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Wednesday, June 1, 2016

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Premium Subsidies, the Mandate, and Medicaid Expansion: Coverage Effects of the Affordable Care Act

Molly Frean, Jonathan Gruber & Benjamin Sommers

NBER Working Paper, April 2016

Abstract:
Using a combination of subsidized premiums for Marketplace coverage, an individual mandate, and expanded Medicaid eligibility, the Affordable Care Act (ACA) has significantly increased insurance coverage rates. We assessed the relative contributions to insurance changes of these different ACA provisions in the law’s first full year, using rating-area level premium data for all 50 states and microdata from the 2012-2014 American Community Survey. We employ a difference-in-difference-in-difference estimation strategy that relies on variation across income groups, areas, and years to causally identify the role of the ACA policy levers. We have four key findings. First, insurance coverage was only moderately responsive to price subsidies, but the subsidies were still large enough to raise coverage by almost one percent of the population; the coverage gains were larger in states that operated their own health insurance exchanges (as opposed to using the federal exchange). Second, the exemptions and tax penalty structure of the individual mandate had little impact on coverage decisions. Third, the law increased Medicaid coverage both among newly eligible populations and those who were previously eligible for Medicaid (the “woodwork” effect), with the latter driven predominantly by states that expanded their programs prior to 2014. Finally, there was no “crowdout” effect of expanded Medicaid on private insurance. Overall, we conclude that exchange premium subsidies produced roughly 40% of the ACA’s 2014 coverage gains, and Medicaid the other 60%, of which 2/3 occurred among previously-eligible individuals.

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‘Government Patent Use’: A Legal Approach To Reducing Drug Spending

Amy Kapczynski & Aaron Kesselheim

Health Affairs, May 2016, Pages 791-797

Abstract:
The high cost of patent-protected brand-name drugs can strain budgets and curb the widespread use of new medicines. An example is the case of direct-acting antiviral drugs for the treatment of hepatitis C. While prices for these drugs have come down in recent months, they still create barriers to treatment. Additionally, prescribing restrictions imposed by insurers put patients at increased risk of medical complications and contribute to transmission of the hepatitis C virus. We propose that the federal government invoke its power under an existing “government patent use” law to reduce excessive prices for important patent-protected medicines. Using this law would permit the government to procure generic versions of patented drugs and in exchange pay the patent-holding companies reasonable royalties to compensate them for research and development. This would allow patients in federal programs, and perhaps beyond, to be treated with inexpensive generic medicines according to clinical need — meaning that many more patients could be reached for no more, and perhaps far less, money than is currently spent. Another benefit would be a reduction in the opportunity for companies to extract monopoly profits that far exceed their risk-adjusted costs of research and development.

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Outcomes are Worse in US Patients Undergoing Surgery on Weekends Compared With Weekdays

Laurent Glance et al.

Medical Care, June 2016, Pages 608–615

Research Design: Using all-payer data, we conducted a retrospective cohort study of 305,853 patients undergoing isolated coronary artery bypass graft surgery, colorectal surgery, open repair of abdominal aortic aneurysm, endovascular repair of abdominal aortic aneurysm, and lower extremity revascularization. We compared in-hospital mortality and major complications for weekday versus weekend surgery using multivariable logistic regression analysis.

Results: After controlling for patient risk and surgery type, weekend elective surgery [adjusted odds ratio (AOR)=3.18; 95% confidence interval (CI), 2.26–4.49; P<0.001] and weekend urgent surgery (AOR=2.11; 95% CI, 1.68–2.66; P<0.001) were associated with a higher risk of death compared with weekday surgery. Weekend elective (AOR=1.58; 95% CI, 1.29–1.93; P<0.001) and weekend urgent surgery (AOR=1.61; 95% CI, 1.42–1.82; P<0.001) were also associated with a higher risk of major complications compared with weekday surgery.

Conclusions: Patients undergoing nonemergent major cardiac and noncardiac surgery on the weekends have a clinically significantly increased risk of death and major complications compared with patients undergoing surgery on weekdays. These findings should prompt decision makers to seek to better understand factors, such physician and nurse staffing, which may contribute to the weekend effect.

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The Impact of Health Insurance on Preventive Care and Health Behaviors: Evidence from the 2014 ACA Medicaid Expansions

Kosali Simon, Aparna Soni & John Cawley

NBER Working Paper, May 2016

Abstract:
The U.S. population receives suboptimal levels of preventive care and has a high prevalence of risky health behaviors. One goal of the Affordable Care Act (ACA) was to increase preventive care and improve health behaviors by expanding access to health insurance. This paper estimates how the ACA’s state-level expansions of Medicaid in 2014 affected these outcomes. Using data from the Behavioral Risk Factor Surveillance System, and a difference-in-differences model that compares states that did and did not expand Medicaid, we examine the impact of the expansions on preventive care (e.g. dental visits, immunizations, mammograms, cancer screenings) and risky health behaviors (e.g. smoking, heavy drinking, lack of exercise, obesity). We find evidence consistent with increased use of certain forms of preventive care such as dental visits and cancer screenings but little evidence of changes in health behaviors and in particular no evidence of ex ante moral hazard (i.e., no evidence that risky health behaviors increased in response to health insurance coverage). The Medicaid expansions also resulted in modest improvements in self-assessed health and decreases in the number of work days missed due to poor health.

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Medicare Part D and Portfolio Choice

Padmaja Ayyagari & Daifeng He

American Economic Review, May 2016, Pages 339-342

Abstract:
Economic theory suggests that medical spending risk affects the extent to which households are willing to accept financial risk, and consequently their investment portfolios. In this study, we focus on the elderly for whom medical spending represents a substantial risk. We exploit the exogenous reduction in prescription drug spending risk due to the introduction of Medicare Part D in the U.S. in 2006 to identify the causal effect of medical spending risk on portfolio choice. Consistent with theory, we find that Medicare-eligible persons increased risky investment after the introduction of prescription drug coverage, relative to a younger, ineligible cohort.

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Quality of Care Provided by Board-Certified Versus Non-Board-Certified Psychiatrists and Neurologists

Anna Wallace et al.

Academic Medicine, forthcoming

Purpose: To examine associations between board certification of psychiatrists and neurologists and quality-of-care measures, using multilevel models controlling for physician and patient characteristics, and to assess feasibility of linking physician information with patient records to construct quality measures from electronic claims data.

Method: The authors identified quality measures and matched claims data from 2006 to 2012 with 942 board-certified (BC) psychiatrists, 868 non-board-certified (nBC) psychiatrists, 963 BC neurologists, and 328 nBC neurologists. Using the matched data, they identified psychiatrists who treated at least one patient with a schizophrenia diagnosis, and neurologists attending patients discharged with a principal diagnosis of ischemic stroke, and analyzed claims from these patients. For patients with schizophrenia who were prescribed an atypical antipsychotic, quality measures were claims for glucose and lipid tests, duration of any antipsychotic treatment, and concurrent prescription of multiple antipsychotics. For patients with ischemic stroke, quality measures were dysphagia evaluation; speech/language evaluation; and prescription of clopidogrel, low-molecular-weight heparin, intravenous heparin, and warfarin (for patients with co-occurring atrial fibrillation).

Results: Overall, multilevel models (patients nested within physicians) showed no statistically significant differences in quality measures between BC and nBC psychiatrists and neurologists.

Conclusions: The authors demonstrated the feasibility of linking physician information with patient records to construct quality measures from electronic claims data, but there may be only minimal differences in the quality of care between BC and nBC psychiatrists and neurologists, or there may be a difference that could not be measured with the quality measures used.

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What is the Marginal Benefit of Payment-Induced Family Care?

Norma Coe et al.

NBER Working Paper, May 2016

Abstract:
Research on informal and formal long-term care has centered almost solely on costs; to date, there has been very little attention paid to the benefits. This study exploits the randomization in the Cash and Counseling Demonstration and Evaluation program and instrumental variable techniques to gain causal estimates of the effect of family involvement in home-based care on health care utilization and health outcomes. We find that family involvement significantly decreases Medicaid utilization. Importantly, we find family involvement significantly lowers the likelihood of urinary tract infections, respiratory infections, and bedsores, suggesting that the lower utilization is due to better health outcomes.

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Association Between Availability of a Price Transparency Tool and Outpatient Spending

Sunita Desai et al.

Journal of the American Medical Association, 3 May 2016, Pages 1874-1881

Design, Setting, and Participants: Two large employers represented in multiple market areas across the United States offered an online health care price transparency tool to their employees. One introduced it on April 1, 2011, and the other on January 1, 2012. The tool provided users information about what they would pay out of pocket for services from different physicians, hospitals, or other clinical sites. Using a matched difference-in-differences design, outpatient spending among employees offered the tool (n=148 655) was compared with that among employees from other companies not offered the tool (n=295 983) in the year before and after it was introduced.

Results: Mean outpatient spending among employees offered the tool was $2021 in the year before the tool was introduced and $2233 in the year after. In comparison, among controls, mean outpatient spending changed from $1985 to $2138. After adjusting for demographic and health characteristics, being offered the tool was associated with a mean $59 (95% CI, $25-$93) increase in outpatient spending. Mean outpatient out-of-pocket spending among those offered the tool was $507 in the year before introduction of the tool and $555 in the year after. Among the comparison group, mean outpatient out-of-pocket spending changed from $490 to $520. Being offered the price transparency tool was associated with a mean $18 (95% CI, $12-$25) increase in out-of-pocket spending after adjusting for relevant factors. In the first 12 months, 10% of employees who were offered the tool used it at least once.

Conclusions and Relevance: Among employees at 2 large companies, offering a price transparency tool was not associated with lower health care spending. The tool was used by only a small percentage of eligible employees.

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The Deservingness Heuristic and the Politics of Health Care

Carsten Jensen & Michael Bang Petersen

American Journal of Political Science, forthcoming

Abstract:
Citizens’ social policy opinions are strongly influenced by a simple heuristic: Are the recipients of social benefits deserving or not? Adding to this growing literature, we provide evidence that the deservingness heuristic does not treat all social benefits alike. Already at the level of preconscious processing, the heuristic displays a bias toward tagging the recipients of health care — that is, sick individuals — as deserving. This powerful, implicit effect overrides other opinion factors and produces broad-based support among the public for health care — across levels of self-interest, media frames, ideological divides, and national cultures. In contrast, when the deservingness heuristic is utilized for reasoning about unemployment benefits, implicit psychological constraints are fewer and political conflict erupts depending on differences in interest and worldviews. Using a variety of methodologies, we track this fundamental difference between the politics of health care and unemployment benefits from the level of implicit processing to the level of political attitudes.

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Tort Reform and Innovation

Alberto Galasso & Hong Luo

Harvard Working Paper, February 2016

Abstract:
Current academic and policy debates focus on the impact of tort reforms on physicians’ behavior and medical costs. This paper examines whether these reforms also affect incentives to develop new technologies. We find that laws which limit the liability exposure of healthcare providers are associated with a 13 percent reduction in medical device patenting. Tort reforms have the strongest impact in medical fields in which malpractice litigation is more frequent, and do not seem to affect the propensity to develop technologies of the highest and lowest quality. Our results underscore the importance of considering dynamic effects in economic analysis of tort laws.

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Are Settlements in Patent Litigation Collusive? Evidence from Paragraph IV Challenges

Eric Helland & Seth Seabury

NBER Working Paper, April 2016

Abstract:
The use of “pay-for-delay” settlements in patent litigation – in which a branded manufacturer and generic entrant settle a Paragraph IV patent challenge and agree to forestall entry – has come under considerable scrutiny in recent years. Critics argue that these settlements are collusive and lower consumer welfare by maintaining monopoly prices after patents should have expired, while proponents argue they reinforce incentives for innovation. We estimate the impact of settlements to Paragraph IV challenges on generic entry and evaluate the implications for drug prices and quantity. To address the potential endogeneity of Paragraph IV challenges and settlements we estimate the model using instrumental variables. Our instruments include standard measures of patent strength and a measure of settlement legality based on a split between several Circuit Courts of Appeal. We find that Paragraph IV challenges increase generic entry, lower drug prices and increase quantity, while settlements effectively reverse the effect. These effects persist over time, inflating price and depressing quantity for up to 5 years after the challenge. We also find that eliminating settlements would result in a relatively small reduction in research and development (R&D) expenditures.

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The Effect of Physician and Hospital Market Structure on Medical Technology Diffusion

Pinar Karaca-Mandic, Robert Town & Andrew Wilcock

Health Services Research, forthcoming

Objective: To examine the influence of physician and hospital market structures on medical technology diffusion, studying the diffusion of drug-eluting stents (DESs), which became available in April 2003.

Data Sources/Study Setting: Medicare claims linked to physician demographic data from the American Medical Association and to hospital characteristics from the American Hospital Association Survey.

Data Collection/Extraction Methods: All fee-for-service Medicare beneficiaries who received a percutaneous coronary intervention (PCI) with a cardiac stent in 2003 or 2004. Each PCI record was joined to characteristics on the patient, the procedure, the cardiologist, and the hospital where the PCI was delivered. We accounted for the endogeneity of physician and hospital market structure using exogenous variation in the distances between patient, physician, and hospital locations. We estimated multivariate linear probability models that related the use of a DES in the PCI on market structure while controlling for patient, physician, and hospital characteristics.

Principal Findings: DESs diffused faster in markets where cardiology practices faced more competition. Conversely, we found no evidence that the structure of the hospital market mattered.

Conclusions: Competitive pressure to maintain or expand PCI volume shares compelled cardiologists to adopt DESs more quickly.

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Productivity Dispersion in Medicine and Manufacturing

Amitabh Chandra et al.

American Economic Review, May 2016, Pages 99-103

Abstract:
The conventional wisdom in health economics is that large differences in average productivity across US hospitals are the result of idiosyncratic features of the healthcare sector which dull the role of market forces. Strikingly, however, we find that productivity dispersion in heart attack treatment across hospitals is, if anything, smaller than in narrowly defined manufacturing industries such as ready-mixed concrete. While this fact admits multiple interpretations, it suggests that healthcare may have more in common with "traditional" sectors than is often assumed, and relatedly, that insights from research on productivity and allocation in other sectors may enrich analysis of healthcare.

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Traditional Medicare Versus Private Insurance: How Spending, Volume, And Price Change At Age Sixty-Five

Jacob Wallace & Zirui Song

Health Affairs, May 2016, Pages 864-872

Abstract:
To slow the growth of Medicare spending, some policy makers have advocated raising the Medicare eligibility age from the current sixty-five years to sixty-seven years. For the majority of affected adults, this would delay entry into Medicare and increase the time they are covered by private insurance. Despite its policy importance, little is known about how such a change would affect national health care spending, which is the sum of health care spending for all consumers and payers — including governments. We examined how spending differed between Medicare and private insurance using longitudinal data on imaging and procedures for a national cohort of individuals who switched from private insurance to Medicare at age sixty-five. Using a regression discontinuity design, we found that spending fell by $38.56 per beneficiary per quarter — or 32.4 percent — upon entry into Medicare at age sixty-five. In contrast, we found no changes in the volume of services at age sixty-five. For the previously insured, entry into Medicare led to a large drop in spending driven by lower provider prices, which may reflect Medicare’s purchasing power as a large insurer. These findings imply that increasing the Medicare eligibility age may raise national health care spending by replacing Medicare coverage with private insurance, which pays higher provider prices than Medicare does.

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Impacts of the Affordable Care Act on Health Insurance Coverage in Medicaid Expansion and Non-Expansion States

Charles Courtemanche et al.

NBER Working Paper, April 2016

Abstract:
The Affordable Care Act (ACA) aimed to achieve nearly universal health insurance coverage in the United States through a combination of insurance market reforms, mandates, subsidies, health insurance exchanges, and Medicaid expansions, most of which took effect in 2014. This paper estimates the causal effects of the ACA on health insurance coverage using data from the American Community Survey. We utilize difference-in-difference-in-differences models that exploit cross-sectional variation in the intensity of treatment arising from state participation in the Medicaid expansion and local area pre-ACA uninsured rates. This strategy allows us to identify the effects of the ACA in both Medicaid expansion and non-expansion states. Our preferred specification suggests that, at the average pre-treatment uninsured rate, the full ACA increased the proportion of residents with insurance by 5.9 percentage points compared to 3.0 percentage points in states that did not expand Medicaid. Private insurance expansions from the ACA were due to increases in both employer-provided and non-group coverage. The coverage gains from the full ACA were largest for those with incomes below the Medicaid eligibility threshold, non-whites, young adults, and unmarried individuals. We find some evidence that the Medicaid expansion partially crowded out private coverage among low-income individuals.

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Differing Impacts Of Market Concentration On Affordable Care Act Marketplace Premiums

Richard Scheffler et al.

Health Affairs, May 2016, Pages 880-888

Abstract:
Recent increases in market concentration among health plans, hospitals, and medical groups raise questions about what impact such mergers are having on costs to consumers. We examined the impact of market concentration on the growth of health insurance premiums between 2014 and 2015 in two Affordable Care Act state-based Marketplaces: Covered California and NY State of Health. We measured health plan, hospital, and medical group market concentration using the well-known Herfindahl-Hirschman Index (HHI) and used a multivariate regression model to relate these measures to premium growth. Both states exhibited a positive association between hospital concentration and premium growth and a positive (but not statistically significant) association between medical group concentration and premium growth. Our results for health plan concentration differed between the two states: It was positively associated with premium growth in New York but negatively associated with premium growth in California. The health plan concentration finding in Covered California may be the result of its selectively contracting with health plans.

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The Affordable Care Act, State Policies and Demand for Primary Care Physicians

Marco Huesch, Truls Ostbye & Lloyd Michener

Duke University Working Paper, April 2016

Abstract:
The Affordable Care Act is designed to increase healthcare access nationwide. Such foreseeable new demand in the face of a fixed supply of physicians could lead to greater, and/or more intensive, recruitment of primary care physicians. We analyzed all primary care advertisements on three important national physician recruitment websites by ‘scraping’ all content on two days one year apart and parsed the content using text analytic tools. We expected greater increases in recruitment activity in those states expanding Medicaid and which partnered with the federal government to construct insurance exchanges. Contrary to hypothesis, physician labor markets did not consistently respond to foreseeable increases in patient demand by increased recruitment activities.

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Supervised autonomous robotic soft tissue surgery

Azad Shademan et al.

Science Translational Medicine, 4 May 2016

Abstract:
The current paradigm of robot-assisted surgeries (RASs) depends entirely on an individual surgeon’s manual capability. Autonomous robotic surgery — removing the surgeon’s hands — promises enhanced efficacy, safety, and improved access to optimized surgical techniques. Surgeries involving soft tissue have not been performed autonomously because of technological limitations, including lack of vision systems that can distinguish and track the target tissues in dynamic surgical environments and lack of intelligent algorithms that can execute complex surgical tasks. We demonstrate in vivo supervised autonomous soft tissue surgery in an open surgical setting, enabled by a plenoptic three-dimensional and near-infrared fluorescent (NIRF) imaging system and an autonomous suturing algorithm. Inspired by the best human surgical practices, a computer program generates a plan to complete complex surgical tasks on deformable soft tissue, such as suturing and intestinal anastomosis. We compared metrics of anastomosis — including the consistency of suturing informed by the average suture spacing, the pressure at which the anastomosis leaked, the number of mistakes that required removing the needle from the tissue, completion time, and lumen reduction in intestinal anastomoses—between our supervised autonomous system, manual laparoscopic surgery, and clinically used RAS approaches. Despite dynamic scene changes and tissue movement during surgery, we demonstrate that the outcome of supervised autonomous procedures is superior to surgery performed by expert surgeons and RAS techniques in ex vivo porcine tissues and in living pigs. These results demonstrate the potential for autonomous robots to improve the efficacy, consistency, functional outcome, and accessibility of surgical techniques.

