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Friday, August 26, 2016

Bringing back the jobs

Learning to Love the Government: Trade Unions and Late Adoption of the Minimum Wage

Brett Meyer

World Politics, July 2016, Pages 538-575

Abstract:
One counterintuitive variation in wage-setting regulation is that countries with the highest labor standards and strongest labor movements are among the least likely to set a statutory minimum wage. This, the author argues, is due largely to trade union opposition. Trade unions oppose the minimum wage when they face minimal low-wage competition, which is affected by the political institutions regulating industrial action, collective agreements, and employment, as well as by the skill and wage levels of their members. When political institutions effectively regulate low-wage competition, unions oppose the minimum wage. When political institutions are less favorable toward unions, there may be a cleavage between high- and low-wage unions in their minimum wage preferences. The argument is illustrated with case studies of the UK, Germany, and Sweden. The author demonstrates how the regulation of low-wage competition affects unions' minimum wage preferences by exploiting the following labor market institutional shocks: the Conservatives' labor law reforms in the UK, the Hartz labor market reforms in Germany, and the European Court of Justice's Laval ruling in Sweden. The importance of union preferences for minimum wage adoption is also shown by how trade union confederation preferences influenced the position of the Labour Party in the UK and the Social Democratic Party in Germany.

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Moving to a Job: The Role of Home Equity, Debt, and Access to Credit

Yuliya Demyanyk et al.

American Economic Journal: Macroeconomics, forthcoming

Abstract:
We use individual-level credit reports merged with loan-level mortgage data to estimate how home equity interacted with mobility in relatively weak and strong labor markets in the United States during the Great Recession. We construct a dynamic model of housing, consumption, employment, and relocation, which provides a structural interpretation of our empirical results and allows us to explore the role that foreclosure played in labor mobility. We find that negative home equity is not a significant barrier to job-related mobility because the benefits of accepting an out-of-area job outweigh the costs of moving. This pattern holds even if homeowners are not able to default on their mortgages.

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The Rise of Finance and Firm Employment Dynamics

Ken-Hou Lin

Organization Science, July-August 2016, Pages 972-988

Abstract:
This article sheds light on the ongoing employment stagnation in the United States by investigating the links between the rise of finance and firm employment dynamics during the 1982-2005 period. I argue that the rise of finance marginalized the role of labor in revenue generating and sharing processes, which led to employment stagnation among the largest nonfinancial firms in the United States. Evidence suggests that increasing investment in financial assets depresses the workforce size. The growing dependence on debt reprioritizes the order of distribution, heightening the need for workforce reduction. The increasing rewards for shareholders generate a downsize-and-distribute spiral, in which labor expense becomes a primary target of cost-cutting strategies. Further analysis indicates that production and service workers are more vulnerable to shifts associated with the rise of finance than managers and professionals.

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Partial Automation: Routine-Biased Technical Change, Deskilling, and the Minimum Wage

Mitch Downey

University of California Working Paper, May 2016

Abstract:
Recent research emphasizes the pressure technological change exerts on middle-wage occupations by automating routine tasks. I argue that technology only partially automates these tasks, which often still require labor. Rather, technology reduces task complexity enabling a less skilled worker to do the same job. The costs of automation, then, are not only the costs of the technology itself but also of low-wage workers to use it. By raising the cost of low-wage labor, the minimum wage reduces the profitability of adopting automating technologies. I test this prediction with state variation in the minimum wage and industry variation in complementarity between low-wage workers and technology. I show that accounting for state price differences induces new and useful minimum wage variation, derive new measures of complementarity from the Dictionary of Occupational Titles and the CPS Computer Use Supplement, and build a measure of technology based on IT employment, the largest component of IT spending. My results imply a $1 decrease in the minimum wage raises the average industry's technology use by 30% and decreases the routine share of the wage bill by 1 percentage point (3.3%), both relative to a counterfactual without complementarity. Routine-intensive industries often exhibit high complementarity, making the minimum wage an important policy lever to influence the pace of routine-biased technical change.

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Skill Demands and Mismatch in U.S. Manufacturing

Andrew Weaver & Paul Osterman

ILR Review, forthcoming

Abstract:
Recent economic events have sparked debates over the degree of structural mismatch in the U.S. economy. One of the most frequent claims is that workers lack the skills that employers demand. The existing literature, however, analyzes this potential mismatch at a high level of aggregation with abstract indices and noisy proxies that obscure the underlying mechanisms. The authors address these issues by presenting and analyzing results from a survey of U.S. manufacturing establishments. The survey is the first, to their knowledge, to directly measure concrete employer skill demands and hiring experiences in a nationally representative survey at the industry level. The findings indicate that demand for higher-level skills is generally modest, and that three-quarters of manufacturing establishments do not show signs of hiring difficulties. Among the remainder, demands for higher-level math and reading skills are significant predictors of long-term vacancies, but demands for computer skills and other critical-thinking/problem-solving skills are not. Of particular interest, high-tech plants do not experience greater levels of hiring challenges. When the authors examine the potential mechanisms that could contribute to hiring difficulties, they find that neither external regional supply conditions nor internal firm practices are predictive of hiring problems. Rather, the data show that establishments that are members of clusters or that demand highly specialized skills have the greatest probability of incurring long-term vacancies. The authors interpret these results as a sign that it is important to think about factors that complicate the interaction of supply and demand - such as disaggregation and communication/coordination failures - rather than simply focusing on inadequate labor supply.

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No Woman No Crime: Ban the Box, Employment, and Upskilling

Daniel Shoag & Stan Veuger

Harvard Working Paper, March 2016

Abstract:
A sizable number of localities have in recent years limited the use of criminal background checks in hiring decisions, or "banned the box." Using LEHD Origin-Destination Employment and American Community Survey data, we show that these bans increased employment of residents in high-crime neighborhoods by as much as 4%. These increases are particularly large in the public sector. At the same time, we establish using job postings data that employers respond to ban-the-box measures by raising experience requirements. A perhaps unintended consequence of this is that women, who are less likely to be convicted of crimes, see their employment opportunities reduced.

