie Sui et al.
Social Cognitive and Affective Neuroscience, forthcoming
Abstract:
Long-term cultural experiences influence neural response to one's own and friend's faces. The present study investigated whether an individual's culturally-specific pattern of neural activity to faces can be modulated by temporary access to other cultural frameworks using a self-construal priming paradigm. Event-related potentials were recorded from British and Chinese adults during judgments of orientations of one's own and friend's faces after they were primed with independent and interdependent self-construals. We found that an early frontal negative activity at 220-340 ms (the anterior N2) differentiated between one's own and friend's faces in both cultural groups. Most remarkably, for British participants, priming an interdependent self-construal reduced the default anterior N2 to their own faces. For Chinese participants, however, priming an independent self-construal suppressed the default anterior N2 to their friend's faces. These findings indicate fast modulations of culturally-specific neural responses induced by temporary access to other cultural frameworks.
----------------------
Values, trust and democracy in Germany: Still in search of ‘inner unity'?
Ross Campbell
European Journal of Political Research, forthcoming
Abstract:
Twenty years after German reunification, surveys have persistently uncovered differences in political trust between the eastern and western parts of the country. Studies have offered disintegrated and inconclusive assessments of the cross-regional variation. This variation is traced to a tenacious, retrospective sympathy for socialism steeped in political socialisation and experiential learning. Empirical analyses confirm the presence of two key effects. First, retrospective evaluations of socialism not only fuel popular distrust of political institutions, but are more strongly correlated with trust in the east. Second, East-West evaluations of socialism are sufficiently different to contribute towards explaining the contrasting levels of trust between the two regions. That socialist values constitute a core axis upon which East German attitudes pivot presents a challenge for nurturing trust in democratic institutions and renews attention to processes through which supportive attitudes to democracy are acquired in transitional countries.
----------------------
Reconciling long-term cultural diversity and short-term collective social behavior
Luca Valori et al.
Proceedings of the National Academy of Sciences, 24 January 2012, Pages 1068-1073
Abstract:
An outstanding open problem is whether collective social phenomena occurring over short timescales can systematically reduce cultural heterogeneity in the long run, and whether offline and online human interactions contribute differently to the process. Theoretical models suggest that short-term collective behavior and long-term cultural diversity are mutually excluding, since they require very different levels of social influence. The latter jointly depends on two factors: the topology of the underlying social network and the overlap between individuals in multidimensional cultural space. However, while the empirical properties of social networks are intensively studied, little is known about the large-scale organization of real societies in cultural space, so that random input specifications are necessarily used in models. Here we use a large dataset to perform a high-dimensional analysis of the scientific beliefs of thousands of Europeans. We find that interopinion correlations determine a nontrivial ultrametric hierarchy of individuals in cultural space. When empirical data are used as inputs in models, ultrametricity has strong and counterintuitive effects. On short timescales, it facilitates a symmetry-breaking phase transition triggering coordinated social behavior. On long timescales, it suppresses cultural convergence by restricting it within disjoint groups. Moreover, ultrametricity implies that these results are surprisingly robust to modifications of the dynamical rules considered. Thus the empirical distribution of individuals in cultural space appears to systematically optimize the coexistence of short-term collective behavior and long-term cultural diversity, which can be realized simultaneously for the same moderate level of mutual influence in a diverse range of online and offline settings.
----------------------
Daniel Steel, Tiffany Rinne & John Fairweather
Cross-Cultural Research, February 2012, Pages 3-30
Abstract:
Research has shown relationships between personality factors and innovation at the level of the individual person. Recently, data have become available that would allow testing of these relationships at the nation-state level. Based on theoretical aspects of the Big Five factors of personality, and on empirical work conducted using individuals as the unit of analysis, the authors hypothesize that mean national scores of Openness to Experience, Agreeableness, and Conscientiousness would be related to national innovation scores. Multinational data on mean national scores of the Big Five Inventory and the NEO-PI-R are compared to national-level innovation input and output scores from the International Innovation Index and the Global Innovation Index. On both indices, the results of the analyses using the NEO-PI-R show strong, positive relationships between Openness to Experience and both aspects of innovation, a strong positive relationship between Agreeableness and innovation inputs and no relationships between Conscientiousness and either innovation inputs or outputs. The analyses using the Big Five Inventory data shows no reliable relationship between national-level personality and national innovation scores. These results are discussed in terms of their implications for what one can learn from national-level studies of personality and innovation. Suggestions are offered to those governments and financial institutions interested in encouraging economic growth via innovation.
Monday, February 6, 2012
Property
Peter Leeson
Journal of Legal Analysis, Spring 2011, Pages 341-375
Abstract:
For over a century England's judicial system decided land disputes by ordering disputants' legal representatives to bludgeon one another before an arena of spectating citizens. The victor won the property right for his principal. The vanquished lost his cause and, if he were unlucky, his life. People called these combats trials by battle. This paper investigates the law and economics of trial by battle. In a feudal world where high transaction costs confounded the Coase theorem, I argue that trial by battle allocated disputed property rights efficiently. It did this by allocating contested property to the higher bidder in an all-pay auction. Trial by battle's "auctions" permitted rent seeking. But they encouraged less rent seeking than the obvious alternative: a first-price ascending-bid auction.
----------------------
Bart Wilson et al.
Journal of Law, Economics, & Organization, forthcoming
Abstract:
This article uses a laboratory experiment to probe the proposition that property emerges anarchically out of social custom. We test the hypothesis that whalers in the 18th and 19th centuries developed rules of conduct that minimized the sum of the transaction and production costs of capturing their prey, the primary implication being that different ecological conditions led to different rules of capture. Ceteris paribus, we find that simply imposing two different types of prey is insufficient to observe two different rules of capture. Another factor is essential, namely, as Samuel Pufendorf theorized over 300 years ago, that the members of the community are civil minded.
----------------------
Sound taxation? On the use of self-declared value
Marco Haan et al.
European Economic Review, February 2012, Pages 205-215
Abstract:
In the 16th century, foreign ships passing through the Sound had to pay ad valorem taxes, known as the Sound Dues. To give skippers an incentive to declare the true value of their cargo, the Danish Crown reserved the right to purchase it at the declared value. We show that this rule does not induce truth-telling, but does allow the authorities to effectively implement a given tax rate.
----------------------
Institutional reversals and economic growth: Palestine 1516-1948
Andrew Schein
Journal of Institutional Economics, March 2012, Pages 119-141
Abstract:
This study examines the type and quality of institutions in Palestine and the correlation between the institutions and economic growth in Palestine from 1516 to 1948. Initially in the 16th century, with the Ottoman conquest of the area, institutions in Palestine involved de facto private user-rights. The level of expropriation by elites was low, and this enabled the people to develop the lands that they had acquired the right to cultivate. In the 17th and 18th centuries, with the exception of the Galilee in the middle of the 18th century, institutions became extractive due to tax farming, rapacious governors and Bedouin raids. From the middle of the 19th century until 1948, there was a second reversal back to private property institutions, first slowly until the First World War, and then more rapidly under the British Mandate after the First World War. When there were private property institutions the economy prospered, while when there were extractive institutions, the economy stagnated.
----------------------
Kim Manturuk, Sarah Riley & Janneke Ratcliffe
Social Science Research, March 2012, Pages 276-286
Abstract:
This research examines how homeowners and renters were impacted by the financial crisis in 2009. We build from the hypothesis that homeownership provides people a sense of stability which decreases the extent to which they feel stressed as a result of financial hardship. Our study tests whether owning a home affected either the degree to which lower-income households experienced financial hardship or the extent to which they perceived they were financially stressed. Using a sample of lower-income borrowers who obtained affordable mortgages through the Community Advantage Program (CAP) and a comparison panel of renters, we collected data on the effects of the financial crisis. From a portfolio performance standpoint, CAP loans have performed relatively well. Our analysis of the survey data finds that, although both renters and owners experienced similar levels of financial hardship, the homeowners were less psychologically stressed overall and reported feeling more satisfied with their financial situation.
----------------------
Should you pay off your mortgage or invest?
Valentina Michelangeli
Economics Letters, May 2012, Pages 322-324
Abstract:
The mortgage payoff dilemma affects many retirees that have enough financial assets to pay off their mortgage. I find that, on average, retirees with less than $300,000 in non-housing financial wealth are better off keeping the mortgage and investing.
----------------------
Do Borrower Rights Improve Borrower Outcomes? Evidence from the Foreclosure Process
Kristopher Gerardi, Lauren Lambie-Hanson & Paul Willen
NBER Working Paper, December 2011
Abstract:
We evaluate laws designed to protect borrowers from foreclosure. We find that these laws delay but do not prevent foreclosures. We first compare states that require lenders to seek judicial permission to foreclose with states that do not. Borrowers in judicial states are no more likely to cure and no more likely to renegotiate their loans, but the delays lead to a build-up in these states of persistently delinquent borrowers, the vast majority of whom eventually lose their homes. We next analyze a "right-to-cure" law instituted in Massachusetts on May 1, 2008. Using a difference-in-differences approach to evaluate the effect of the policy, we compare Massachusetts with neighboring states that did not adopt similar laws. We find that the right-to-cure law lengthens the foreclosure timeline but does not lead to better outcomes for borrowers.
----------------------
Waltraud Schelkle
Politics & Society, March 2012, Pages 59-80
Abstract:
The crisis of 2007-09 was prefigured by bubbles in the housing and mortgage credit markets of major Organisation for Economic Co-operation and Development (OECD) countries. A comparison of the United States, the United Kingdom, and France reveals that, contrary to popular perception, the two European countries had a bigger housing price bubble, more volatility, and a more short-termist mortgage market. Yet, the fallout of the crisis - in terms of overindebtedness of mortgage holders, foreclosures of homes, and the extent to which the "nest-eggs" of households were devalued - has been worse in the United States. This article explores which differences in the use of credit markets for the social policy of promoting homeownership can account for this puzzling finding.
----------------------
Tax Incentives for Homeownership and the Provision of Local Public Services
Kelly Edmiston & Kenneth Spong
Public Finance Review, January 2012, Pages 116-144
Abstract:
There is a substantial literature that assesses the distributional impact of the mortgage interest and state and local property tax deductions and the disparate incentives for buying a home across income groups, but virtually no work exists that evaluates the secondary effect on the provision of local public services. In this paper we evaluate the impact that disparate homeowner tax subsidies have on the provision of local public services, specifically, schools. Performing a path analysis, we find that a 100 percent increase in the average homeowner tax subsidy yields a ten percent increase in local public school spending per student.
----------------------
After the Fall: An Ex Post Characterization of Housing Price Declines across Metropolitan Areas
Richard Carson & Samuel Dastrup
Contemporary Economic Policy, forthcoming
Abstract:
Housing prices have plummeted across the United States. This article examines differences in the magnitude of housing price decreases across metropolitan areas. A small number of housing market variables observable before the fall are capable of explaining over 70% of the considerable variation in price declines. An additional non-parametric analysis suggests that exceeding particular thresholds for some of the key predictors is associated with much larger price drops. These findings are consistent with historical price patterns, which raises questions about the validity of mortgage pricing policy and risk diversification norms in the United States. The analysis points to a set of stylized facts concerning the housing price bubble that need to be explained and suggests fruitful hypotheses for understanding the dramatic housing price declines.
----------------------
Housing, the Welfare State, and the Global Financial Crisis: What is the Connection?
Herman Schwartz
Politics & Society, March 2012, Pages 35-58
Abstract:
Analyses of the global financial crisis that assign causality to the erosion of parts of the welfare state that protected individuals miss the importance of macro level regulation that protected firms and the financial system from itself. Post-Depression macro level regulation of finance prevented the emergence of mismatched maturities where deposits lacked state guarantees, and thus prevented runs on banks or near-banks. A balance sheet approach shows that macro regulation linked long duration liabilities in housing finance (mortgages) to long duration assets (pensions). Deregulation permitted the reemergence of mismatched maturities, providing both a necessary and sufficient condition for the current financial crisis.
----------------------
The Determinants of Attitudes towards Strategic Default on Mortgages
Luigi Guiso, Paola Sapienza & Luigi Zingales
Journal of Finance, forthcoming
Abstract:
We use survey data to measure households' propensity to default on mortgages even if they can afford to pay them (strategic default) when the value of the mortgage exceeds the value of the house. The willingness to default increases both in the absolute and in the relative size of the home-equity shortfall. Our evidence suggests that this willingness is affected both by pecuniary and non-pecuniary factors, such as views about fairness and morality. We also find that exposure to other people who strategically defaulted increases the propensity to default strategically because it conveys information about the probability of being sued.
----------------------
Preston McAfee & Alan Miller
Journal of Public Economics, April 2012, Pages 349-353
Abstract:
We develop a model of scarce, renewable resources to study the commons problem. We show that, contrary to conventional wisdom, property rights can often be less efficient than a commons. In particular, we study two effects: (1) waste which arises when individuals expend resources to use a resource unavailable due to congestion and (2) the risk of underutilization of the resource. We provide necessary and sufficient conditions for each effect to dominate the other when the cost of determining the availability of a resource is low.
----------------------
Revealed Preference for Relative Status: Evidence from the Housing Market
Susane Leguizamon & Justin Ross
Journal of Housing Economics, forthcoming
Abstract:
This paper investigates the value individuals place on their relative housing consumption as compared to absolute housing consumption. Using observed housing sales from three Ohio MSAs in 2000, a spatial Durbin hedonic price model provides total marginal willingness-to-pay estimates for both characteristics of housing units and those of its neighbors. Using this revealed-preference approach, we find evidence suggesting individuals do value relative house size, but the absolute effect dominates. For instance, the estimates indicate that if all homes in Columbus were to increase in size by 100 square feet, the net effect of impacts on absolute and relative consumption would be to increase house prices by $605 on average. This stands in contrast to the stated preference literature, which frequently find individuals to be willing to forgo absolute well-being in exchange for relative status gains.
----------------------
Voting on a NIMBY Facility: Proximity Cost of an "Iconic" Stadium
Gabriel Ahlfeldt & Wolfgang Maennig
Urban Affairs Review, forthcoming
Abstract:
This paper provides a spatial analysis at precinct level of the 2001 referendum of the Allianz Arena, a professional soccer stadium in Munich in Germany. While at the city level voters clearly supported the sports arena, voters in proximity of the proposed site opposed the project. Voters in proximity of an alternative site instead supported the project. We conclude that residents expected net costs of proximity to stadia and engaged in the referendum in order to shift the stadium away from their neighborhood. These findings indicate that sport facilities may exhibit a NIMBY (Not In My Backyard) character, which stands in contrast to the evidence available for the United States. Proximity costs and benefits of sports facilities apparently vary across sports and countries.
Sunday, February 5, 2012
Couch Potato
The Effects of Reality Television on Weight Bias: An Examination of The Biggest Loser
Sarah Domoff et al.
Obesity, forthcoming
Abstract:
Weight-loss reality shows, a popular form of television programming, portray obese individuals and their struggles to lose weight. While the media is believed to reinforce obesity stereotypes and contribute to weight stigma, it is not yet known whether weight-loss reality shows have any effect on weight bias. The goal of this investigation was to examine how exposure to 40-min of The Biggest Loser impacted participants' levels of weight bias. Fifty-nine participants (majority of whom were white females) were randomly assigned to either an experimental (one episode of The Biggest Loser) or control (one episode of a nature reality show) condition. Levels of weight bias were measured by the Implicit Associations Test (IAT), the Obese Person Trait Survey (OPTS), and the Anti-fat Attitudes scale (AFA) at baseline and following the episode viewing (1 week later). Participants in The Biggest Loser condition had significantly higher levels of dislike of overweight individuals and more strongly believed that weight is controllable after the exposure. No significant condition effects were found for implicit bias or traits associated with obese persons. Exploratory analyses examining moderation of the condition effect by BMI and intention to lose weight indicated that participants who had lower BMIs and were not trying to lose weight had significantly higher levels of dislike of overweight individuals following exposure to The Biggest Loser compared to similar participants in the control condition. These results indicate that anti-fat attitudes increase after brief exposure to weight-loss reality television.
----------------------
The Psychological Weight of Weight Stigma
Brenda Major, Dina Eliezer & Heather Rieck
Social Psychological and Personality Science, forthcoming
Abstract:
The authors theorized that overweight individuals experience social identity threat in situations that activate concerns about weight stigma, causing them to experience increased stress and reduced self-control. To test these predictions, women who varied in body mass index (BMI) gave a speech on why they would make a good dating partner. Half thought they were videotaped (weight visible); the remainder thought they were audiotaped (weight not visible). As predicted, higher BMI was associated with increased blood pressure and poorer performance on a measure of executive control when weight was visible and concerns about stigma were activated but not when weight was not visible. Compared to average weight women, overweight women also reported more stress-related emotions when videotaped versus audiotaped. Findings suggest that weight stigma can be detrimental to mental and physical health and deplete self-regulatory resources necessary for weight control.
----------------------
Kathleen Keller et al.