By KEVIN LEWIS | 09:00:00 AM

Tuesday, May 31, 2016

Looking for jobs

Welfare Reform and Labor Force Exit by Young, Low-Skilled Single Males

Lincoln Groves

Demography, April 2016, Pages 393-418

Abstract:
While the labor market woes of low-skilled male workers in the United States over the past several decades have been well documented, the academic literature identifying causal factors leading to declines in labor force participation (LFP) by young, low-skilled males remains scant. To address this gap, I use the timing and characteristics of welfare-reform policies implemented during the 1990s and fixed-effects, instrumental variable regression modeling to show that policies seeking to increase LFP rates for low-skilled single mothers inadvertently led to labor force exit by young, low-skilled single males. Using data from the Current Population Survey and a bundle of work inducements enacted by states throughout the 1990s as exogenous variation in a quasi-experimental design, I find that the roughly 10 percentage point increase in LFP for low-skilled single mothers facilitated by welfare reform resulted in a statistically significant 2.8 percentage point decline in LFP for young, low-skilled single males. After conducting a series of robustness checks, I conclude that this result is driven entirely by white males, who responded to welfare-reform policies with a 3.7 percentage point decline in labor supply. Young black males, as well as other groups of potentially affected workers, appear to be uninfluenced by the labor supply response of less-educated single mothers to welfare reform. Impacts on young, single white males are large and economically significant, suggesting that nearly 150,000 males departed the formal labor market in response to directed welfare-reform policies.

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The Enduring Employment Impact of Your Great Recession Location

Danny Yagan

University of California Working Paper, March 2016

Abstract:
This paper asks whether Americans were jobless in 2014 because of where they were living in 2007. In the cross section, employment rates diverged across U.S. local areas 2007-2009 and - in contrast to history - have barely converged. This "great divergence" could reflect spatial differences in human capital, rather than causal location effects. I therefore use administrative data to compare two million workers with very similar pre-2007 human capital: those who in 2006 earned the same amount from the same retail firm, at establishments located in different local areas. I find that conditional on 2006 firm-x-wages fixed effects, living in 2007 in a below-median 2007-2009-fluctuation area caused those workers to have a 1.3%-lower 2014 employment rate. Hence, U.S. local labor markets are limitedly integrated: location has caused long-term joblessness and exacerbated within-skill income inequality. The enduring impact is not explained by more layoffs, more disability insurance enrollment, or reduced migration. Instead, the employment outcomes of cross-area movers are consistent with severe-fluctuation areas continuing to depress their residents' employment. Impacts are correlated with housing busts but not manufacturing busts, possibly reconciling current experience with history. If recent trends continue, employment rates are estimated to remain diverged into the 2020s - adding up to a relative lost decade for half the country. Employment models should allow market-wide shocks to cause persistent labor force exit, leaving employment depressed even after unemployment returns to normal.

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Can You Gig it? An Empirical Examination of the Gig-Economy and Entrepreneurial Activity

Gordon Burtch, Seth Carnahan & Brad Greenwood

University of Michigan Working Paper, March 2016

Abstract:
We examine how the entry of gig-economy platforms influences local entrepreneurial activity. On one hand, such platforms may reduce entrepreneurial activity by offering stable employment for the un- and under-employed. On the other hand, such platforms may enable entrepreneurial activity by offering work flexibility that allows the entrepreneur to re-deploy resources strategically in order to pursue her nascent venture. To resolve this tension we exploit a set of natural experiments, the entry of the ride-sharing platform Uber X and the on-demand delivery platform Postmates into local areas. We examine the effect of each on crowdfunding campaign launches at Kickstarter, the world's largest reward-based crowdfunding platform. Results indicate a negative and significant effect on crowdfunding campaign launches, and thus local entrepreneurial activity, after entry of Uber X or Postmates. Strikingly, the effect appears to accrue primarily to un-funded and under-funded projects, suggesting that gig-economy platforms predominantly reduce lower quality entrepreneurial activity by offering viable employment for the un- and under-employed.

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Downskilling: Changes in employer skill requirements over the business cycle

Alicia Sasser Modestino, Daniel Shoag & Joshua Ballance

Labour Economics, forthcoming

Abstract:
Using a novel database of 82.5 million online job postings, we show that employer skill requirements fell as the labor market improved from 2010 to 2014. We find that a 1 percentage point reduction in the local unemployment rate is associated with a roughly 0.27 percentage point reduction in the fraction of jobs requiring at least a bachelor's degree and a roughly 0.23 percentage point reduction in the fraction requiring five or more years of experience. This pattern is established using multiple measures of labor availability, is bolstered by similar trends along heretofore un-measured dimensions of skill, and even occurs within firm-job title pairs. We further confirm the causal effect of labor market tightening on skill requirements using a natural experiment based on the fracking boom in the United States, as an exogenous shock to the local labor supply in tradable, non-fracking industries. These industries are not plausibly affected by local demand shocks or natural gas extraction technology, but still show fewer skill requirements in response to tighter labor markets. Our results imply this labor market-induced downskilling reversed much of the cyclical increase in education and experience requirements that occurred during the Great Recession.

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How Credit Constraints Impact Job Finding Rates, Sorting & Aggregate Output

Kyle Herkenhoff, Gordon Phillips & Ethan Cohen-Cole

NBER Working Paper, May 2016

Abstract:
We empirically and theoretically examine how consumer credit access affects displaced workers. Empirically, we link administrative employment histories to credit reports. We show that an increase in credit limits worth 10% of prior annual earnings allows individuals to take .15 to 3 weeks longer to find a job. Conditional on finding a job, they earn more and work at more productive firms. We develop a labor sorting model with credit to provide structural estimates of the impact of credit on employment outcomes, which we find are similar to our empirical estimates. We use the model to understand the impact of consumer credit on the macroeconomy. We find that if credit limits tighten during a downturn, employment recovers quicker, but output and productivity remain depressed. This is because when limits tighten, low-asset, low-productivity job losers cannot self-insure. Therefore, they search less thoroughly and take more accessible jobs at less productive firms.

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Career Interruption and Productivity: Evidence from Major League Baseball during the Vietnam War Era

Brennan Mange & David Phillips

Journal of Human Capital, Summer 2016, Pages 159-185

Abstract:
Can temporary shocks to training and early career experience permanently reduce productivity? Using detailed data on the careers and productivity of Major League Baseball players subject to the Vietnam War draft, we find that birth dates randomly drawn in the draft produce 19 percent fewer major league players. Players born on draft days who do make it to Major League Baseball produce 29 percent fewer wins than those born on nondraft days, a gap that is largest for the most productive players and persists as players age. In addition, the tendency of the draft to push men toward more schooling generates at least some of our results.

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Beyond the labour income tax wedge: The unemployment-reducing effect of tax progressivity

Etienne Lehmann et al.

International Tax and Public Finance, June 2016, Pages 454-489

Abstract:
In this paper, we argue that, for a given overall level of labour income taxation, a more progressive tax schedule increases employment. From a theoretical point of view, higher progressivity increases overall employment through a wage moderating effect and also because employment of low-paid workers is more elastic to wages. We test these theoretical predictions on a panel of 21 OECD countries over 1998-2008. Controlling for the burden of taxation at the average wage, our estimates suggest that a more progressive tax schedule reduces the unemployment rate and increases the employment rate. These findings are confirmed when we account for the potential endogeneity of both average taxation and progressivity. Overall, our results suggest that policy-makers should not only focus on the detrimental effects of tax progressivity on in-work effort, but also consider the employment-enhancing effects.

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The Race Between Machine and Man: Implications of Technology for Growth, Factor Shares and Employment

Daron Acemoglu & Pascual Restrepo

NBER Working Paper, May 2016

Abstract:
The advent of automation and the simultaneous decline in the labor share and employment among advanced economies raise concerns that labor will be marginalized and made redundant by new technologies. We examine this proposition using a task-based framework in which tasks previously performed by labor can be automated and more complex versions of existing tasks, in which labor has a comparative advantage, can be created. We characterize the equilibrium in this model and establish how the available technologies and the choices of firms between producing with capital or labor determine factor prices and the allocation of factors to tasks. In a static version of our model where capital is fixed and technology is exogenous, automation reduces employment and the share of labor in national income and may even reduce wages, while the creation of more complex tasks has the opposite effects. Our full model endogenizes capital accumulation and the direction of research towards automation and the creation of new complex tasks. Under reasonable conditions, there exists a stable balanced growth path in which the two types of innovations go hand-in-hand. An increase in automation reduces the cost of producing using labor, and thus discourages further automation and encourages the faster creation of new complex tasks. The endogenous response of technology restores the labor share and employment back to their initial level. Although the economy contains powerful self correcting forces, the equilibrium generates too much automation. Finally, we extend the model to include workers of different skills. We find that inequality increases during transitions, but the self-correcting forces in our model also limit the increase in inequality over the long-run.

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The Impact of Forced Migration on Modern Cities: Evidence from 1930s Crop Failures

Lauren Cohen, Christopher Malloy & Quoc Nguyen

Harvard Working Paper, January 2016

Abstract:
We find that a sizable portion of current city-level variation in unionization was set in place during the 1930s, and that this exogenous unionization has a real impact on city-level economic outcomes today. First, we show that the driving factor behind these city-level differences was random, and a result of substantially different rainfall levels during the Dust Bowl. We find that individuals in drought - ridden areas were significantly more likely to migrate to close-by cities. Workers in these cities - facing an influx of rural migrants - then became far more inclined to unionize than those facing less competition for their jobs. Using this rainfall (and the resultant crop failures) in surrounding counties to generate exogenous variation in city migration inflows, we show that random differences in the drought-laden 1930's rainfall predict migration patterns, and variation in union formation rates that persist through today. These exogenous events explaining a sizable percentage of cross-sectional geographic variation in current unionization challenges explanations of unionization as a necessary response to work-place conditions. Furthermore, and importantly, we show that this exogenous unionization that persists through today predicts variation in key city-level economic outcomes such as level of education, establishment growth, and the presence of high-value industries.

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The effect of education on the minimum wage

Christos Pargianas

Applied Economics Letters, Summer 2016, Pages 765-767

Abstract:
This research shows for the first time that the level of education has a causal, negative effect on the minimum wage. I use 2SLS, with historical educational data as an instrument for the level of education in 2010, and I find that across the US states a one percentage point greater proportion of college graduates is associated with a real minimum wage that is lower by 1.5%-1.6%. Also, in order to control for state-level omitted variables, I regress the change in the minimum wage on the change in education and I find again a negative, and significantly at the 1% level, effect. Minimum wage is a policy that is chosen by governments according to voters' preferences. The results of this research imply that when the level of education increases voters prefer a lower minimum wage.

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The Limited Macroeconomic Effects of Unemployment Benefit Extensions

Gabriel Chodorow-Reich & Loukas Karabarbounis

NBER Working Paper, April 2016

Abstract:
By how much does an extension of unemployment benefits affect macroeconomic outcomes such as unemployment? Answering this question is challenging because U.S. law extends benefits for states experiencing high unemployment. We use data revisions to decompose the variation in the duration of benefits into the part coming from actual differences in economic conditions and the part coming from measurement error in the real-time data used to determine benefit extensions. Using only the variation coming from measurement error, we find that benefit extensions have a limited influence on state-level macroeconomic outcomes. We use our estimates to quantify the effects of the increase in the duration of benefits during the Great Recession and find that they increased the unemployment rate by at most 0.3 percentage point.

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Minimum Wage Shocks, Employment Flows, and Labor Market Frictions

Arindrajit Dube, William Lester & Michael Reich

Journal of Labor Economics, forthcoming

Abstract:
We provide the first estimates of the effects of minimum wages on employment flows in the US labor market, identifying the impact by using policy discontinuities at state borders. We find that minimum wages have a sizable negative effect on employment flows but not on stocks. Separations and accessions fall among affected workers, especially those with low tenure. We do not find changes in the duration of nonemployment for separations or hires. This evidence is consistent with search models with endogenous separations.

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Local employment multipliers in U.S. cities

Jasper Jacob van Dijk

Journal of Economic Geography, forthcoming

Abstract:
In this article, I show that within a U.S. city there is a significant effect of a permanent shock to employment in the tradable sector on employment in the non-tradable sector. I find that each additional job in the tradable sector will result in between 1.6 and 1.7 new jobs in the non-tradable sector. This result is robust to the specification of sector growth in the regression model. When I split the tradable sector into high- and low-wage workers, I find a larger multiplier of 2.0-2.3 for high-wage workers and no significant multiplier for low-wage workers.

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50 is the new 30 - long-run trends of schooling and retirement explained by human aging

Holger Strulik & Katharina Werner

Journal of Economic Growth, June 2016, Pages 165-187

Abstract:
Workers in the US and other developed countries retire no later than a century ago and spend a significantly longer part of their life in school, implying that they stay less years in the work force. The facts of longer schooling and simultaneously shorter working life are seemingly hard to square with the rationality of the standard economic life cycle model. In this paper we propose a novel theory, based on health and aging, that explains these long-run trends. Workers optimally respond to a longer stay in a healthy state of high productivity by obtaining more education and supplying less labor. Better health increases productivity and amplifies the return on education. The health accelerator allows workers to finance educational efforts with less forgone labor supply than in the previous state of shorter healthy life expectancy. When both life-span and healthy life expectancy increase, the health effect is dominating and the working life gets shorter if the intertemporal elasticity of substitution for leisure is sufficiently small or the return on education is sufficiently large. We calibrate the model and show that it is able to predict the historical trends of schooling and retirement.

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Job Mobility and Earnings Instability

Marco Leonardi

Economic Inquiry, forthcoming

Abstract:
There is still no consensus on the causes of the increase in the variance of transitory earnings (earnings instability) in the United States. It is difficult to attribute the rise in instability to job mobility because there is no evidence of a concurrent increase in job turnover or separations. Using an error component model of the covariance structure of earnings on Panel Survey of Income Dynamics and Survey of Income and Program Participation data, this study shows that job mobility and the increase in the variance of wage changes upon job change accounts for a substantial part of the increase in earnings instability. The empirical evidence is consistent with the simulations of a search and matching model where an increase in the variance of productivity shocks increases on-the-job search and earnings instability among job changers while leaving job turnover approximately constant.

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Can Genes Play a Role in Explaining Frequent Job Changes? An Examination of Gene-Environment Interaction From Human Capital Theory

Wei Chi et al.

Journal of Applied Psychology, forthcoming

Abstract:
This study examined how a dopamine genetic marker, DRD4 7 Repeat allele, interacted with early life environmental factors (i.e., family socioeconomic status, and neighborhood poverty) to influence job change frequency in adulthood using a national representative sample from the United States. The dopamine gene played a moderating role in the relationship between early life environments and later job change behaviors, which was meditated through educational achievement. In particular, higher family socioeconomic status was associated with higher educational achievement, and thereafter higher frequency of voluntary job changes and lower frequency of involuntary job changes; such relationships were stronger (i.e., more positive or negative) for individuals with more DRD4 7R alleles. In contrast, higher neighborhood poverty was associated with lower educational achievement, and thereafter lower frequency of voluntary job change and higher frequency of involuntary job change; such relationships were again stronger (i.e., more positive or negative) for individuals with more DRD4 7R alleles. The results demonstrated that molecular genetics using DNA information, along with early life environmental factors, can bring new insights to enhance our understanding of job change frequency in individuals' early career development.

By KEVIN LEWIS | 09:00:00 AM

Monday, May 30, 2016

Trade mission

Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure

David Autor et al.

MIT Working Paper, April 2016

Abstract:
Has rising trade integration between the U.S. and China contributed to the polarization of U.S. politics? Analyzing outcomes from the 2002 and 2010 congressional elections, we detect an ideological realignment that is centered in trade-exposed local labor markets and that commences prior to the divisive 2016 U.S. presidential election. Exploiting the exogenous component of rising trade with China and classifying legislator ideologies by their congressional voting record, we find strong evidence that congressional districts exposed to larger increases in import competition disproportionately removed moderate representatives from office in the 2000s. Trade-exposed districts initially in Republican hands become substantially more likely to elect a conservative Republican, while trade-exposed districts initially in Democratic hands become more likely to elect either a liberal Democrat or a conservative Republican. Polarization is also evident when breaking down districts by race: trade-exposed locations with a majority white population are disproportionately likely to replace moderate legislators with conservative Republicans, whereas locations with a majority non-white population tend to replace moderates with liberal Democrats. In contrast with much previous work in political science, we find limited impacts of economic shocks on the probability of party turnover (an anti-incumbency effect) or on the electoral vote shares of the major parties (a party realignment effect). Focusing on legislator behavior rather than on party vote counts, we find that trade exposure abets the replacement of incumbents from both parties with more ideologically strident successors.

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Does Trade Liberalization with China Influence U.S. Elections?

Yi Che et al.

NBER Working Paper, April 2016

Abstract:
This paper examines the impact of trade liberalization on U.S. Congressional elections. We find that U.S. counties subject to greater competition from China via a change in U.S. trade policy exhibit relative increases in turnout, the share of votes cast for Democrats and the probability that the county is represented by a Democrat. We find that these changes are consistent with Democrats in office during the period examined being more likely than Republicans to support legislation limiting import competition or favoring economic assistance.

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Good Jobs, Bad Jobs: What's Trade Got to Do with it?

James Lake & Daniel Millimet

Southern Methodist University Working Paper, March 2016

Abstract:
Using US local labor markets between 1990 and 2010, we analyze the heterogeneous impact of rising trade exposure on employment growth of 'good' and 'bad' jobs. Three salient findings emerge. First, rising local exposure to import competition, via falling US tariffs or rising Chinese import penetration, reduces (increases) employment growth of bad (good) jobs. Conversely, improved local access to export markets, via falling foreign tariffs, increases (reduces) employment growth of bad (good) jobs. Second, falling US tariff protection is substantially more important, economically and statistically, than rising Chinese import penetration. Third, globalization generates occupational polarization but not job polarization.

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Going for the Gold: The Economics of the Olympics

Robert Baade & Victor Matheson

Journal of Economic Perspectives, Spring 2016, Pages 201-218

Abstract:
In this paper, we explore the costs and benefits of hosting the Olympic Games. On the cost side, there are three major categories: general infrastructure such as transportation and housing to accommodate athletes and fans; specific sports infrastructure required for competition venues; and operational costs, including general administration as well as the opening and closing ceremony and security. Three major categories of benefits also exist: the short-run benefits of tourist spending during the Games; the long-run benefits or the "Olympic legacy" which might include improvements in infrastructure and increased trade, foreign investment, or tourism after the Games; and intangible benefits such as the "feel-good effect" or civic pride. Each of these costs and benefits will be addressed in turn, but the overwhelming conclusion is that in most cases the Olympics are a money-losing proposition for host cities; they result in positive net benefits only under very specific and unusual circumstances. Furthermore, the cost-benefit proposition is worse for cities in developing countries than for those in the industrialized world. In closing, we discuss why what looks like an increasingly poor investment decision on the part of cities still receives significant bidding interest and whether changes in the bidding process of the International Olympic Committee (IOC) will improve outcomes for potential hosts.

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On the Origins and Development of Pakistan's Soccer-Ball Cluster

David Atkin et al.

World Bank Economic Review, forthcoming

Abstract:
Sialkot, Pakistan, is the world center of hand-stitched soccer-ball manufacturing. The existence of the cluster is puzzling and seems to argue against the "home market effect", since there is little local demand for soccer balls. This paper traces the development of the cluster from its origins in the late 1800s and shows that it was rooted in an initial home market effect due to the presence of British colonists. Subsequent expansion was driven by agglomeration forces and effective industrial policy. The case study underlines the importance of longer-term historical dynamics and the role of industrial policy for understanding a country's contemporaneous pattern of specialization in the world economy.

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Corruption: Transcending Borders

Esteban Alemán Correa, Michael Jetter & Alejandra Montoya Agudelo

Kyklos, May 2016, Pages 183-207

Abstract:
Is corrupt behavior transmitted internationally? Using panel data for 123 countries from 1995 to 2012, our results suggest a positive and statistically meaningful relationship between neighboring countries' corruption levels and domestic graft. This result is robust to including two-way fixed effects, country-specific time trends, and the standard set of control variables. The effect becomes stronger as income increases, if capital cities are located closer to each other, and if countries share a common political union, such as the European Union. We find less evidence for common language or comparable institutional backgrounds (e.g., similar degrees of democracy), but some evidence for trade relationships as potential transmission channels. These findings allow two main conclusions. First, a country with corrupt neighbors will find it difficult to get rid of corruption. Second, on a more positive note, efforts aimed at decreasing domestic corruption levels could produce positive externalities in affecting neighboring countries. This could particularly hold true within a common institutional framework, such as the European Union.