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Does employment growth increase travel time to work?: An empirical analysis using military troop movements

Geoffrey Morrison & Cynthia Lin Lawell

Regional Science and Urban Economics, September 2016, Pages 180-197

Abstract:
Employment growth is a common public policy goal, but it can lead to a number of unwanted environmental, social, and economic costs - particularly in high growth communities - due to its impact on peak-hour traffic. This paper examines the short-run impacts of rapid employment growth on travel time to work. We exploit exogenous variation in employment levels resulting from movements of military troops during the 2005 Base Realignment and Closure (BRAC) in order to identify the effect of employment growth on travel time using difference-in-difference-in-differences and instrumental variable methods. Our results show that for each additional 10 workers added per square kilometer, travel time increases by 0.171 to 0.244 min per one-way commute trip per commuter in the short run, which equates to $0.07 to $0.20 in travel time cost per commuter per day. Our estimates imply that the annualized short-run congestion costs of the 2005 BRAC were $79 to $761 million per year (in constant 2005 dollars) for military commuters and $3.15 to $6.3 billion per year (in constant 2005 dollars) for civilian commuters in BRAC-affected areas.

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The Effect of Population Aging on Economic Growth, the Labor Force and Productivity

Nicole Maestas, Kathleen Mullen & David Powell

NBER Working Paper, July 2016

Abstract:
Population aging is widely assumed to have detrimental effects on economic growth yet there is little empirical evidence about the magnitude of its effects. This paper starts from the observation that many U.S. states have already experienced substantial growth in the size of their older population and much of this growth was predetermined by historical trends in fertility. We use predicted variation in the rate of population aging across U.S. states over the period 1980-2010 to estimate the economic impact of aging on state output per capita. We find that a 10% increase in the fraction of the population ages 60+ decreases the growth rate of GDP per capita by 5.5%. Two-thirds of the reduction is due to slower growth in the labor productivity of workers across the age distribution, while one-third arises from slower labor force growth. Our results imply annual GDP growth will slow by 1.2 percentage points this decade and 0.6 percentage points next decade due to population aging.

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The General Equilibrium Impacts of Unemployment Insurance: Evidence from a Large Online Job Board

Ioana Marinescu

NBER Working Paper, July 2016

Abstract:
During the Great Recession, U.S. unemployment benefits were extended by up to 73 weeks. Theory predicts that extensions increase unemployment by discouraging job search, a partial equilibrium effect. Using data from the large job board CareerBuilder.com, I find that a 10% increase in benefit duration decreased state-level job applications by 1%, but had no robust effect on job vacancies. Job seekers thus faced reduced competition for jobs, a general equilibrium effect. Calibration implies that the general equilibrium effect reduces the impact of unemployment insurance on unemployment by 40%: increasing benefit duration by 10% increases unemployment by only 0.6% in equilibrium.

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Does the Unemployment Benefit Institution Affect the Productivity of Workers? Evidence from the Field

Mariana Blanco, Patricio Dalton & Juan Vargas

Management Science, forthcoming

Abstract:
This paper studies the effects of unemployment benefit schemes on individual productivity. We created employment and unemployment in the field and compared workers' productivity under no unemployment benefits to productivity under two different unemployment schemes. In one scheme, the unemployed received an unconditional monetary transfer. In the other, the monetary transfer was obtained conditional on the unemployed spending some time on an ancillary activity. Our results challenge the standard economic theory prediction that unemployment benefits, especially unconditional compensations, hinder workers' effort. We find that workers employed under the unconditional scheme are more productive than workers under the conditional one, and both schemes make workers more productive than having no unemployment benefit. We discuss two possible explanations for our results based on reciprocity and differential psychological costs of unemployment across unemployment benefit schemes.

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Potential Unemployment Insurance Duration and Labor Supply: The Individual and Market-Level Response to a Benefit Cut

Andrew Johnston & Alexandre Mas

NBER Working Paper, July 2016

Abstract:
We examine how a 16-week cut in potential unemployment insurance (UI) duration in Missouri affected search behavior of UI recipients and the aggregate labor market. Using a regression discontinuity design (RDD), we estimate a marginal effect of maximum duration on UI and nonemployment spells of approximately 0.5 and 0.3 respectively. We use RDD estimates to simulate the unemployment rate assuming no market-level externalities. The simulated response closely approximates the estimated change in the unemployment rate following the benefit cut, suggesting that even in a period of high unemployment the labor market absorbed this influx of workers without crowding-out other jobseekers.

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Effects of the unemployment insurance work test on long-term employment outcomes

Marta Lachowska, Merve Meral & Stephen Woodbury

Labour Economics, August 2016, Pages 246-265

Abstract:
Does requiring job seekers to be available and searching for work affect job quality? We examine the effects of this unemployment insurance (UI) work test on long-term employment outcomes. Adding administrative wage records to the Washington Alternative Work Search (WAWS) experiment, we examine effects on earnings, hours worked, employment, and job match quality in the nine years following the experiment. Among UI recipients as a whole, the effects of the work test were negligible, counter to the hypothesis that the work test may harm long-term earnings. But for permanent job losers, the work test reduced time to reemployment by 1-2 quarters, and increased job tenure with the first post-claim employer by about 2 quarters. Also, we find that the work test selected lower-wage workers into reemployment. Accordingly, the work test may be an important policy for improving the reemployment prospects of lower-wage, permanent job losers.