Obesity, forthcoming
Abstract:
Animal studies show that CD36, a fatty acid translocase, is involved in fat detection and preference, but these findings have not been reported in humans. The objective of this study was to determine whether human genetic variation in 5 common CD36 polymorphisms is associated with oral fat perception of Italian salad dressings, self-reported acceptance of high-fat foods and obesity in African-American adults (n = 317). Ratings of perceived oiliness, fat content, and creaminess were assessed on a 170-mm visual analogue scale (VAS) in response to salad dressings that were 5%, 35%, and 55% fat-by-weight content. Acceptance of added fats and oils and high-fat foods was self-reported and anthropometric measures were taken in the laboratory. DNA was isolated from saliva and genotyped at 5 CD36 polymorphisms. Three polymorphisms, rs1761667, rs3840546, and rs1527483 were associated with the outcomes. Participants with the A/A genotype at rs1761667 reported greater perceived creaminess, regardless of the fat concentration of the salad dressings (P < 0.01) and higher mean acceptance of added fats and oils (P = 0.02) compared to those with other genotypes at this site. Individuals who had C/T or T/T genotypes at rs1527483 also perceived greater fat content in the salad dressings, independent of fat concentration (P = 0.03). BMI and waist circumference were higher in participants who were homozygous for a deletion (D/D) at rs3840546, compared to I/D or D/D individuals (P < 0.001), but only 2 D/D individuals were tested, so this finding needs replication. This is the first study to demonstrate an association between common variants in CD36 and fat ingestive behaviors in humans.
----------------------
Obesity, SES, and Economic Development: A Test of the Reversal Hypothesis
Fred Pampel
Social Science & Medicine, forthcoming
Abstract:
Studies of individual countries suggest that socioeconomic status (SES) and weight are positively associated in lower-income countries but negatively associated in higher-income countries. However, this reversal in the direction of the SES-weight relationship and arguments about the underlying causes of the reversal need to be tested with comparable data for a large and diverse set of nations. This study systematically tests the reversal hypothesis using individual- and aggregate-level data for 67 nations representing all regions of the world. In support of the hypothesis, we find not only that the body mass index, being overweight, and being obese rise with national product but also that the associations of SES with these outcomes shift from positive to negative. These findings fit arguments about how health-related, SES-based resources, costs, and values differ across levels of economic development. Although economic and social development can improve health, it can also lead to increasing obesity and widening SES disparities in obesity.
----------------------
Educational Differences in Obesity in the United States: A Closer Look at the Trends
Yan Yu
Obesity, forthcoming
Abstract:
Both body weight and educational attainment have risen in the United States. Empirical evidence regarding educational differences in obesity (BMI ≥30) is inconsistent. According to some widely cited claims, these differences have declined since the 1970s, and the most educated have experienced the greatest gain in obesity. Prior research was limited in grouping college graduates with nongraduates, combining men and women in the same analysis, and using self-reported rather than measured anthropometric information. Using the National Health and Nutrition Examination Surveys (NHANES), we address these issues and examine changing educational differences in obesity from 1971-1980 to 1999-2006 for non-Hispanic whites and blacks in two separate age groups (25-44 vs. 45-64 years). We find that (i) obesity differentials by education have remained largely stable, (ii) compared with college graduates, less educated whites and younger black women continue to be more likely to be obese, (iii) but the differentials are larger for women than men, and weak or nonexistent among black men and older black women. There are exceptions to the overall trend. The obesity gap has widened between the two groups of college-educated younger women, but disappeared between the least and most educated younger white men. Thus, the increase in obesity was similar for most educational groups, but significantly greater for younger women with some college and smaller for younger white men without a high-school degree. Lumping together the two distinct college groups has biased previous estimates of educational differences in obesity.
----------------------
Economic growth and obesity: An interesting relationship with world-wide implications
Garry Egger, Boyd Swinburn & Amirul Islam
Economics & Human Biology, forthcoming
Abstract:
The prosperity of a country, commonly measured in terms of its annual per capita Gross Domestic Product (GDP), has different relationships with population levels of body weight and happiness, as well as environmental impacts such as carbon emissions. The aim of this study was to examine these relationships and to try to find a level of GDP, which provides for sustainable economic activity, optimal happiness and healthy levels of mean body mass index (BMI). Spline regression analyses were conducted using national indices from 175 countries: GDP, adult BMI, mean happiness scores, and carbon footprint per capita for the year 2007. Results showed that GDP was positively related to BMI and happiness up to ∼$US3,000 and ∼$5,000 per capita respectively, with no significant relationships beyond these levels. GDP was also positively related to CO2 emissions with a recognised sustainable carbon footprint of less than 5 tonnes per capita occurring at a GDP of <$US15,000. These findings show that a GDP between $US5-$15,000 is associated with greater population happiness and environmental stability. A mean BMI of 21-23 kg/m2, which minimises the prevalence of underweight and overweight in the population then helps to define an ideal position in relation to growth, which few countries appear to have obtained. Within a group of wealthy countries (GDP > $US30,000), those with lower income inequalities and more regulated (less liberal) market systems had lower mean BMIs.
----------------------
Acute Sleep Deprivation Enhances the Brain's Response to Hedonic Food Stimuli: An fMRI Study
Christian Benedict et al.
Journal of Clinical Endocrinology & Metabolism, forthcoming
Context: There is growing recognition that a large number of individuals living in Western society are chronically sleep deprived. Sleep deprivation is associated with an increase in food consumption and appetite. However, the brain regions that are most susceptible to sleep deprivation-induced changes when processing food stimuli are unknown.
Objective: Our objective was to examine brain activation after sleep and sleep deprivation in response to images of food.
Intervention: Twelve normal-weight male subjects were examined on two sessions in a counterbalanced fashion: after one night of total sleep deprivation and one night of sleep. On the morning after either total sleep deprivation or sleep, neural activation was measured by functional magnetic resonance imaging in a block design alternating between high- and low-calorie food items. Hunger ratings and morning fasting plasma glucose concentrations were assessed before the scan, as were appetite ratings in response to food images after the scan.
Main Outcome Measures: Compared with sleep, total sleep deprivation was associated with an increased activation in the right anterior cingulate cortex in response to food images, independent of calorie content and prescan hunger ratings. Relative to the postsleep condition, in the total sleep deprivation condition, the activation in the anterior cingulate cortex evoked by foods correlated positively with postscan subjective appetite ratings. Self-reported hunger after the nocturnal vigil was enhanced, but importantly, no change in fasting plasma glucose concentration was found.
Conclusions: These results provide evidence that acute sleep loss enhances hedonic stimulus processing in the brain underlying the drive to consume food, independent of plasma glucose levels. These findings highlight a potentially important mechanism contributing to the growing levels of obesity in Western society.
----------------------
Kate Tchanturia et al.
PLoS ONE, January 2012, e28331
Background: People with eating disorders (ED) frequently present with inflexible behaviours, including eating related issues which contribute to the maintenance of the illness. Small scale studies point to difficulties with cognitive set-shifting as a basis. Using larger scale studies will lend robustness to these data.
Methodology/Principal Findings: 542 participants were included in the dataset as follows: Anorexia Nervosa (AN) n = 171; Bulimia Nervosa (BN) n = 82; Recovered AN n = 90; Healthy controls (HC): n = 199. All completed the Wisconsin Card Sorting Task (WCST), an assessment that integrates multiple measurement of several executive processes concerned with problem solving and cognitive flexibility. The AN and BN groups performed poorly in most domains of the WCST. Recovered AN participants showed a better performance than currently ill participants; however, the number of preservative errors was higher than for HC participants.
Conclusions/Significance: There is a growing interest in the diagnostic and treatment implications of cognitive flexibility in eating disorders. This large dataset supports previous smaller scale studies and a systematic review which indicate poor cognitive flexibility in people with ED.
----------------------
Monika Krzyżanowska & Nicholas Mascie-Taylor
Journal of Biosocial Science, March 2012, Pages 221-228
Abstract:
Using a sample of 2090 British father and son pairs the relationships between social and geographical intra- and inter-generational mobility were examined in relation to height, weight and body mass index (BMI). There was much more social mobility than geographical (regional) migration. Social mobility and geographical migration were not independent: socially non-mobile fathers and sons were more likely to be geographical non-migrants, and upwardly socially mobile fathers and sons were more likely to be regional migrants. Upwardly socially mobile fathers and sons were, on average, taller and had a lower BMI than non-mobile and downwardly mobile fathers and sons. In general, no significant associations were found between geographical migration and height or weight. Migrating fathers had a lower BMI than sedentes, as did their sons who migrated between 1965 and 1991. There was no significant interaction that indicated that social mobility and geographical migration were acting in a simple additive way on height, weight and BMI.
----------------------
Obesity and Pain Are Associated in the United States
Arthur Stone & Joan Broderick
Obesity, forthcoming
Abstract:
Recent small-scale studies have shown a positive association between central obesity and self-reported pain levels. This study attempts to replicate the finding in a survey of over 1,000,000 individuals in the United States. The Gallup Organization conducted a proprietary survey between 2008 through 2010 where 1,062,271 randomly selected individuals in the United States participated in a telephone interview. Survey questions included height and weight, from which BMI was computed, questions about pain conditions in the past year, and a question about pain experience yesterday. Only 19.2% of the sample was classified as Low-Normal BMI, 21.4 were classified as Overweight, and the remainder was in the three categories of Obese. BMI and pain yesterday were reliably associated when demographic variables were controlled: the overweight group reported 20% higher rates of pain than Low-Normal group, 68% higher for Obese I group, 136% higher for Obese II group, and 254% higher for Obese III group. The association held for both men and women and it became stronger in older age groups. Controlling the associations for other pain-related medical conditions substantially reduced the associations, but they remained substantial for the Obese groups. We conclude that BMI and daily pain are positively correlated in the United States: people who are obese are considerably more prone to having daily pain. The association is robust and holds after controlling for several pain conditions and across gender and age. The increasing BMI-pain association with older ages suggests a developmental process that, along with metabolic hypotheses, calls out for investigation.
----------------------
Evidence of Motivational Influences in Early Visual Perception: Hunger Modulates Conscious Access
Rémi Radel & Corentin Clément-Guillotin
Psychological Science, forthcoming
"Although food deprivation did not affect the reported visibility of neutral words, t(40) = 0.48, n.s., fasting participants rated the visibility of food-related words higher (M = 5.48, SD = 1.42) than satiated participants did (M = 4.52, SD = 1.51), t(40) = 2.06, p < .05...The research reported here extends the generally accepted concept that people tend to see what they want to see (e.g., Balcetis & Dunning, 2006). Whereas the results of previous studies could be explained by an implicit bias occurring at a postperceptual stage, our findings indicate that motivation directly improves perceptual encoding of desired stimuli. This demonstration of a modulation of conscious access reveals that motivational influences can penetrate early perceptual processing. Specifically, our results imply that the stimuli were quickly processed unconsciously on a semantic level, and that the stimuli most relevant to participants' goals were most likely to be selected to reach consciousness."
----------------------
"Theory of food" as a neurocognitive adaptation
John Allen
American Journal of Human Biology, forthcoming
Abstract:
Human adult cognition emerges over the course of development via the interaction of multiple critical neurocognitive networks. These networks evolved in response to various selection pressures, many of which were modified or intensified by the intellectual, technological, and sociocultural environments that arose in connection with the evolution of genus Homo. Networks related to language and theory of mind clearly play an important role in adult cognition. Given the critical importance of food to both basic survival and cultural interaction, a "theory of food" (analogous to theory of mind) may represent another complex network essential for normal cognition. I propose that theory of food evolved as an internal, cognitive representation of our diets in our minds. Like other complex cognitive abilities, it relies on complex and overlapping dedicated neural networks that develop in childhood under familial and cultural influences. Normative diets are analogous to first languages in that they are acquired without overt teaching; they are also difficult to change or modify once a critical period in development is passed. Theory of food suggests that cognitive activities related to food may be cognitive enhancers, which could have implications for maintaining healthy brain function in aging.
----------------------
Impact of Physician BMI on Obesity Care and Beliefs
Sara Bleich et al.
Obesity, forthcoming
Abstract:
Using a national cross-sectional survey of 500 primary care physicians conducted between 9 February and 1 March 2011, the objective of this study was to assess the impact of physician BMI on obesity care, physician self-efficacy, perceptions of role-modeling weight-related health behaviors, and perceptions of patient trust in weight loss advice. We found that physicians with normal BMI were more likely to engage their obese patients in weight loss discussions as compared to overweight/obese physicians (30% vs. 18%, P = 0.010). Physicians with normal BMI had greater confidence in their ability to provide diet (53% vs. 37%, P = 0.002) and exercise counseling (56% vs. 38%, P = 0.001) to their obese patients. A higher percentage of normal BMI physicians believed that overweight/obese patients would be less likely to trust weight loss advice from overweight/obese doctors (80% vs. 69%, P = 0.02). Physicians in the normal BMI category were more likely to believe that physicians should model healthy weight-related behaviors - maintaining a healthy weight (72% vs. 56%, P = 0.002) and exercising regularly (73% vs. 57%, P = 0.001). The probability of a physician recording an obesity diagnosis (93% vs. 7%, P < 0.001) or initiating a weight loss conversation (89% vs. 11%, P ≤ 0.001) with their obese patients was higher when the physicians' perception of the patients' body weight met or exceeded their own personal body weight. These results suggest that more normal weight physicians provided recommended obesity care to their patients and felt confident doing so.
----------------------
Looks Good Enough to Eat: How Food Plating Preferences Differ Across Cultures and Continents
Francesca Zampollo et al.
Cross-Cultural Research, February 2012, Pages 31-49
Abstract:
Food is central to cross-cultural studies of behavior, thought, and symbolism. The way it is presented to people, however, can have a dramatic influence on how palatable it is perceived and what is eaten. Because of this, issues of food plating and presentation are of applied interest to anyone who wishes to influence the perceptions and consumption of prepared food. This includes chefs, marketers, and parents. This study examines two questions: (a) What are these visual preferences of plating, and (b) How do they vary across cultures? To explore these questions, we presented a wide range of meal photos to adults from the United States, Italy, and Japan to assess preferences for various plating arrangements. Across six visual dimensions of food, there was a consistent preference for the number of colors on a plate (three), components on a plate (three to four) and the fill level of a plate; however, there were diverging preferences regarding the preferred position of the featured main course, how the items should be organized, and whether they should be casually presented. We discuss the implications of our findings for cross-cultural researchers as well as those who wish to influence the perceptions and food consumption of others.
----------------------
Measuring Availability of Healthy Foods: Agreement Between Directly Measured and Self-reported Data
Latetia Moore, Ana Diez Roux & Manuel Franco
American Journal of Epidemiology, forthcoming
Abstract:
A major challenge in studies of the impact of the local food environment is the accuracy of measures of healthy food access. The authors assessed agreement between self-reported and directly measured availability of healthful choices within neighborhood food stores and examined the validity of reported availability using directly measured availability as a "gold standard." Reported availability was measured via a phone survey of 1,170 adults in Baltimore, Maryland, in 2004. Directly measured availability was assessed in 226 food stores in 2006 using a modified Nutrition Environment Measures Survey in Stores (NEMS-S). Whites, college-educated individuals, and higher income households (≥$50,000) had significantly higher reported and directly measured availability than did blacks, those with less education, and lower income households. Persons in areas with above average directly measured availability reported above average availability 70%-80% of the time (sensitivity = 79.6% for all stores within 1 mile (1.6 km) of participants' homes and 69.6% for the store with the highest availability within 1 mile). Those with below average directly measured availability reported low availability only half the time. With revisions to improve specificity, self-reported measures can be reasonable indicators of healthy food availability and provide feasible proxy measures of directly assessed availability.
Saturday, February 4, 2012
Open Your Mind
Dead and Alive: Beliefs in Contradictory Conspiracy Theories
Michael Wood, Karen Douglas & Robbie Sutton
Social Psychological and Personality Science, forthcoming
Abstract:
Conspiracy theories can form a monological belief system: A self-sustaining worldview comprised of a network of mutually supportive beliefs. The present research shows that even mutually incompatible conspiracy theories are positively correlated in endorsement. In Study 1 (n = 137), the more participants believed that Princess Diana faked her own death, the more they believed that she was murdered. In Study 2 (n = 102), the more participants believed that Osama Bin Laden was already dead when U.S. special forces raided his compound in Pakistan, the more they believed he is still alive. Hierarchical regression models showed that mutually incompatible conspiracy theories are positively associated because both are associated with the view that the authorities are engaged in a cover-up (Study 2). The monological nature of conspiracy belief appears to be driven not by conspiracy theories directly supporting one another but by broader beliefs supporting conspiracy theories in general.