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Under One Roof: Supply Chains and the Protection of Foreign Investment

Leslie Johns & Rachel Wellhausen

American Political Science Review, February 2016, Pages 31-51

Abstract:
We argue that economic links, such as supply chains, can create a common roof that protects foreign investors in host countries that lack strong institutions to protect property rights. Supply chains link the activities of firms: when a host government breaks a contract with one firm, other firms in the supply chain are harmed. These partner firms therefore have incentive to protect one another's property rights. This leads to the key implication of our argument: host governments are less likely to violate the property rights of firms that are more tightly linked with other firms in the host economy. We test our argument with cross-national data on investment arbitration, a survey of US multinational subsidiaries in Russia, and case studies from Azerbaijan. Our findings imply that one benefit of outsourcing in developing and transition economies is the creation of a network of partner firms that protect each other's property rights.

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The Hazardous Effects of Antidumping

Tibor Besedeš & Thomas Prusa

Economic Inquiry, forthcoming

Abstract:
We investigate the extent to which antidumping actions eliminate trade altogether. Using quarterly 10-digit HS-level export data for products involved in U.S. antidumping cases we find that antidumping actions increase the hazard rate by more than 50%. We find strong evidence of investigation effects with the impact during the initiation and preliminary duty phases considerably larger than once final duties are imposed. There are also important differences with respect to the size of duties with cases with large duties experiencing very large investigation effects. We show the antidumping (AD)-affected countries are less likely to return to the market even after the AD order is removed.

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Size matters! Who is bashing whom in trade war?

Kaz Miyagiwa, Huasheng Song & Hylke Vandenbussche

International Review of Economics & Finance, September 2016, Pages 33-45

Abstract:
In this paper we present a dynamic model of trade wars in contingent protection. We find that "market size" matters in trade wars in the sense that countries are more likely to initiate anti-dumping cases against countries having sufficiently smaller home markets relative to their own, but less likely against countries with larger markets. We test this "selective-targeting hypothesis" using World Bank data of worldwide anti-dumping filings during the years 1995-2014, and find strong support for it. Thus, our study indicates the importance of relative market size in understanding recent patterns of anti-dumping filings and contingent protection in world trade.

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Population Aging and Comparative Advantage

Jie Cai & Andrey Stoyanov

Journal of International Economics, forthcoming

Abstract:
In this paper we show that demographic differences between countries are a source of comparative advantage in international trade. Since many skills are age-dependent, population aging decreases the relative supply and increases the relative price of skills which depreciate with age. Thus, industries relying on skills in which younger workers are relatively more efficient will be more productive in countries with a younger labor force and less productive in countries with an older population. Building upon the neuroscience and economics literature, we construct industry-level measures of intensities in various age-dependent skills and show that population aging leads to specialization in industries which use age-appreciating skills intensively and erodes comparative advantage in industries for which age-depreciating skills are more important.

By KEVIN LEWIS | 09:00:00 AM

Sunday, May 29, 2016

Raging

Violent Video Games and Violent Crime

Scott Cunningham, Benjamin Engelstätter & Michael Ward

Southern Economic Journal, April 2016, Pages 1247–1265

Abstract:
Video games are an increasingly popular leisure activity. As many best-selling games contain hyper-realistic violence, many researchers and policymakers have hypothesized that violent games cause violent behaviors. Laboratory experiments have found evidence suggesting that violent video games increase aggression. Before drawing policy conclusions about the effect of violent games on actual behavior, these experimental studies should be subjected to tests of external validity. Our study uses a quasi-experimental methodology to identify the short-run and medium-run effects of violent game sales on violent crime using time variation in retail unit sales data of the top 30 selling video games and violent criminal offenses from both the Uniform Crime Report and the National Incident-Based Reporting System from 2005 to 2011. We find no evidence of an increase in crime associated with video games and perhaps a decrease.

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Violence as Honorable? Racial and Ethnic Differences in Attitudes Toward Violence

Mary Rose & Christopher Ellison

Crime & Delinquency, June 2016, Pages 800-820

Abstract:
Criminologists have suggested that Latinos differ from Southern Whites in their views of violence. A sample of 1,429 Texans indicated whether they agreed that violence deserves a violent response, whether violence is necessary to prevent future violence, and whether people have a right to kill in defense of self or family. Controlling for other factors, Latinos and African Americans were more likely than non-Hispanic Whites to disagree about the need for violence in preventing future harm and the right to self-defense. Less-acculturated Latinos, indicated by whether they took the survey in Spanish, were the least supportive of violence. Despite having roots in a so-called “culture of honor,” Latino immigrants, as well as those who are U.S. citizens, have distinct views on violence.

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Going to extremes for one's group: The role of prototypicality and group acceptance

Liran Goldman & Michael Hogg

Journal of Applied Social Psychology, forthcoming

Abstract:
To explore who goes to aggressive and antisocial extremes on behalf of their group we primed perceptions of (a) group prototypicality (peripheral vs. central) and (b) ease of acceptance by the group. Participants were members of self-significant groups — fraternities and sororities (N = 218). Drawing on social identity theory, uncertainty-identity theory and the social identity theory of influence through leadership, we found, as predicted, that peripheral members who believed it was easy to be accepted were most likely to intend to engage in and support antisocial and aggressive intergroup behaviors. This effect was somewhat stronger among males than females, and strengthened among the most highly identified participants. The research's potential for understanding socially harmful intergroup violence is noted.

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Are target-shooters more aggressive than the general population?

Thorsten Erle et al.

Aggressive Behavior, forthcoming

Abstract:
Although psychological research shows that guns are aggressive cues, proponents of liberal gun control argue that people rather than guns are to blame for gun-related violence. For instance, athletic target-shooters might classify guns as athletic rather than aggressive stimuli and thus should not be more aggressive than the general population. The present work investigated aggression and emotion-regulation in target-shooters. A longitudinal study found that initial self-reported aggression in target-shooters was higher than in the general population and further increased over 1 year. Additionally, the sample exhibited deficient emotion-regulation strategies, and this was related to self-reported aggression. In contrast, their implicit self-construct became more peaceful over time but was unrelated to all other measures. Two further cross-sectional experiments explored the causal impact of athletic target-shooting and other athletic activities (shooting a basketball) on aggression. Target-shooters and basketball players were tested before and after their regular team practice and aggressive thoughts and feelings were measured. Target-shooting but not basketball practice activated aggressive and anxiety-related thought more strongly than positive thought. Future research avenues, implications for the indirect measurement of aggression, and possible interventions to decrease aggression in target-shooters are discussed.

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Have LEGO Products Become More Violent?

Christoph Bartneck et al.

PLoS ONE, May 2016

Abstract:
Although television, computer games and the Internet play an important role in the lives of children they still also play with physical toys, such as dolls, cars and LEGO bricks. The LEGO company has become the world’s largest toy manufacturer. Our study investigates if the LEGO company’s products have become more violent over time. First, we analyzed the frequency of weapon bricks in LEGO sets. Their use has significantly increased. Second, we empirically investigated the perceived violence in the LEGO product catalogs from the years 1978–2014. Our results show that the violence of the depicted products has increased significantly over time. The LEGO Company’s products are not as innocent as they used to be.

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The association between intelligence and personal victimization in adolescence and adulthood

Kevin Beaver et al.

Personality and Individual Differences, August 2016, Pages 355–360

Abstract:
Intelligence has been linked to antisocial, violent, and criminal behaviors. Surprisingly, however, there is a lack of research examining whether intelligence differentially affects the risk for personal victimization. The current study addresses this gap in the literature by examining whether adolescent levels of verbal intelligence are related to the odds of personal victimization in adolescence and adulthood. This study analyzed data from the National Longitudinal Study of Adolescent to Adult Health (Add Health). The results revealed a statistically significant and consistent association between intelligence and victimization. Persons with lower intelligence were more likely to report being victimized even after controlling for the effects of violent criminal behavior. Future research would benefit by examining more closely the association between IQ score and the risk for victimization over the life course.

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Code of the Classroom? Social Disadvantage and Bullying Among American Adolescents, U.S. 2011-2012

Bryan Sykes, Alex Piquero & Jason Gioviano

Crime & Delinquency, forthcoming

Abstract:
Little research has explored whether social policies aimed at lessening economic hardship affect the prevalence of bullying, particularly after the Great Recession. This article investigates how the strains of neighborhood and cumulative disadvantage are associated with racial differences in bullying, and we consider whether social program participation — enlistment in needs-based social programs to attenuate poverty and disadvantage — upends race-based differences in bullying. Using probit, negative binomial, and propensity score matching methods, we show that adolescents who experience any markers of disadvantage are more likely to bully others, with Black and Hispanic adolescents being more likely to engage in bullying than Whites. Importantly, matched estimates reveal that participation in needs-based social programs eliminates racial differences in bullying.

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The Bond That Breaks: Closeness and Honor Predict Morality-Related Aggression

Theresa Benavidez, Adon Neria & Daniel Jones

Evolutionary Psychological Science, June 2016, Pages 140-148

Abstract:
Endorsement of a “culture of honor” contributes to the belief that family honor is tied to female obedience across a variety of moral values. Violations of these moral values may lead to aggression. Male participants in studies 1 and 3 filled out a measure of cultural honor and closeness to their present wife or partner. Participants with high levels of both closeness and honor were most aggressive toward a hypothetical moral violation. In study 2, we randomly assigned men to bond or not with a female confederate who devalued his most important moral value. Participants were then given the opportunity to aggress against her in a supposedly unrelated study by choosing how much painful hot sauce she would be forced to drink. Once again, high levels of closeness and honor predicted the greatest levels of aggression. In sum, moral disagreements by women are met with increased aggression within the culture of honor, the closer an honor-endorsing male is to the woman.

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When Is It “Manly” to Intervene?: Examining the Effects of a Misogynistic Peer Norm on Bystander Intervention for Sexual Aggression

Ruschelle Leone, Dominic Parrott & Kevin Swartout

Psychology of Violence, forthcoming

Objective: The current study examined effects of the presence of a misogynistic male peer norm and masculine gender role stress (MGRS) on bystander intervention behavior for sexual aggression.

Method: Undergraduate men (N = 104) engaged in a novel laboratory paradigm in which they and 3 male confederates watched a female confederate, who reported a strong dislike of sexual content in the media, view a sexually explicit film which they could stop at any time. Prior to the female viewing the film, participants were randomly assigned to an audience manipulation wherein the male confederates set a misogynistic or ambiguous group norm.

Results: Zero-inflated negative binomial (ZINB) regression models indicated (a) the presence of a misogynistic peer norm decreased the odds of intervening, and (b) higher levels of MGRS significantly increased the rate of bystander intervention among participants exposed to a misogynistic, but not an ambiguous, norm.

Conclusions: Findings highlight the importance of examining situational and individual level factors that may influence prosocial bystander intervention behavior to prevent sexual aggression.

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Uric acid excretion predicts increased aggression in urban adolescents

Sylvie Mrug & Michal Mrug

Physiology & Behavior, September 2016, Pages 144–148

Abstract:
Elevated levels of uric acid have been linked with impulsive and disinhibited behavior in clinical and community populations of adults, but no studies have examined uric acid in relation to adolescent aggression. This study examined the prospective role of uric acid in aggressive behavior among urban, low income adolescents, and whether this relationship varies by gender. A total of 84 adolescents (M age 13.36 years; 50% male; 95% African American) self-reported on their physical aggression at baseline and 1.5 years later. At baseline, the youth also completed a 12-h (overnight) urine collection at home which was used to measure uric acid excretion. After adjusting for baseline aggression and age, greater uric acid excretion predicted more frequent aggressive behavior at follow up, with no significant gender differences. The results suggest that lowering uric acid levels may help reduce youth aggression.

By KEVIN LEWIS | 09:00:00 AM

Saturday, May 28, 2016

Noticeable

Up speeds you down. Awe-evoking monumental buildings trigger behavioral and perceived freezing

Yannick Joye & Siegfried Dewitte

Journal of Environmental Psychology, September 2016, Pages 112-125

Abstract:
Since the dawn of large-scale civilizations, humans have built exceptionally tall architectural structures. We tested whether exposing individuals to images of very tall buildings would produce feelings of awe in them, and would lead to a behavioral response frequently associated with this emotion, namely "freezing". Across four studies participants reported to feel more awestruck (Pilot 1a, Study 1a) and more bodily immobile after having seen pictures of high versus low buildings (Study 1b). In addition to perceived immobility, we also found that participants responded slower on a manual clicking task in the face of high as opposed to low buildings (Pilot 1b, Study 1b). This effect was mediated by perceived bodily immobility, suggesting that slow clicking after seeing high buildings indeed reflected behavioral freezing. Overall, our findings suggest that very tall buildings can be a trigger of awe, and that experiencing this emotion can involve a state of behavioral freezing.

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From Painkiller to Empathy Killer: Acetaminophen (Paracetamol) Reduces Empathy for Pain

Dominik Mischkowski, Jennifer Crocker & Baldwin Way

Social Cognitive and Affective Neuroscience, forthcoming

Abstract:
Simulation theories of empathy hypothesize that empathizing with others' pain shares some overlapping psychological computations with the processing of one's own pain. Support for this perspective has largely relied on functional neuroimaging evidence of an overlap between activations during the experience of physical pain and empathy for other people's pain. Here, we extend the functional overlap perspective to the neurochemical level and test whether a common physical painkiller, acetaminophen (paracetamol), can reduce empathy for another's pain. In two double-blind placebo-controlled experiments, participants rated perceived pain, personal distress, and empathic concern in response to reading physical or social pain scenarios, witnessing ostracism in the lab, or visualizing another study participant receiving painful noise blasts. As hypothesized, acetaminophen reduced empathy in response to others' pain. Acetaminophen also reduced the unpleasantness of noise blasts delivered to the participant, which mediated acetaminophen's effects on empathy. Together, these findings suggest that the physical painkiller acetaminophen reduces empathy for pain and provide a new perspective on the neurochemical bases of empathy. Because empathy regulates prosocial and antisocial behavior, these drug-induced reductions in empathy raise concerns about the broader social side effects of acetaminophen, which is taken by almost a quarter of US adults each week.

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Sex Differences in Music: A Female Advantage at Recognizing Familiar Melodies

Scott Miles, Robbin Miranda & Michael Ullman

Frontiers in Psychology, March 2016

Abstract:
Although sex differences have been observed in various cognitive domains, there has been little work examining sex differences in the cognition of music. We tested the prediction that women would be better than men at recognizing familiar melodies, since memories of specific melodies are likely to be learned (at least in part) by declarative memory, which shows female advantages. Participants were 24 men and 24 women, with half musicians and half non-musicians in each group. The two groups were matched on age, education, and various measures of musical training. Participants were presented with well-known and novel melodies, and were asked to indicate their recognition of familiar melodies as rapidly as possible. The women were significantly faster than the men in responding, with a large effect size. The female advantage held across musicians and non-musicians, and across melodies with and without commonly associated lyrics, as evidenced by an absence of interactions between sex and these factors. Additionally, the results did not seem to be explained by sex differences in response biases, or in basic motor processes as tested in a control task. Though caution is warranted given that this is the first study to examine sex differences in familiar melody recognition, the results are consistent with the hypothesis motivating our prediction, namely that declarative memory underlies knowledge about music (particularly about familiar melodies), and that the female advantage at declarative memory may thus lead to female advantages in music cognition (particularly at familiar melody recognition). Additionally, the findings argue against the view that female advantages at tasks involving verbal (or verbalizable) material are due solely to a sex difference specific to the verbal domain. Further, the results may help explain previously reported cognitive commonalities between music and language: since declarative memory also underlies language, such commonalities may be partly due to a common dependence on this memory system. More generally, because declarative memory is well studied at many levels, evidence that music cognition depends on this system may lead to a powerful research program generating a wide range of novel predictions for the neurocognition of music, potentially advancing the field.

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Money in your palm: Sharp shaped vegetation in the surroundings increase the subjective value of houses

Shlomo Hareli et al.

Journal of Environmental Psychology, forthcoming

Abstract:
Preference for round over sharp shaped objects, is attributed to the potential damage of sharpness. We tested if leaf sharpness of vegetation surrounding a house, affects the evaluation the house and its owner. We demonstrated that houses surrounded by sharp leaf vegetation (SLV) were evaluated as more expensive than houses surrounded by round leaf vegetation (RLV). Among the SLV surrounded houses, those surrounded only by palms were rated highest while SLV houses were evaluated as safer. In a final experiment, the perceptions of individual leaves differing in shape, were consistent with the protective function of sharp leaves. Our findings are explained by theorizing that SLV confer protective value on neighboring houses. The perceived higher values and safety of houses surrounded by palms is attributed to the association of palms with suitable and stable living environments. Furthermore, preference for palm habitats may have deep roots of human evolution in African savannas.

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Testing for Individual Differences in the Identification of Chemosignals for Fear and Happy: Phenotypic Super-Detectors, Detectors and Non-Detectors

Jeannette Haviland-Jones, Terry McGuire & Patricia Wilson

PLoS ONE, May 2016

Abstract:
Mood odor identification, explicit awareness of mood odor, may be an important emotion skill and part of a complex dual processing system. It has already been shown that mood odors have significant implicit effects, effects that occur without awareness. This study applies methods for examining human individual differences in the identification of chemosignals for fear and happy, important in itself, and a key to understanding the dual processing of emotion in the olfactory system. Axillary mood odors had been collected from 14 male donors during a mood induction task. Pads were collected after 12 and 24 minutes, creating two doses. Sixty -one participants (41 females) identified the mood odor chemosignals. On a single trial, participants identified 2 doses of fear, 2 doses of happy, and a sterile control. There were 15 trials. The first analysis (rtt) showed that the population was phenotypically heterogeneous, not homogeneous, in identification accuracy. It also showed that a minimum of 10 trials was needed for test reliability. The second analysis, Growth Mixture Modeling, found three distinct groups of detectors: (1) 49.49% were consistently accurate super detectors, (2) 32.52% were accurate above chance level detectors, and (3) 17.98% were non-detectors. Bayesian Posterior Analyses showed reliability of groups at or above 98%. No differences related to mood odor valence (fear or happy), dose (collection at 12 or 24 minutes) or gender were found. Implications for further study of genetic differences, learning and function of identification are noted. It appears that many people can be reliable in explicitly identifying fear and happy mood odors but this skill is not homogeneous.

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The Song Is You: Preferences for Musical Attribute Dimensions Reflect Personality

David Greenberg et al.

Social Psychological and Personality Science, forthcoming

Abstract:
Research suggests that musical preferences are linked to personality, but this research has been hindered by genre-based theories and methods. We address this limitation using a novel method based on the actual attributes that people perceive from music. In Study 1, using 102 musical pieces representing 26 genres and subgenres, we show that 38 perceived attributes in music can be organized into three basic dimensions: arousal, valence, and depth. In Study 2 (N = 9,454), we show that people's preferences for these musical attributes reflected their self-ratings of personality traits. Importantly, personality was found to predict musical preferences above and beyond demographic variables. These findings advance previous theory and research and have direct applications for the music industry, recommendation algorithms, and health-care professionals.

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A Simple Task Uncovers a Postdictive Illusion of Choice

Adam Bear & Paul Bloom

Psychological Science, forthcoming

Abstract:
Do people know when, or whether, they have made a conscious choice? Here, we explore the possibility that choices can seem to occur before they are actually made. In two studies, participants were asked to quickly choose from a set of options before a randomly selected option was made salient. Even when they believed that they had made their decision prior to this event, participants were significantly more likely than chance to report choosing the salient option when this option was made salient soon after the perceived time of choice. Thus, without participants' awareness, a seemingly later event influenced choices that were experienced as occurring at an earlier time. These findings suggest that, like certain low-level perceptual experiences, the experience of choice is susceptible to "postdictive" influence and that people may systematically overestimate the role that consciousness plays in their chosen behavior.

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Feeling light or dark? Emotions affect perception of brightness

Xiaobin Zhang et al.