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Education, Participation, and the Revival of U.S. Economic Growth

Dale Jorgenson, Mun Ho & Jon Samuels

NBER Working Paper, July 2016

Abstract:
Labor quality growth captures the upgrading of the labor force through higher educational attainment and greater experience. Our first finding is that average levels of educational attainment of new entrants will remain high, but will no longer continue to rise, so that growing educational attainment will gradually disappear as a source of U.S. economic growth. Our second finding is that the investment boom of 1995-2000 drew many younger and less-educated workers into employment. Participation rates for these workers declined during the recovery of 2000-2007 and dropped further during the Great Recession of 2007-2009. In order to assess the prospects for recovery of participation as a potential source U.S. economic growth, we project the participation rates of each age-gender-education group. Our third finding is that the recovery of participation rates will provide an important opportunity for the revival of U.S. economic growth. Participation rates for less-educated workers are unlikely to recover the peak levels that followed the investment boom of 1995-2000. However, these rates can achieve the levels that preceded the Great Recession. While labor quality will grow more slowly, hours worked will grow much faster.

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Weathering the Great Recession: Variation in Employment Responses by Establishments and Countries

Erling Barth et al.

NBER Working Paper, July 2016

Abstract:
This paper finds that US employment changed differently relative to output in the Great Recession and recovery than in most other advanced countries or in the US in earlier recessions. Instead of hoarding labor, US firms reduced employment proportionately more than output in the Great Recession, with establishments that survived the downturn contracting jobs massively. Diverging from the aggregate pattern, US manufacturers reduced employment less than output while the elasticity of employment to gross output varied widely among establishments. In the recovery, growth of employment was dominated by job creation in new establishments. The variegated responses of employment to output challenges extant models of how enterprises adjust employment over the business cycle.

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Exploring Wage Determination by Education Level: A U.S. Metropolitan Statistical Area Analysis From 2005 to 2012

Penelope Prime, Donald Grimes & Mary Beth Walker

Economic Development Quarterly, August 2016, Pages 191-202

Abstract:
The purpose of this study is to explain urban wage differentials with a special focus on educational levels. The authors explore whether the share of people with a bachelor's degree or higher in the community matters to the wages of those within specific educational cohorts, accounting for cost of living, human capital externalities, consumer externalities, policy factors, and local labor market conditions. Using data for all U.S. Metropolitan Statistical Areas between 2005 and 2012, the authors find that the presence of more highly educated people will result in a higher median wage in the community overall, as do many studies, but that this factor does not significantly increase the wage for any individual education cohort. These results are hidden if we only look at the entire workforce in the aggregate.

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Employment Protection, Technology Choice, and Worker Allocation 

Eric Bartelsman, Pieter Gautier & Joris De Wind

International Economic Review, August 2016, Pages 787-826

Abstract:
We show empirically that high-risk sectors, which contribute strongly to aggregate productivity growth, are relatively small and have relatively low productivity growth in countries with strict employment protection legislation (EPL). To understand these findings, we develop a two-sector matching model where firms endogenously choose between a safe technology and a risky technology. For firms that have chosen the risky technology, EPL raises the costs of shedding workers in case they receive a low productivity draw. According to our calibrated model, high-EPL countries benefit less from the arrival of new risky technologies than low-EPL countries. Parameters estimated through reduced-form regressions of employment and productivity on exit costs, riskiness, and in particular their interaction are qualitatively similar for actual cross-country data and simulated model data. Our model is consistent with the slowdown in productivity in the European Union relative to the United States since the mid-1990s.

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Penalizing the Underdogs? Employment Protection and the Competitive Dynamics of Firm Innovation

Daniel Dongil Keum

NYU Working Paper, June 2016

Abstract:
This paper examines how constraining resource adjustment affects a firm's ability to increase innovation as a response to falling behind. By limiting the pace and efficiency with which laggard firms can release obsolete resources, resource constraints reduce their ability to experiment with new resources and increase innovation. To explore this theory empirically, I exploit staggered adoptions of employment protection laws by U.S. state courts that increase the cost of employee dismissal. In addition to showing that increasing employment protection results in fewer and safer yet lower quality patents by laggards, I find that the negative effects are highly asymmetrical, more heavily penalizing firms operating in sectors with high technological velocity or employee turnover, firms with limited financial slack, and technologies that require significant resource adjustments.

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Taking the Leap: The Determinants of Entrepreneurs Hiring their First Employee

Robert Fairlie & Javier Miranda

NBER Working Paper, July 2016

Abstract:
Job creation is one of the most important aspects of entrepreneurship, but we know relatively little about the hiring patterns and decisions of startups. Longitudinal data from the Integrated Longitudinal Business Database (iLBD), Kauffman Firm Survey (KFS), and the Growing America through Entrepreneurship (GATE) experiment are used to provide some of the first evidence in the literature on the determinants of taking the leap from a non-employer to employer firm among startups. Several interesting patterns emerge regarding the dynamics of non-employer startups hiring their first employee. Hiring rates among the universe of non-employer startups are very low, but increase when the population of non-employers is focused on more growth-oriented businesses such as incorporated and EIN businesses. If non-employer startups hire, the bulk of hiring occurs in the first few years of existence. After this point in time relatively few non-employer startups hire an employee. Focusing on more growth- and employment-oriented startups in the KFS, we find that Asian-owned and Hispanic-owned startups have higher rates of hiring their first employee than white-owned startups. Female-owned startups are roughly 10 percentage points less likely to hire their first employee by the first, second and seventh years after startup. The education level of the owner, however, is not found to be associated with the probability of hiring an employee. Among business characteristics, we find evidence that business assets and intellectual property are associated with hiring the first employee. Using data from the largest random experiment providing entrepreneurship training in the United States ever conducted, we do not find evidence that entrepreneurship training increases the likelihood that non-employers hire their first employee.