----------------------
Feeling the Future: The Emotional Oracle Effect
Michel Tuan Pham, Leonard Lee & Andrew Stephen
Journal of Consumer Research, forthcoming
Abstract:
Eight studies reveal an intriguing phenomenon: Individuals who have higher trust in their feelings can predict the outcomes of future events better than individuals with lower trust in their feelings. This emotional oracle effect was found across a variety of prediction domains, including (a) the 2008 U.S. Democratic presidential nomination, (b) movie box-office success, (c) the winner of American Idol, (d) the stock market, (e) college football, and even (f) the weather. It is mostly high trust in feelings that improves prediction accuracy rather than low trust in feelings that impairs it. However, the effect occurs only among individuals who possess sufficient background knowledge about the prediction domain, and dissipates when the prediction criterion becomes inherently unpredictable. The authors hypothesize that the effect arises because trusting one's feelings encourages access to a "privileged window" into the vast amount of predictive information that people learn, often unconsciously, about their environments.
----------------------
Reducing Information Avoidance Through Affirmation
Jennifer Howell & James Shepperd
Psychological Science, February 2012, Pages 141-145
Abstract:
Although screening for medical problems can have health benefits, the potentially threatening nature of the results can lead people to avoid screening. In three studies, we examined whether affirming people's self-worth reduces their avoidance of medical-screening feedback. Participants completed an online risk calculator for a fictitious medical condition and then were offered a choice to receive or not receive their risk feedback. Our results showed that affirmation decreased participants' avoidance of risk feedback (Study 1) and eliminated the increased avoidance typically observed when risk feedback might obligate people to engage in undesired behavior (Study 2) and when feedback is about risk for an untreatable disease (Study 3). These findings suggest that affirmation may be an effective strategy for increasing rates of medical screening.
----------------------
Uncorking the muse: Alcohol intoxication facilitates creative problem solving
Andrew Jarosz, Gregory Colflesh & Jennifer Wiley
Consciousness and Cognition, forthcoming
Abstract:
That alcohol provides a benefit to creative processes has long been assumed by popular culture, but to date has not been tested. The current experiment tested the effects of moderate alcohol intoxication on a common creative problem solving task, the Remote Associates Test (RAT). Individuals were brought to a blood alcohol content of approximately .075, and, after reaching peak intoxication, completed a battery of RAT items. Intoxicated individuals solved more RAT items, in less time, and were more likely to perceive their solutions as the result of a sudden insight. Results are interpreted from an attentional control perspective.
----------------------
Kimberlee Weaver, Stephen Garcia & Norbert Schwartz
Journal of Consumer Research, forthcoming
Abstract
This analysis introduces the Presenter's Paradox. Robust findings in impression formation demonstrate that perceivers' judgments show a weighted averaging pattern, which results in less favorable evaluations when mildly favorable information is added to highly favorable information. Across seven studies, we show that presenters do not anticipate this averaging pattern on the part of evaluators and instead design presentations that include all of the favorable information available. This additive strategy ("more is better") hurts presenters in the perceivers' eyes because mildly favorable information dilutes the impact of highly favorable information. For example, presenters choose to spend more money to make a product bundle look more costly, even though doing so actually cheapened its value from the evaluators' perspective (study 1). Additional studies demonstrate the robustness of the effect, investigate the psychological processes underlying it, and examine its implications for a variety of marketing contexts.
----------------------
Dean Simonton
Psychology of Aesthetics, Creativity, and the Arts, forthcoming
Abstract:
Galileo Galilei's celebrated contributions to astronomy are used as case studies in the psychology of scientific discovery. Particular attention was devoted to the involvement of foresight, insight, oversight, and hindsight. These four mental acts concern, in divergent ways, the relative degree of "sightedness" in Galileo's discovery process and accordingly have implications for evaluating the blind-variation and selective-retention (BVSR) theory of creativity and discovery. Scrutiny of the biographical and historical details indicates that Galileo's mental processes were far less sighted than often depicted in retrospective accounts. Hindsight biases clearly tend to underline his insights and foresights while ignoring his very frequent and substantial oversights. Of special importance was how Galileo was able to create a domain-specific expertise where no such expertise previously existed - in part by exploiting his extensive knowledge and skill in the visual arts. Galileo's success as an astronomer was founded partly and "blindly" on his artistic avocations. The investigation closes by briefly discussing Antonie van Leeuwenhoek's similar creation of microscopic biology. This parallel case indicates that Galileo's telescopic astronomy was probably not unique as an illustration of how scientific discovery works in practice.
----------------------
Embodied Metaphors and Creative "Acts"
Angela Leung et al.
Psychological Science, forthcoming
Abstract:
Creativity is a highly sought after skill. To inspire people's creativity, prescriptive advice in the form of metaphors abound: We are encouraged to think outside the box, to consider the problem on one hand, then on the other hand, and to put two and two together to achieve creative breakthroughs. These metaphors suggest a connection between concrete bodily experiences and creative cognition. Inspired by recent advances on body-mind linkages under the emerging vernacular of embodied cognition, we explored for the first time whether enacting metaphors for creativity enhances creative problem-solving. In five studies, findings revealed that both physically and psychologically embodying creative metaphors promote fluency, flexibility, and/or originality in problem-solving. Going beyond prior research that focused primarily on the kind of embodiment that primes preexisting knowledge, we provide the first evidence that embodiment can also activate cognitive processes conducive for generating previously unknown ideas and connections.
----------------------
Edith Chen et al.
Psychosomatic Medicine, forthcoming
Objective: Low socioeconomic status (SES) early in life is one of the most well-established social predictors of poor health. However, little is understood about why some adults who grew up in low-SES environments do not have poor health outcomes. This study examined whether the psychological characteristic of "shift-and-persist" protects adults from the physiological risks of growing up in low-SES households. Shift-and-persist consists of reframing appraisals of current stressors more positively (shifting), while simultaneously persisting with a focus on the future. We hypothesized that this characteristic would be associated with reduced physiological risk in low-childhood SES individuals.
Methods: A national sample of 1207 adults (aged 25-74 years) from the Survey of Midlife Development in the United States completed psychological questionnaires and were queried about parent education. Biologic assessments consisted of 24 different measures across seven physiological systems, from which a composite measure representing cumulative physiological risk (allostatic load) was derived.
Results: Among adults who grew up in low-SES households, those who engaged in high-shift-and-high-persist strategies had the lowest allostatic load (b = -0.15, p = .04). No benefit of shift-and-persist was found for those from higher-childhood SES backgrounds (p = .36).
Conclusions: Identifying the health-related protective qualities that naturally occur in some low-SES individuals represents one important approach for developing future health improvement interventions for those who start out life low in SES. Moreover, the psychological qualities that are protective from future disease risk for those from low-SES backgrounds are different from those beneficial to high-SES individuals.
----------------------
Empathy Manipulation Impacts Music-Induced Emotions: A Psychophysiological Study on Opera
Andrei Miu & Felicia Rodica Balteş
PLoS ONE, January 2012, e30618
Abstract:
This study investigated the effects of voluntarily empathizing with a musical performer (i.e., cognitive empathy) on music-induced emotions and their underlying physiological activity. N = 56 participants watched video-clips of two operatic compositions performed in concerts, with low or high empathy instructions. Heart rate and heart rate variability, skin conductance level (SCL), and respiration rate (RR) were measured during music listening, and music-induced emotions were quantified using the Geneva Emotional Music Scale immediately after music listening. Listening to the aria with sad content in a high empathy condition facilitated the emotion of nostalgia and decreased SCL, in comparison to the low empathy condition. Listening to the song with happy content in a high empathy condition also facilitated the emotion of power and increased RR, in comparison to the low empathy condition. To our knowledge, this study offers the first experimental evidence that cognitive empathy influences emotion psychophysiology during music listening.
----------------------
Saving the Last for Best: A Positivity Bias for End Experiences
Ed O'Brien & Phoebe Ellsworth
Psychological Science, February 2012, Pages 163-165
"The research reported here demonstrates the power of endings in everyday life. Furthermore, unlike most prior research, it assessed participants' feelings as the endings occurred rather than retrospectively. Participants who knew they were eating the final chocolate of a taste test enjoyed it more, preferred it to other chocolates, and rated the overall experience as more enjoyable than participants who thought they were just eating one more chocolate in a series. These results are especially intriguing because the 'end' was somewhat artificial and impermanent (i.e., participants could still eat chocolates after finishing our experiment). This suggests that the same experience is viewed as better simply because people are aware that it is the last in a series, and this awareness influences subsequent evaluations and preferences."
----------------------
Jack Goncalo & Michelle Duguid
Organizational Behavior and Human Decision Processes, forthcoming
Abstract:
Adopting a person by situation interaction approach, we identified conditions under which conformity pressure can either stifle or boost group creativity depending on the joint effects of norm content and group personality composition. Using a 2 × 2 × 2 experimental design, we hypothesized and found that pressure to adhere to an individualistic norm boosted creativity in groups whose members scored low on the Creative Personality Scale (Gough, 1979), but stifled creativity in groups whose members scored high on that measure. Our findings suggest that conformity pressure may be a viable mechanism for boosting group creativity, but only among those who lack creative talent.
----------------------
Carsten De Dreu et al.
Personality and Social Psychology Bulletin, forthcoming
Abstract:
Anecdotes from creative eminences suggest that executive control plays an important role in creativity, but scientific evidence is sparse. Invoking the Dual Pathway to Creativity Model, the authors hypothesize that working memory capacity (WMC) relates to creative performance because it enables persistent, focused, and systematic combining of elements and possibilities (persistence). Study 1 indeed showed that under cognitive load, participants performed worse on a creative insight task. Study 2 revealed positive associations between time-on-task and creativity among individuals high but not low in WMC, even after controlling for general intelligence. Study 3 revealed that across trials, semiprofessional cellists performed increasingly more creative improvisations when they had high rather than low WMC. Study 4 showed that WMC predicts original ideation because it allows persistent (rather than flexible) processing. The authors conclude that WMC benefits creativity because it enables the individual to maintain attention focused on the task and prevents undesirable mind wandering.
----------------------
Ettore Ambrosini, Corrado Sinigaglia & Marcello Costantini
Journal of Experimental Psychology: Human Perception and Performance, forthcoming
Abstract:
Previous studies have demonstrated that motor abilities allow us not only to execute our own actions and to predict their consequences, but also to predict others' actions and their consequences. But just how deeply are motor abilities implicated in action observation? If an observer is prevented from acting while witnessing others' actions, will this impact on their making sense of others' behavior? We recorded proactive eye movements while participants observed an actor grasping objects. The participants' hands were either freely resting on the table or tied behind their back. Proactivity of gaze behavior was dramatically impaired when participants observed others' actions with their hands tied. Since we don't literally perceive actions with our hands, the effect may be explained by the hypothesis that effective observation of action depends not only on motor abilities but on being in a position to exercise them. This suggests, for the first time, that actions are observed best when we are actually in the position to perform them.
----------------------
The Role of Bolstering and Counterarguing Mind-Sets in Persuasion
Alison Jing Xu & Robert Wyer
Journal of Consumer Research, February 2012, Pages 920-932
Abstract:
The effect of a persuasive communication on individuals' attitudes can be influenced by the cognitive behavior they have performed in an earlier, unrelated situation. Inducing participants to make supportive elaborations about a series of propositions activated a bolstering mind-set that increased the effectiveness of an unrelated advertisement they encountered subsequently. However, inducing participants to refute the implications of a series of propositions activated a counterarguing mind-set that decreased the ad's effectiveness. These mind-sets had more impact when the cognitive behavior they activated differed from the behavior that would occur in the absence of these mind-sets. When the implications of a persuasive message were difficult to refute, inducing a counterarguing mind-set increased its effectiveness. Finally, watching a political speech or debate activated different mind-sets, depending on participants' a priori attitude toward the politicians involved, and these mind-sets influenced the impact of an unrelated commercial they considered later.
----------------------
The Wisdom of the Crowd in Combinatorial Problems
Sheng Kung Michael Yi et al.
Cognitive Science, forthcoming
Abstract:
The "wisdom of the crowd" phenomenon refers to the finding that the aggregate of a set of proposed solutions from a group of individuals performs better than the majority of individual solutions. Most often, wisdom of the crowd effects have been investigated for problems that require single numerical estimates. We investigate whether the effect can also be observed for problems where the answer requires the coordination of multiple pieces of information. We focus on combinatorial problems such as the planar Euclidean traveling salesperson problem, minimum spanning tree problem, and a spanning tree memory task. We develop aggregation methods that combine common solution fragments into a global solution and demonstrate that these aggregate solutions outperform the majority of individual solutions. These case studies suggest that the wisdom of the crowd phenomenon might be broadly applicable to problem-solving and decision-making situations that go beyond the estimation of single numbers.
----------------------
Disliked Music can be Better for Performance than Liked Music
Nick Perham & Martinne Sykora
Applied Cognitive Psychology, forthcoming
Abstract:
Although liked music is known to improve performance through boosting one's mood and arousal, both liked music and disliked music impair serial recall performance. Given that the key acoustical feature of this impairment is the acoustical variation, it is possible that some music may contain less acoustical variation and so produce less impairment. In this situation, unliked, unfamiliar music could be better for performance than liked, familiar music. This study tested this by asking participants to serially recall eight-item lists in either quiet, liked or disliked music conditions. Results showed that performance was significantly poorer in both music conditions compared with quiet. More importantly, performance in the liked music condition was significantly poorer than in the disliked music condition. These findings provide further illustration of the irrelevant sound effect and limitations of the impact of liked music on cognition.
----------------------
The role of medial prefrontal cortex in theory of mind: A deep rTMS study
Laura Krause et al.
Behavioural Brain Research, 1 March 2012, Pages 87-90
Abstract:
Neuroimaging studies suggest that the medial prefrontal cortex (mPFC) plays a central role in cognitive theory of mind (ToM). This can be assessed more definitively, however, using repetitive transcranial magnetic stimulation (rTMS). Sixteen healthy participants (10 females, 6 males) completed tasks assessing cognitive and affective ToM following low-frequency deep rTMS to bilateral mPFC in active-stimulation and placebo-stimulation sessions. There was no effect of deep rTMS on either cognitive or affective ToM performance. When examining self-reported empathy, however, there was evidence for a double dissociation: deep rTMS disrupted affective ToM performance for those with high self-reported empathy, but improved affective ToM performance for those with low self-reported empathy. mPFC appears to play a role in affective ToM processing, but the present study suggest that stimulation outcomes are dependent on baseline empathic abilities.
----------------------
Dopamine receptor D4 gene variation predicts preschoolers' developing theory of mind
Christine Lackner et al.
Developmental Science, forthcoming
Abstract:
Individual differences in preschoolers' understanding that human action is caused by internal mental states, or representational theory of mind (RTM), are heritable, as are developmental disorders such as autism in which RTM is particularly impaired. We investigated whether polymorphisms of genes affecting dopamine (DA) utilization and metabolism constitute part of the molecular basis of this heritability. Seventy-three 42- to 54-month-olds were given a battery of RTM tasks along with other task batteries that measured executive functioning and representational understanding more generally. Polymorphisms of the dopamine D4 receptor gene (DRD4) were associated with RTM performance such that preschoolers with shorter alleles outperformed those with one or more longer alleles. However, polymorphisms of the catechol-O-methyl transferase gene (COMT) and the dopamine transporter gene (DAT1) genes were not associated with children's RTM performance. Further tests showed that the association between DRD4 allele length and RTM performance was not attributable to a common association with executive functioning or representational understanding more generally. We conclude that DRD4 receptors, likely via their effects on frontal lobe development and functioning, may represent a neuromaturational constraint governing the stereotypical and universal trajectory of RTM development.
Friday, February 3, 2012
Accountable
Penalizing the Party: Health Care Reform Issue Voting in the 2010 Election
David Konisky & Lilliard Richardson
American Politics Research, forthcoming
Abstract:
Many political pundits characterized the 2010 election as a referendum on President Obama's health care reform law. The political science literature on issue voting, however, does not consistently demonstrate that these types of policy evaluations are central to citizens' vote choices. Moreover, existing theories suggest different predictions about how the health care reform issue would affect elections across different levels of government. Studying data from the 2010 Cooperative Congressional Election Study (CCES), the analysis indicates that those opposed to health care reform were less likely to vote for Democratic candidates in the U.S. House, the U.S. Senate, state gubernatorial, and state attorneys general contests, controlling for partisan affiliation, political ideology, perceptions of the economy, and evaluations of other salient policy issues. These findings suggest that, across the board, Democrats were penalized for their support of health care reform, and more generally provide evidence of the role of noneconomic issue voting in U.S. elections.
----------------------
The Electoral Consequences of Large Fiscal Adjustments
Alberto Alesina, Dorian Carloni & Giampaolo Lecce
NBER Working Paper, December 2011
Abstract:
The conventional wisdom regarding the political consequences of large reductions of budget deficits is that they are very costly for the governments which implement them: they are punished by voters at the following elections. In the present paper, instead, we find no evidence that governments which quickly reduce budget deficits are systematically voted out of office in a sample of 19 OECD countries from 1975 to 2008. We also take into consideration issues of reverse causality, namely the possibility that only "strong and popular" governments can implement fiscal adjustments and thus they are not voted out of office "despite" having reduced the deficits. In the end we conclude that many governments can reduce deficits avoiding an electoral defeat.