Journal of Environmental Psychology, September 2016, Pages 107-111

Abstract:
In three experiments, we tested whether a perceiver's emotions affected the perception of brightness. Experiment 1 primed emotions via happy or sad film clips and found that happy participants judged the room to be brighter than sad participants. In Experiment 2, participants' emotions were primed by recalling happy or sad deeds and also revealed that happy participants judged the room to be brighter in both watts and using a 7-point scale compared to sad participants. Using the same manipulation as Experiment 2, Experiment 3 also showed that happy participants judged a gray picture presented on a computer screen (i.e., the room) to be brighter than sad participants. These experiments provide evidence that perceivers' emotions can affect the perception of brightness in a metaphorically consistent manner.

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The Insula Mediates Access to Awareness of Visual Stimuli Presented Synchronously to the Heartbeat

Roy Salomon et al.

Journal of Neuroscience, 4 May 2016, Pages 5115-5127

Abstract:
The processing of interoceptive signals in the insular cortex is thought to underlie self-awareness. However, the influence of interoception on visual awareness and the role of the insular cortex in this process remain unclear. Here, we show in a series of experiments that the relative timing of visual stimuli with respect to the heartbeat modulates visual awareness. We used two masking techniques and show that conscious access for visual stimuli synchronous to participants' heartbeat is suppressed compared with the same stimuli presented asynchronously to their heartbeat. Two independent brain imaging experiments using high-resolution fMRI revealed that the insular cortex was sensitive to both visible and invisible cardio-visual stimulation, showing reduced activation for visual stimuli presented synchronously to the heartbeat. Our results show that interoceptive insular processing affects visual awareness, demonstrating the role of the insula in integrating interoceptive and exteroceptive signals and in the processing of conscious signals beyond self-awareness.

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Causal Evidence for a Mechanism of Semantic Integration in the Angular Gyrus as Revealed by High-Definition Transcranial Direct Current Stimulation

Amy Rose Price et al.

Journal of Neuroscience, 30 March 2016, Pages 3829-3838

Abstract:
A defining aspect of human cognition is the ability to integrate conceptual information into complex semantic combinations. For example, we can comprehend "plaid" and "jacket" as individual concepts, but we can also effortlessly combine these concepts to form the semantic representation of "plaid jacket." Many neuroanatomic models of semantic memory propose that heteromodal cortical hubs integrate distributed semantic features into coherent representations. However, little work has specifically examined these proposed integrative mechanisms and the causal role of these regions in semantic integration. Here, we test the hypothesis that the angular gyrus (AG) is critical for integrating semantic information by applying high-definition transcranial direct current stimulation (tDCS) to an fMRI-guided region-of-interest in the left AG. We found that anodal stimulation to the left AG modulated semantic integration but had no effect on a letter-string control task. Specifically, anodal stimulation to the left AG resulted in faster comprehension of semantically meaningful combinations like "tiny radish" relative to non-meaningful combinations, such as "fast blueberry," when compared to the effects observed during sham stimulation and stimulation to a right-hemisphere control brain region. Moreover, the size of the effect from brain stimulation correlated with the degree of semantic coherence between the word pairs. These findings demonstrate that the left AG plays a causal role in the integration of lexical-semantic information, and that high-definition tDCS to an associative cortical hub can selectively modulate integrative processes in semantic memory.

By KEVIN LEWIS | 09:00:00 AM

Friday, May 27, 2016

Who gets what

Money Supply, Class Power, and Inflation: Monetarism Reassessed

Ho-fung Hung & Daniel Thompson

American Sociological Review, June 2016, Pages 447-466

Abstract:
Recent sociological work shows that pro-market neoliberal policies across advanced capitalist countries are due to distributional struggle between classes in the 1970s and 1980s. The orthodox monetarist view, alternatively, sees neoliberal reform as a nonpolitical attempt to end the stagflation crisis of the 1970s. From this perspective, monetary and fiscal expansions brought high inflation, and central bank discipline and government austerity is the solution; but the recent trend of low inflation despite accelerating money growth and government spending contradicts this view. Analyses of time-series cross-section data for 23 OECD countries from 1960 to 2009 support the thesis that the rise and fall of inflation is more about distribution of power between labor and capital than about monetary and fiscal discipline. Inflation in the 1970s originated from a strong working class and hurt capital more than it did workers, while neoliberal repression of workers' power has kept inflation low from the 1980s onward. Disempowerment of labor created rising inequality and economic imbalances that fueled a financial boom underlying the global financial crisis of 2008. Re-empowering labor is a remedy to such imbalances and the subsequent deflationary pressure.

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Adam Smith on What Is Wrong with Economic Inequality

Dennis Rasmussen

American Political Science Review, forthcoming

Abstract:
This article explores Adam Smith's attitude toward economic inequality, as distinct from the problem of poverty, and argues that he regarded it as a double-edged sword. On the one hand, as has often been recognized, Smith saw a high degree of economic inequality as an inevitable result of a flourishing commercial society, and he considered a certain amount of such inequality to be positively useful as a means of encouraging productivity and bolstering political stability. On the other hand, it has seldom been noticed that Smith also expressed deep worries about some of the other effects of extreme economic inequality - worries that are, moreover, interestingly different from those that dominate contemporary discourse. In Smith's view, extreme economic inequality leads people to sympathize more fully and readily with the rich than the poor, and this distortion in our sympathies in turn undermines both morality and happiness.

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Capital in the Twenty-First Century - in the Rest of the World

Michael Albertus & Victor Menaldo

Annual Review of Political Science, 2016, Pages 49-66

Abstract:
Recent work has documented an upward trend in inequality since the 1970s that harks back to the Gilded Age: the inegalitarian pre-World War I world. Most prominently, Thomas Piketty argues in Capital in the Twenty-First Century that this is partially due to the fact that capitalism is hardwired to exacerbate the gap between the rich and poor. By critically evaluating recent literature on this topic, this article offers three big contributions. First, we advance an alternative explanation for the long-term U-shaped nature of inequality that Piketty examines. Political regime types and the social groups they empower, rather than war and globalization, can account for the sharp fall and then sharp rise in inequality over the long 20th century. Second, we demonstrate that this U-shaped pattern only really holds for a handful of industrialized economies and a subset of developing countries. Finally, we provide a unified framework centered on two unorthodox assumptions that can explain inequality patterns beyond the U-shaped one. Capitalists and landholders actually prefer democracy if they can first strike a deal that protects them after transition. This is because dictators are not the loyal servants of the economic elite they are portrayed to be - in fact, they are often responsible for soaking, if not destroying, the rich under autocracy.

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Growth of income and welfare in the U.S, 1979-2011

John Komlos

NBER Working Paper, April 2016

Abstract:
We estimate growth rates of real incomes in the U.S. by quintiles using the Congressional Budget Office's (CBO) post-tax, post-transfer data as basis for the period 1979-2011. We improve upon them by including only the present value of earnings that will accrue in retirement and excluding items included in the CBO income estimates such as "corporate taxes borne by labor" that do not increase either current purchasing power or utility. We estimate a high and a low growth rate using two price indexes, the CPI and the Personal Consumption Expenditure index. The major consistent findings include what in the colloquial is referred to as the "hollowing out" of the middle class. According to these estimates, the income of the middle class 2nd and 3rd quintiles increased at a rate of between 0.1% and 0.7% per annum, i.e., barely distinguishable from zero. Even that meager rate was achieved only through substantial transfer payments. In contrast, the income of the top 1% grew at an astronomical rate of between 3.4% and 3.9% per annum during the 32-year period, reaching an average annual value of $918,000, up from $281,000 in 1979 (in 2011 dollars). Hence, the post-tax, post-transfer income of the 1% relative to the 1st quintile increased from a factor of 21 in 1979 to a factor of 51 in 2011. However, income of no other group increased substantially relative to that of the lowest quintile. Oddly, the income of even those in the 96-99 percentiles increased only from a multiple of 8.1 to a multiple of 11.3. We next estimate growth in welfare assuming diminishing marginal utility of income. A logarithmic utility function yields a growth in welfare for the middle class of roughly 0.01% to 0.07% per annum, which is indistinguishable from zero. With interdependent utility functions only the welfare of the 5th quintile experienced meaningful growth while those of the first four quintiles tend to be either negligible or even negative.

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The Unequal Gains from Product Innovations

Xavier Jaravel

Harvard Working Paper, May 2016

Abstract:
Using detailed product-level data in the retail sector in the United States from 2004 to 2013, this paper shows that product innovations disproportionately benefited high-income households due to increasing inequality and the endogenous response of supply to market size. Annualized quality-adjusted inflation was 0.65 percentage points lower for high-income households, relative to low-income households. Using national and local changes in market size driven by demographic trends plausibly exogenous to supply factors, the paper provides causal evidence that a shock to the relative demand for goods (1) affects the direction of product innovations, and (2) leads to a decrease in the relative price of the good for which demand became relatively larger (i.e. the long-term supply curve is downward sloping). A calibration shows that this channel can explain most of the observed difference in quality-adjusted inflation rates across the income distribution.

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Does Educational Equality Increase Mobility? Exploiting Nineteenth-Century U.S. Compulsory Schooling Laws

Emily Rauscher

American Journal of Sociology, May 2016, Pages 1697-1761

Abstract:
Existing evidence of educational effects on intergenerational mobility is associational. This study employs early compulsory schooling laws to approach a causal estimate of the relationship between education and mobility in the context of a large-scale policy change. Using IPUMS Linked Representative Samples (linked census data), regression discontinuity models exploit state differences in the timing of compulsory schooling laws to estimate an intent-to-treat effect on intergenerational occupational mobility among white males. Despite increasing equality of attendance, results reveal that compulsory laws initially reduced relative mobility for the first few cohorts affected by the laws. Among later cohorts, who were required to attend the maximum years of school, mobility was similar to prelaw levels. School funding and other data suggest that structural lag could explain this nonlinear relationship. It seems, therefore, that educational expansion inadvertently reduced mobility through institutional inertia rather than elite efforts to maintain advantage.

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The Political Economy of Redistribution in the US in the Aftermath of World War II - Evidence and Theory

Roel Beetsma, Alex Cukierman & Massimo Giuliodori

American Economic Journal: Economic Policy, forthcoming

Abstract:
We present legislative, historical, and statistical evidence of a substantial upward ratchet in transfers and taxes in the US due to World-War II. This finding is explained within a political-economy framework with defense spending responding to a war threat and a median voter in the population who interacts with a (richer) agenda setter in Congress in setting redistribution. While the setter managed to cap redistribution before the War, the War itself raised the status-quo tax burden and improved tax collection technology, strengthening the bargaining power of the median voter as defense spending receded. This permanently raised the level of redistribution.

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Physical and situational inequality on airplanes predicts air rage

Katherine DeCelles & Michael Norton

Proceedings of the National Academy of Sciences, 17 May 2016, Pages 5588-5591

Abstract:
We posit that the modern airplane is a social microcosm of class-based society, and that the increasing incidence of "air rage" can be understood through the lens of inequality. Research on inequality typically examines the effects of relatively fixed, macrostructural forms of inequality, such as socioeconomic status; we examine how temporary exposure to both physical and situational inequality, induced by the design of environments, can foster antisocial behavior. We use a complete set of all onboard air rage incidents over several years from a large, international airline to test our predictions. Physical inequality on airplanes - that is, the presence of a first class cabin - is associated with more frequent air rage incidents in economy class. Situational inequality - boarding from the front (requiring walking through the first class cabin) versus the middle of the plane - also significantly increases the odds of air rage in both economy and first class. We show that physical design that highlights inequality can trigger antisocial behavior on airplanes. More broadly, these results point to the importance of considering the design of environments - from airplanes to office layouts to stadium seating - in understanding both the form and emergence of antisocial behavior.

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How the Rich Drive Progressive Marginal Tax Rates

Jason Oh

University of California Working Paper, April 2016

Abstract:
Why do income tax systems consistently feature progressive marginal rates? The existing literature tells a political story focusing on the preferences of the poor and middle class - high rates at the top of the rate schedule can fund greater redistribution. This Article argues that progressive marginal rates can alternatively be explained by focusing on the preferences of the middle class and the rich regarding the bottom of the rate schedule. Specifically, these groups benefit from inframarginal rate cuts at low levels of income. This alternative explanation of marginal rate progressivity is attractive because it focuses on the rich, a group which intuition and research suggest wields disproportionate political power. To make this argument, I use an optimal tax model and focus on two types of changes to the income tax schedule - incremental adjustments and major reform. With respect to incremental changes, I show that middle and upper-income taxpayers generally benefit from reductions in marginal rates at low incomes. With respect to more significant changes to the rate schedule, I use Markov chain Monte Carlo ("MCMC") simulations to explore the policy cycling that results from majoritarian voting. The simulations suggest (1) that progressive rate schedules are generally much more likely than linear or regressive schedules, (2) that progressive rate schedules become more likely as political power is concentrated in the hands of the rich, and (3) progressive rate schedules are still predominant even if the median voter has more income than the average taxpayer.

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The Dynamics of Wealth Inequality and the Effect of Income Distribution

Yonatan Berman, Eshel Ben-Jacob & Yoash Shapira

PLoS ONE, April 2016

Abstract:
The rapid increase of wealth inequality in the past few decades is one of the most disturbing social and economic issues of our time. Studying its origin and underlying mechanisms is essential for policy aiming to control and even reverse this trend. In that context, controlling the distribution of income, using income tax or other macroeconomic policy instruments, is generally perceived as effective for regulating the wealth distribution. We provide a theoretical tool, based on the realistic modeling of wealth inequality dynamics, to describe the effects of personal savings and income distribution on wealth inequality. Our theoretical approach incorporates coupled equations, solved using iterated maps to model the dynamics of wealth and income inequality. Notably, using the appropriate historical parameter values we were able to capture the historical dynamics of wealth inequality in the United States during the course of the 20th century. It is found that the effect of personal savings on wealth inequality is substantial, and its major decrease in the past 30 years can be associated with the current wealth inequality surge. In addition, the effect of increasing income tax, though naturally contributing to lowering income inequality, might contribute to a mild increase in wealth inequality and vice versa. Plausible changes in income tax are found to have an insignificant effect on wealth inequality, in practice. In addition, controlling the income inequality, by progressive taxation, for example, is found to have a very small effect on wealth inequality in the short run. The results imply, therefore, that controlling income inequality is an impractical tool for regulating wealth inequality.

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Status Traps

Steven Durlauf, Andros Kourtellos & Chih Ming Tan

Journal of Business and Economic Statistics, forthcoming

Abstract:
In this paper, we explore nonlinearities in the intergenerational mobility process using threshold regression models. We uncover evidence of threshold effects in children's outcomes based on parental education and cognitive and non-cognitive skills as well as their interaction with offspring characteristics. We interpret these thresholds as organizing dynastic earnings processes into "status traps". Status traps, unlike poverty traps, are not absorbing states. Rather, they reduce the impact of favorable shocks for disadvantaged children and so inhibit upward mobility in ways not captured by linear models. Our evidence of status traps is based on three complementary datasets; i.e., the PSID, the NLSY, and US administrative data at the commuting zone level, which together suggest that the threshold-like mobility behavior we observe in the data is robust for a range of outcomes and contexts.

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Ethnic Diversity and Support for Redistributive Social Policies

Liza Steele

Social Forces, June 2016, Pages 1439-1481

Abstract:
Scholars and public figures have drawn attention to lower social spending in more ethnically diverse countries, and explicitly or implicitly claimed that this resulted from a lack of public support for more generous social-spending policies in more diverse countries - despite the lack of empirical evidence on the topic. Such arguments ultimately hinge on how diversity is related to attitudes about distribution. However, empirical studies of the relationship between social-spending attitudes and diversity in cross-national perspective are scarce and limited in geographic scope, and have yielded inconsistent results. Through a study of individual-level attitudes in 91 countries in this paper, I explore the relationship between ethnic diversity and actual attitudes about social spending using two different cross-national public opinion data sets, and multiple approaches to measuring diversity. The results of 48 regression models show that ethnic diversity itself is not negatively related, and may even be positively related, to support for redistributive social spending, which challenges the prevailing assumption about the divisiveness of ethnic diversity. There is one exception - support for redistribution may be lower when there have been large increases in the size of the immigrant population in a country, but only in countries in which economic inequality is particularly acute.

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When Fair Isn't Fair: Sophisticated Time Inconsistency in Social Preferences

James Andreoni et al.

Stanford Working Paper, March 2016

Abstract:
How do people think about fairness in settings with uncertainty? One view holds that fairness requires equality of opportunity; another holds that it requires equality of outcomes. Relative to the resolution of uncertainty, the first view takes an ex ante perspective, while the second takes an ex post perspective. In this paper, we conduct a laboratory experiment designed to determine which perspective people adopt, and under what conditions. We find that most people view fairness from an ex ante perspective when making decisions ex ante, and from an ex post perspective when making decisions ex post. As a result, they exhibit the hallmark of time-inconsistency: after making an initial plan that is fully state-contingent, they revise it upon learning that certain states will not occur. These patterns are robust and persist even when people are aware of their proclivities. Indeed, subjects who switch from ex ante fair to ex post fair choices, and who are aware of this proclivity, generally avoid precommitments and intentionally retain the flexibility to manifest time inconsistency. We argue that these patterns are best explained by a theory of nominal fairness.

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Public Education Expenditures, Growth and Income Inequality

Lionel Artige & Laurent Cavenaile

NYU Working Paper, April 2016

Abstract:
Governments throughout the world spend a lot of public money on education to give any child a chance to have access to well-paid jobs and foster aggregate income growth. The theoretical literature tends to consider that public education is also an emancipatory force which contributes to reducing income inequality. The empirical evidence on this is rather scarce but tends to support the existing theoretical literature conclusions. This paper documents a U-shaped relationship between public education spending and income inequality for a cross-section of 140 countries as well as across US states. We investigate theoretically the potential ambiguous role of public education towards income inequality and identify the potential causes of this U-shaped relationship. We do so by modeling the demand and the supply of the education sector in an overlapping-generations model with heterogenous agents and occupational choice. If an increase in public education spending benefits all through an improvement of production efficiency, it also affects the labor supply in each occupation, which results in first a reduction and then a rise in income inequality as public education spending increases. Finally, we calibrate our model on data from 8 OECD countries and show that some countries, including the U.S., could spend more on public education to yield more income growth and less income inequality.

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Inequality, Costly Redistribution and Welfare in an Open Economy

Pol Antras, Alonso de Gortari & Oleg Itskhoki

Harvard Working Paper, March 2016

Abstract:
This paper studies the welfare implications of trade liberalization in a world in which trade increases income inequality, and in which redistribution needs to occur via a distortionary income tax-transfer system. We provide tools to characterize and quantify the actual amount of compensation that will take place following trade opening, as well as the efficiency costs of undertaking such redistribution. We propose two types of adjustments to standard measures of the welfare gains from trade: a 'welfarist' correction inspired by the Atkinson (1970) index of inequality, and a 'costly-redistribution' correction capturing the efficiency costs associated with the behavioral responses of agents to trade-induced shifts across marginal tax rates. We calibrate our model to the United States over the period 1979-2007 using data on the distribution of adjusted gross income in public samples of IRS tax returns, as well as CBO information on the tax liabilities and transfers received by agents at different percentiles of the U.S. income distribution. Our quantitative results suggest that these corrections are nonnegligible and erode about one-fifth of the gains from trade.

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Capital and Inequality

James Mirrlees

Contemporary Economic Policy, July 2016, Pages 399-402

Abstract:
Wealth inequality comes about mainly as a result of lifetime accumulation of capital and risky investment. Evidence from the Forbes Rich Lists show that in recent years volatility of the wealth of the richest has been very great. Randomness of returns to capital can explain a substantial part of global wealth inequality. As a consequence, inequality can best be reduced by a tax on returns to capital in excess of a normal rate of return, in addition to tax on labor earnings.

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The Impact of the Civil War on Southern Wealth Holders

Brandon Dupont & Joshua Rosenbloom

NBER Working Paper, April 2016

Abstract:
The U.S. Civil War and emancipation wiped out a substantial fraction of southern wealth. The prevailing view of most economic historians, however, is that the southern planter elite was able to retain its relative status despite these shocks. Previous studies have been hampered, however, by limits on the ability to link individuals between census years, and have been forced to focus on persistence within one or a few counties. Recent advances in electronic access to the Federal Census manuscripts now make it possible to link individuals without these constraints. We exploit the ability to search the full manuscript census to construct a sample that links top wealth holders in 1870 to their 1860 census records. Although there was an entrenched southern planter elite that retained their economic status, we find evidence that the turmoil of 1860s opened greater opportunities for mobility in the South than was the case in the North, resulting in much greater turnover among wealthy southerners than among comparably wealthy northerners.