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Deterring Wage Theft: Alt-Labor, State Politics, and the Policy Determinants of Minimum Wage Compliance

Daniel Galvin

Perspectives on Politics, June 2016, Pages 324-350

Abstract:
Can stronger state-level public policies help protect workers from "wage theft?" In recent years, workers' rights groups have responded to policy drift and legislative inaction at the national level by launching campaigns to enact stronger penalties for wage and hour violations at the state level. Many of these campaigns have been legislatively successful and formative for the development of "alt-labor." But are such policies actually effective in deterring wage theft? Previous scholarship has long concluded that although stronger penalties should theoretically make a difference, in practice, they do not. But by confining the analysis to the admittedly weak national-level regulatory regime, the existing literature has eliminated all variation from the costs side of the equation and overlooked the rich variety of employment laws that exist at the state level. Using an original dataset of state laws, new estimates of minimum wage violations, and difference-in-differences analyses of a dozen recently enacted "wage-theft laws," I find that stronger penalties can, in fact, serve as an effective deterrent against wage theft, but the structure of the policy matters a great deal, as does its enforcement. The implications for workers' rights and the changing shape of the labor movement are discussed in detail.

By KEVIN LEWIS | 09:00:00 AM

Thursday, August 25, 2016

Stupefying

The Effect of Medical Marijuana on Sickness Absence

Darin Ullman

Health Economics, forthcoming

Abstract:
Utilizing the Current Population Survey, the study identifies that absences due to sickness decline following the legalization of medical marijuana. The effect is stronger in states with ‘lax’ medical marijuana regulations, for full-time workers, and for middle-aged males, which is the group most likely to hold medical marijuana cards.

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Racial-Ethnic Disparities in Opioid Prescriptions at Emergency Department Visits for Conditions Commonly Associated with Prescription Drug Abuse

Astha Singhal, Yu-Yu Tien & Renee Hsia

PLoS ONE, August 2016

Abstract:
Prescription drug abuse is a growing problem nationally. In an effort to curb this problem, emergency physicians might rely on subjective cues such as race-ethnicity, often unknowingly, when prescribing opioids for pain-related complaints, especially for conditions that are often associated with drug-seeking behavior. Previous studies that examined racial-ethnic disparities in opioid dispensing at emergency departments (EDs) did not differentiate between prescriptions at discharge and drug administration in the ED. We examined racial-ethnic disparities in opioid prescription at ED visits for pain-related complaints often associated with drug-seeking behavior and contrasted them with conditions objectively associated with pain. We hypothesized a priori that racial-ethnic disparities will be present among opioid prescriptions for conditions associated with non-medical use, but not for objective pain-related conditions. Using data from the National Hospital Ambulatory Medical Care Survey for 5 years (2007–2011), the odds of opioid prescription during ED visits made by non-elderly adults aged 18–65 for ‘non-definitive’ conditions (toothache, back pain and abdominal pain) or ‘definitive’ conditions (long-bone fracture and kidney stones) were modeled. Opioid prescription at discharge and opioid administration at the ED were the primary outcomes. We found significant racial-ethnic disparities, with non-Hispanic Blacks being less likely (adjusted odds ratio ranging from 0.56–0.67, p-value < 0.05) to receive opioid prescription at discharge during ED visits for back pain and abdominal pain, but not for toothache, fractures and kidney stones, compared to non-Hispanic whites after adjusting for other covariates. Differential prescription of opioids by race-ethnicity could lead to widening of existing disparities in health, and may have implications for disproportionate burden of opioid abuse among whites. The findings have important implications for medical provider education to include sensitization exercises towards their inherent biases, to enable them to consciously avoid these biases from defining their practice behavior.

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Does one day of drinking matter? 21st birthday drinking predicts subsequent drinking and consequences

Irene Geisner et al.

Addictive Behaviors, January 2017, Pages 57–61

Objective: There has been ample research on college student risks and consequences related to 21st Birthday Drinking. To date, no studies we are aware of have examined how 21st birthday drinking impacts subsequent drinking and related consequences. This study evaluates the effect of a single night of drinking on peak drinking, heavy drinking, and negative consequences over 12 months following the event. Furthermore, we examine if typical drinking behavior prior to 21st birthday moderates the relationship between the event drinking and subsequent use.

Method: Participants included 599 college students (46% male) who intended to consume at least five/four drinks (men/women respectively) on their 21st birthday. Screening and baseline assessments were completed approximately four weeks before turning 21. A follow-up assessment was completed approximately one week after students' birthdays and every 3 months for one year thereafter.

Results: Those who drank more on their 21st birthday, also reported higher peak consumption, increased likelihood of consequences, and increased number of consequences throughout the year. Additionally, baseline peak drinking moderated the relationship such that those who drank less at peak occasion prior to turning 21 showed the strongest effects of 21st BD drinking on subsequent consumption.

Conclusions: 21st BD drinking could impact subsequent choices and problems related to alcohol. Interventions are warranted and implications discussed.

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Cannabis Control and Crime: Medicinal Use, Depenalization and the War on Drugs

Arthur Huber, Rebecca Newman & Daniel LaFave B.E.

Journal of Economic Analysis & Policy, forthcoming

Abstract:
To date, 27 states and the District of Columbia have passed laws easing marijuana control. This paper examines the relationship between the legalization of medical marijuana, depenalization of possession, and the incidence of non-drug crime. Using state panel data from 1970 to 2012, results show evidence of 4–12 % reductions in robberies, larcenies, and burglaries due to the legalization of medical marijuana, but that depenalization has little effect and may instead increase crime rates. These effects are supported by null results for crimes unrelated to the cannabis market and are consistent with the supply-side effects of medicinal use that are absent from depenalization laws as well as existing evidence on the substitution between marijuana and alcohol. The findings contribute new evidence to the complex debate surrounding marijuana policy and the war on drugs.

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Young People’s More Permissive Views About Marijuana: Local Impact of State Laws or National Trend?

Laura Schmidt, Laurie Jacobs & Joanne Spetz American

Journal of Public Health, August 2016, Pages 1498-1503

Objectives: To determine whether state medical marijuana laws “send the wrong message,” that is, have a local influence on the views of young people about the risks of using marijuana.

Methods: We performed multilevel, serial, cross-sectional analyses on 10 annual waves of the US National Survey on Drug Use and Health (2004–2013) nationally and for states with marijuana laws using individual- and state-level controls.