----------------------
David Law
Georgetown Law Journal, March 2011, Pages 779-835
Abstract:
The organizational structure of a judicial system has systematic implications for the ideological slant of judicial policymaking. These implications are, however, rarely discussed and poorly understood. This Article uses the prospect of court-rigging to illustrate both the impact of institutional design on judicial policymaking and the perils of taking institutional design for granted. Political leaders often pursue a form of entrenchment by attempting to imbue the courts with an enduring ideological bias. But the most familiar strategies for achieving this type of entrenchment - namely, court-packing and gerrymandering - are doomed to enjoy only limited success in the context of the Federal Judiciary. Comparative analysis of the judiciary's organizational structure, by contrast, highlights the existence of design vulnerabilities that could be exploited to greater effect. Examination of the Japanese judiciary in particular suggests that a more effective strategy would be to restructure the federal courts by delegating power over sensitive policy and personnel decisions to ideologically reliable, self-replicating agents who are insulated from the effects of regime change. Unlike conventional court-packing strategies, this approach can be implemented in ways that are not merely consistent with the requirements of Article III, but that actually exploit those very requirements for even greater effect. Specific implementation mechanisms discussed in this Article include the creation of a new intermediate appellate court with the ability to select its own members; the introduction of procedural rules that would effectively restrict the Supreme Court's appellate docket; and a comprehensive overhaul of the law clerk system that would forge the clerks into a collective body, establish their independence from the judges whom they nominally serve, and subject them to a combination of bureaucratic supervision and oversight by the legal academy.
----------------------
Gregory Huber, Seth Hill & Gabriel Lenz
Yale Working Paper, September 2011
Abstract:
Are citizens competent assessors of incumbent performance? Although observational studies cast doubt on their retrospective abilities, inferences from these studies are limited by the complexity of the real world, making it difficult to know why these shortcoming arise. In this paper, we show that biases in retrospective evaluation occur even in the simplified setting of experimental games. In three experiments, our participants (1) overweighted recent relative to overall incumbent performance when made aware of an election closer rather than more distant from that event, (2) allowed an unrelated lottery that affected their welfare to influence their choices, and (3) were influenced by rhetoric to give more weight to recent rather than overall incumbent performance. These biases were apparent even though we provided information, reinforced with a monetary incentive, that weighting all performance equally was preferable. These findings suggest key limitations in voters' abilities to effectively implement a retrospective decision rule.
----------------------
Hearing Campaign Appeals: The Accountability Implications of Presidential Campaign Tone
Michele Claibourn
Political Communication, Winter 2012, Pages 64-85
Abstract:
Citizen understanding of candidate priorities is highly consequential for both elections and postelection accountability and is especially key to the office of the presidency. I examine the impact of campaign advertising tone on citizen understanding of candidate agendas in the context of the 2000 presidential election. Merging data on political ads from the Wisconsin Advertising Project with individual survey data, I test whether citizens are more likely to accurately hear a positive campaign theme. The analysis provides empirical support for this benefit of positivity.
----------------------
Henning Finseraas
Journal of Elections, Public Opinion & Parties, Winter 2012, Pages 95-108
Abstract:
This article examines the importance of retrospective pocketbook voting, i.e. that voters reward an incumbent party for an improvement in their own economic situation, in the Norwegian 2005 general election. The article utilizes a dataset with extensive tax register information on income and tax payments in 2004 and 2005, which makes it possible to examine how changes in tax burdens affect the probability of voting for an incumbent party. The results show that a reduced tax burden is not significantly correlated with vote choice, a finding that questions the reward/punishment logic of retrospective pocketbook voting. The article does, however, find some evidence of retrospective sociotropic voting, as the county-level unemployment rate is significantly correlated with vote choice.
----------------------
Smith (and Jones) Go to Washington: Democracy and Vice-Presidential Selection
Joseph Uscinski
PS: Political Science & Politics, January 2012, Pages 58-66
Abstract:
The American vice president's most notable constitutional function is that of succession: if the president unexpectedly leaves office, the vice president becomes president. The process of selecting vice-presidential running mates has fallen into fewer hands over time, moving from the electorate, to party bosses and delegates, to a single person: the presidential candidate. The selection process presents challenges for democratic governance: electoral considerations may provide presidential candidates with incentive to choose vice-presidential running mates who differ from themselves politically. In cases of succession, this can lead to undemocratic outcomes and unstable policy.
----------------------
The Influence of Magna Carta in Limiting Executive Power in the War on Terror
Eric Kasper
Political Science Quarterly, Winter 2011, Pages 547-578
Abstract:
Eric T. Kasper examines the use of Magna Carta by U.S. federal courts in enemy combatant cases. He traces the history of due process, jury trial, and habeas corpus rights within Magna Carta as well as subsequent legal documents and rulings in England and America. He concludes that Magna Carta is properly used by the federal courts as persuasive authority to limit executive power in the war on terror.
----------------------
Stefanie Lindquist & Pamela Corley
Journal of Legal Studies, June 2011, Pages 467-502
Abstract:
The Supreme Court's decision to invalidate a legislative enactment involves both the choice to strike as well as the choice whether to invalidate the statute on its face or as applied. Both choices implicate the possibility of counteraction by the legislature. In this paper, we evaluate the justices' choices to invalidate a state or federal enactment on its face or as applied and find that the justices are responsive to congressional preferences concerning the substance of the legal challenge at both stages of judicial review. Other factors systematically affect the justices' decisions as well, including the legal basis for the challenge, the statutory scope of the constitutional challenge, the president (through the solicitor general), and interest groups' amicus filings. These findings suggest that the Court's exercise of judicial review is significantly influenced by Congress and by other contextual, legal, and political factors, both as to the choice to strike as well as to the method of constitutional enforcement.
----------------------
Distributive Politics and Electoral Incentives: Evidence from Seven US State Legislatures
Toke Aidt & Julia Shvets
American Economic Journal: Economic Policy, forthcoming
Abstract:
We study the effect of electoral incentives on the allocation of public services across legislative districts. We develop a model in which elections encourage legislators to cater to parochial interests and thus aggravate the common pool problem. Using unique data from seven US states, we study how the amount of funding that a legislator channels to his district changes when he faces a term limit. We find that legislators bring less pork to their district when they cannot seek re-election. Consistent with the Law of 1/N, this last term reduction in funding is smaller in states with many legislative districts.
----------------------
Public Approval of U.S. State Legislatures
Lilliard Richardson, David Konisky & Jeffrey Milyo
Legislative Studies Quarterly, February 2012, Pages 99-116
Abstract:
The determinants of public approval for state legislatures have not received much attention, but one important finding is that more professionalized legislatures experience lower levels of public support. We argue that this result is an artifact of limited data and problematic model specifications. Analyzing a large national survey sample, we demonstrate that the negative relationship holds primarily for conservatives and to a lesser extent for moderates but not liberals. Additionally, we find that legislative approval in states with term limits and ballot initiatives is no different than in states without these institutions.
----------------------
Should We Venerate That Which We Cannot Love? James Madison on Constitutional Imperfection
Jeremy Bailey
Political Research Quarterly, forthcoming
Abstract:
Scholars have long pointed to James Madison's argument for constitutional veneration in Federalist No. 49 to illustrate what they see as Madison's fear of democratic politics and frequent constitutional reform. This article challenges that consensus, first, by showing that Madison said the opposite several years earlier and, second, by revisiting the historical and textual context of Federalist No. 49. It argues that even as Madison praises veneration he offers serious reasons to be wary of it.
----------------------
Policy Networks and the U.S. Congressional Efforts to Terminate Four Federal Agencies
Gordon E. Shockley
International Journal of Public Administration, February 2012, Pages 98-111
Abstract:
The article develops a partial explanation for the varying fates of four federal agencies that the U.S. Congress targeted for elimination in the 1980s or 1990s: the Civil Aeronautics Board (CAB), Interstate Commerce Commission (ICC), Office of Technology Assessment (OTA), and the National Endowment for the Arts (NEA). Congress successfully eliminated the CAB, ICC, and OTA; the NEA, however, survived. The argument of the article is that a vibrant policy network surrounding an agency Congress has targeted for elimination provides resiliency to resist congressional termination efforts by weaving together the relevant institutions and organizations into a resilient policy network and generating critical political support during dire times. A model of policy network resiliency is presented and applied to congressional efforts to terminate the CAB, ICC, OTA, and NEA.
----------------------
Do Standards of Review Matter? The Case of Federal Criminal Sentencing
Joshua Fischman & Max Schanzenbach
Journal of Legal Studies, June 2011, Pages 405-437
Abstract:
We study whether changes to standards of review affect district court sentencing decisions under the U.S. sentencing guidelines. Departures from the guidelines by district judges have at times been reviewed strictly or deferentially. If review standards are constraining, then differences among judges should be larger when review is deferential. We find that Democratic appointees are more lenient than Republican appointees under deferential review, but this difference significantly narrows when review is strict. We conclude that district judges are meaningfully constrained by the prospect of appellate reversal. By contrast, judges appointed before the adoption of the guidelines are more likely to depart and issue shorter sentences, but their decisions are not significantly affected by the standard of review. We suggest that the constraining effect of appellate review varies with a judge's respect for the underlying legal regime.
----------------------
Political institutions, voter turnout, and policy outcomes
Eileen Fumagalli & Gaia Narciso
European Journal of Political Economy, June 2012, Pages 162-173
Abstract:
This paper tests whether constitutions directly affect economic outcomes. By introducing citizens' political participation as the driving force connecting institutions to policy outcomes, we empirically show that voter turnout is the channel through which forms of government affect economic policies. We provide evidence of the existence of two relationships. First, presidential regimes appear to be associated with lower voter participation in national elections. Second, higher voter participation induces an increase in government expenditure, total revenues, welfare state spending, and budget deficit. We conclude that forms of government affect policy outcomes only through voter turnout.
----------------------
Kai Jäger
Democratization, forthcoming
Abstract:
In 2006, Bangkok's middle-class residents overwhelmingly supported the military coup that displaced the elected government of Thaksin Shinawatra. Survey research shows that opponents of Thaksin had a stronger commitment to liberal democracy and possibly to royalist values while rural voters supported Thaksin because he fulfilled their social demands. Opposition to Thaksin was not motivated by economic interests, but rather, there is some evidence that urban middle- and upper-class voters disliked Thaksin because they heard negative reporting about him, which were less available in the countryside. These findings are compatible with a new theory of democratic consolidation, in which the upper classes have the means that would enable and encourage them to pay sufficient attention to politics to discover that what they viewed as ‘good government' was violated by the ruling party, which could have led to demands for more democracy historically. More recently, however, in Thailand and perhaps other instances in Southeast Asia and Latin America, those with the money and leisure to follow politics closely have heard reports about the ‘bad government' of populist, democratically elected leaders, and thus have turned against them.
----------------------
Attacks on Civilians in Civil War: Targeting the Achilles Heel of Democratic Governments
Lisa Hultman
International Interactions, forthcoming
Abstract:
Previous research has indicated that democracy decreases the risk of armed conflict, while increasing the likelihood of terrorist attacks, but we know little about the effect of democracy on violence against civilians in ongoing civil conflicts. This study seeks to fill this empirical gap in the research on democracy and political violence, by examining all rebel groups involved in an armed conflict 1989-2004. Using different measures of democracy, the results demonstrate that rebels target more civilians when facing a democratic (or semi-democratic) government. Democracies are perceived as particularly vulnerable to attacks on the population, since civilians can hold the government accountable for failures to provide security, and this provides incentives for rebels to target civilians. At the same time, the openness of democratic societies provides opportunities for carrying out violent attacks. Thus, the strength of democracy - its accountability and openness - can become an Achilles heel during an internal armed conflict.
----------------------
Some Dared Call It Torture: Cultural Resonance, Abu Ghraib, and a Selectively Echoing Press
Charles Rowling, Timothy Jones & Penelope Sheets
Journal of Communication, December 2011, Pages 1043-1061
Abstract:
This study draws upon research on "indexing" and "cascading activation" to explore U.S. political and news discourse surrounding the Abu Ghraib prison scandal. Specifically, we systematically analyze White House, military, congressional, and news messages. In so doing, we incorporate scholarship on social identity theory to suggest why news media challenge certain White House frames but uncritically echo others. Our data demonstrate that White House frames were consistently challenged by Democrats in the opposing party, but that these competing congressional messages were largely absent in news coverage. These results challenge previous research on news coverage of Abu Ghraib. We discuss how these patterns align with and expand Entman's cascading activation model of press-state relations, and consider the implications for future scholarship.
----------------------
Subconscious Gatekeeping: The Effect of Death Thoughts on Bias Toward Outgroups in News Writing
David Cuillier
Mass Communication and Society, January/February 2012, Pages 4-24
Abstract:
This study contributes to gatekeeping theory by examining the importance of individual-level subconscious psychological factors in news story fact selection, specifically whether the thought of death increases biased writing toward outgroups. An experiment (N = 79), based on terror management theory from social psychology, indicated that college journalists primed to think about death injected into their news stories 66% more negative facts toward a rival university than those in a control condition. Implications for mass media research, particularly individual-level psychological factors overriding routine gatekeeping forces, are discussed.
----------------------
Club-in-the-Club: Reform under Unanimity
Erik Berglöf et al.
Journal of Comparative Economics, forthcoming
Abstract:
In many organizations, decisions are taken by unanimity giving each member veto power. We analyze a model of an organization in which members with heterogenous productivity privately contribute to a common good. Under unanimity, the least efficient member imposes her preferred effort choice on the entire organization. The threat of forming an "inner organization" can undermine the veto power of the less efficient members and coerce them to exert more effort. We also identify the conditions under which the threat of forming an inner organization is executed. Finally, we show that majority rules effectively prevent the emergence of inner organizations.
Thursday, February 2, 2012
Family Values
Chris Herbst & Erdal Tekin
NBER Working Paper, January 2012
Abstract:
A complete account of the U.S. child care subsidy system requires an understanding of its implications for both parental and child well-being. Although the effects of child care subsidies on maternal employment and child development have been recently studied, many other dimensions of family well-being have received little attention. This paper attempts to fill this gap by examining the impact of child care subsidy receipt on maternal health and the quality of child-parent interactions. The empirical analyses use data from three nationally representative surveys, providing access to numerous measures of family well-being. In addition, we attempt to handle the possibility of non-random selection into subsidy receipt by using several identification strategies both within and across the surveys. Our results consistently indicate that child care subsidies are associated with worse maternal health and poorer interactions between parents and their children. In particular, subsidized mothers report lower levels of overall health and are more likely to show symptoms consistent with anxiety, depression, and parenting stress. Such mothers also reveal more psychological and physical aggression toward their children and are more likely to utilize spanking as a disciplinary tool. Together, these findings suggest that work-based public policies aimed at economically disadvantaged mothers may ultimately undermine family well-being.
----------------------
The Effect of a Child's Sex on Support for Traditional Gender Roles
Emily Fitzgibbons Shafer & Neil Malhotra
Social Forces, September 2011, Pages 209-222
Abstract:
We examine whether sex of child affects parents' beliefs about traditional gender roles. Using an improved methodological approach that explicitly analyzes the natural experiment via differences in differences, we find that having a daughter (vs. having a son) causes men to reduce their support for traditional gender roles, but a female child has no such effect among women, representing less than 4 percent of the size of the standard deviation of the attitude scale.
----------------------
Desiree Baolian Qin et al.
Journal of Adolescence, forthcoming
Abstract:
Chinese American students are often perceived as problem-free high achievers. Recent research, however, suggests that high-achieving Chinese American students can experience elevated levels of stress, especially comparing to their peers from other ethnic groups. In this paper, we examine how family dynamics may influence psychological adjustment among a group of high-achieving adolescents. Drawing on survey data collected on 295 Chinese American and 192 European American 9th graders attending a highly selective magnet school, our findings show that Chinese American adolescents reported significantly lower levels of psychological adjustment (d = -.31), and significantly less family cohesion (d = -.34) and more conflict (d = .56) than their European American peers. Further, the ethnic differences on adjustment disappeared after controlling for perceptions of family cohesion and conflict, indicating that such perceptions may be a key factor in understanding the high academic achievement/low psychological adjustment paradoxical pattern of development among Chinese American adolescents.
----------------------
Expansions in Maternity Leave Coverage and Children's Long-Term Outcomes
Christian Dustmann & Uta Schönberg
American Economic Journal: Applied Economics, forthcoming
Abstract:
This paper evaluates the impact of three major expansions in maternity leave coverage in Germany on children's long-run outcomes. To identify the causal impact of the reforms, we use a difference-in-difference design that compares outcomes of children born shortly before and shortly after a change in maternity leave legislation in years of policy changes, and in years when no changes have taken place. We find no support for the hypothesis that the expansions in leave coverage improved children's outcomes, despite a strong impact on mothers' return to work behavior after childbirth.