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Hierarchy in the Eye of the Beholder: (Anti-)Egalitarianism Shapes Perceived Levels of Social Inequality

Nour Kteily, Jennifer Sheehy-Skeffington & Arnold Ho

Journal of Personality and Social Psychology, forthcoming

Abstract:
Debate surrounding the issue of inequality and hierarchy between social groups has become increasingly prominent in recent years. At the same time, individuals disagree about the extent to which inequality between advantaged and disadvantaged groups exists. Whereas prior work has examined the ways in which individuals legitimize (or delegitimize) inequality as a function of their motivations, we consider whether individuals' orientation toward group-based hierarchy motivates the extent to which they perceive inequality between social groups in the first place. Across 8 studies in both real-world (race, gender, and class) and artificial contexts, and involving members of both advantaged and disadvantaged groups, we show that the more individuals endorse hierarchy between groups, the less they perceive inequality between groups at the top and groups at the bottom. Perceiving less inequality is associated with rejecting egalitarian social policies aimed at reducing it. We show that these differences in hierarchy perception as a function of individuals' motivational orientation hold even when inequality is depicted abstractly using images, and even when individuals are financially incentivized to accurately report their true perceptions. Using a novel methodology to assess accurate memory of hierarchy, we find that differences may be driven by both antiegalitarians underestimating inequality, and egalitarians overestimating it. In sum, our results identify a novel perceptual bias rooted in individuals' chronic motivations toward hierarchy-maintenance, with the potential to influence their policy attitudes.

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They May Not Have the Skills, but They Have the Desire: Why the Skill Composition of Trade Unions Matters for Wage Inequality

Kyung Joon Han & Eric Graig Castater

Research in Social Stratification and Mobility, forthcoming

Abstract:
There has been a scholarly consensus that greater union strength translates into lower levels of wage inequality. However, recent evidence indicates that this union effect disappeared in the 1990s. We argue that unions still reduce wage inequality, but that their effect is dependent on the type of workers that are actually unionized. Using survey data, we construct a variable that measures the proportion of union members that are unskilled manual workers in twenty wealthy democracies. We find that as the share of these workers rises, wage inequality falls, regardless of the level of union density, the level of union coverage, or whether a country has liberal, mixed, or coordinated market economy. However, the proportion of union members that are unskilled manual workers has no effect on wage inequality when wage bargaining institutions are decentralized, likely because such workers are unable to extract wage gains from their more skilled and higher paid union brethren in such an institutional context. These results suggest that the unitary actor assumption, so commonly employed by scholars to explain union effects on political and socio-economic outcomes, is misplaced; and that even though politicians may be more responsive to the policy preferences of the wealthy, poorer individuals can achieve relative economic gains when properly organized.

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The Importance of Family Income in the Formation and Evolution of Non-Cognitive Skills in Childhood

Jason Fletcher & Barbara Wolfe

NBER Working Paper, April 2016

Abstract:
Little is known about the relationship between family income and children's non-cognitive (or socio-emotional) skill formation. This is an important gap, as these skills have been hypothesized to be a critical link between early outcomes and adult socioeconomic status. This paper presents new evidence of the importance of family income in the formation and evolution of children's non-cognitive skills using a recent US panel dataset that tracks children between grades K-5. Findings suggest an important divergence in non-cognitive skills based on family income that accumulates over time and does not seem to be explained by children's health status differences.

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Income inequality within urban settings and depressive symptoms among adolescents

Roman Pabayo et al.

Journal of Epidemiology & Community Health, forthcoming

Methods: We analysed the cross-sectional data from a sample of 1878 adolescents living in 38 neighbourhoods participating in the 2008 Boston Youth Survey. Using multilevel linear regression modelling, we: (1) estimated the association between neighbourhood income inequality and depressive symptoms, (2) tested for cross-level interactions between sex and neighbourhood income inequality and (3) examined neighbourhood social cohesion as a mediator of the relationship between income inequality and depressive symptoms.

Results: The association between neighbourhood income inequality and depressive symptoms varied significantly by sex, with girls in higher income inequality neighbourhood reporting higher depressive symptom scores, but not boys. Among girls, a unit increase in Gini Z-score was associated with more depressive symptoms (β=0.38, 95% CI 0.28 to 0.47, p=0.01) adjusting for nativity, neighbourhood income, social cohesion, crime and social disorder. There was no evidence that the association between income inequality and depressive symptoms was due to neighbourhood-level differences in social cohesion.

Conclusions: The distribution of incomes within an urban area adversely affects adolescent girls' mental health; future work is needed to understand why, as well as to examine in greater depth the potential consequences of inequality for males, which may have been difficult to detect here.

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Income Mobility Breeds Tolerance for Income Inequality: Cross-National and Experimental Evidence

Azim Shariff, Dylan Wiwad & Lara Aknin

Perspectives on Psychological Science, May 2016, Pages 373-380

Abstract:
American politicians often justify income inequality by referencing the opportunities people have to move between economic stations. Though past research has shown associations between income mobility and resistance to wealth redistribution policies, no experimental work has tested whether perceptions of mobility influence tolerance for inequality. In this article, we present a cross-national comparison showing that income mobility is associated with tolerance for inequality and experimental work demonstrating that perceptions of higher mobility directly affect attitudes toward inequality. We find support for both the prospect of upward mobility and the view that peoples' economic station is the product of their own efforts, as mediating mechanisms.

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Social Mobility and Stability of Democracy: Re-Evaluating De Toqueville

Daron Acemoglu, Georgy Egorov & Konstantin Sonin

NBER Working Paper, April 2016

Abstract:
An influential thesis often associated with De Tocqueville views social mobility as a bulwark of democracy: when members of a social group expect to join the ranks of other social groups in the near future, they should have less reason to exclude these other groups from the political process. In this paper, we investigate this hypothesis using a dynamic model of political economy. As well as formalizing this argument, our model demonstrates its limits, elucidating a robust theoretical force making democracy less stable in societies with high social mobility: when the median voter expects to move up (respectively down), she would prefer to give less voice to poorer (respectively richer) social groups. Our theoretical analysis shows that in the presence of social mobility, the political preferences of an individual depend on the potentially conflicting preferences of her "future selves," and that the evolution of institutions is determined through the implicit interaction between occupants of the same social niche at different points in time. When social mobility is endogenized, our model identifies new political economic forces limiting the amount of mobility in society - because the middle class will lose out from mobility at the bottom and because a peripheral coalition between the rich and the poor may oppose mobility at the top.

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Capuchin monkeys punish those who have more

Kristin Leimgruber, Alexandra Rosati & Laurie Santos

Evolution and Human Behavior, May 2016, Pages 236-244

Abstract:
Punishment of non-cooperators is important for the maintenance of large-scale cooperation in humans, but relatively little is known about the relationship between punishment and cooperation across phylogeny. The current study examined second-party punishment behavior in a nonhuman primate species known for its cooperative tendencies - the brown capuchin monkey (Cebus apella). We found that capuchins consistently punished a conspecific partner who gained possession of a food resource, regardless of whether the unequal distribution of this resource was intentional on the part of the partner. A non-social comparison confirmed that punishment behavior was not due to frustration, nor did punishment stem from increased emotional arousal. Instead, punishment behavior in capuchins appears to be decidedly social in nature, as monkeys only pursued punitive actions when such actions directly decreased the welfare of a recently endowed conspecific. This pattern of results is consistent with two features central to human cooperation: spite and inequity aversion, suggesting that the evolutionary origins of some human-like punitive tendencies may extend even deeper than previously thought.

By KEVIN LEWIS | 09:00:00 AM

Thursday, May 26, 2016

Dependents

Gendering Genetics: Biological Contingencies in the Protective Effects of Social Integration for Men and Women

Brea Perry

American Journal of Sociology, May 2016, Pages 1655-1696

Abstract:
Evidence that social and biological processes are intertwined in producing health and human behavior is rapidly accumulating. Using a feminist approach, this research explores how gender moderates the interaction between biological processes and men’s and women’s behavioral and emotional responses to similar social environments. Using data from the Collaborative Study on the Genetics of Alcoholism, the influence of gender, social integration, and genetic risk on nicotine and alcohol dependence is examined. Three-way interaction models reveal gender-specific moderation of interactions between genetic risk score and social integration. Namely, being currently married and reporting positive social psychological integration are predictive of reduced risk of nicotine dependence among men with genetic susceptibility to strong nicotine cravings in the presence of social cues like stress. In contrast, the protective effects of marital status and social integration are substantially attenuated and absent, respectively, among women with high-risk genotypes. This pattern reflects the dualism (i.e., simultaneous costs and benefits) inherent in social integration for women, which may disproportionately affect those with a genetic sensitivity to stress. These findings contest the notion of genotype as static biological hardwiring that is independent from social and cultural systems of gender difference.

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Payments For Opioids Shifted Substantially To Public And Private Insurers While Consumer Spending Declined, 1999–2012

Chao Zhou, Curtis Florence & Deborah Dowell

Health Affairs, May 2016, Pages 824-831

Abstract:
Deaths from opioid pain reliever overdose in the United States quadrupled between 1999 and 2013, concurrent with an increase in the use of the drugs. We used data from the Medical Expenditure Panel Survey to examine trends in opioid pain reliever expenditures, financing by various payers, and use from 1999 to 2012. We found major shifts in expenditures by payer type for these drugs, with private and public insurers paying a much larger share than patients in recent years. Consumer out-of-pocket spending on opioids per 100 morphine milligram equivalents (a standard reference measure of strength for various opioids) declined from $4.40 to $0.90 between 2001 and 2012. Since the implementation of Medicare Part D in 2006, Medicare has been the largest payer for opioid pain relievers, covering about 20–30 percent of the cost. Medicare spends considerably more on these drugs for enrollees younger than age sixty-five than it does for any other age group or than Medicaid or private insurance does for any age group. Further research is needed to evaluate whether payer strategies to address the overuse of opioids could reduce avoidable opioid-related mortality.

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How do smoking bans in restaurants affect restaurant and at-home alcohol consumption?

Aycan Koksal & Michael Wohlgenant

Empirical Economics, June 2016, Pages 1193-1213

Abstract:
In this paper, we analyze the impact of smoking bans on restaurant and at-home alcohol consumptions in a rational addiction model using a pseudo-panel data approach. Cigarette consumption, restaurant alcohol consumption and at-home alcohol consumption fit well with the rational addiction model. Our results suggest that cigarettes and alcohol reinforce each other in consumption, but consumers increase restaurant alcohol consumption when cigarette prices increase. We find that smoking bans increase restaurant alcohol consumption, but decrease at-home alcohol consumption. After a smoking ban is imposed, nonsmokers are likely to stay longer at restaurants and consume more alcohol. On the other hand, when smokers are not allowed to smoke in restaurants, they are likely to compensate for it by increasing restaurant alcohol consumption. As smoking bans increase social drinking habits, a decrease in at-home alcohol consumption is observed. Our results suggest that smoking bans in restaurants or bars must be accompanied by decreased blood alcohol concentration limits and increased road controls so that negative externalities such as fatalities due to drunk driving can be avoided.

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Opioids and social bonding: Naltrexone reduces feelings of social connection

Tristen Inagaki et al.

Social Cognitive and Affective Neuroscience, May 2016, Pages 728-735

Abstract:
Close social bonds are critical to a happy and fulfilled life and yet little is known, in humans, about the neurochemical mechanisms that keep individuals feeling close and connected to one another. According to the brain opioid theory of social attachment, opioids may underlie the contented feelings associated with social connection and may be critical to continued bonding. However, the role of opioids in feelings of connection toward close others has only begun to be examined in humans. In a double-blind, placebo-controlled, crossover study of naltrexone (an opioid antagonist), 31 volunteers took naltrexone for 4 days and placebo for 4 days (separated by a 10-day washout period). Participants came to the laboratory once on the last day of taking each drug to complete a task designed to elicit feelings of social connection. Participants also completed daily reports of feelings of social connection while on naltrexone and placebo. In line with hypotheses, and for the first time in humans, results demonstrated that naltrexone (vs placebo) reduced feelings of connection both in the laboratory and in daily reports. These results highlight the importance of opioids for social bonding with close others, lending support to the brain opioid theory of social attachment.

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Prescription drug coverage and chronic pain

Padmaja Ayyagari

International Journal of Health Economics and Management, June 2016, Pages 189-200

Abstract:
Chronic pain is one of the most common chronic conditions affecting more than 50 % of older adults. While pain management can be quite complex, prescription drugs are the most commonly used treatment modality. In this study, I examine whether increased access to prescription drugs due to the introduction of the Medicare Part D program in 2006 led to better management of pain among the elderly. While prior work has identified increases in the utilization of analgesics due to the introduction of Medicare Part D, the extent to which this increase in drug use actually improved the well-being of older adults is not known. Using data from the Health and Retirement Study, I employ a difference-in-differences strategy that compares pre versus post 2006 changes in pain related outcomes between Medicare eligible persons and a younger ineligible group. I find that Medicare Part D significantly reduced pain related activity limitations among a sample of older adults who report being troubled by pain.

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The economics of the war on illegal drug production and trafficking

Daniel Mejia & Pascual Restrepo

Journal of Economic Behavior & Organization, June 2016, Pages 255–275

Abstract:
We model the war on drugs in source countries as a conflict over scarce inputs in successive levels of the production and trafficking chain, and study how policies aimed at different stages affect prices and quantities in upstream and downstream markets. We use the model to study Plan Colombia, a large intervention aimed at reducing the downstream supply of cocaine by targeting illicit crops and blocking the transport of cocaine outside this source country. The model fits the main patterns found in the data, including the displacement of the drug trade to other source countries, the increase in coca crops’ productivity as a response to eradication, and the lack of apparent effects in consumer markets. We use a reasonable parametrization of our model to evaluate the cost-effectiveness of different policies implemented under Plan Colombia. We find that the marginal cost to the U.S. of reducing cocaine transacted in retail markets by one kilogram is $940,000, if it subsidizes eradication efforts; and $175,000, if it subsidizes interdiction efforts in Colombia.

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The price elasticity of marijuana demand: Evidence from crowd-sourced transaction data

Adam Davis, Karl Geisler & Mark Nichols

Empirical Economics, June 2016, Pages 1171-1192

Abstract:
This paper uses crowd-sourced transaction data from a cross section of the USA to examine demand for marijuana. State and regional variations in consumption, price, and quality are also explored. Our data are a unique cross section of over 23,000 actual marijuana transactions where price, quantity, and quality are reported, allowing for an estimation of the full demand elasticity rather than the participation elasticity. In addition, we account for the endogeneity of price by using instrumental variable estimation to calculate price elasticity. Price elasticity of demand estimates ranges between −−0.67 and −−0.79. Noticeable price differences are found between high-, medium-, and low-quality marijuana, with high-quality marijuana, at $13.77 per gram, 144 % greater than low-quality marijuana, at $5.63 a gram. Significant price variation is also found by medical marijuana status and census region, although this variation depends critically on the quality of the marijuana.

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Advertising, Habit Formation, and U.S. Tobacco Product Demand

Yuqing Zheng et al.

American Journal of Agricultural Economics, forthcoming

Abstract:
The U.S. tobacco market has experienced a shift toward noncigarette tobacco products. We examined the degree of habit formation and the role of advertising for cigarettes, little cigars/cigarillos, large cigars, e-cigarettes, and smokeless tobacco using market-level scanner data for convenience stores from 2009 to 2013. Results based on a dynamic demand system show that while all tobacco products are habitual, e-cigarettes are the most habitual product. More choices of flavors, less restrictions on its use in public places, less documented harmful effects, and a higher upfront cost might explain the higher degree of habit formation for e-cigarettes. We also find that e-cigarettes did not substitute for or complement cigarettes. The results imply that e-cigarettes may serve as a gateway to nicotine addiction but not necessarily to cigarette smoking. Regarding advertising, cigarette magazine advertising did not affect cigarette demand, while e-cigarette TV advertising increased e-cigarette demand with a positive spillover to cigarette demand. Such results may help explain e-cigarettes’ recent success in sales and imply that e-cigarette TV advertising might undermine efforts to reduce cigarette smoking. Advertising was also found to affect the degree of habit formation for cigarettes, large cigars, and e-cigarettes.

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The inequitable distribution of tobacco outlet density: The role of income in two Black Mid-Atlantic geopolitical areas

D.O. Fakunle et al.

Public Health, forthcoming

Study design: In this cross-sectional examination of tobacco outlet and census tract-level sociodemographic data, Baltimore City, Maryland, and Prince George's County, Maryland, were geocoded to determine tobacco outlet density.

Methods: Tobacco outlet density was defined as the mean number of tobacco outlets per 1000 persons per census tract. Comparisons of tobacco outlet density and sociodemographic variables were analysed via two-sample t-tests, and the direct effect of sociodemographic variables on tobacco outlet density for each area was analysed via spatial lag regressions.

Results: Prince George's County, the area with the higher income level ($77,190 vs $43,571), has a significantly lower tobacco outlet density than Baltimore City (P < 0.001). Prince George's County has a 67.5% Black population and an average of 3.94 tobacco outlets per 1000 persons per tract. By contrast, Baltimore City has a 65.3% Black population and an average of 7.95 tobacco outlets per 1000 persons per tract. Spatial lag regression model results indicate an inverse relationship between income and tobacco outlet density in Baltimore City and Prince George's County (β = −0.03, P < 0.01 & β = −0.01, P = 0.02, respectively), and a significant interaction term indicating a greater magnitude in the relationship between income and tobacco outlet density in Baltimore City (β = −0.05, P < 0.01).

Conclusion: Results suggest that higher socio-economic status, even in primarily underrepresented racial and ethnic geopolitical areas, is linked to lower tobacco outlet density.

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Evidence That Implementation Intentions Can Overcome the Effects of Smoking Habits

Christopher Armitage

Health Psychology, forthcoming

Objective: In this study, the aim was to (a) test for the first time whether implementation intentions formed outside the laboratory can overcome the effects of habits, and (b) see whether the operation of implementation intentions could be improved by asking people to form certain “when–then” plans as opposed to uncertain “if–then” plans.

Method: The study employed a 2 × 2 fully factorial design with baseline and follow-up measures of smoking status and habits. Smokers (N = 168; circa 33 years of age; 79 women, 89 men) were randomly allocated to 1 of 2 intervention groups to form either if–then plans or when–then plans using supporting tools, or to 1 of 2 control conditions in which they were exposed to identical supporting tools but were not asked to form if–then plans or when–then plans.

Results: Certainty did not affect the operation of implementation intentions, but smokers who formed implementation intentions were significantly more likely to quit, χ2(1, N = 168) = 8.86, p < .01, and the effect was mediated by changes in smoking habits (95% CI [0.02, 0.14]). Similar effects were observed when cigarettes smoked per day, nicotine dependence, and craving served as the dependent variables.

Conclusion: The findings demonstrate that people who have formed implementation intentions can overcome habits, such as smoking, outside the laboratory. The supporting tools described in the present research could be deployed at low cost with high public health reach to support behavior change.

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Neighborhood × Serotonin Transporter Linked Polymorphic Region (5-HTTLPR) interactions for substance use from ages 10 to 24 years using a harmonized data set of African American children

Michael Windle et al.

Development and Psychopathology, May 2016, Pages 415-431

Abstract:
This study investigated the influences of neighborhood factors (residential stability and neighborhood disadvantage) and variants of the serotonin transporter linked polymorphic region (5-HTTLPR) genotype on the development of substance use among African American children aged 10–24 years. To accomplish this, a harmonized data set of five longitudinal studies was created via pooling overlapping age cohorts to establish a database with 2,689 children and 12,474 data points to span ages 10–24 years. A description of steps used in the development of the harmonized data set is provided, including how issues such as the measurement equivalence of constructs were addressed. A sequence of multilevel models was specified to evaluate Gene × Environment effects on growth of substance use across time. Findings indicated that residential instability was associated with higher levels and a steeper gradient of growth in substance use across time. The inclusion of the 5-HTTLPR genotype provided greater precision to the relationships in that higher residential instability, in conjunction with the risk variant of 5-HTTLPR (i.e., the short allele), was associated with the highest level and steepest gradient of growth in substance use across ages 10–24 years. The findings demonstrated how the creation of a harmonized data set increased statistical power to test Gene × Environment interactions for an under studied sample.