Results: Living in medical marijuana states was associated with more permissive views regarding marijuana across 5 different measures. However, these associations became non–statistically significant after we adjusted for state-level differences. By contrast, there was a consistent and significant national time trend toward more permissive attitudes, which was less pronounced among children of middle school age than it was among their older counterparts.

Conclusions: Passing medical marijuana laws does not seem to directly affect the views of young people in medical marijuana states. However, there is a national trend toward young people taking more permissive views about marijuana independent of any effects within states.

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Why Alcoholics Ought to Compete Equally for Liver Transplants

Alexander Zambrano

Bioethics, forthcoming

Abstract:
Some philosophers and physicians have argued that alcoholic patients, who are responsible for their liver failure by virtue of alcoholism, ought to be given lower priority for a transplant when donated livers are being allocated to patients in need of a liver transplant. The primary argument for this proposal, known as the Responsibility Argument, is based on the more general idea that patients who require scarce medical resources should be given lower priority for those resources when they are responsible for needing them and when they are competing with patients who need the same resources through no fault of their own. Since alcoholic patients are responsible for needing a new liver and are in direct competition with other patients who need a new liver through no fault of their own, it follows that alcoholic patients ought to be given lower priority for a transplant. In this article, I argue against the Responsibility Argument by suggesting that in order for it to avoid the force of plausible counter examples, it must be revised to say that patients who are responsible for needing a scarce medical resource due to engaging in behavior that is not socially valuable ought to be given lower priority. I'll then argue that allocating organs according to social value is inconsistent or in tension with liberal neutrality on the good life. Thus, if one is committed to liberal neutrality, one ought to reject the Responsibility Argument.

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The Application of a Decision-Theoretic Model to Estimate the Public Health Impact of Vaporized Nicotine Product Initiation in the United States

David Levy et al.

Nicotine & Tobacco Research, forthcoming

Introduction: The public health impact of vaporized nicotine products (VNPs) such as e-cigarettes is unknown at this time. VNP uptake may encourage or deflect progression to cigarette smoking in those who would not have otherwise smoked, thereby undermining or accelerating reductions in smoking prevalence seen in recent years.

Methods: The public health impact of VNP use are modeled in terms of how it alters smoking patterns among those who would have otherwise smoked cigarettes and among those who would not have otherwise smoked cigarettes in the absence of VNPs. The model incorporates transitions from trial to established VNP use, transitions to exclusive VNP and dual use, and the effects of cessation at later ages. Public health impact on deaths and life years lost is estimated for a recent birth cohort incorporating evidence-informed parameter estimates.

Results: Based on current use patterns and conservative assumptions, we project a reduction of 21% in smoking-attributable deaths and of 20% in life years lost as a result of VNP use by the 1997 US birth cohort compared to a scenario without VNPs. In sensitivity analysis, health gains from VNP use are especially sensitive to VNP risks and VNP use rates among those likely to smoke cigarettes.

Conclusions: Under most plausible scenarios, VNP use generally has a positive public health impact. However, very high VNP use rates could result in net harms. More accurate projections of VNP impacts will require better longitudinal measures of transitions into and out of VNP, cigarette and dual use.

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Nonmedical use of prescription drugs and related negative sexual events: Prevalence estimates and correlates in college students

Kathleen Parks et al.

Addictive Behaviors, forthcoming

Abstract:
The present study of college students investigated (a) the prevalence of nonmedical use of three classes of prescription drugs (stimulants, anxiolytics/sedatives, analgesics), (b) the prevalence of negative sexual events (NSE) associated with any nonmedical use of prescription drugs (NMUPD), and (c) a set of correlates of NSE. The specific NSE were sexual aggression victimization and perpetration, and regretted sex. The correlates of the NSE were sex, race/ethnicity, year in school, psychological symptoms, alcohol use, illegal drug use, and NMUPD. Participants were 509 (254 females, 255 males) randomly-selected college students who reported any NMUPD. The majority (76.2%) of the sample reported ever using stimulants, 38.9% reported ever using anxiolytics/sedatives, and 40.9% reported using analgesics. During NMUPD, 14.3% of the students reported regretted sex, 7.1% of female students reported sexual victimization, and 6.3% of male students reported perpetrating sexual aggression. Multiple logistic regression analyses indicated that anxiolytic/sedative use (Adj. OR = 1.99; 95% CI = 1.51—2.62) was positively associated with regretted sex, whereas anxiolytic/sedative use (Adj. OR = 1.79; 95% CI = 1.01—3.16) and psychological symptoms (Adj. OR = 1.06; 95% CI = 1.02—1.10) were positively associated with sexual victimization. Illegal drug use was positively associated with perpetrating sexual aggression (Adj. OR = 4.10; 95% CI = 1.21—13.86). These findings suggest that among these college students, NMUPD-associated NSE were not uncommon, and primarily associated with anxiolytic/sedative use. Given the academic, physical, and psychological implications associated with NSE, research needs to further explore the causal nature of these relations.

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Alcohol consumption by youth: Peers, parents, or prices?

Olugbenga Ajilore, Aliaksandr Amialchuk & Keven Egan

Economics & Human Biology, December 2016, Pages 76–83

Abstract:
Using data from the National Longitudinal Survey of Adolescent to Adult Health, we estimate the effect of peers’ alcohol consumption and alcohol prices on the drinking habits of high-school-age youth. We use the two-stage residual inclusion method to account for the endogeneity of peer drinking in nonlinear models. For our sample of high school students, we find that peer effects are statistically and economically significant regarding the choice to participate in drinking but are not significant for the frequency of drinking, including binge drinking. Regarding alcohol prices, even though we have good price variation in our sample, alcohol prices are not found to be significant. The results are important for policymakers who are considering policies to reduce underage drinking, as we conclude that no significant impact on underage drinking will result from low-tax states’ increasing excise taxes on alcohol so they are similar to those of high-tax states. Policymakers may choose to focus instead on the influence of peers and changing the social norm behavior.