----------------------
Observed Gender Differences in African American Mother-Child Relationships and Child Behavior
Jelani Mandara et al.
Family Relations, February 2012, Pages 129-141
Abstract:
African American mother-child dyads (N = 99) were observed interacting on a collaborative puzzle exercise. Raters blind to the purpose of the study rated the dyads on several mother and child behaviors. Mothers of daughters were rated as more empathetic, encouraging, warm, and accepting and less negative than mothers of sons. Male children were more challenging and less happy, relaxed, and engaged. Mediation analyses found that the differences in mother-child relationships explained the gender differences in child behavior. These patterns were consistent across different child age groups and after controlling for family socioeconomic status. It was concluded that many of the gender disparities may be reduced with empirically informed and culturally sensitive parent training interventions that teach parents the necessity of being warm and loving as well as encouraging both male and female children to excel.
----------------------
Eugenio Proto, Daniel Sgroi & Andrew Oswald
Experimental Economics, March 2012, Pages 1-23
Abstract:
High rates of divorce in western society have prompted much research on the repercussions for well-being and the economy. Yet little is known about the important topic of whether parental divorce has deleterious consequences upon adult children. By combining experimental and econometric survey-based evidence, this study attempts to provide an answer. Under controlled conditions, it measures university students' subjective well-being and productivity (in a standardized laboratory task). It finds no evidence that either of these is negatively associated with recent parental divorce. If anything, happiness and productivity appear to be slightly greater, particularly among males, if their parents have divorced. Using longitudinal data from the British Household Panel Survey - to control for so-called fixed effects - we then cross-check this result, and confirm the same finding, on various random samples of young British adults.
----------------------
Ashley Smith Leavell et al.
Sex Roles, January 2012, Pages 53-65
Abstract:
We examined the activities that low-income, ethnically diverse fathers of sons versus daughters engage in with their children in the preschool years. African American, Latino, and White fathers (N = 426) from research sites across the United States, were interviewed about their caregiving, play, literacy, and visiting activities when their children were 2 years, 3 years, and preschool age. Fathers of boys engaged more frequently in physical play than fathers of girls, whereas fathers of girls engaged more frequently in literacy activities. Moreover, gendered patterns of father engagement were already evident at the 2-year assessment, suggesting that fathers channel their children toward gender-typed activities well before their children have a clear understanding of gender roles. Ethnic differences were also found in fathers' activities with children, and child gender moderated ethnic patterns of behavior. For example, Black fathers of sons reported the highest levels of engagement in caregiving, play and visiting activities, and both Latino and African American fathers of sons engaged in more visiting activities compared to White fathers of sons. Fathers' education and marital status were also associated with fathers' activities. Married fathers and those with a high school diploma more frequently engaged in literacy activities than unmarried fathers without a diploma; moreover, although Latino fathers engaged less in caregiving activities than African American and White fathers, this difference attenuated after controlling for differences in fathers' education. The activities children share with their fathers vary by child gender, race/ethnicity, and family circumstances and offer insight into early gendered experiences in the family.
----------------------
Child Gender And Parental Investments In India: Are Boys And Girls Treated Differently?
Silvia Barcellos, Leandro Carvalho & Adriana Lleras-Muney
NBER Working Paper, January 2012
Abstract:
Although previous research has not always found that boys and girls are treated differently in rural India, son-biased stopping rules imply that estimates of the effect of gender on parental investments are likely to be biased because girls systematically end up in larger families. We propose a novel identification strategy for overcoming this bias. We document that boys receive significantly more childcare time than girls. In addition boys are more likely to be breastfed longer, and to be given vaccinations and vitamin supplementation. We then present suggestive evidence that the differential treatment of boys is neither due to their greater needs nor to the effect of anticipated family size.
----------------------
Neighborhood Effects on Working Mothers' Child Care Arrangements
Meirong Liu & Steven Anderson
Children and Youth Services Review, forthcoming
Abstract:
The implementation of stricter work requirements for low-income mothers following passage of the 1996 Personal Responsibility and Work Opportunity Reconciliation Act has elevated the importance of developing quality child care options for working families. Prior research indicates that the type of child care used not only is associated with maternal labor force participation, but also affects children's later cognitive outcomes. This study used the Fragile Families and Child Wellbeing study to examine whether neighborhood factors were related to the types of child care selected by employed mothers of three-year old children in the post-welfare reform era. Multinomial logistic regression analysis revealed that working mothers in neighborhoods with higher poverty rates were more likely to rely on relative care and family day care than on center care, and mothers in neighborhoods with higher immigrant rates were more likely to rely on family day care than center care. The findings are useful in informing social policies and interventions related to early child care education and child care provision for low-income families, particularly with respect to considering neighborhood factors in targeting parent education and child care development strategies.
----------------------
The Interactive Effect of Parental Education on Language Production
Julie Hupp et al.
Current Psychology, December 2011, Pages 312-323
Abstract:
This study examines the interactive effect of mother's and father's education on childhood language development. Parents of sixteen- and twenty-month-old children (N = 48) completed measures on their children's language production (MacArthur Communicative Development Inventory: Words and Sentences) as well as basic demographic information. There were variations in language production according to maternal education for only the older children. There was also an interaction between maternal and paternal education; children of parents with heterogeneous levels of education (that is, only one parent with a 4-year degree) had higher levels of language production than parents with homogeneous levels of education (that is, either both parents with a degree or both parents without a degree). Surprisingly, children with homogeneous levels of parental education were the ones who scored the lowest on measures of language production. This may be due to less effective parenting at both the low and high parental education levels or because disparity in parental education positively affects the home learning environment.
----------------------
Should Mom go back to school? Post-natal educational attainment and parenting practices
Thurston Domina & Josipa Roksa
Social Science Research, forthcoming
Abstract:
Although the relationship between educational attainment and parenting practices is well documented, it is typically examined at only one point in time. What happens if mothers acquire more education after the birth of their children: do they alter their parenting practices?. Panel data models based on longitudinal data from ECLS-K indicate that changes in mother's educational attainment are positively associated with increases in parental school involvement, having books in the home, and participating in non-academic family activities, but not with attitudes toward discipline. Although post-natal maternal education does not change all aspects of parenting, our findings are broadly consistent with the theory of cultural mobility and provide insights into the extent of socio-cultural mobility in contemporary American society.
----------------------
Joseph Murray, Rolf Loeber & Dustin Pardini
Criminology, February 2012, Pages 255-302
Abstract:
Explanations for the fact that crime tends to run in families have focused on the deprived social backgrounds of criminal parents, methods of child-rearing, modeling processes, and genetic mechanisms. However, parental involvement in the criminal justice system itself also might contribute to the intergenerational transmission of crime and have other adverse effects on children's well-being. We investigated the development of youth problem behavior in relation to parental arrest, conviction, and incarceration in the youngest and oldest samples of the Pittsburgh Youth Study, a longitudinal survey of 1,009 inner-city boys. Parental arrest and conviction without incarceration did not predict the development of youth problem behavior. Parental incarceration was not associated with increases in marijuana use, depression, or poor academic performance. However, boys experiencing parental incarceration showed greater increases in theft compared with a control group matched on propensity scores. The association between parental incarceration and youth theft was stronger for White youth than for Black youth. Parenting and peer relations after parental incarceration explained about half of its effects on youth theft. Because the effects of parental incarceration were specific to youth theft, labeling and stigma processes might be particularly important for understanding the consequences of parental incarceration for children.
----------------------
Bruce Ellis et al.
Development and Psychopathology, February 2012, Pages 317-332
Abstract:
Girls receiving lower quality paternal investment tend to engage in more risky sexual behavior (RSB) than peers. Whereas paternal investment theory posits that this effect is causal, it could arise from environmental or genetic confounds. To distinguish between these competing explanations, the current authors employed a genetically and environmentally controlled sibling design (N = 101 sister pairs; ages 18-36), which retrospectively examined the effects of differential sibling exposure to family disruption/father absence and quality of fathering. Consistent with a causal explanation, differences between older and younger sisters in the effects of quality of fathering on RSB were greatest in biologically disrupted families when there was a large age gap between the sisters (thus maximizing differential exposure to fathers), with greater exposure within families to higher quality fathering serving as a protective factor against RSB. Further, variation around the lower end of fathering quality appeared to have the most influence on RSB. In contrast, differential sibling exposure to family disruption/father absence (irrespective of quality of fathering) was not associated with RSB. The differential sibling-exposure design affords a new quasi-experimental method for evaluating the causal effects of fathers within families.
----------------------
Jeremiah Wills & Jonathan Brauer
Social Science Research, March 2012, Pages 425-443
Abstract:
Drawing on previous theoretical and empirical work, we posit that maternal employment influences on child well-being vary across birth cohorts. We investigate this possibility by analyzing longitudinal data from a sample of children and their mothers drawn from the National Longitudinal Survey of Youth. We introduce a series of age, cohort, and maternal employment interaction terms into multilevel models predicting child well-being to assess whether any potential short-term or long-term effects of early and current maternal employment vary across birth cohorts. Results indicate that maternal employment largely is inconsequential to child well-being regardless of birth cohort, with a few exceptions. For instance, children born in earlier cohorts may have experienced long-term positive effects of having an employed mother; however, as maternal employment became more commonplace in recent cohorts, these beneficial effects appear to have disappeared. We discuss theoretical and methodological implications of these findings.
----------------------
Unilateral divorce versus child custody and child support in the U.S.
Rafael González-Val & Miriam Marcén
Journal of Economic Behavior & Organization, February 2012, Pages 613-643
Abstract:
This paper explores the response of the divorce rate to law reforms introducing unilateral divorce after controlling for law reforms concerning the aftermath of divorce, which are omitted from most previous studies. We introduce two main policy changes that have swept the US since the late 1970s: the approval of the joint custody regime and the Child Support Enforcement program. Because those reforms affect divorce decisions by counteracting the reallocation of property rights generated by the unilateral divorce procedure and by increasing the expected financial costs of divorce, it is arguable that their omissions might obscure the impact of unilateral divorce reforms on divorce rates. After allowing for changes in laws concerning the aftermath of divorce, we find that the positive impact of unilateral divorce reforms on divorce rates does not vanish over time, suggesting that the Coase theorem may not apply to changes in divorce laws. Supplemental analysis, developed to examine the frequency of permanent shocks in US divorce rates, indicates that the positive permanent changes in divorce rates can be associated with the implementation of unilateral divorce reforms and that the negative permanent changes can be related to the law reforms concerning living arrangements in the aftermath of divorce. This seems to confirm the important role of these policies in the evolution of divorce rates.
----------------------
The Effect of Parental Employment on Child Schooling
John Ermisch & Marco Francesconi
Journal of Applied Econometrics, forthcoming
Abstract:
This paper presents a model that provides conditions under which a causal interpretation can be given to the association between childhood parental employment and subsequent educational attainments of children. The key parameter comes from the conditional demand function for children's future earning capacity. Its identification rests on having data on siblings and assumptions about the timing of parents' knowledge of their children's endowments. In addition to sibling differences, the use of a fixed-effects instrumental-variables estimator identifies the parameter under weaker conditions. Empirical analysis informed by the model reveals a negative and significant effect on the child's educational attainment of the months of the mother's full-time employment when the child was aged 0-5. The effect of the mother's part-time employment is smaller and less well determined, but again negative. These results suggest that the substitution effect of the mother's employment dominates the income effects. Stronger adverse effects are found for children of less-educated mothers.
----------------------
Intergenerational Continuity of Taste: Parental and Adolescent Music Preferences
Tom ter Bogt et al.
Social Forces, September 2011, Pages 297-319
Abstract:
In this article, the continuity in music taste from parents to their children is discussed via a multi-actor design. In our models music preferences of 325 adolescents and both their parents were linked, with parental and adolescent educational level as covariates. Parents' preferences for different types of music that had been popular when they were young were subsumed under the general labels of Pop, Rock and Highbrow. Current adolescent music preferences resolved into Pop, Rock, Highbrow and Dance. Among partners in a couple, tastes were similar; for both generations, education was linked to taste; and parental preferences predicted adolescent music choices. More specifically, the preference of fathers and mothers for Pop was associated with adolescent preferences for Pop and Dance. Parents' preferences for Rock seemed to indicate their daughters would also like Rock music, but not their sons. Parental passion for Highbrow music was associated with Highbrow preferences among their children. It is concluded that preferences for cultural artifacts such as (popular) music show continuity from generation to generation.
----------------------
Hillary Fouts et al.
Journal of Cross-Cultural Psychology, February 2012, Pages 328-348
Abstract:
Most studies of diverse populations of families within the United States have either focused predominantly on ethnicity or socioeconomic status (SES), and those that have examined both ethnicity and SES have noted difficulties in disentangling the effects of SES and ethnicity. In order to achieve a greater understanding of variation in infant experiences with parental and nonparental caregivers in differing socioeconomic and ethnic contexts, 41 infants from African American and 40 infants from European American families of lower and middle SES were observed for 12 hours each in and around their home environments. Ethnic differences were evident in the infants' overall experiences with caregivers, maternal availability, affection, caregiving, and stimulation by nonnuclear relatives; SES differences were identified for maternal and paternal holding, maternal carrying, and paternal caregiving. When caregiver availability was taken into account, variations in interactional and care experiences were predominantly predicted by ethnicity. These results underscore the need to study both ethnicity and socioeconomic variation rather than either one alone. Furthermore, the caregiving behaviors of African American mothers and fathers may be misrepresented when multiple SES contexts are not considered.
----------------------
Why Parenthood, and Why Now? Gay Men's Motivations for Pursuing Parenthood
Abbie Goldberg, Jordan Downing & April Moyer
Family Relations, February 2012, Pages 157-174
Abstract:
The current qualitative study of 35 preadoptive gay male couples (70 men) examined gay men's motivations to parent and their reasons for pursuing parenthood at the current time. Similar to heterosexual couples, gay men described a range of psychologically oriented reasons as shaping their decision to become parents. Some of these (e.g., desire to teach a child tolerance) may have been uniquely shaped by their sexual minority status, and others (e.g., desire to give a child a good home) in part reflect their adoptive status. Men named age, finances, and relationship factors, as well as unique contextual factors such as the need to find and move to gay-friendly neighborhoods, as influencing their readiness to pursue parenthood at the current time. Gay men's motivations to parent echo normative life course decision-making processes, but also reflect concerns that are uniquely informed by their sexual minority status.
----------------------
Arginine vasopressin 1a receptor gene and maternal behavior: Evidence of association and moderation
Rossana Bisceglia et al.
Genes, Brain and Behavior, forthcoming
Abstract:
This study examined associations between maternal sensitivity, mothers' early adversity and the Arginine Vasopressin 1a Receptor gene. Early adversity in mothers' background has been found to be associated with lower maternal sensitivity. Animal literature suggests that variation in the Arginine Vasopressin 1a Receptor gene is associated with parenting quality. The goal of the study was to examine the role of the Arginine Vasopressin 1a Receptor gene in maternal sensitivity, especially under conditions of high early adversity. Participants included 151 Caucasian women from a community sample. The women were videotaped in their home while interacting separately with two of their children (target child = 18 months, older sibling < 6 years). Evidence was found for an association between the Arginine Vasopressin 1a Receptor gene and maternal sensitivity. Mothers with two copies of the long RS3 alleles were less sensitive than mothers with one or zero copies of the long alleles. This association was strongest under conditions of high maternal early adversity.
----------------------
Maternal support in early childhood predicts larger hippocampal volumes at school age
Joan Luby et al.
Proceedings of the National Academy of Sciences, forthcoming
Abstract:
Early maternal support has been shown to promote specific gene expression, neurogenesis, adaptive stress responses, and larger hippocampal volumes in developing animals. In humans, a relationship between psychosocial factors in early childhood and later amygdala volumes based on prospective data has been demonstrated, providing a key link between early experience and brain development. Although much retrospective data suggests a link between early psychosocial factors and hippocampal volumes in humans, to date there has been no prospective data to inform this potentially important public health issue. In a longitudinal study of depressed and healthy preschool children who underwent neuroimaging at school age, we investigated whether early maternal support predicted later hippocampal volumes. Maternal support observed in early childhood was strongly predictive of hippocampal volume measured at school age. The positive effect of maternal support on hippocampal volumes was greater in nondepressed children. These findings provide prospective evidence in humans of the positive effect of early supportive parenting on healthy hippocampal development, a brain region key to memory and stress modulation.
----------------------
Going Back Part-time: Family Leave Legislation and Women's Return to Work
Whitney Schott
Population Research and Policy Review, February 2012, Pages 1-30
Abstract:
Using a multinomial logit model with data from the Survey of Income and Program Participation, this paper tests whether the implementation of the Family and Medical Leave Act (FMLA) is associated with an increase in return to work at part-time status among first-time mothers working full-time during their pregnancy. I find a statistically significant trend of increasingly higher odds of returning to work at part-time status relative to return at full-time status, beginning in 1993 (the year in which the FMLA is implemented). Furthermore, an additional week of either state or federal leave is significantly associated with a higher odds of return at part-time status. This article provides evidence that job protection and leave legislation may help facilitate higher levels of labor force participation among women with small children, through more flexible work arrangements.