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Breaking the cycle demonstration project: Using a quasi-experimental analysis to test the “worst of both worlds” hypothesis and risk principle

Glenn Walters

Journal of Experimental Criminology, March 2016, Pages 127-141

Objectives: The purpose of this study was to test the “worst of both worlds” hypothesis and the risk principle in a sample of drug-involved offenders enrolled in the Breaking the Cycle (BTC) demonstration project, an intensive drug intervention implemented in Birmingham, Alabama, Jacksonville, Florida, and Tacoma, Washington.

Methods: A group of 1081 drug-involved offenders enrolled in BTC were compared to 934 drug-involved offenders (pre-BTC) who processed through the regular court system of each city 1 year prior to implementation of BTC. Participants from both groups were divided into risk levels based on scores from the Addiction Severity Index (ASI) Drug (D) and Legal (L) scales. Individuals who scored at or above the mean on both the ASI-D and ASI-L were identified as high risk, individuals who scored at or above the mean on either the ASI-D or ASI-L but not both were identified as moderate risk, and individuals who scored below the mean on both the ASI-D and ASI-L were identified as low risk.

Results: Consistent with the risk principle, high-risk BTC participants displayed significant improvements in subsequent drug problem days, criminal offending, and days spent in jail relative to high-risk pre-BTC participants. There was no apparent benefit of BTC enrollment for moderate- and low-risk participants.

Conclusions: These results indicate that drug–crime comorbidity can be used to assess risk and that individuals identified as high risk are more likely to benefit from higher-intensity forms of intervention than moderate- or low-risk individuals.

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The Effect of Medical Marijuana Laws on Labor Market Outcomes

Joseph Sabia & Thanh Tam Nguyen

San Diego State University Working Paper, March 2016

Abstract:
A number of recent studies have found that medical marijuana laws (MMLs) are associated with increased marijuana use among adults, in part due to spillover effects into the recreational market. This study is the first to explore the labor market consequences of MMLs. Using repeated cross-sections of the Current Population Survey from January 1990 to December 2014, we find that the enforcement of MMLs is associated with a 2 to 3 percent reduction in hourly earnings for young adult males. The effect is particularly pronounced when examining MMLs that include a collective cultivation provision. For women and older males, there is little evidence of adverse labor market effects of MMLs. We conclude that the health effects of MMLs may adversely affect labor market productivity of young males.

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Impact of Tobacco Control Policies on Adolescent Smoking

Summer Sherburne Hawkins, Nicoline Bach & Christopher Baum

Journal of Adolescent Health, June 2016, Pages 679–685

Methods: Using data on 717,543 adolescents from 43 states in the 1999–2013 Youth Risk Behavior Surveys, we used difference-in-differences regression models to evaluate the impact of tobacco control policies on current adolescent smoking (yes/no) and, separately, smoking frequency (defined as 0, 1–5, 6–29, 30+ days per month). We tested an interaction between age and cigarette taxes and, separately, smoke-free legislation.

Results: From 1999 to 2013, adolescent smoking decreased from 35.3% to 13.9% and 41 of 43 states increased their cigarette tax in real terms by an average of 257%. By the end of the study period, 29 of 43 states had 100% smoke-free restaurant legislation. Although we found no overall effect of cigarette taxes on current smoking, there was a significant interaction by age. Among 14- and 15-year olds, every $1.00 cigarette tax increase was associated with a 2.2 and 1.6 percentage point reduction in smoking, respectively. The enactment of 100% smoke-free restaurant legislation was associated with an overall reduction in adolescent smoking by 1.1 percentage points and there were no differences by age. Cigarette taxes and smoke-free legislation were also associated with decreased smoking frequency.

Conclusions: The youngest adolescents are the most price sensitive, and cigarette taxes continue to be a successful approach to reduce adolescent smoking. Smoke-free legislation may also be an effective strategy to reduce smoking among all adolescents.

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The Pass-Through of Beer Taxes to Prices: Evidence from State and Federal Tax Changes

Vinish Shrestha & Sara Markowitz

Economic Inquiry, forthcoming

Abstract:
From a policy perspective, it is crucial to understand how changes in beer taxes affect retail beer prices. This study provides new evidence of the pass-through rate of state beer taxes to prices in a post-merger era. Our estimates that use state-level beer tax changes suggest that a 10-cent increase in beer taxes raises retail prices by about 17 cents. Comparable findings from the 1991 federal beer tax increase show a rise in retail beer prices of 19–22 cents. Our findings suggest that consumers fully bear the burden of increased beer taxes.

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Separating Family-Level and Direct Exposure Effects of Smoking During Pregnancy on Offspring Externalizing Symptoms: Bridging the Behavior Genetic and Behavior Teratologic Divide

Ryne Estabrook et al.

Behavior Genetics, May 2016, Pages 389-402

Abstract:
Maternal smoking during pregnancy (MSDP) has been robustly associated with externalizing problems and their developmental precursors in offspring in studies using behavioral teratologic designs (Wakschlag et al., Am J Public Health 92(6):966–974, 2002; Espy et al., Dev Psychol 47(1):153–169, 2011). In contrast, the use of behavior genetic approaches has shown that the effects commonly attributed to MSDP can be explained by family-level variables (D’Onofrio et al., Dev Psychopathol 20(01):139–164, 2008). Reconciling these conflicting findings requires integration of these study designs. We utilize longitudinal data on a preschool proband and his/her sibling from the Midwest Infant Development Study-Preschool (MIDS-P) to test for teratologic and family level effects of MSDP. We find considerable variation in prenatal smoking patterns both within and across pregnancies within families, indicating that binary smoking measures are not sufficiently capturing exposure. Structural equation models indicate that both conduct disorder and oppositional defiant disorder symptoms showed unique effects of MSDP over and above family level effects. Blending high quality exposure measurement with a within-family design suggests that it is premature to foreclose the possibility of a teratologic effect of MSDP on externalizing problems. Implications and recommendations for future studies are discussed.

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Effects of serotonin 2A/1A receptor stimulation on social exclusion processing

Katrin Preller et al.

Proceedings of the National Academy of Sciences, 3 May 2016, Pages 5119–5124

Abstract:
Social ties are crucial for physical and mental health. However, psychiatric patients frequently encounter social rejection. Moreover, an increased reactivity to social exclusion influences the development, progression, and treatment of various psychiatric disorders. Nevertheless, the neuromodulatory substrates of rejection experiences are largely unknown. The preferential serotonin (5-HT) 2A/1A receptor agonist, psilocybin (Psi), reduces the processing of negative stimuli, but whether 5-HT2A/1A receptor stimulation modulates the processing of negative social interactions remains unclear. Therefore, this double-blind, randomized, counterbalanced, cross-over study assessed the neural response to social exclusion after the acute administration of Psi (0.215 mg/kg) or placebo (Pla) in 21 healthy volunteers by using functional magnetic resonance imaging (fMRI) and resting-state magnetic resonance spectroscopy (MRS). Participants reported a reduced feeling of social exclusion after Psi vs. Pla administration, and the neural response to social exclusion was decreased in the dorsal anterior cingulate cortex (dACC) and the middle frontal gyrus, key regions for social pain processing. The reduced neural response in the dACC was significantly correlated with Psi-induced changes in self-processing and decreased aspartate (Asp) content. In conclusion, 5-HT2A/1A receptor stimulation with psilocybin seems to reduce social pain processing in association with changes in self-experience. These findings may be relevant to the normalization of negative social interaction processing in psychiatric disorders characterized by increased rejection sensitivity. The current results also emphasize the importance of 5-HT2A/1A receptor subtypes and the Asp system in the control of social functioning, and as prospective targets in the treatment of sociocognitive impairments in psychiatric illnesses.

By KEVIN LEWIS | 09:00:00 AM

Wednesday, May 25, 2016

Talking dirty

Unemployment and Environmental Regulation in General Equilibrium

Marc Hafstead & Roberton Williams

NBER Working Paper, May 2016

Abstract:
This paper analyzes the effects of environmental policy on employment (and unemployment) using a new general-equilibrium two-sector search model. We find that imposing a pollution tax causes substantial reductions in employment in the regulated (polluting) industry, but this is offset by increased employment in the unregulated (nonpolluting) sector. Thus the policy causes a substantial shift in employment between industries, but the net effect on overall employment (and unemployment) is small, even in the short run. An environmental performance standard causes a substantially smaller sectoral shift in employment than the emissions tax, with roughly similar net effects. The effects on the unregulated industry suggest that empirical studies of environmental regulation that focus only on regulated firms can be misleading (and those that use nonregulated firms as controls for regulated firms will be even more misleading). The paper’s results also suggest that overall effects on employment are not a major issue for environmental policy, and that policymakers who want to minimize sectoral shifts in employment might prefer performance standards over environmental taxes.

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Political conservatism, religion, and environmental consumption in the United States

Jared Peifer, Simranjit Khalsa & Elaine Howard Ecklund

Environmental Politics, July/August 2016, Pages 661-689

Abstract:
The role of political conservatism and religion in shaping attitudes toward environmental consumption in the US is examined. Previous research suggests that while there is a mixed relationship between religiosity (measured in various ways) and environmentalism, political conservatives are unlikely to support pro-environment measures. Using nationally representative survey data, mixed results are found regarding the relationship of religiosity and environmental consumption: religious attendance and religious identity are positively related to environmental consumption, while belief in an involved God and biblical literalism are negatively related. Increased levels of religiosity, however, mute the otherwise strong negative effect of political conservatism. This suggests, surprisingly, that Green marketers and activists are likely to face less conservative resistance to environmental consumption among religious Americans.

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A Difficult Road Ahead: Fleet Fuel Economy, Footprint Based CAFE Compliance, and Manufacturer Incentives

Darin Ullman

Energy Economics, June 2016, Pages 94–105

Abstract:
Using detailed vehicle specifications, this paper analyzes the impact identifiable vehicle characteristics and technological progress has on fleet fuel economy by vehicle type and class. The results suggest manufacturers will face a difficult task complying with the new footprint-based CAFE standards if compliance is met by only changing identifiable vehicle characteristics. I find evidence that the stringent footprint-based standards create a manufacturer incentive to increase vehicle size to lower the burden of compliance. This undermines the standards' potential to create expected fuel savings and lower emissions levels.

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Systems thinking and environmental concern

Stephen Lezak & Paul Thibodeau

Journal of Environmental Psychology, forthcoming

Abstract:
Systems thinking is thought to facilitate complex decision-making, but relatively little is known about its psychological underpinning. We present three studies that situate a measure of the construct in relation to other dispositional measures that have received more attention in environmental psychology and by testing whether the mindset predicts behavior in a set of novel decision making tasks. In Study 1, we find that systems thinkers tend to believe in scientific consensus, recognize risks posed by climate change, and support policy interventions to address climate change; systems thinking was negatively related to conspiracist and free-market ideation. In Studies 2 and 3 we find that systems thinkers ascribe more value to the natural world — both in monetary terms as well as on social and ecological grounds. The findings suggest that models of environmental cognition can be improved by measuring peoples' tendency to engage in systems thinking.

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The Dynamics of Behavior Change: Evidence from Energy Conservation

Omar Asensio & Magali Delmas

Journal of Economic Behavior and Organization, June 2016, Pages 196–212

Abstract:
Little is known about the effect of message framing on conservation behavior over time. In a randomized controlled trial with residential households, we use advanced metering and information technologies to test how different messages about household energy use impact the dynamics of conservation behavior down to the appliance level. Our results, based on 374 million panel observations of kilowatt-hour (kWh) electricity consumption for 118 households over 9 months, show that differences in behavioral responses due to message framing become more significant over time. We find that a health-based frame, in which households consider the human health effects of their marginal electricity use, induced persistent energy savings behavior of 8-10% over 100 days; whereas a more traditional cost savings frame, drove sharp attenuation of treatment effects after 2 weeks with no significant savings versus control after 7 weeks. We discuss implications for the design of effective information campaigns to engage households in conservation behavior.

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Lead exposure and violent crime in the early twentieth century

James Feigenbaum & Christopher Muller

Explorations in Economic History, forthcoming

Abstract:
In the second half of the nineteenth century, many American cities built water systems using lead or iron service pipes. Municipal water systems generated significant public health improvements, but these improvements may have been partially offset by the damaging effects of lead exposure through lead water pipes. We study the effect of cities' use of lead pipes on homicide between 1921 and 1936. Lead water pipes exposed entire city populations to much higher doses of lead than have previously been studied in relation to crime. Our estimates suggest that cities' use of lead service pipes considerably increased city-level homicide rates.

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Unintended consequences of the Clean Air Act: Mortality rates in Appalachian coal mining communities

Michael Hendryx & Benjamin Holland

Environmental Science & Policy, September 2016, Pages 1–6

Abstract:
The 1990 amendments to the US Clean Air Act (CAA) encouraged the growth of mountaintop removal (MTR) coal mining in Central Appalachia. This study tests the hypothesis that the amendments had unintended impacts on increasing mortality rates for populations living in these mining areas. We used a panel design to examine adjusted mortality rates for three groups (all-cause, respiratory cancer, and non-cancer respiratory disease) between 1968 and 2014 in 404 counties stratified by MTR and Appalachian/non-Appalachian status. The results showed significant interactions between MTR status and post-CAA period for all three mortality groups. These differences persisted after control for time, age, smoking rates, poverty, obesity, and physician supply. The MTR region in the post-CAA years experienced an excess of approximately 1200 adjusted deaths per year. Although the CAA has benefits, energy policies have in general focused on the combustion portion of the fossil fuel cycle. Other components of fossil fuel production (e.g. extraction, transport, and processing) should be considered in the comprehensive development of sustainable energy policy.

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Geographic proximity to coal plants and U.S. public support for extending the Production Tax Credit

Jillian Goldfarb, Marric Buessing & Douglas Kriner

Energy Policy, forthcoming

Abstract:
The Production Tax Credit (PTC) is an important policy instrument through which the federal government promotes renewable energy development in the United States. However, the efficacy of the PTC is hampered by repeated expirations and short-term extensions, and by the general uncertainty surrounding its future status. We examine the factors driving variation in public support for the extension of the PTC using a nationally representative, internet-based survey. Americans living near a coal-fired power plant are significantly more likely to support extending the PTC than are their peers who are more insulated from the externalities of burning coal. The evidence for this dynamic was strongest and most statistically significant among subjects experimentally primed to think about the adverse health effects of burning coal. Raising awareness of the public health ramifications of generating electricity from fossil fuels holds the potential to increase support for renewable energy policies among those living in proximity to coal plants, even in a highly politicized policy debate.

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Neighborhood Greenness and Chronic Health Conditions in Medicare Beneficiaries

Scott Brown et al.

American Journal of Preventive Medicine, forthcoming

Introduction: Prior studies suggest that exposure to the natural environment may impact health. The present study examines the association between objective measures of block-level greenness (vegetative presence) and chronic medical conditions, including cardiometabolic conditions, in a large population-based sample of Medicare beneficiaries in Miami-Dade County, Florida.

Methods: The sample included 249,405 Medicare beneficiaries aged ≥65 years whose location (ZIP+4) within Miami-Dade County, Florida, did not change, from 2010 to 2011. Data were obtained in 2013 and multilevel analyses conducted in 2014 to examine relationships between greenness, measured by mean Normalized Difference Vegetation Index from satellite imagery at the Census block level, and chronic health conditions in 2011, adjusting for neighborhood median household income, individual age, gender, race, and ethnicity.

Results: Higher greenness was significantly associated with better health, adjusting for covariates: An increase in mean block-level Normalized Difference Vegetation Index from 1 SD less to 1 SD more than the mean was associated with 49 fewer chronic conditions per 1,000 individuals, which is approximately similar to a reduction in age of the overall study population by 3 years. This same level of increase in mean Normalized Difference Vegetation Index was associated with a reduced risk of diabetes by 14%, hypertension by 13%, and hyperlipidemia by 10%. Planned post-hoc analyses revealed stronger and more consistently positive relationships between greenness and health in lower- than higher-income neighborhoods.

Conclusions: Greenness or vegetative presence may be effective in promoting health in older populations, particularly in poor neighborhoods, possibly due to increased time outdoors, physical activity, or stress mitigation.

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Intrauterine Inflammation and Maternal Exposure to Ambient PM2.5 during Preconception and Specific Periods of Pregnancy: The Boston Birth Cohort

Rebecca Massa Nachman et al.

Environmental Health Perspectives, forthcoming

Background: Prenatal exposure to ambient PM2.5, (i.e., fine particulate matter) has been associated with preterm birth and low birth weight. The association between prenatal PM2.5 exposure and intrauterine inflammation (IUI), an important risk factor for preterm birth and neurodevelopmental outcomes, has not been evaluated.

Objectives: We aimed to investigate the association between maternal exposure to PM2.5 and IUI in the Boston Birth Cohort (BBC), a predominantly urban low-income minority population.

Methods: This analysis included 5,059 mother-infant pairs in the BBC. IUI was assessed based on intrapartum fever and placenta pathology. PM2.5 exposure was assigned using data from EPA’s Air Quality System. Odds ratios (OR) and 95% confidence intervals (95% CI) quantified the association of maternal PM2.5 exposure during preconception and various periods of pregnancy with IUI.

Results: Comparing the highest with the lowest PM2.5 exposure quartiles, the multi-adjusted association with IUI was significant for all exposure periods considered, including 3 months prior to conception (OR = 1.52; 95% CI: 1.22, 1.89), first trimester (OR = 1.93; 95% CI: 1.55, 2.40), second trimester (OR = 1.67; 95% CI: 1.35, 2.08), third trimester (OR = 1.53; 95% CI: 1.24, 1.90) and whole pregnancy (OR = 1.92; 95% CI: 1.55, 2.37).

Conclusions: Despite relatively low exposures, our results suggest a monotonic positive relationship between PM2.5 exposure during preconception and pregnancy and IUI. IUI may be a sensitive biomarker for assessing early biological effect of PM2.5 exposure on the developing fetus.

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Particulate Matter Exposure and Preterm Birth: Estimates of U.S. Attributable Burden and Economic Costs

Leonardo Trasande, Patrick Malecha & Teresa Attina

Environmental Health Perspectives, forthcoming

Background: Preterm birth (PTB) rates (11.4% in 2013) in the United States (US) remain high and are a substantial cause of morbidity. Studies of prenatal exposure have associated particulate matter <2.5microns in diameter (PM2.5) and other ambient air pollutants with adverse birth outcomes, yet, to our knowledge, burden and costs of PM 2.5-attributable PTB have not been estimated in the US.

Methods: Annual deciles of PM2.5 were obtained from US EPA. We converted PTB odds ratio (OR), identified in a previous meta-analysis (1.15 per 10µg/m3 for our base case, 1.07-1.16 for low- and high-end scenarios) to relative risk (RRs), to obtain an estimate that better represents the true relative risk. A reference level (RL) of 8.8µg/m3 was applied. We then used the RR estimates and county-level PTB prevalence to quantify PM2.5 attributable PTB. Direct medical costs were obtained from the 2007 Institute of Medicine report, and lost economic productivity (LEP) was estimated using a meta-analysis of PTB-associated IQ loss, and well-established relationships of IQ loss with LEP. All costs were calculated using 2010 dollars.

Results: An estimated 3.32% of PTBs nationally (corresponding to15,808 PTBs) in 2010 could be attributed to PM2.5 (PM2.5>8.8 µg/m3). Attributable PTBs cost were estimated at $4.33 billion (SA: $2.06-8.22B), of which $760 million were spent for medical care (SA: $362M-1.44B). The estimated PM2.5-attributable fraction (AF) of PTB was highest in urban counties, with highest AFs in the Ohio valley and Southern US.

Conclusions: PM2.5 may contribute substantially to burden and costs of PTB in the US, and considerable health and economic benefits could be achieved through environmental regulatory interventions that reduce PM2.5 exposure in pregnancy.