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The Couple That Smokes Together: Dyadic Marijuana Use and Relationship Functioning During Conflict

Cory Crane et al.

Psychology of Addictive Behaviors, forthcoming

Abstract:
Self-reported marijuana use has been associated with poor relationship functioning and decreased stability over time. The present study examined the behavioral interactions of couples with concordant and discordant patterns of marijuana use during conflict, using individual self-reports and observation by independent coders. Heavy drinking community couples (N = 149) participated in a conflict resolution paradigm. Interactions were recorded and coded by naïve coders. Approximately 30% of the sample reported past year marijuana use. Actor-Partner Interdependence Models and analysis of covariance (ANCOVA) were used to evaluate the individual and interactive effects of dyadic marijuana use on maladaptive relationship functioning. A Robust Actor × Partner Marijuana Use interaction was detected for a range of behavioral outcomes, assessed by both self-report and direct observation, including relationship satisfaction, anger experience, patterns of demand and withdrawal during conflict, constructive behaviors, and overall relationship quality. Specifically, couples in which both partners used or abstained from marijuana displayed more adaptive relationship functioning across indicators relative to couples in which only 1 partner identified as a marijuana user. This pattern was particularly strong for couples in which the female partner used marijuana and the male partner did not. Couples with discordant, rather than concordant, marijuana use displayed distinct conflict resolution behaviors that were consistent with the long-term negative relationship outcomes that have been observed in previous studies.

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The paradox of decreasing nonmedical opioid analgesic use and increasing abuse or dependence — An assessment of demographic and substance use trends, United States, 2003–2014

Christopher Jones

Addictive Behaviors, forthcoming

Methods: Data from the National Survey on Drug Use and Health were used to assess trends in opioid analgesic nonmedical use, abuse, and dependence for 2003–2005, 2006–2008, 2009–2011, and 2012–2014. Multivariable logistic regression was used to identify characteristics associated with opioid analgesic abuse or dependence.

Results: Rates of past-year opioid analgesic nonmedical use decreased from 48.4 per 1000 persons aged 12 years and older in 2003–2005 to 43.3 in 2012–2014. Declines were seen among most demographic and substance using groups. In contrast, rates of past-year opioid analgesic abuse or dependence increased from 6.0 per 1000 persons in 2003–2005 to 7.5 in 2012–2014; increases were seen among most demographic and substance using groups. In 2012–2014, odds of opioid analgesic abuse or dependence were highest among those with sedative or tranquilizer and heroin abuse or dependence.

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U.S. Demand for Tobacco Products in a System Framework

Yuqing Zheng et al.

Health Economics, forthcoming

Abstract:
This study estimated a system of demand for cigarettes, little cigars/cigarillos, large cigars, e-cigarettes, smokeless tobacco, and loose smoking tobacco using market-level scanner data for convenience stores. We found that the unconditional own-price elasticities for the six categories are −1.188, −1.428, −1.501, −2.054, −0.532, and −1.678, respectively. Several price substitute (e.g., cigarettes and e-cigarettes) and complement (e.g., cigarettes and smokeless tobacco) relationships were identified. Magazine and television advertising increased demand for e-cigarettes, and magazine advertising increased demand for smokeless tobacco and had spillover effects on demand for other tobacco products. We also reported the elasticities by U.S. census regions and market size. These results may have important policy implications, especially viewed in the context of the rise of electronic cigarettes and the potential for harm reduction if combustible tobacco users switch to non-combustible tobacco products.

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From Maize to Haze: Agricultural Shocks and the Growth of the Mexican Drug Sector

Oeindrila Dube, Omar García-Ponce & Kevin Thom

Journal of the European Economic Association, forthcoming

Abstract:
Understanding how economic incentives affect illegal drug production is essential for crafting policies in response to the international drug trade. Policymakers typically face a choice between two strategies: targeting criminal groups via law enforcement, and offering producers incentives to engage in alternate activities. Yet, little is known about how the returns to alternate legal activities affect drug supply. We contribute to this literature by examining how shocks to legal commodity prices affect the drug trade in Mexico. Our analysis exploits exogenous movements in the Mexican maize price stemming from weather conditions in US maize-growing regions, as well as exports of other major maize producers. Using data on over 2200 municipios spanning 1990–2010, we show that lower prices differentially increased the cultivation of both marijuana and opium poppies in municipios more climatically suited to growing maize. We also find impacts on downstream drug-trade outcomes, including drug cartel operations and killings perpetrated by these groups. Our findings demonstrate that maize price changes contributed to the burgeoning drug trade in Mexico, and point to the violent consequences of an expanding drug sector.

By KEVIN LEWIS | 09:00:00 AM

Wednesday, August 24, 2016

The golden rules

Beautiful Lemons: Adverse Selection in Durable-Goods Markets with Sorting

Jonathan Peterson & Henry Schneider

Management Science, forthcoming

Abstract:
We document a basic characteristic of adverse selection in secondhand markets for durable goods: goods with higher observed quality may have more adverse selection and hence lower unobserved quality. We provide a simple theoretical model to demonstrate this result, which is a consequence of the interaction of sorting between drivers over observed quality and adverse selection over unobserved quality. We then offer empirical support using data on secondhand prices and repair rates of used cars from the Consumer Expenditure Survey, and discuss a number of implications for everyday advertising and consumer questions.

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Economic freedom and economic crises

Christian Bjørnskov

European Journal of Political Economy, forthcoming

Abstract:
In this paper, I explore the politically contested association between the degree of capitalism, captured by measures of economic freedom, and the risk and characteristics of economic crises. After offering some brief theoretical considerations, I estimate the effects of economic freedom on crisis risk in the post-Cold War period 1993–2010. I further estimate the effects on the duration, peak-to-trough GDP ratios and recovery times of 212 crises across 175 countries within this period. Estimates suggest that economic freedom is robustly associated with smaller peak-to-trough ratios and shorter recovery time. These effects are driven by regulatory components of the economic freedom index.