----------------------
Sarah Oberlander et al.
Journal of Family Psychology, December 2011, Pages 885-894
Abstract:
This prospective investigation used multi-informant models to examine whether parental monitoring moderated associations between child maltreatment and either emotional distress or sexual intercourse. Data included 637 youth in the Longitudinal Studies of Child Abuse and Neglect (LONGSCAN). Child maltreatment was determined by lifetime Child Protective Service records and youth self-report and included sexual, physical, psychological abuse, and neglect (age 12). The moderating variable was youth- and caregiver-reported parental monitoring (age 12). Outcome variables were emotional distress (age 12) and sexual intercourse (age 14). Analyses included multi- and individual-informant models, adjusting for age, ethnicity/race, family income, and study site. Rates of parental monitoring did not differ by gender, but gender-specific analyses found that among girls, but not boys, youth-reported parental monitoring buffered the effect of maltreatment on emotional distress. Subtype analyses found that the buffering effects of monitoring on emotional distress were strongest for sexual and physical abuse and when youth experienced multiple subtypes of maltreatment. Caregiver-reported monitoring was not associated with reduced emotional distress. Youth and caregiver reports of parental monitoring were inversely associated with sexual intercourse, regardless of maltreatment history. Findings suggest that promoting parental monitoring among caregivers, and perceptions of monitoring among youth, may prevent early sexual intercourse regardless of maltreatment history. Promoting parental monitoring among youth with a history of maltreatment, especially girls or those who have experienced sexual or physical abuse or multiple subtypes of abuse, may reduce the likelihood of emotional distress.
----------------------
Rotem Regev, Noa Gueron-Sela & Naama Atzaba-Poria
Infant and Child Development, January/February 2012, Pages 34-51
Abstract:
This paper examines explanatory mechanisms of differences, in both positive and negative aspects of children's adjustment, between ethnic minority (i.e., Former Soviet Union-FSU origin) and ethnic majority (i.e., Israeli) children living in Israel. Seventy Israeli children (40 girls) and 75 FSU origin children (38 girls) and their parents constituted the study sample. Both mothers and fathers reported on the children's prosocial and externalizing behaviours and provided accounts of their use of corporal punishment. Analyses showed that FSU origin children displayed lower levels of prosocial behaviour as well as higher levels of externalizing problems and that their parents used more corporal punishment than their Israeli counterparts. In addition, a mediation model was determined in which both maternal and paternal use of corporal punishment mediated the link between ethnicity and the child's prosocial behaviour. Furthermore, according to the best fitting structural equation model, ethnicity did not have a direct effect on children's prosocial behaviour. This link was fully mediated by maternal and paternal corporal punishment. No mediation was revealed for the links between ethnicity and externalizing problems. The process of risk is discussed.
----------------------
Maternal modulation of novelty effects on physical development
Akaysha Tang et al.
Proceedings of the National Academy of Sciences, forthcoming
Abstract:
Familiarity to the mother and the novelty afforded by the postnatal environment are two contrasting sources of neonatal influence. One hypothesis regarding their relationship is the maternal modulation hypothesis, which predicts that the same neonatal stimulation may have different effects depending on the maternal context. Here we tested this hypothesis using physical development, indexed by body weight, as an endpoint and found that, among offspring of mothers with a high initial swim-stress-induced corticosterone (CORT) response, neonatal novelty exposure induced an enhancement in early growth, and among offspring with mothers of a low initial CORT response, the same neonatal stimulation induced an impairment. At an older age, a novelty-induced increase in body weight was also found among offspring of mothers with high postnatal care reliability and a novelty-induced reduction found among offspring of mothers with low care reliability. These results support a maternal modulation of early stimulation effects on physical development and demonstrate that the maternal influence originates from multiple instead of any singular sources. These results (i) significantly extend the findings of maternal modulation from the domain of cognitive development to the domain of physical development; (ii) offer a unifying explanation for a previously inconsistent literature regarding early stimulation effects on body weight; and (iii) highlight the notion that the early experience effect involves no causal primacy but higher order interactions among the initial triggering events and subsequent events involving a multitude of maternal and nonmaternal influences.
Wednesday, February 1, 2012
Separate and unequal
De Gustibus non est Taxandum: Theory and Evidence on Preference Heterogeneity and Redistribution
Benjamin Lockwood & Matthew Weinzierl
NBER Working Paper, January 2012
Abstract:
Preferences over consumption and leisure play no role in the standard optimal tax model, which attributes all variation in earnings to differences in income-earning ability. We show how to incorporate these preferences, which like ability are publicly unobservable, into the standard model in a tractable way. In this more general model, the policy designer must guess at the relative importance of ability and preferences in explaining variation in earnings. We show that such preferences could, in principle, increase or decrease optimal redistribution. In the most plausible specifications of the model, however, the result is clear: greater variation in preferences lowers the optimal extent of redistribution. To generate more redistribution than in standard results, one must assume that the desire for income is inversely related to income earned. This result holds even when the conventional model accurately describes the average individual, and it suggests one potential resolution to the puzzle of why observed redistribution is in some cases weaker than conventional theory would suggest. We then establish a new empirical finding that confirms this model's central policy prediction across developed countries and U.S. states. In countries and states with more heterogeneous tastes for consumption relative to leisure, redistribution is statistically significantly lower.
----------------------
Financial Deprivation Prompts Consumers to Seek Scarce Goods
Eesha Sharma & Adam Alter
Journal of Consumer Research, forthcoming
Abstract:
Consumers assess their wellbeing subjectively, largely by comparing the present state of their lives to the state of comparable others and to their own state earlier in time. We suggest that consumers similarly assess their financial wellbeing, and when these evaluations highlight a deficit in their financial position, they pursue strategies that mitigate the associated sense of financial deprivation. Specifically, consumers counteract the relative deficit in their financial resources by acquiring resources that are consequently unavailable to other consumers in their environment. The results from five studies suggest that the inferiority and unpleasant affect associated with financial deprivation motivates consumers to attend to, choose, and consume scarce goods rather than comparable abundant goods. These effects diminish when scarce goods are limited because other people have already obtained them, and when consumers attribute their unpleasant feelings to an extraneous source.
----------------------
Democratic Legitimacy and Economic Liberty
John Tomasi
Social Philosophy and Policy, January 2012, Pages 50-80
Abstract:
Libertarians and classical liberals typically defend private economic liberty as a requirement of self-ownership or on the basis of consequentialist arguments of various sorts. By contrast, this paper defends private economic liberty as a requirement of democratic legitimacy. In recent decades, many philosophers have converged upon a certain view about political justification. If a set of social institutions is to be just and legitimate, those institutions must be acceptable in principle to the citizens who are to lead their lives within them. This deliberative or democratic approach to justification is traditionally associated with thinkers on the left who are skeptical of the importance of private economic liberty. This article shows how the protection of private economic liberty is a requirement of citizens' developing and exercising the moral powers they have as democratic citizens. Democratic legitimacy does not require the affirmation of absolute economic liberty rights as sometimes defended by libertarians. But democratic legitimacy does require that a wide range of private economic liberties be meriting constitutional protection on a par with the civil and political liberties of democratic citizens. This opens the way for a wider defense of classical liberalism based upon the idea of democratic legitimacy.
----------------------
Understanding the geography of food stamp program participation: Do space and place matter?
Tim Slack & Candice Myers
Social Science Research, March 2012, Pages 263-275
Abstract:
This study examines the extent to which geographic variation in Food Stamp Program (FSP) participation is explained by place-based factors, with special attention to the case of the three poorest regions of the United States: Central Appalachia, the Texas Borderland, and the Lower Mississippi Delta. We use descriptive statistics and regression models to assess the prevalence and correlates of county-level FSP participation circa 2005. Our findings show that the economic distress that has long characterized Appalachia, the Borderland, and the Delta clearly translates into greater reliance on the FSP relative to other areas of the country. State-level effects and local-level variations in poverty, labor market conditions, population structure, human capital, and residential context explain much of this reality. Yet, even after taking all of these factors into account, these regional geographies remain home to particularly high FSP participation. Our findings underscore the importance of considering these regions as key cases of study in the stratification of American society and hold a variety of implications for public policy.
----------------------
Saving Rates and Poverty: The Role of Conspicuous Consumption and Human Capital
Omer Moav & Zvika Neeman
Economic Journal, forthcoming
Abstract:
Poor families around the world spend a large fraction of their income consuming goods that do not appear to alleviate poverty, while saving at low rates. We suggest that individuals care about economic status and interpret this behaviour as conspicuous consumption intended to provide a signal about unobserved income. We show that if human capital is observable and correlated with income, then a signaling equilibrium in which poor individuals tend to spend a large fraction of their income on conspicuous consumption can emerge. This equilibrium gives rise to an increasing marginal propensity to save that might generate a poverty trap.
----------------------
Credit Access and Social Welfare: The Rise of Consumer Lending in the United States and France
Gunnar Trumbull
Politics & Society, March 2012, Pages 9-34
Abstract:
Research into the causes of the 2008 financial crisis has drawn attention to a link between growing income inequality in the United States and high household indebtedness. Most accounts trace the U.S. idea of credit-as-welfare to the period of wage stagnation and welfare retrenchment that began in the early 1970s. Using France as a comparison case, I argue that the link between credit and welfare was not unique to the United States. Indeed, U.S. charitable lending institutions that emerged at the beginning of the twentieth century were modeled in part on older French financial institutions. Three historical factors drove U.S. lenders and policymakers to push for expanded credit access for the working class. First, welfare reformers in the interwar period embraced private credit as an alternative to an expansive welfare state. Second, U.S. organized labor in the wake of World War II embraced credit access as a means to sustain industrial employment and finance strike actions. Third, commercial banks in the 1950s began offering revolving credit accounts as a means to attract new depositors at a time when banking regulation restricted the interest they could offer on deposits.
----------------------
Social Mobility in 20 Modern Societies: The Role of Economic and Political Context
Meir Yaish & Robert Andersen
Social Science Research, forthcoming
Abstract:
It is commonly argued that social mobility rates are influenced by economic and political conditions. Nevertheless, research on this issue has tended to be hindered by two limitations that make it difficult to draw strong conclusions about contextual effects: (1) seldom have country-level and individual-level influences been tested simultaneously, and (2) only rarely have data more recent than the 1970s been employed. We improve on previous research by employing multilevel models fitted to relatively recent survey data collected from 20 modern societies by the International Social Survey Program (ISSP) and national-level characteristics derived from various official sources. Our findings demonstrate systematic cross-national variation in the association between the occupational status of respondents and their fathers. Consistent with the industrialization thesis, this variation is positively associated with per-capita GDP, suggesting that more affluent nations are characterized by more open and fluid stratification structures. Our results also suggest the importance of political regimes and migration for social mobility. In contrast, economic inequality appears to explain very little of the cross-national variation in mobility rates.
----------------------
Income Inequality and Social Preferences for Redistribution and Compensation Differentials
William Kerr
NBER Working Paper, December 2011
Abstract:
In cross-sectional studies, countries with greater income inequality typically exhibit less support for government-led redistribution and greater acceptance of wage inequality (e.g., United States versus Western Europe). If individual nations evolve along this pattern, a vicious cycle could form with reduced social concern amplifying primal increases in inequality due to forces like skill-biased technical change. Exploring movements around these long-term levels, however, this study finds mixed evidence regarding the vicious cycle hypothesis. On one hand, larger compensation differentials are accepted as inequality grows. This growth in differentials is of a smaller magnitude than the actual increase in inequality, but it is nonetheless positive and substantial in size. Weighing against this, growth in inequality is met with greater support for government-led redistribution to the poor. These patterns suggest that short-run inequality shocks can be reinforced in the labor market but do not result in weaker political preferences for redistribution.
----------------------
Preschoolers are able to take merit into account when distributing goods
Nicolas Baumard, Oliver Mascaro & Coralie Chevallier
Developmental Psychology, forthcoming
Abstract:
Classic studies in developmental psychology demonstrate a relatively late development of equity, with children as old as 6 or even 8-10 years failing to follow the logic of merit - that is, giving more to those who contributed more. Following Piaget (1932), these studies have been taken to indicate that judgments of justice develop slowly and follow a stagelike progression, starting off with simple rules (e.g., equality: everyone receives the same) and only later on in development evolving into more complex ones (e.g., equity: distributions match contributions). Here, we report 2 experiments with 3- and 4-year-old children (N = 195) that contradict this constructivist account. Our results demonstrate that children as young as 3 years old are able to take merit into account by distributing tokens according to individual contributions but that this ability may be hidden by a preference for equality.
----------------------
Do Infants Have a Sense of Fairness?
Stephanie Sloane, Renée Baillargeon & David Premack
Psychological Science, forthcoming
Abstract:
Two experiments examined infants' expectations about how an experimenter should distribute resources and rewards to other individuals. In Experiment 1, 19-month-olds expected an experimenter to divide two items equally, as opposed to unequally, between two individuals. The infants held no particular expectation when the individuals were replaced with inanimate objects, or when the experimenter simply removed covers in front of the individuals to reveal the items (instead of distributing them). In Experiment 2, 21-month-olds expected an experimenter to give a reward to each of two individuals when both had worked to complete an assigned chore, but not when one of the individuals had done all the work while the other played. The infants held this expectation only when the experimenter could determine through visual inspection who had worked and who had not. Together, these results provide converging evidence that infants in the 2nd year of life already possess context-sensitive expectations relevant to fairness.
----------------------
Legitimacy of Inequality in a Highly Unequal Context: Evidence from the Chilean Case
Juan Carlos Castillo
Social Justice Research, December 2011, Pages 314-340
Abstract:
Economic inequality is usually assumed to be a threat to social cohesion and democracy. Nevertheless, this opposition of inequality and democracy is based on further assumptions such as (a) that people perceive economic inequality accurately, and (b) that, by and large they consider inequality unjust. Research into distributive issues has not found consistent support for neither of these assumptions. Quite the contrary, empirical evidence indicates that economic inequality is widely misperceived and that inequality is to some extent considered legitimate. So far most of the empirical evidence in the area of legitimacy comes from experimental studies in the developed world. The present research aims at widening the scope of legitimacy studies by focusing on Chile as a case country, one of the societies with the highest economic inequality worldwide, guided by the question to what extent is economic inequality considered legitimate in a context of high economic inequality? In addressing this question, and based on previous evidence, the article proposes a way to evaluate (a) the legitimacy of inequality at a country level via survey research, and (b) the role of inequality perception and justice ideologies in the justification of economic inequality. The data to be analyzed is the public opinion survey International Social Justice Project (ISJP), implemented in Chile in the year 2007 (n = 890). Multivariate analysis results reveal signs of legitimacy of inequality in Chile, opening a series of issues regarding the acceptance and stability of unequal distributions.
----------------------
The Polarizing Effect of Economic Inequality on Class Identification: Evidence from 44 Countries
Robert Andersen & Josh Curtis
Research in Social Stratification and Mobility, forthcoming
Abstract:
Using cumulative logit mixed models fitted to World Values Survey data from 44 countries, we explore the impact of economic conditions - both at the individual-level and the national-level - on social class identification. Consistent with previous research, we find a positive relationship between household income and class identification in all countries that we explore, though this relationship varies substantially. Also corroborating previous research, we find that ‘low' class identifications are more likely in poor countries than in rich ones. However, in contrast to previous research that has neglected the role of inequality, our results indicate that the effect of economic development diminishes if income inequality is considered in the same model. We further demonstrate that income inequality has an important polarizing effect on class identification. Specifically, the relationship between household income and class identity tends to be strongest in countries with a high level of income inequality.
----------------------
Is wealth accumulation a luxury good?
Kiichi Tokuoka
Economics Letters, forthcoming
Abstract:
This paper structurally estimates the Capitalist Spirit Model, in which utility derives from direct preferences for wealth. Its results support the hypothesis that wealth accumulation is a luxury good, by showing that the marginal utility from wealth declines more slowly than that from consumption.
----------------------
The Dynamic Interplay of Inequality and Trust - An Experimental Study
Ben Greiner, Axel Ockenfels & Peter Werner
Journal of Economic Behavior & Organization, February 2012, Pages 355-365
Abstract:
We study the interplay of inequality and trust in a dynamic growth game, in which trust increases efficiency and thus allows higher growth of the laboratory economy in the future. We find that trust (as measured by the percentage of wealth invested in a trust game) is initially high in a treatment starting with equal endowments, but decreases over time. In a treatment with unequal endowments, trust is initially lower yet more robust. The disparity of wealth distributions across economies mitigates over time. Our findings suggest that both the level and the (exogenous or endogenous) source of inequality matters for the dynamics of trust.