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Cancer Mortality Risks from Long-term Exposure to Ambient Fine Particle

Chit Ming Wong et al.

Cancer Epidemiology, Biomarkers & Prevention, May 2016, Pages 839-845

Background: Few studies have assessed long-term effects of particulate matter (PM) with aerodynamic diameter < 2.5 μm (PM2.5) on mortality for causes of cancer other than the lung; we assessed the effects on multiple causes. In Hong Kong, most people live and work in urban or suburban areas with high-rise buildings. This facilitates the estimation of PM2.5 exposure of individuals, taking into account the height of residence above ground level for assessment of the long-term health effects with sufficient statistical power.

Methods: We recruited 66,820 persons who were ≥65 in 1998 to 2001 and followed up for mortality outcomes until 2011. Annual concentrations of PM at their residential addresses were estimated using PM2.5 concentrations measured at fixed-site monitors, horizontal–vertical locations, and satellite data. We used Cox regression model to assess the HR of mortality for cancer per 10 μg/m3 increase of PM2.5.

Results: PM2.5 was associated with increased risk of mortality for all causes of cancer [HR, 1.22 (95% CI, 1.11–1.34)] and for specific cause of cancer in upper digestive tract [1.42 (1.06–1.89)], digestive accessory organs [1.35 (1.06–1.71)] in all subjects; breast [1.80 (1.26–2.55)] in females; and lung [1.36 (1.05–1.77)] in males.

Conclusions: Long-term exposures to PM2.5 are associated with elevated risks of cancer in various organs.

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Fee disbursements and the local acceptance of unconventional gas development: Insights from Pennsylvania

Naveed Paydar et al.

Energy Research & Social Science, forthcoming

Abstract:
This paper explores the extent to which local public support for an unconventional gas development (UGD) project is associated with public revenues disbursed to county and municipal governments where UGD occurs. Pennsylvania adopted “impact fees” in 2012, which have raised more than $400 million for use by county and municipal governments that host UGD. We designed a public opinion survey (N = 453) that oversamples residents in UGD counties in Pennsylvania to test whether residents in counties and municipalities that received impact fees are more supportive of a hypothetical UGD project than residents in counties and municipalities that received less or no impact fee revenue. We found that impact fee revenue is positively associated with support for the UGD project. Further, the level of government receiving the funds (county versus municipality) is related to public support for UGD: impact fee revenue disbursed to municipal governments is associated with a higher rate of public support than comparable amounts disbursed to county governments, conditional on the respondent being aware of fracking prior to the survey. Our findings are consistent with the literature on public trust in local government and have implications for understanding the social feasibility of UGD in the United States and internationally.

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Canary in a Coal Mine: Infant Mortality, Property Values, and Tradeoffs Associated with Mid-20th Century Air Pollution

Karen Clay, Joshua Lewis & Edson Severnini

NBER Working Paper, April 2016

Abstract:
Pollution is a common byproduct of economic activity. Although policymakers should account for both the benefits and the negative externalities of polluting activities, it is difficult to identify those who are harmed and those who benefit from them. To overcome this challenge, our paper uses a novel dataset on the mid-20th century expansion of the U.S. power grid to study the costs and the benefits of coal-fired electricity generation. The empirical analysis exploits the timing of coal-fired power plant openings and annual variation in plant-level coal consumption from 1938 to 1962, when emissions were virtually unregulated. Pollution from the burning of coal for electricity generation is shown to have quantitatively important and nonlinear effects on county-level infant mortality rates. By 1962, it was responsible for 3,500 infant deaths per year, over one death per thousand live births. These effects are even larger at lower levels of coal consumption. We also find evidence of clear tradeoffs associated with coal-fired electricity generation. For counties with low access to electricity in the baseline, increases in local power plant coal consumption reduced infant mortality and increased housing values and rental prices. For counties with near universal access to electricity in the baseline, increases in coal consumption by power plants led to higher infant mortality rates, and lower housing values and rental prices. These results highlight the importance of considering both the costs and benefits of polluting activities, and suggest that demand for policy intervention may emerge only when the negative externalities are significantly larger than the perceived benefits.

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Brine Spills Associated with Unconventional Oil Development in North Dakota

Nancy Lauer, Jennifer Harkness & Avner Vengosh

Environmental Science & Technology, 17 May 2016, Pages 5389–5397

Abstract:
The rapid rise of unconventional oil production during the past decade in the Bakken region of North Dakota raises concerns related to water contamination associated with the accidental release of oil and gas wastewater to the environment. Here, we characterize the major and trace element chemistry and isotopic ratios (87Sr/86Sr, δ18O, δ2H) of surface waters (n = 29) in areas impacted by oil and gas wastewater spills in the Bakken region of North Dakota. We establish geochemical and isotopic tracers that can identify Bakken brine spills in the environment. In addition to elevated concentrations of dissolved salts (Na, Cl, Br), spill waters also consisted of elevated concentrations of other contaminants (Se, V, Pb, NH4) compared to background waters, and soil and sediment in spill sites had elevated total radium activities (228Ra + 226Ra) relative to background, indicating accumulation of Ra in impacted soil and sediment. We observed that inorganic contamination associated with brine spills in North Dakota is remarkably persistent, with elevated levels of contaminants observed in spills sites up to 4 years following the spill events.

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Do Constitutions Matter? The Effects of Constitutional Environmental Rights Provisions on Environmental Outcomes

Chris Jeffords & Lanse Minkler

Kyklos, May 2016, Pages 294–335

Abstract:
We use a novel data set within an instrumental variables framework to test whether the presence and language of constitutional environmental rights influence environmental outcomes. The outcome variables include Yale's Environmental Performance Index and its components. We employ two-stage least squares to account for reverse causality, that is, the possibility that a country which takes steps to protect the environment might also be more likely to constitutionalize environmental rights. Our first stage theory combines constitution norms, opposition costs, and generation effects. Our controls include country income, which means that our study is also related to the Environmental Kuznets Curve literature. We find that constitutions do indeed matter for positive environmental outcomes, which suggests that we should not only pay attention to the incentives confronting polluters and resource users, but also to the incentives and constraints confronting those policymakers who initiate, monitor, and enforce environmental policies.

By KEVIN LEWIS | 09:00:00 AM

Tuesday, May 24, 2016

Big issues

Obesity and sex ratios in the U.S.

Wanchuan Lin, Kathryn McEvilly & Juan Pantano

Review of Economics of the Household, June 2016, Pages 269-292

Abstract:
This paper studies how rising male incarceration and its impact on marriage markets has affected female incentives to gain weight. Exogenous variation in marriage market conditions is obtained from differential trends in male incarceration rates across markets defined by race, location and age. We provide evidence that marriage market conditions do in fact affect the incidence of obesity. In particular, we find that increases in male imprisonment that reduced the male–female sex-ratio explain about 18 % of the increase in the female obesity rate for African-Americans in the United States over the 1990s. Results are particularly large for those in the younger age group (ages 18–23).

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Shining Light on Atmospherics: How Ambient Light Influences Food Choices

Dipayan Biswas et al.

Journal of Marketing Research, forthcoming

Abstract:
Retail atmospherics is emerging as a major competitive tool, and it is especially notable in the restaurant industry where lighting is used to create the overall ambience and influence consumer experience. Along with influencing overall experience, can ambient light luminance have unintended consequences in terms of influencing what a diner orders? The results of a field study at multiple locations of a major restaurant chain and a series of lab studies robustly show that consumers tend to choose less healthy food options when ambient lighting is dim (vs. bright). Process evidence suggests that this phenomenon occurs because ambient light luminance influences mental alertness, which in turn influences food choices. While restaurant and perhaps grocery store managers can use these insights and their ambient light switches to nudge consumers toward targeted food choices, such as healthy or high margin signature items, health conscious consumers can opt for dining environments with bright ambient lighting.

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Prevalence of obesity and severe obesity in US children, 1999-2014

Asheley Cockrell Skinner, Eliana Perrin & Joseph Skelton

Obesity, May 2016, Pages 1116–1123

Objective: Provide the most recent data on the prevalence of obesity and severe obesity among United States children and adolescents aged 2 to 19 years.

Methods: The National Health and Nutrition Examination Survey, 1999–2014, was used. Weight status was defined using measured height and weight and standard definitions as follows: overweight as ≥85th percentile for age- and sex-specific BMI; class I obesity as ≥95th percentile; class II obesity as ≥120 of the 95th percentile, or BMI ≥35; and class III obesity as ≥140% of the 95th percentile, or BMI ≥40. This study reports the prevalence of obesity by 2-year National Health and Nutrition Examination Survey cycle and Wald tests comparing the 2011–2012 cycle with the 2013–2014 cycle, as well as the linear trend from 1999 to 2014. Multivariable logistic regression models estimated odds ratios for differences by each 2-year cycle.

Results: In 2013–2014, 17.4% of children met criteria for class I obesity, including 6.3% for class II and 2.4% for class III, none statistically different than 2011–2012. A clear, statistically significant increase in all classes of obesity continued from 1999 through 2014.

Conclusions: There is no evidence of a decline in obesity prevalence in any age group, despite substantial clinical and policy efforts targeting the issue.

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Why can't we control our food intake? The downside of dietary variety on learned satiety responses

Ashley Martin

Physiology & Behavior, forthcoming

Abstract:
A striking feature of the modern food environment is the sheer amount of dietary choice available to the individual. In addition to an endless variety of highly palatable and energy dense foods, efforts to combat obesity have resulted in the production of several low- and reduced-calorie versions of these foods that are marketed to consumers. As a result, we are now confronted with a staggering amount of ‘dietary variability’ — the same food item can be obtained in a variety of different energy densities. This is a concern because evidence in rodents suggests that this kind of dietary variability can compromise one of the major cognitive determinants of food intake among non-human animals — flavor-nutrient satiety learning. Flavor-nutrient satiety learning enables animals to learn about the energy content or satiating quality of the foods they consume and adjust their intake to fit their energy needs. Notably, evidence suggests that dietary variability can disrupt this kind of learning, leading to overeating and weight gain. Here, we discuss the utility of flavor-nutrient satiety learning in human dietary behavior, highlighting certain features of the modern environment that can be disruptive to the acquisition of this kind of learning in humans. Special emphasis is placed on dietary variability, however we will also highlight other aspects of the environment that can undermine this kind of learning, such as competition from other satiety-relevant cues (i.e., food labels), detrimental effects of Western diets on food-related cognitive processing, and the abundance of macronutrients that are inadequate at supporting learned satiety responses. The goal of this work is to highlight novel ways in which the environment may disrupt food-relevant learning and energy intake, and to provide some explanation for the elusive nature of flavor-nutrient learning in humans.

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Neighborhood and Home Food Environment and Children’s Diet and Obesity: Evidence from Military Personnel’s Installation Assignment

Victoria Shier, Nancy Nicosia & Ashlesha Datar

Social Science & Medicine, June 2016, Pages 122–131

Abstract:
Research and policy initiatives are increasingly focused on the role of neighborhood food environment in children’s diet and obesity. However, existing evidence relies on observational data that is limited by neighborhood selection bias. The Military Teenagers’ Environments, Exercise, and Nutrition Study (M-TEENS) leverages the quasi-random variation in neighborhood environment generated by military personnel’s assignment to installations to examine whether neighborhood food environments are associated with children’s dietary behaviors and BMI. Our results suggest that neither the actual nor the perceived availability of particular food outlets in the neighborhood is associated with children’s diet or BMI. The availability of supermarkets and convenience stores in the neighborhood was not associated with where families shop for food or children’s dietary behaviors. Further, the type of store that families shop at was not associated with the healthiness of food available at home. Similarly, availability of fast food and restaurants was unrelated to children’s dietary behaviors or how often children eat fast food or restaurant meals. However, the healthiness of food available at home was associated with healthy dietary behaviors while eating at fast food outlets and restaurants were associated with unhealthy dietary behaviors in children. Further, parental supervision, including limits on snack foods and meals eaten as a family, was associated with dietary behaviors. These findings suggest that focusing only on the neighborhood food environment may ignore important factors that influence children’s outcomes. Future research should also consider how families make decisions about what foods to purchase, where to shop for foods and eating out, how closely to monitor their children’s food intake, and, ultimately how these decisions collectively impact children’s outcomes.

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Food Environments and Obesity: Household Diet Expenditure Versus Food Deserts

Danhong Chen, Edward Jaenicke & Richard Volpe

American Journal of Public Health, May 2016, Pages 881-888

Objectives: To examine the associations between obesity and multiple aspects of the food environments, at home and in the neighborhood.

Methods: Our study included 38 650 individuals nested in 18 381 households located in 2104 US counties. Our novel home food environment measure, USDAScore, evaluated the adherence of a household’s monthly expenditure shares of 24 aggregated food categories to the recommended values based on US Department of Agriculture food plans. The US Census Bureau’s County Business Patterns (2008), the detailed food purchase information in the IRi Consumer Panel scanner data (2008–2012), and its associated MedProfiler data set (2012) constituted the main sources for neighborhood-, household-, and individual-level data, respectively.

Results: After we controlled for a number of confounders at the individual, household, and neighborhood levels, USDAScore was negatively linked with obesity status, and a census tract–level indicator of food desert status was positively associated with obesity status.

Conclusions: Neighborhood food environment factors, such as food desert status, were associated with obesity status even after we controlled for home food environment factors.

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Why has the prevalence of obesity doubled?

Charles Baum & Shin-Yi Chou

Review of Economics of the Household, June 2016, Pages 251-267

Abstract:
The prevalence of obesity has doubled over the last 25 years. We estimate the effects of multiple socio-environmental factors (e.g., physical demands at work, restaurants, food prices, cigarette smoking, food stamps, and urban sprawl) on obesity using NLSY data. Then we use the Oaxaca–Blinder decomposition technique to approximate the contribution of each socio-environmental factor to the increase during this time. Many socio-environmental factors significantly affect weight, but none are able to explain a large portion of the obesity increase. Decreases in cigarette smoking consistently explains about 2–4 % of the increase in obesity and BMI. Food stamp receipt also consistently affects the measures of weight, but the small decrease in food stamp program participation during the period we examine actually dampened the increases in obesity and BMI. Collectively, the socio-environmental factors we examine never explain more than about 6.5 % of the weight increases.

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Psychosocial factors as mediators of food Insecurity and weight status among middle school students

Don Willis & Kevin Fitzpatrick

Appetite, August 2016, Pages 236–243

Abstract:
Research regarding the association between food insecurity and weight status among youth has produced mixed results. However, few studies on this topic have utilized data that includes survey responses from children themselves regarding their experience with food insecurity. This study was undertaken to examine the association between food insecurity and weight status among youth, as well as the potential mediation by psychosocial factors. A survey of 5th-7th grade students was administered to gather information on food insecurity, social and psychological resources, and health. The primary analysis includes OLS (Ordinary Least Squares) regression conducted using SPSS software and Sobel's test for mediation. Results suggest a positive association between food insecurity and weight status even when controlling for key demographic variables. In addition, we find that this association is mediated by psychosocial factors — namely, perceived social status and depression. Insights from this work highlight the need to consider non-nutritional pathways through which food insecurity impacts health as well the need to continue surveying youth directly when examining their experiences with food insecurity.

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More Similar but Less Satisfying: Comparing Preferences for and the Efficacy of Within- and Cross-Category Substitutes for Food

Young Eun Huh, Joachim Vosgerau & Carey Morewedge

Psychological Science, forthcoming

Abstract:
When people cannot get what they want, they often satisfy their desire by consuming a substitute. Substitutes can originate from within the taxonomic category of the desired stimulus (i.e., within-category substitutes) or from a different taxonomic category that serves the same basic goal (i.e., cross-category substitutes). Both a store-brand chocolate (within-category substitute) and a granola bar (cross-category substitute), for example, can serve as substitutes for gourmet chocolate. Here, we found that people believe that within-category substitutes, which are more similar to desired stimuli, will more effectively satisfy their cravings than will cross-category substitutes (Experiments 1, 2a, and 2b). However, because within-category substitutes are more similar than cross-category substitutes to desired stimuli, they are more likely to evoke an unanticipated negative contrast effect. As a result, unless substitutes are equivalent in quality to the desired stimulus, cross-category substitutes more effectively satisfy cravings for the desired stimulus (Experiments 3 and 4).

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Persistent metabolic adaptation 6 years after “The Biggest Loser” competition

Erin Fothergill et al.

Obesity, forthcoming

Objective: To measure long-term changes in resting metabolic rate (RMR) and body composition in participants of “The Biggest Loser” competition.

Methods: Body composition was measured by dual energy X-ray absorptiometry, and RMR was determined by indirect calorimetry at baseline, at the end of the 30-week competition and 6 years later. Metabolic adaptation was defined as the residual RMR after adjusting for changes in body composition and age.

Results: Of the 16 “Biggest Loser” competitors originally investigated, 14 participated in this follow-up study. Weight loss at the end of the competition was (mean ± SD) 58.3 ± 24.9 kg (P < 0.0001), and RMR decreased by 610 ± 483 kcal/day (P = 0.0004). After 6 years, 41.0 ± 31.3 kg of the lost weight was regained (P = 0.0002), while RMR was 704 ± 427 kcal/day below baseline (P < 0.0001) and metabolic adaptation was −499 ± 207 kcal/day (P < 0.0001). Weight regain was not significantly correlated with metabolic adaptation at the competition's end (r = −0.1, P = 0.75), but those subjects maintaining greater weight loss at 6 years also experienced greater concurrent metabolic slowing (r = 0.59, P = 0.025).

Conclusions: Metabolic adaptation persists over time and is likely a proportional, but incomplete, response to contemporaneous efforts to reduce body weight.

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An exploration of exercise-induced cognitive enhancement and transfer effects to dietary self-control

Cassandra Lowe, Dimitar Kolev & Peter Hall

Brain and Cognition, forthcoming

Abstract:
The primary objective of this study was to examine the effects of aerobic exercise on executive function, specifically inhibitory control, and the transfer to self-control in the dietary domain. It was hypothesized that exercise would enhance inhibitory control, and that this enhancement would facilitate self-control in a laboratory taste test paradigm. Using a crossover design, 51 participants completed counterbalanced sessions of both moderate exercise (experimental condition) and minimal effort walking (control condition) using a treadmill; the intersession interval was 7 days. Prior to each exercise bout participants completed a Stroop task. Following each bout participants completed a second Stoop task, as well as a bogus taste test involving three appetitive calorie dense snack foods and two control foods; the amount of each food type consumed during the taste test was covertly measured. Results revealed that moderate exercise significantly improved performance on the Stroop task, and also reduced food consumption during the taste test for appetitive calorie dense snack foods; there was no exercise effect on control food consumption. Exercise-induced gains in Stroop performance mediated the effects of moderate exercise on appetitive snack food consumption. Together these findings provide evidence that a bout of a moderate aerobic exercise can enhance inhibitory control, and support for cross-domain transfer effects to dietary self-control.

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Satiety effects of psyllium in healthy volunteers

Jose Brum et al.

Appetite, forthcoming

Abstract:
Controlling hunger between meals is a challenge for many individuals. This manuscript comprises 2 sequential clinical trials investigating the effects of psyllium (Metamucil) on satiety, both using a randomized, double-blind, placebo-controlled cross-over design. The first study determined the effects of 3.4 g, 6.8 g, and 10.2 g of psyllium taken before breakfast and lunch for 3 days. The second study determined the effects of 6.8 g (taken before breakfast and lunch on Days 1 and 2 and before breakfast on Day 3) on the satiety of participants receiving an energy restricted meal in the morning (breakfast) for 3 days. Efficacy endpoints were mean inter-meal hunger, desire to eat, and Satiety Labeled Intensity Magnitude Visual Analog Scale scores. In Study 1, all 3 psyllium doses resulted in directional or statistically significant mean reduction in hunger and desire to eat, and increased fullness between meals compared to placebo, with both higher doses better than placebo or 3.4 g. The 6.8 g dose provided more consistent (p ≤ 0.013) satiety benefits versus placebo. In Study 2, satiety was assessed similarly to Study 1. A significant (p ≤ 0.004) decrease in the 3-day mean hunger and desire to eat, as well as an increase in fullness for psyllium relative to placebo was observed. Most adverse events were mild gastrointestinal symptoms and were similar for psyllium compared to placebo. These results indicate that psyllium supplementation contributes to greater fullness and less hunger between meals.