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Property Is Another Name for Monopoly Facilitating Efficient Bargaining with Partial Common Ownership of Spectrum, Corporations, and Land

Eric Posner & Glen Weyl

University of Chicago Working Paper, August 2016

Abstract:
The existing system of private property interferes with allocative efficiency by giving owners the power to hold out for excessive prices. We propose a remedy in the form of a tax on property, based on the value self-assessed by its owner at intervals, along with a requirement that the owner sell the property to any third party willing to pay a price equal to the self-assessed value. The tax rate would reflect a tradeoff between gains from allocative efficiency and losses to investment efficiency, and would increase in line with expected developments in information technology. The legal and economic implications of this system are explored.

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The Bright Side of Patents

Joan Farre-Mensa, Deepak Hegde & Alexander Ljungqvist

NBER Working Paper, February 2016

Abstract:
Motivated by concerns that the patent system is hindering innovation, particularly for small inventors, this study investigates the bright side of patents. We examine whether patents help startups grow and succeed using detailed micro data on all patent applications filed by startups at the U.S. Patent and Trademark Office (USPTO) since 2001 and approved or rejected before 2014. We leverage the fact that patent applications are assigned quasi-randomly to USPTO examiners and instrument for the probability that an application is approved with individual examiners’ historical approval rates. We find that patent approvals help startups create jobs, grow their sales, innovate, and reward their investors. Exogenous delays in the patent examination process significantly reduce firm growth, job creation, and innovation, even when a firm’s patent application is eventually approved. Our results suggest that patents act as a catalyst that sets startups on a growth path by facilitating their access to capital. Proposals for patent reform should consider these benefits of patents alongside their potential costs.

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The Regulatory Determinants of Railroad Safety

Jerry Ellig & Patrick McLaughlin

Review of Industrial Organization, September 2016, Pages 371-398

Abstract:
The dramatic improvement in railroad safety since the 1970s has been accompanied by a substantial increase in safety regulation and a substantial reduction in economic regulation after 1980. We assess the effects of both regulatory changes on railroad safety with the use of RegData: a new data set that was developed by one of the authors that measures the amount of regulation that is imposed by specific regulatory agencies on specific industries. We find that partial economic deregulation is associated with improved safety. Safety regulation was most closely associated with improved railroad safety during the period when economic regulation curtailed railroads’ incentives to operate safely.

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Regional business climate and interstate manufacturing relocation decisions

Tessa Conroy, Steven Deller & Alexandra Tsvetkova

Regional Science and Urban Economics, September 2016, Pages 155–168

Abstract:
In this study, we use the National Establishment Time Series (NETS) database to study relocation by manufacturers based on differences in the business climate between the origin and destination states. We model interstate relocations for manufacturers in aggregate and for three subgroups characterized by their industry-level research and development (R&D) intensity. The analysis suggests that very few manufacturing firms relocate across state lines in any given year and the vast majority of those that do are small in size and move to adjoining states. Our results also reveal that interstate migration by manufacturing establishments varies with their R&D intensity. Whereas a number of factors considered in this study are statistically significant, marginal effects at the mean are infinitesimal. This implies that states attempting to encourage manufacturing firms to relocate from other states via traditional perspectives on business climate are unlikely to be successful.

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Insurance coverage of customers induces dishonesty of sellers in markets for credence goods

Rudolf Kerschbamer, Daniel Neururer & Matthias Sutter

Proceedings of the National Academy of Sciences, 5 July 2016, Pages 7454–7458

Abstract
Honesty is a fundamental pillar for cooperation in human societies and thus for their economic welfare. However, humans do not always act in an honest way. Here, we examine how insurance coverage affects the degree of honesty in credence goods markets. Such markets are plagued by strong incentives for fraudulent behavior of sellers, resulting in estimated annual costs of billions of dollars to customers and the society as a whole. Prime examples of credence goods are all kinds of repair services, the provision of medical treatments, the sale of software programs, and the provision of taxi rides in unfamiliar cities. We examine in a natural field experiment how computer repair shops take advantage of customers’ insurance for repair costs. In a control treatment, the average repair price is about EUR 70, whereas the repair bill increases by more than 80% when the service provider is informed that an insurance would reimburse the bill. Our design allows decomposing the sources of this economically impressive difference, showing that it is mainly due to the overprovision of parts and overcharging of working time. A survey among repair shops shows that the higher bills are mainly ascribed to insured customers being less likely to be concerned about minimizing costs because a third party (the insurer) pays the bill. Overall, our results strongly suggest that insurance coverage greatly increases the extent of dishonesty in important sectors of the economy with potentially huge costs to customers and whole economies.

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Economic freedom and social capital: Pooled mean group evidence

Jeremy Jackson

Applied Economics Letters, forthcoming

Abstract:
This article uses annual US-state-level data from 1986 to 2004 and pooled-mean group estimation based on Pesaran et al. (1999) to examine whether economic freedom influences social capital. We find economic freedom has a negative effect on our social capital measure. This result is driven by the labour market component of freedom which is indicative of the relationship between labour market freedom and Olson-type group social capital.

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Of Mice and Academics: Examining the Effect of Openness on Innovation

Fiona Murray et al

American Economic Journal: Economic Policy, February 2016, Pages 212-252

Abstract:
This paper argues that openness, by lowering costs to access existing research, can enhance both early and late stage innovation through greater exploration of novel research directions. We examine a natural experiment in openness: late-1990s NIH agreements that reduced academics' access costs regarding certain genetically engineered mice. Implementing difference-in-differences estimators, we find that increased openness encourages entry by new researchers and exploration of more diverse research paths, and does not reduce the creation of new genetically engineered mice. Our findings highlight a neglected cost of strong intellectual property restrictions: lower levels of exploration leading to reduced diversity of research output.