----------------------
Spend it like Beckham? Inequality and redistribution in the UK, 1983-2004
Andreas Georgiadis & Alan Manning
Public Choice, June 2012, Pages 537-563
Abstract:
A main activity of the state is to redistribute resources. Standard political economy models predict that a rise in inequality will lead to more redistribution. This paper shows that, for the UK in the period 1983-2004, a plausibly exogenous rise in income inequality has not been associated with increased redistribution. We explore this example of the ‘paradox of redistribution' using attitudinal data. We show that standard political economy models of the individual demand for redistribution do have explanatory power, but that other attitudes and beliefs are also very important. Moreover, these attitudes and beliefs change quite quickly so are very important in explaining variation in the demand for redistribution.
----------------------
Duangkamon Chotikapanich et al.
Review of Economics and Statistics, February 2012, Pages 52-73
Abstract:
Using a method-of-moments estimator, flexible three-parameter beta distributions are fitted to aggregate country-level income data to overcome an untenable assumption of previous studies that persons within each income group receive the same income. Regional and global income distributions are derived as weighted mixtures of country-specific distributions. Analytical expressions for Gini and Theil's measures of inequality at country, regional, and global levels are derived in terms of the parameters of the beta distributions. Application to data for 91 countries in 1993 and 2000 reveals a high degree of global inequality, with evidence of declining inequality, largely attributable to growth in China.
----------------------
The Devolution of Risk and the Changing Life Course in the United States
Angela O'Rand
Social Forces, September 2011, Pages 1-16
Abstract:
Recent patterns of labor exit in late life in the United States are increasingly heterogeneous. This heterogeneity stems from diverse employment careers that are emerging in the workplace where job security is declining. Individuals' structural locations in the labor market expose them to diverse risks for employment and income security at older ages. Among those risks are access to institutional mechanisms for retirement saving and the requirement to assume full responsibility for decisions about retirement savings that involve market risks. The spread of these individualized pressures to invest in retirement has elevated the importance of financial literacy in the 21st century. Late employment careers and patterns of financial literacy are studied in this article using the premier U.S. longitudinal dataset from the National Institute of Aging, the Health and Retirement Study initiated in 1992, which is linked to restricted Social Security earnings records that extend over several decades. These merged data afford the opportunity to observe continuous work histories in this sample from 1981 through 2006 to identify latent trajectories of employment in late life. In addition, a supplementary module attached to the 2004 wave of the HRS provides valuable information on the financial literacy of subgroups. The work-retirement trajectories and financial literacy patterns observed reflect persistent patterns of inequality amplified by modern risks in the labor market.
----------------------
Estimating the long-run relationship between income inequality and economic development
Tuomas Malinen
Empirical Economics, February 2012, Pages 209-233
Abstract:
There are several theories describing the effect of income inequality on economic growth. These theories usually predict that there exists some optimal, steady-state growth path between inequality and development. This study uses a new measure of income distribution and panel data cointegration methods to test for the existence of such a steady-state equilibrium relation. It is shown that there is a long-run equilibrium relationship between the variables, and that this relationship is negative in developed economies.
----------------------
Relative Deprivation: A Theoretical and Meta-Analytic Review
Heather Smith et al.
Personality and Social Psychology Review, forthcoming
Abstract:
Relative deprivation (RD) is the judgment that one is worse off compared to some standard accompanied by feelings of anger and resentment. Social scientists use RD to predict a wide range of significant outcome variables: collective action, individual achievement and deviance, intergroup attitudes, and physical and mental health. But the results are often weak and inconsistent. The authors draw on a theoretical and meta-analytic review (210 studies composing 293 independent samples, 421 tests, and 186,073 respondents) to present a model that integrates group and individual RD. RD measures that (a) include justice-related affect, (b) match the outcome level of analysis, and (c) use higher quality measures yield significantly stronger relationships. Future research should focus on appropriate RD measurement, angry resentment, and the inclusion of theoretically relevant situational appraisals. Such methodological improvements would revitalize RD as a useful social psychological predictor of a wide range of important individual and social processes.
----------------------
Long-term association of economic inequality and mortality in adult Costa Ricans
Sepideh Modrek, William Dow & Luis Rosero-Bixby
Social Science & Medicine, January 2012, Pages 158-166
Abstract:
Despite the large number of studies, mostly in developed economies, there is limited consensus on the health effects of inequality. Recently a related literature has examined the relationship between relative deprivation and health as a mechanism to explain the economic inequality and health relationship. This study evaluates the relationship between mortality and economic inequality, as measured by area-level Gini coefficients, as well as the relationship between mortality and relative deprivation, in the context of a middle-income country, Costa Rica. We followed a nationally representative prospective cohort of approximately 16,000 individuals aged 30 and over who were randomly selected from the 1984 census. These individuals were then linked to the Costa Rican National Death Registry until Dec. 31, 2007. Hazard models were used to estimate the relative risk of mortality for all-cause and cardiovascular disease mortality for two indicators: canton-level income inequality and relative deprivation based on asset ownership. Results indicate that there was an unexpectedly negative association between canton income inequality and mortality, but the relationship is not robust to the inclusion of canton fixed-effects. In contrast, we find a positive association between relative deprivation and mortality, which is robust to the inclusion of canton fixed-effects. Taken together, these results suggest that deprivation relative to those higher in a hierarchy is more detrimental to health than the overall dispersion of the hierarchy itself, within the Costa Rican context.
----------------------
Manoj Atolia, Santanu Chatterjee & Stephen Turnovsky
Journal of Economic Dynamics and Control, March 2012, Pages 331-348
Abstract:
This paper examines the significance of the time path of a given productivity increase on growth and inequality. Whereas the time path impacts only the transitional paths of aggregate quantities, it has both transitional and permanent consequences for wealth and income distribution. Hence, the growth-inequality tradeoff generated by a given discrete increase in productivity contrasts sharply with that obtained when the same productivity increase occurs gradually. The latter can generate a Kuznets-type relationship between inequality and per-capita income. Our results suggest that economies with similar aggregate structural characteristics may have different outcomes for income and wealth inequality, depending on the nature of the productivity growth path.
----------------------
The emergence of popular personal finance magazines and the risk shift in American society
Roei Davidson
Media, Culture & Society, January 2012, Pages 3-20
Abstract:
This study considers the emergence of personal finance magazines in the US after the Second World War. It examines an instance when a possible relationship existed between a media genre's emergence and shifts in the general political economy. It suggests that the appearance of the personal finance genre was related to the shift in the American political economy from corporate liberalism to neoliberalism. Specifically, it focuses on the hailing patterns evident in personal finance magazines' editorial statements, and finds that these patterns attempt to constitute a popular and heterogeneous investing public of independent individuals in which magazines supplant other agents as sources of advice.
Tuesday, January 31, 2012
Interfaith
America's Grace: How a Tolerant Nation Bridges Its Religious Divides
David Campbell & Robert Putnam
Political Science Quarterly, Winter 2011, Pages 611-640
Abstract:
David E. Campbell and Robert D. Putnam ask how America can simultaneously be religiously devout, religiously diverse, and religiously tolerant. They argue that America's relative religious harmony lies in the frequency of "religious bridging." Almost all Americans have a friend or close family member of another religion, and these personal relationships keep America's religious melting pot from boiling over.
----------------------
Yavuz Fahir Zulfikar
Journal of Business Ethics, February 2012, Pages 489-502
Abstract:
This study examines the work ethic characteristics of Protestant, Catholic, and Muslim people who are living in the US. People originally from Turkey were targeted under the Muslim group. Since a significant number of people selected "none" as their religious affiliation in the survey, this group has also been included in the final analysis. Eight hundred and three people (313 Protestants, 180 "none", 96 Muslims, 86 Catholics, and 128 other) participated in this questionnaire study. The analyses revealed that Muslim Turks reported greater scores on four of the five Protestant work ethic (PWE) characteristics. Protestants scored higher than Catholics on all characteristics, but there was no significant difference.
----------------------
Are virtues shaped by national cultures or religions?
Jan Pieter van Oudenhoven et al.
Swiss Journal of Psychology, January 2012, Pages 29-34
Abstract:
The present paper examines the relative influence of religion and nation on conceptions of virtues. In a first study, conducted in the Netherlands, 926 respondents of different profession, age, sex, and religious background rank ordered a list of 15 virtues. A comparison of Dutch Muslims and non-Muslims showed a remarkably high resemblance in their ratings of virtues. Only faith was rated as being much more important by Muslims than by non-Muslims. In the second study, the influence of national cultures was examined. Adults (N = 795) from two culturally relatively similar countries, Germany and the Netherlands, and from Spain rated the same list of virtues. Cross-national differences between the two Northern European countries and Spain by far exceeded the influence of religion on the importance ratings of virtues. The implications of the findings for the often-mentioned clash of religions are discussed. Currently, the influence of religion on the values of immigrants may be overemphasized and other important characteristics may be underestimated.
----------------------
Jochen Gebauer, Constantine Sedikides & Wiebke Neberich
Psychological Science, forthcoming
"The religiosity-as-social-value hypothesis posits that the psychological benefits of religiosity (benefits to social self-esteem and psychological adjustment) are culturally specific: They should be stronger in countries that tend to value religiosity more. Data from more than 180,000 individuals across 11 countries were consistent with this prediction. Overall, believers claimed greater social self-esteem and psychological adjustment than nonbelievers did. However, culture qualified this effect. Believers enjoyed psychological benefits in countries that tended to value religiosity, but did not differ from nonbelievers in countries that did not tend to value religiosity."
----------------------
Religious people discount the future less
Evan Carter et al.
Evolution and Human Behavior, forthcoming
Abstract:
The propensity for religious belief and behavior is a universal feature of human societies, but religious practice often imposes substantial costs upon its practitioners. This suggests that during human cultural evolution, the costs associated with religiosity might have been traded off for psychological or social benefits that redounded to fitness on average. One possible benefit of religious belief and behavior, which virtually every world religion extols, is delay of gratification - that is, the ability to forego small rewards available immediately in the interest of obtaining larger rewards that are available only after a time delay. In this study, we found that religious commitment was associated with a tendency to forgo immediate rewards in order to gain larger, future rewards. We also found that this relationship was partially mediated by future time orientation, which is a subjective sense that the future is very close in time and is approaching rapidly. Although the effect sizes of these associations were relatively small in magnitude, they were obtained even when controlling for sex and the Big Five personality traits (Openness, Conscientiousness, Extraversion, Agreeableness, and Neuroticism).
----------------------
Managerial Abilities: Evidence from Religious Mutual Fund Managers
Luis Ferruz, Fernando Muñoz & María Vargas
Journal of Business Ethics, February 2012, Pages 503-517
Abstract:
In this study, we analyze the financial performance and the managerial abilities of religious mutual fund managers, implementing a comparative analysis with conventional mutual funds. We use a broad sample, free of survivorship bias, of religious equity mutual funds from the US market, for the period from January 1994 to September 2010. We build a matched-pair conventional sample in order to compare the results obtained for both kinds of mutual fund managers. We analyze stock-picking and market timing abilities, topics widely neglected for the specific case of religious mutual fund managers. We also study style timing abilities. As far as we are aware, this aspect has not been studied previously for religious mutual fund managers. Our results indicate that religious mutual fund managers underperform both the market and their conventional counterparts. This result is driven by negative stock-picking ability which could be generated by excluding "Sin" stocks from their portfolios. Moreover, they are not able to time the market or any of the following styles: size, book-to-market, and momentum.
----------------------
Higher Education and Religious Liberalization among Young Adults
Damon Mayrl & Jeremy Uecker
Social Forces, September 2011, Pages 181-208
Abstract:
Going to college has long been assumed to liberalize students' religious beliefs. Using longitudinal data from the National Study of Youth and Religion, we compare change in the content of religious beliefs of those who do and do not attend college. We find that, in general, college students are no more likely to develop liberal religious beliefs than non-students. In some cases, collegians actually appear more likely to retain their initial beliefs. Change in religious beliefs appears instead to be more strongly associated with network effects. These findings indicate that college's effect on students' religious beliefs is both weak and fragmented, and suggest that the multiplicity of social worlds on college campuses may help to sustain religious beliefs as well as religious practice and commitment.
----------------------
Intrinsic religiosity reduces intergroup hostility under mortality salience
Agnieszka Golec de Zavala et al.
European Journal of Social Psychology, forthcoming
Abstract:
Results of three studies indicate that intrinsic religiosity and mortality salience interact to predict intergroup hostility. Study 1, conducted among 200 American Christians and Jews, reveals that under mortality salience, intrinsic (but not extrinsic or quest) religiosity is related to decreased support for aggressive counterterrorism. Study 2, conducted among 148 Muslims in Iran, demonstrates that intrinsic religiosity predicts decreased out-group derogation under mortality salience. Study 3, conducted among 131 Polish Christians, shows that under mortality salience, priming of intrinsic religious concepts decreases support for aggressive counterterrorism.
----------------------
Renate Ysseldyk et al.
Group Processes & Intergroup Relations, January 2012, Pages 105-117
Abstract:
The divide between religious traditionalists and secular humanists has been widening for decades; yet, little is known about factors that attenuate hostility between these groups. Two studies examined whether (ir)religious identification could mitigate negative feelings toward (ir)religious outgroups. Following priming to make salient religious groups in daily life or group-based threat, Atheists and Christians in Britain (Study 1, n = 113), and Atheists, Catholics, Jews, Muslims, and Protestants in Canada (Study 2, n = 181) reported intergroup feelings, ingroup evaluations, and perceptions of their group as viewed by others. Atheists reported the lowest ingroup identification and felt equally negative toward all religious groups. Likewise, religious group members generally felt most negative toward Atheists. However, identification with the (ir)religious ingroup was associated with less hostility toward the outgroup(s). This was particularly marked for Atheists who perceived that religious followers felt positively toward them. These results challenge suggestions that (ir)religious identification and threat necessarily promote intergroup hostility.
----------------------
The Main Contributors to a Future Utopia
Richard Kinnier et al.
Current Psychology, December 2011, Pages 383-394
Abstract:
Which people, events, movements, institutions, and documents in the history of humankind have contributed most to the possible realization of a future utopia (i.e., a time when the Golden Rule is universally lived by)? This study consisted of two phases. The first phase involved generating nominated lists from over 100 graduate students and professionals in a variety of fields. In the second phase, the two resultant lists of 155 people and 122 events, movements, institutions, and documents were sent to a randomly-selected list of 400 tenured and tenure-track history and philosophy professors at 40 randomly-selected public Research 1 universities. These professors were asked to select who and what would be on their ‘A' lists. The most frequently-selected people included Mohandas Gandhi, Martin Luther King, Jr., and Buddha. The most-frequently selected events, movements, institutions, and documents included: the Abolitionist movement, the American Bill of Rights, and the Abolishment of Apartheid in South Africa. The lists are presented and discussed.
----------------------
Evolution of increased complexity in a molecular machine
Gregory Finnigan et al.
Nature, 19 January 2012, Pages 360-364
Abstract:
Many cellular processes are carried out by molecular ‘machines' - assemblies of multiple differentiated proteins that physically interact to execute biological functions. Despite much speculation, strong evidence of the mechanisms by which these assemblies evolved is lacking. Here we use ancestral gene resurrection and manipulative genetic experiments to determine how the complexity of an essential molecular machine - the hexameric transmembrane ring of the eukaryotic V-ATPase proton pump - increased hundreds of millions of years ago. We show that the ring of Fungi, which is composed of three paralogous proteins, evolved from a more ancient two-paralogue complex because of a gene duplication that was followed by loss in each daughter copy of specific interfaces by which it interacts with other ring proteins. These losses were complementary, so both copies became obligate components with restricted spatial roles in the complex. Reintroducing a single historical mutation from each paralogue lineage into the resurrected ancestral proteins is sufficient to recapitulate their asymmetric degeneration and trigger the requirement for the more elaborate three-component ring. Our experiments show that increased complexity in an essential molecular machine evolved because of simple, high-probability evolutionary processes, without the apparent evolution of novel functions. They point to a plausible mechanism for the evolution of complexity in other multi-paralogue protein complexes.
----------------------
Experimental evolution of multicellularity
William Ratcliff et al.
Proceedings of the National Academy of Sciences, forthcoming
Abstract:
Multicellularity was one of the most significant innovations in the history of life, but its initial evolution remains poorly understood. Using experimental evolution, we show that key steps in this transition could have occurred quickly. We subjected the unicellular yeast Saccharomyces cerevisiae to an environment in which we expected multicellularity to be adaptive. We observed the rapid evolution of clustering genotypes that display a novel multicellular life history characterized by reproduction via multicellular propagules, a juvenile phase, and determinate growth. The multicellular clusters are uniclonal, minimizing within-cluster genetic conflicts of interest. Simple among-cell division of labor rapidly evolved. Early multicellular strains were composed of physiologically similar cells, but these subsequently evolved higher rates of programmed cell death (apoptosis), an adaptation that increases propagule production. These results show that key aspects of multicellular complexity, a subject of central importance to biology, can readily evolve from unicellular eukaryotes.