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Believing in food addiction: Helpful or counterproductive for eating behavior?

Helen Ruddock et al.

Obesity, forthcoming

Methods: In two studies, female participants (study 1: N = 64; study 2: N = 90) completed food-related computerized tasks and were given bogus feedback on their performance which indicated that they had high, low, or average food addiction tendencies. Food intake was then assessed in an ad libitum taste test. Dietary concern and time taken to complete the taste test were recorded in study 2.

Results: In study 1, participants in the high-addiction condition consumed fewer calories than those in the low-addiction condition, F(1,60) = 7.61, P = 0.008, ηp2 = 0.11. Study 2 replicated and extended this finding, showing that the effect of the high-addiction condition on food intake was mediated by increased dietary concern, which reduced the amount of time participants willingly spent exposed to the foods during the taste test, b = −0.06 (0.03), 95% confidence interval = −0.13 to −0.01.

Conclusions: Believing oneself to be a food addict is associated with short-term dietary restriction. The longer-term effects on weight management now warrant attention.

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Change in Body Mass Index Associated With Lowest Mortality in Denmark, 1976-2013

Shoaib Afzal et al.

Journal of the American Medical Association, 10 May 2016, Pages 1989-1996

Objective: To determine whether the BMI value that is associated with the lowest all-cause mortality has increased in the general population over a period of 3 decades.

Design, Setting, and Participants: Three cohorts from the same general population enrolled at different times: the Copenhagen City Heart Study in 1976-1978 (n = 13 704) and 1991-1994 (n = 9482) and the Copenhagen General Population Study in 2003-2013 (n = 97 362). All participants were followed up from inclusion in the studies to November 2014, emigration, or death, whichever came first.

Results: The number of deaths during follow-up was 10 624 in the 1976-1978 cohort (78% cumulative mortality; mortality rate [MR], 30/1000 person-years [95% CI, 20-46]), 5025 in the 1991-1994 cohort (53%; MR, 16/1000 person-years [95% CI, 9-30]), and 5580 in the 2003-2013 cohort (6%; MR, 4/1000 person-years [95% CI, 1-10]). Except for cancer mortality, the association of BMI with all-cause, cardiovascular, and other mortality was curvilinear (U-shaped). The BMI value that was associated with the lowest all-cause mortality was 23.7 (95% CI, 23.4-24.3) in the 1976-1978 cohort, 24.6 (95% CI, 24.0-26.3) in the 1991-1994 cohort, and 27.0 (95% CI, 26.5-27.6) in the 2003-2013 cohort. The corresponding BMI estimates for cardiovascular mortality were 23.2 (95% CI, 22.6-23.7), 24.0 (95% CI, 23.4-25.0), and 26.4 (95% CI, 24.1-27.4), respectively, and for other mortality, 24.1 (95% CI, 23.5-25.9), 26.8 (95% CI, 26.1-27.9), and 27.8 (95% CI, 27.1-29.6), respectively. The multivariable-adjusted hazard ratios for all-cause mortality for BMI of 30 or more vs BMI of 18.5 to 24.9 were 1.31 (95% CI, 1.23-1.39; MR, 46/1000 person-years [95% CI, 32-66] vs 28/1000 person-years [95% CI, 18-45]) in the 1976-1978 cohort, 1.13 (95% CI, 1.04-1.22; MR, 28/1000 person-years [95% CI, 17-47] vs 15/1000 person-years [95% CI, 7-31]) in the 1991-1994 cohort, and 0.99 (95% CI, 0.92-1.07; MR, 5/1000 person-years [95% CI, 2-12] vs 4/1000 person-years [95% CI, 1-11]) in the 2003-2013 cohort.

Conclusions and Relevance: Among 3 Danish cohorts, the BMI associated with the lowest all-cause mortality increased by 3.3 from cohorts enrolled from 1976-1978 through 2003-2013. Further investigation is needed to understand the reason for this change and its implications.

By KEVIN LEWIS | 09:00:00 AM

Monday, May 23, 2016

It's a developing story

The Long-Term Effects of the Printing Press in Sub-Saharan Africa

Julia Cagé & Valeria Rueda

American Economic Journal: Applied Economics, forthcoming

Abstract:
This article investigates the long-term consequences of the printing press in the 19th century sub-Saharan Africa on social capital nowadays. Protestant missionaries were the first to import the printing press and to allow the indigenous population to use it. We build a new geocoded dataset locating Protestant missions in 1903. This dataset includes, for each mission station, the geographic location and its characteristics, as well as the printing-, educational-, and health-related investments undertaken by the mission. We show that, within regions close to missions, proximity to a printing press is associated with higher newspaper readership, trust, education, and political participation.

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Law and Finance Matter: Lessons from Externally Imposed Courts

James Brown, Anthony Cookson & Rawley Heimer

Review of Financial Studies, forthcoming

Abstract:
This paper provides novel evidence on the real and financial market effects of legal institutions. Our analysis exploits persistent and externally imposed differences in court enforcement that arose when the U.S. Congress assigned state courts to adjudicate contracts on a subset of Native American reservations. Using area-specific data on small business lending, we find that reservations assigned to state courts, which enforce contracts more predictably than tribal courts, have stronger credit markets. Moreover, the law-driven component of credit market development is associated with significantly higher per capita income, with stronger effects in sectors that depend more on external financing.

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Time for Growth

Lars Boerner & Battista Severgnini

London School of Economics Working Paper, February 2016

Abstract:
This paper studies the impact of the early adoption of one of the most important high-technology machines in history, the public mechanical clock, on long-run growth in Europe. We avoid endogeneity by considering the relationship between the adoption of clocks with two sets of instruments: distance from the first adopters and the appearance of repeated solar eclipses. The latter instrument is motivated by the predecessor technologies of mechanical clocks, astronomic instruments that measured the course of heavenly bodies. We find significant growth rates between 1500 and 1700 in the range of 30 percentage points in early adopter cities and areas.

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Abstinence Funding Was Not Associated With Reductions In HIV Risk Behavior In Sub-Saharan Africa

Nathan Lo, Anita Lowe & Eran Bendavid

Health Affairs, May 2016, Pages 856-863

Abstract:
The President's Emergency Plan for AIDS Relief (PEPFAR) has been the largest funder of abstinence and faithfulness programming in sub-Saharan Africa, with a cumulative investment of over US $1.4 billion in the period 2004-13. We examined whether PEPFAR funding for abstinence and faithfulness programs, which aimed to reduce the risk of HIV transmission, was associated with a relative change in five outcomes indicative of high-risk sexual behavior: number of sexual partners in the past twelve months for men and for women, age at first sexual intercourse for men and for women, and teenage pregnancies. Using nationally representative surveys from twenty-two sub-Saharan African countries, we compared trends between people living in countries that received PEPFAR abstinence and faithfulness funding and those living in countries that did not in the period 1998-2013. We found no evidence to suggest that PEPFAR funding was associated with population-level reductions in any of the five outcomes. These results suggest that alternative funding priorities for HIV prevention may yield greater health benefits.

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Population Size Effects in the Structural Development of England

Oksana Leukhina & Stephen Turnovsky

American Economic Journal: Macroeconomics, forthcoming

Abstract:
The English structural transformation from farming to manufacturing was accompanied by rapid technological change, expansion of trade, and massive population growth. While the roles of technology and trade in this process have been investigated, the literature has largely ignored the role of population growth. We examine population size effects on various aspects of structural development, characterizing their explicit dependence on preference-side and production-side characteristics of the economy, and trade. Our quantitative analysis of the English transformation assigns a major role to population growth, with especially notable contributions to post-1750 rise in the manufacturing employment share and the relative price dynamics.

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Jewish Communities and City Growth in Preindustrial Europe

Noel Johnson & Mark Koyama

George Mason University Working Paper, May 2016

Abstract:
We study whether cities with Jewish communities grew faster than cities without Jewish communities in Europe between 1400 and 1850. We match data on city populations from Bairoch (1988) with data on the presence of a Jewish community from the Encyclopedia Judaica. Our difference-in-differences results indicate that cities with Jewish communities grew about 30% faster than comparable cities without Jewish communities between 1400 and 1850. To establish causality, we create time varying instrumental variables which rely only on the spatially extended network of Jewish communities in order to predict Jewish presence in a given city. We also provide evidence that the advantage of cities with Jewish communities stemmed in part from Jewish Emancipation and their ability to exploit increases in market access after 1600.

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Gender Discrimination in Property Rights: Six Centuries of Commons Governance in the Alps

Marco Casari & Maurizio Lisciandra

Journal of Economic History, June 2016, Pages 559-594

Abstract:
Starting from the Medieval period, women in the Italian Alps experienced a progressive erosion in property rights over the commons. We collected documents about the evolution of inheritance regulations on collective land issued by hundreds of villages over a period of six centuries (thirteenth-nineteenth). Based on this original dataset, we provide a long-term perspective of decentralized institutional change in which gender-biased inheritance systems emerged as a defensive measure to preserve the wealth of village insiders. This institutional change also had implications for the population growth, marriage strategies, and the protection from economic shocks.

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Are the world's poorest being left behind?

Martin Ravallion

Journal of Economic Growth, June 2016, Pages 139-164

Abstract:
Traditional assessments of economic growth and progress against poverty tell us little about whether the poorest are being left behind - whether the consumption floor is rising above the biological minimum. To address this deficiency, the paper identifies the expected value of the floor as a weighted mean of observed consumptions for the poorest stratum. Under the identifying assumptions and using data for the developing world over 1981-2011, the estimated floor is about half the $1.25 a day poverty line. Economic growth and social policies have delivered only modest progress in raising the floor, despite overall growth and progress in reducing the number living near the floor.

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Aid, Catastrophes and the Samaritan's Dilemma

Paul Raschky & Manijeh Schwindt

Economica, forthcoming

Abstract:
This paper analyses the impact of past foreign aid on the recipient country's preparedness against natural disasters. We estimate the impact of past foreign aid on the occurrence of natural disasters and the death toll from disasters using data from 5089 major natural disasters in 81 developing countries between 1979 and 2012. The results suggest that past foreign aid flows crowd out the recipient's incentives to provide protective measures that decrease the likelihood and the societal impact of a disaster. The crowding-out effect appears to be stronger in developing countries that are relatively poorer and have weaker political institutions.

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The Global Spatial Distribution of Economic Activity: Nature, History, and the Role of Trade

Vernon Henderson et al.

NBER Working Paper, April 2016

Abstract:
We study the distribution of economic activity, as proxied by lights at night, across 250,000 grid cells of average area 560 square kilometers. We first document that nearly half of the variation can be explained by a parsimonious set of physical geography attributes. A full set of country indicators only explains a further 10%. When we divide geographic characteristics into two groups, those primarily important for agriculture and those primarily important for trade, we find that the agriculture variables have relatively more explanatory power in countries that developed early and the trade variables have relatively more in countries that developed late, despite the fact that the latter group of countries are far more dependent on agriculture today. We explain this apparent puzzle in a model in which two technological shocks occur, one increasing agricultural productivity and the other decreasing transportation costs, and in which agglomeration economies lead to persistence in urban locations. In countries that developed early, structural transformation due to rising agricultural productivity began at a time when transport costs were still relatively high, so urban agglomerations were localized in agricultural regions. When transport costs fell, these local agglomerations persisted. In late developing countries, transport costs fell well before structural transformation. To exploit urban scale economies, manufacturing agglomerated in relatively few, often coastal, locations. With structural transformation, these initial coastal locations grew, without formation of more cities in the agricultural interior.

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State Capacity and Public Goods: Institutional Change, Human Capital, and Growth in Early Modern Germany

Jeremiah Dittmar & Ralf Meisenzahl

Federal Reserve Working Paper, March 2016

Abstract:
What are the origins and consequences of the state as a provider of public goods? We study legal reforms that established mass public education and increased state capacity in German cities during the 1500s. These fundamental changes in public goods provision occurred where ideological competition during the Protestant Reformation interacted with popular politics at the local level. We document that cities that formalized public goods provision in the 1500s began differentially producing and attracting upper tail human capital and grew to be significantly larger in the long-run. We study plague outbreaks in a narrow time period as exogenous shocks to local politics and find support for a causal interpretation of the relationship between public goods institutions, human capital, and growth. More broadly, we provide evidence on the origins of state capacity directly targeting welfare improvement.

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Demographic Dividend and Asia's Economic Convergence towards the US

Joonkyung Ha & Sang-Hyop Lee

Journal of the Economics of Ageing, forthcoming

Abstract:
This paper shows the possibility of a middle-income trap for Asia due to demographics. Using panel analyses for 93 countries from all continents for 1970-2011, we show that, first, the speed of convergence to the US in terms of GDP per capita is closely related to the share of working age population - the support ratio - as it drives national saving and various investments. In the case of Asia, the speed of convergence is more elastic to support ratios than other continents, suggesting that the first and the second demographic dividend have been extracted to a deeper degree. Second, fertility - the main driving force of support ratio dynamics - is determined by child rearing costs that are, in turn, a function of the level of GDP per capita relative to the US. Again, Asia's fertility is extremely sensitive to the level of development, implying that economic convergence leads to too high child rearing costs and too low fertility. These findings lead to the possibility of Asia's demography-driven middle-income trap: low fertility eventually turns the positive demographic dividends of the past into negative ones and forces the speed of convergence to slow down, so that the relative per capita GDP stagnates before it fully converges to the US. However, in the meantime, East Asia's declining support ratios and South and South East Asia's increasing support ratios imply that within-Asia convergence may occur for some time. In the long run, economic convergence cannot be sustained without demographic convergence.

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The Effect of Aid on Growth: Evidence from a Quasi-Experiment

Sebastian Galiani et al.

NBER Working Paper, April 2016

Abstract:
The literature on aid and growth has not found a convincing instrumental variable to identify the causal effects of aid. This paper exploits an instrumental variable based on the fact that since 1987, eligibility for aid from the International Development Association (IDA) has been based partly on whether or not a country is below a certain threshold of per capita income. The paper finds evidence that other donors tend to reinforce rather than compensate for reductions in IDA aid following threshold crossings. Overall, aid as a share of gross national income (GNI) drops about 59 percent on average after countries cross the threshold. Focusing on the 35 countries that have crossed the income threshold from below between 1987 and 2010, a positive, statistically significant, and economically sizable effect of aid on growth is found. A one percentage point increase in the aid to GNI ratio from the sample mean raises annual real per capita growth in gross domestic product by approximately 0.35 percentage points.

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Is Living in African Cities Expensive?

Shohei Nakamura et al.

World Bank Working Paper, April 2016

Abstract:
Although several studies have examined why overall price levels are higher in richer countries, little is known about whether there is a similar relationship at the urban and city level across countries. This paper compares the price levels of cities in Sub-Saharan Africa with those of other regions by analyzing price information collected for the 2011 round of the International Comparison Program. Readjusting the calculated price levels from national to urban levels, the analysis indicates that African cities are relatively more expensive, despite having lower income levels. The price levels of goods and services consumed by households are up to 31 percent higher in Sub-Saharan Africa than in other low- and middle-income countries, relative to their income levels. Food and non-alcoholic beverages are especially expensive, with price levels around 35 percent higher than in other countries. The paper also analyzes price information collected by the Economist Intelligence Unit's Worldwide Cost of Living Survey, and obtains a similar result, indicating higher prices of goods and services in African cities.

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Transforming lives: The impact of compulsory schooling on hope and happiness

Bahadır Dursun & Resul Cesur

Journal of Population Economics, July 2016, Pages 911-956

Abstract:
This is the first article examining the causal impact of mandatory extended primary schooling on happiness (sense of well-being) of young adults. We rely on a law change that raised compulsory schooling from 5 to 8 years in Turkey to address the endogeneity of education to happiness. Our study shows that, for females, earning at least a middle school diploma increases the likelihood of being happy and the probability of being satisfied with various life domains. Descriptive tests suggest that being hopeful about one's own future well-being partly explains the relationship between women's schooling and happiness. For males, although relatively imprecisely estimated, we find evidence that earning at least a middle school degree results in a decline in subjective well-being. Supplemental analysis develops evidence consistent with the view that an imbalance between aspirations and attainments, flowing from extended primary schooling, may be the reason behind this counterintuitive finding among men.

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IQ and Socioeconomic Development across Regions of the UK

Noah Carl

Journal of Biosocial Science, May 2016, Pages 406-417

Abstract:
Cross-regional correlations between average IQ and socioeconomic development have been documented in many different countries. This paper presents new IQ estimates for the twelve regions of the UK. These are weakly correlated (r=0.24) with the regional IQs assembled by Lynn (1979). Assuming the two sets of estimates are accurate and comparable, this finding suggests that the relative IQs of different UK regions have changed since the 1950s, most likely due to differentials in the magnitude of the Flynn effect, the selectivity of external migration, the selectivity of internal migration or the strength of the relationship between IQ and fertility. The paper provides evidence for the validity of the regional IQs by showing that IQ estimates for UK nations (England, Scotland, Wales and Northern Ireland) derived from the same data are strongly correlated with national PISA scores (r=0.99). It finds that regional IQ is positively related to income, longevity and technological accomplishment; and is negatively related to poverty, deprivation and unemployment. A general factor of socioeconomic development is correlated with regional IQ at r=0.72.

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The Political Cure: Gender Quotas and Women's Health

Aubrey Westfall & Carissa Chantiles

Politics & Gender, forthcoming

Abstract:
Political gender quotas have become the institutional solution for most governments hoping to increase women's descriptive and substantive representation in national and local government, despite the lack of consensus over whether quotas have a consistent positive effect on the lives of women. We argue that the different forms in which quotas are implemented result in diverse effects in the substantive representation of women's issues. Using women's health to illustrate the substantive effect of women's political participation through quotas, we utilize multilevel models to find that quotas are effective at placing women into legislative office and that this descriptive representation is associated with positive conditions for women's health. However, the strength of the relationship depends on the type of quota implemented. Countries implementing candidate quotas exhibit more consistent but weaker relationships between representation and women's health outcomes than in countries with reserved seat quotas. These results affirm the quota's objective to place women in political office but suggest that the policy effectiveness of the individual female legislators may depend on the quota system in place.

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How did trade norms evolve in Scandinavia? Long-distance trade and social trust in the Viking age

Gunnar Lind Haase Svendsen & Gert Tinggaard Svendsen

Economic Systems, forthcoming

Abstract:
As the saying goes, "it takes years to build up trust and only seconds to destroy it." In this paper, we argue that this is indeed the case when explaining trust formation in Scandinavia. Hence, in an attempt to explain why the Scandinavian welfare states hold the highest social trust scores in the world today, we argue that one possible historical root of social trust may be the long-distance trade practices of the Viking age. To manage the risk of being cheated, trade between strangers in an oral world required a strong informal institution of trust-based trade norms out of necessity to deal with the risk of being cheated. In contrast to similar cases like the famous medieval Maghribi traders, who counted on writing (Greif, 1989), the punishment of cheaters could not be supported by written documents such as legal documents and letters, as the large majority of Vikings were non-literate. If a trader did not keep his word, social sanctioning by word of mouth was most likely the only method to discipline the cheater and prevent future free-rider behavior. The early rise of trust-based trade norms in Scandinavia is an overlooked factor in the region's long-term socio-economic development and social trust accumulation. This result points to the importance of free trade today, especially in poor countries with low levels of economic development and high rates of non-literacy.

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Corporate Resilience to Banking Crises: The Roles of Trust and Trade Credit

Ross Levine, Chen Lin & Wensi Xie

NBER Working Paper, April 2016

Abstract:
Are firms more resilient to systemic banking crises in economies with higher levels of social trust? Using firm-level data in 34 countries from 1990 through 2011, we find that liquidity-dependent firms in high-trust countries obtain more trade credit and suffer smaller drops in profits and employment during banking crises than similar firms in low-trust economies. The results are consistent with the view that when banking crises block the normal banking-lending channel, greater social trust facilitates access to informal finance, cushioning the effects of these crises on corporate profits and employment.

By KEVIN LEWIS | 09:00:00 AM


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