----------------------
Jeff Levin
Journal of Religion and Health, December 2011, Pages 852-868
Abstract:
Using data from the 2000-01 National Jewish Population Survey (NJPS) (N = 5,148), effects of eight religious measures were investigated in relation to two health outcomes, standard single-item indicators of self-rated health and presence of an activity-limiting health condition. Seven of the religious measures were associated bivariately with one or both health indicators. Through two-step OLS regression of each health indicator onto all of the religious measures, adjusting for age and other sociodemographic correlates, two measures of synagogue involvement remained statistically significant. Follow-up analysis revealed a net health impact of religious observance primarily limited to Orthodox and Conservative Jews.
----------------------
Competition and the Strategic Choices of Churches
Adam Rennhoff & Mark Owens
American Economic Journal: Microeconomics, forthcoming
Abstract:
In this paper, we examine how the decisions of churches are impacted by the decisions of rival churches. Using a novel data set of Christian churches in two suburban Nashville, TN counties, we estimate a model of strategic interaction, based on empirical models of discrete games, which accounts for the location and denomination of churches. We focus on a church's decision of whether to provide a weekday child care program. Empirical evidence indicates that churches compete more strongly with nearby same-denomination churches than with different-denomination churches. These effects diminish with distance. Using our estimates, we conduct counterfactual simulations to examine the impact of an increase in the number of church adherents, the number of preschool aged children, and we also remove for-profit providers from the sample.
----------------------
Property rights and institutions in biblical society: The purchase of the cave of the patriarchs
Jacob Rosenberg & Avi Weiss
European Journal of Political Economy, forthcoming
Abstract:
A market economy and civil society require specification and certification of property rights. Where property rights are recognized, allowable transactions are also institutionally specified. In this paper we describe and analyze the earliest documented transfer of property rights to land, in Hebron in the 17th century BCE when Abraham purchased the Cave of the Patriarchs from Ephron the Hittite. We show how a property rights perspective with institutional constraint on permissible transactions resolves the puzzles that have been previously noted in the bargaining between the buyer and seller.
----------------------
Jennifer Jackson
Language & Communication, January 2012, Pages 48-61
Abstract:
This paper examines the deployment of semiotic devices in several mass-mediated public apologies by US politicians and the reflexive awareness of apology as commodity in national political contexts. Beyond acts of contrition and deliverance from the clutches of sin, apology events are extremely dialogical, salient modes of sociality that reach across, arbitrate, and bond multiple publics. The paper examines how speakers toggle between particular chronotopes - of time, place, and personhood - to both shape and reflect particular presentation and participation frameworks. Of certain interest is how the Protestant testimonial informs the apology, makes way for, even necessitates future transgression as it shifts proximity between the sin of the Lost and the testimony of the Found, reinstating membership in and reinforcing a moral public.
----------------------
The Consumer Jihad: Boycott Fatwas and Nonviolent Resistance on the World Wide Web
Leor Halevi
International Journal of Middle East Studies, February 2012, Pages 45-70
Abstract:
This article deals with the origins, development, and popularity of boycott fatwas. Born of the marriage of Islamic politics and Islamic economics in an age of digital communications, these fatwas targeted American, Israeli, and Danish commodities between 2000 and 2006. Muftis representing both mainstream and, surprisingly, radical tendencies argued that jihad can be accomplished through nonviolent consumer boycotts. Their argument marks a significant development in the history of jihad doctrine because boycotts, construed as jihadi acts, do not belong to the commonplace categories of jihad as a "military" or a "spiritual" struggle. The article also demonstrates that boycott fatwas emerged, to a large degree, from below. New media, in particular interconnected computer networks, made it easier for laypersons to drive the juridical discourse. They did so before September 11 as well as, more insistently, afterward. Their consumer jihad had some economic impact on targeted multinationals, and it provoked corporate reactions.
Monday, January 30, 2012
Need Cash Now
Political Pressures on Monetary Policy during the U.S. Great Inflation
Charles Weise
American Economic Journal: Macroeconomics, forthcoming
Abstract:
Drawing on an analysis of Federal Open Market Committee documents, this paper argues that political pressures on the Federal Reserve were an important contributor to the rise in inflation in the United States in the 1970s. Members of the FOMC understood that a serious attempt to tackle inflation would generate opposition from Congress and the Executive branch. Political considerations contributed to delays in monetary tightening, insufficiently aggressive anti-inflation policies, and the premature abandonment of attempts at disinflation. Empirical analysis verifies that references to the political environment at FOMC meetings are correlated with the stance of monetary policy during this period.
----------------------
Martin Larch
Kyklos, February 2012, Pages 53-80
Abstract:
A bias towards running deficits is an entrenched feature of fiscal policy making in most developed economies. Our paper examines whether this tendency is in any way associated with the personal distribution of income of a country. It takes inspiration from theoretical work according to which distributional conflicts may give rise to deficit spending or to delayed fiscal adjustment. Although these theories have been around for years the empirical literature on the determinants of fiscal performance has so far paid little or no attention to the possible role played by different degrees of income inequality. Our results suggest that this neglect was not justified. Using cross-country data we find evidence that a more unequal distribution of income can weigh on a country's fiscal performance. These findings can be relevant in the aftermath of the post-2007 global financial and economic crisis in particular when designing fiscal exit strategies. The success and sustainability of such strategies may inter alia depend on their distributional implications.
----------------------
Importing Corruption Culture from Overseas: Evidence from Corporate Tax Evasion in the United States
Jason DeBacker, Bradley Heim & Anh Tran
NBER Working Paper, January 2012
Abstract:
This paper studies how cultural norms and enforcement policies influence illicit corporate activities. Using confidential IRS audit data, we show that corporations with owners from countries with higher corruption norms engage in higher amounts of tax evasion in the U.S. This effect is strong for small corporations and decreases as the size of the corporation increases. In the mid-2000s, the United States implemented several enforcement measures which significantly increased tax compliance. However, we find that these enforcement efforts were less effective in reducing tax evasion by corporations whose owners are from countries with higher corruption norms. This suggests that cultural norms can be a challenge to legal enforcement.
----------------------
Desperately seeking the positive impact of undervaluation on growth
Ridha Nouira & Khalid Sekkat
Journal of Macroeconomics, forthcoming
Abstract:
This paper contributes to a current and intense debate among economists on whether real exchange rate undervaluation can boost growth. It focuses on addressing econometric and empirical issues that casts doubt about the validity of such positive impact. It also allows for the possibilities that the effect of undervaluation on growth operates with delay or dependent on the persistence or the level of undervaluation. We did not find any convincing support to the claim that a depreciated real exchange rate promotes economic growth. We argue that the contrast between our results and the documented examples of a successful adoption of undervaluation strategy reported in the literature reveals that undervaluation alone is not enough to boost growth. The simultaneous adoption of companion policies may be behind the claimed success.
----------------------
Fairness Spillovers - The Case of Taxation
Thomas Cornelissen, Oliver Himmler & Tobias Koenig
Journal of Economic Behavior & Organization, forthcoming
Abstract:
It is standardly assumed that individuals react to perceived unfairness or norm violations in precisely the same area or relationship where the original offense has occurred. However, grievances over being exposed to injustice may have even broader consequences and also spill over to other contexts, causing non-compliant behavior there. We present evidence that such 'fairness spillovers' can incur large economic costs: A belief that there is unfairness in taxation in the sense that the rich don't pay enough taxes is associated with a twenty percent higher level of paid absenteeism from work.
----------------------
Empirical Evidence on the Aggregate Effects of Anticipated and Unanticipated U.S. Tax Policy Shocks
Morten Ravn & Karel Mertens
American Economic Journal: Economic Policy, forthcoming
Abstract:
We provide empirical evidence on the dynamics effects of tax liability changes in the United States. We distinguish between surprise and anticipated tax changes using a timing-convention. We document that pre-announced but not yet implemented tax cuts give rise to contractions in output, investment and hours worked while real wages increase. In contrast, there are no significant anticipation effects on aggregate consumption. Implemented tax cuts, regardless of their timing, have expansionary and persistent effects on output, consumption, investment, hours worked and real wages. Results are shown to be very robust. We argue that tax shocks are empirically important impulses to the U.S. business cycle and that anticipation effects have been important during several business cycle episodes.
----------------------
Earnings Determination and Taxes: Evidence From a Cohort-Based Payroll Tax Reform in Greece
Emmanuel Saez, Manos Matsaganis & Panos Tsakloglou
Quarterly Journal of Economics, February 2012, Pages 493-533
Abstract:
This article analyzes the response of earnings to payroll tax rates using a cohort-based reform in Greece. Individuals who started working on or after 1993 face permanently a much higher earnings cap for payroll taxes, creating a large and permanent discontinuity in marginal payroll tax rates by date of entry in the labor force for upper earnings workers. Using full-population administrative social security data and a regression discontinuity design, we estimate the long-term labor supply effects and incidence of payroll tax rates on earnings. Standard theory predicts that in the long run, new regime workers should bear the entire burden of the payroll tax increase (relative to old regime workers). In contrast, we find that employers compensate new regime workers for the extra employer payroll taxes but not for the extra employee payroll taxes. We do not find any evidence of labor supply responses along the extensive or intensive margins around the discontinuity, suggesting low efficiency costs of payroll taxes. We discuss various possible explanations for those results.
----------------------
Expectation traps in a new Keynesian open economy model
David Arseneau
Economic Theory, January 2012, Pages 81-112
Abstract:
This paper illustrates that the presence of a money demand distortion in an otherwise standard new Keynesian open economy model results in multiple discretionary equilibria that arise in the form of expectations traps. If private sector inflation expectations become sufficiently unanchored, the model predicts that a monetary authority can easily be trapped into validating these expectations, thereby pushing the economy to a lower welfare equilibrium. Given the ease with which expectation traps arise in the presence of international linkages, the main result presented here suggests that maintaining well-anchored inflation expectations is a critically important policy goal for central banks in open economies.
----------------------
A note on America's 1920-21 depression as an argument for austerity
Daniel Kuehn
Cambridge Journal of Economics, January 2012, Pages 155-160
Abstract:
This note argues that recent interest in the 1920-21 depression in the USA as a historical precedent for austerity is inappropriate. Most of the austerity measures preceded the depression, which had already begun receding by the time Warren Harding implemented the relatively modest spending and tax cuts that are cited by modern proponents of austerity. The evidence suggests that the 1920-21 depression was the result of a variety of supply constraints, rather than a deficiency of effective demand, and is therefore a poor test of the efficacy of Keynesian fiscal policy.
----------------------
Effects of Fiscal Stimulus in Structural Models
Günter Coenen et al.
American Economic Journal: Macroeconomics, January 2012, Pages 22-68
Abstract:
The paper subjects seven structural DSGE models, all used heavily by policymaking institutions, to discretionary fiscal stimulus shocks using seven different fiscal instruments, and compares the results to those of two prominent academic DSGE models. There is considerable agreement across models on both the absolute and relative sizes of different types of fiscal multipliers. The size of many multipliers is large, particularly for spending and targeted transfers. Fiscal policy is most effective if it has moderate persistence and if monetary policy is accommodative. Permanently higher spending or deficits imply significantly lower initial multipliers.
----------------------
On the optimality of age-dependent taxes and the progressive U.S. tax system
Martin Gervais
Journal of Economic Dynamics and Control, forthcoming
Abstract:
In life-cycle economies, where an individual's optimal consumption-work plan is almost never constant, the optimal marginal tax rates on capital and labor income vary with age. Conversely, the progressivity imbedded in the U.S. tax code implies that marginal tax rates vary with age because tax rates vary with earnings and earnings vary with age. Using numerical simulations, this paper shows that if the tax authority is prevented from conditioning tax rates on age, some degree of progressivity is desirable as progressive taxation better imitates optimal age-dependent taxes than an optimal age-independent tax system. This role for progressive taxation emanates from efficiency reasons and does not rely on any insurance nor re-distribution arguments.
----------------------
Fiscal Policy and the Firm: Do Low Corporate Tax Rates Attract Multinational Corporations?
Nathan Jensen
Comparative Political Studies, forthcoming
Abstract:
The existing literature on the political economy of taxation explores how the mobility of firms affects the ability of governments to tax capital. In this article the author tests the relationship between corporate tax rates and multinational investment decisions in advanced, industrialized economies. He utilizes a time-series cross-sectional general error correction model to explore the impact of corporate taxation rates and foreign direct investment (FDI) inflows in up to 19 Organisation for Economic Co-operation and Development economies from 1980 to 2000. To mitigate potential endogeneity problems, the author's identification strategy takes advantage of delays between the passage of tax reductions and the implementation of these policies. The author finds no relationship between corporate tax rates and flows of foreign direct investment. This finding has implications on the link between globalization and domestic politics.
----------------------
Do Agglomeration Economies Reduce the Sensitivity of Firm Location to Tax Differentials?
Marius Brülhart, Mario Jametti & Kurt Schmidheiny
Economic Journal, forthcoming
Abstract:
Recent theoretical work in economic geography has shown that agglomeration forces can mitigate ‘race-to-the-bottom' tax competition, by partly or fully offsetting firms' sensitivity to tax differentials. We test this proposition using data on firm births across Swiss municipalities. We find that corporate taxes deter firm births less in more spatially concentrated sectors. Firms in sectors with an agglomeration intensity in the top quintile are less than half as responsive to differences in corporate tax burdens as firms in sectors with an agglomeration intensity in the bottom quintile. Hence, agglomeration economies do appear to attenuate the impact of tax differentials on firms' location choices.
----------------------
Identification of Preferences and Evaluation of Income Tax Policy
Charles Manski
NBER Working Paper, January 2012
Abstract:
The merits of alternative income tax policies depend on the population distribution of preferences for income, leisure, and public goods. Standard theory, which supposes that persons want more income and more leisure, does not predict how they resolve the tension between these desires. Empirical studies of labor supply have been numerous but have not shed much light on the matter. A persistent problem is that empirical researchers have imposed strong preference assumptions that lack foundation. This paper examines anew the problem of inference on preferences and considers the implications for comparison of tax policies. I first perform a basic revealed-preference analysis that imposes no assumptions on the preference distribution beyond the presumption that persons prefer more income and leisure. This shows that observation of a person's labor supply under a status quo tax policy may bound his labor supply under a proposed policy or may have no implications, depending on the shapes of the two tax schedules and the location of status quo labor supply. I next explore the identifying power of two assumptions restricting the population distribution of income-leisure preferences. One assumes that groups of persons who face different choice sets have the same distribution of preferences, while the other adds restrictions on the shape of this distribution. I then address utilitarian policy comparison with partial knowledge of preferences. Partial knowledge of preferences implies partial knowledge of the welfare function. Hence, it may not be possible to rank policies.
----------------------
Overconfidence, Monetary Policy Committees and Chairman Dominance
Carl Andreas Claussen et al.
Journal of Economic Behavior & Organization, February 2012, Pages 699-711
Abstract:
Monetary policy decisions are typically characterized by three features: (i) decisions are made by a committee, (ii) the committee members often disagree, and (iii) the chairman is almost never on the losing side in the vote. We show that the combination of overconfident policymakers and a chairman with agenda-setting rights can explain all these features. The optimal agenda-setting power to the chairman is a strictly concave function of the degree of overconfidence. We also show that the quality of advice produced by the central bank staff is higher in a flat organization than in a hierarchical one.
----------------------
Equity Risk Incentives and Corporate Tax Aggressiveness
Sonja Olhoft Rego
Journal of Accounting Research, forthcoming
Abstract:
This study examines equity risk incentives as one determinant of corporate tax aggressiveness. Prior research finds that equity risk incentives motivate managers to make risky investment and financing decisions, since risky activities increase stock return volatility and the value of stock option portfolios. Aggressive tax strategies involve significant uncertainty and can impose costs on both firms and managers. As a result, managers must be incentivized to engage in risky tax avoidance that is expected to generate net benefits for the firm and its shareholders. We predict that equity risk incentives motivate managers to undertake risky tax strategies. Consistent with this prediction we find that larger equity risk incentives are associated with greater tax risk and the magnitude of this effect is economically significant. Our results are robust across four measures of tax risk, but do not vary across several proxies for strength of corporate governance. We conclude that equity risk incentives are a significant determinant of corporate tax aggressiveness.
----------------------
Estimating Dynamic Income Responses to Tax Reform
Bertil Holmlund & Martin Söderström
B.E. Journal of Economic Analysis & Policy, November 2011
Abstract:
We study income responses to income tax changes by using a large panel of Swedish tax payers over the period 1991-2002. Changes in statutory tax rates as well as changes in tax bracket thresholds provide exogenous variations in tax rates that can be used to identify income responses. We estimate dynamic income models which allow us to distinguish between short-run and long-run effects in a straightforward fashion. For men, the estimates of the long-run elasticity of income with respect to the net-of-tax rate hover in a range between 0.10 and 0.30. The estimates for women are statistically insignificant. We simulate the fiscal consequences of a tax reform that reduces the top marginal tax rate by five percentage points. Such a reform may have negligible effects on tax revenues when the interactions between income taxes and other taxes are taken into account.