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Beyond Kelo: An Experimental Study of Public Opposition to Eminent Domain

Logan Strother

Journal of Law and Courts, Fall 2016, Pages 339-375

Abstract:
The power of government to take private property for public use has been a frequent source of political disquiet because of the tension it creates with notions of individual rights ingrained in liberal society. The backlash against takings after Kelo offers a case in point. Existing research has focused on the public’s distaste for the taking of homes and has thus missed an important cause of the backlash: the purpose for which property is taken. I utilize a combination of experimental and observational methods to advance our understanding of this important issue, finding that purpose is crucial in shaping attitudes toward takings.

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Money Secrets: How Does Trade Secret Legal Protection Affect Firm Market Value? Evidence from the Uniform Trade Secret Act

Francesco Castellaneta, Raffaele Conti & Aleksandra “Olenka” Kacperczyk

Strategic Management Journal, forthcoming

Abstract:
We investigate the impact of trade secret legal protection on firm market value in the context of acquisitions. On one hand, market value may increase because trade secret assets become better protected from rivals. On the other hand, market value may decrease because trade secret protection reduces information about the target and its competitors available to potential buyers, increasing uncertainty about its value. Buyers will discount their offers in expectation of being compensated for riskier deals. Using a sample of private equity investments in the United States, we find that trade secret protection has a positive effect in industries with high mobility of knowledge workers, and a negative effect in industries with (a) high resource-value uncertainty, and (b) high poor-investment risk.

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Low-quality Patents in the Eye of the Beholder: Evidence from Multiple Examiners

Gaétan de Rassenfosse, Adam Jaffe & Elizabeth Webster

NBER Working Paper, May 2016

Abstract:
Low-quality patents are of considerable concern to businesses operating in patent-dense markets. There are two pathways by which low-quality patents may be issued: the patent office may apply systematically a standard that is too lenient (low inventive step threshold); or the patent office may grant patents that are, in fact, below its own threshold (so-called ‘weak’ patents). This paper uses novel data from inventions that have been examined at the five largest patent offices and an explicit model of the grant process to derive first-of-their-kind office-specific estimates of the height of the inventive step threshold and the prevalence of weak patents. The empirical analysis is based on patent applications granted at one office but refused at another office. We estimate that the fraction of patent grants associated with a patent standard that is lower than that of other countries ranges from 2-15%, with Japan having the tightest standard and the United States and China the loosest. The fraction of grants that are inconsistent with the office’s own standard ranges from 2-6 per cent. The fraction of grants that are inconsistent in this sense is generally higher in newer fields such as software and biotechnology, and lower in traditional fields such as mechanical engineering. Our estimates of invalidity are much lower than those that have been derived from litigation studies, consistent with litigated patents being highly non-representative of the population.

By KEVIN LEWIS | 09:00:00 AM

Tuesday, August 23, 2016

It's a race thing

Viral Challenge Reveals Further Evidence of Skin-Deep Resilience in African Americans From Disadvantaged Backgrounds

Gregory Miller et al.

Health Psychology, forthcoming

Objective: Studies have revealed a phenomenon called skin-deep resilience, which develops in upwardly mobile African American youth. They perform well in school, maintain good mental health, and avoid legal problems. Despite outward indications of success, they also show evidence of worse health in biomarker studies. Here we extend this research, asking whether it manifests in differential susceptibility to upper respiratory infection, and if it emerges in European Americans as well.

Methods: The sample included 514 adults in good health, as judged by physician examination and laboratory testing. Participants completed questionnaires about lifecourse socioeconomic conditions, conscientiousness, psychosocial adjustment, and lifestyle factors. They were subsequently inoculated with a rhinovirus that causes upper respiratory infection, and monitored in quarantine for 5 days the development of illness.

Results: Consistent with past work, African Americans from disadvantaged backgrounds displayed indications of skin-deep resilience. To the extent these participants were high in conscientiousness, they fared better across multiple domains of psychosocial functioning, as reflected in educational attainment, symptoms of depression, and close relationship quality (p values = .01-.04). But analyses of these participants' susceptibility to infection revealed the opposite pattern; higher conscientiousness was associated with a greater likelihood of becoming ill following inoculation (p value = .03). In European Americans, there was no evidence of skin-deep resilience; conscientiousness was associated with better psychosocial outcomes, but not infection risk.

Conclusions: These observations suggest that resilience may be a double-edged sword for African Americans from disadvantaged backgrounds. The same characteristics associated with academic success and psychological adjustment forecast increased vulnerability to health problems.

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Contested Boundaries: Explaining Where Ethnoracial Diversity Provokes Neighborhood Conflict

Joscha Legewie & Merlin Schaeffer

American Journal of Sociology, July 2016, Pages 125-161

Abstract:
Concerns about neighborhood erosion and conflict in ethnically diverse settings occupy scholars, policy makers, and pundits alike; but the empirical evidence is inconclusive. This article proposes the contested boundaries hypothesis as a refined contextual explanation focused on poorly defined boundaries between ethnic and racial groups. The authors argue that neighborhood conflict is more likely to occur at fuzzy boundaries defined as interstitial or transitional areas sandwiched between two homogeneous communities. Edge detection algorithms from computer vision and image processing allow them to identify these boundaries. Data from 4.7 million time- and geo-coded 311 service requests from New York City support their argument: complaints about neighbors making noise, drinking in public, or blocking the driveway are more frequent at fuzzy boundaries rather than crisp, polarized borders. By focusing on the broader sociospatial structure, the contested boundaries hypothesis overcomes the "aspatial" treatment of neighborhoods as isolated areas in research on ethnic diversity.

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Tuskegee and the Health of Black Men

Marcella Alsan & Marianne Wanamaker

NBER Working Paper, June 2016

Abstract:
For forty years, the Tuskegee Study of Untreated Syphilis in the Negro Male passively monitored hundreds of adult black males with syphilis despite the availability of effective treatment. The study's methods have become synonymous with exploitation and mistreatment by the medical community. We find that the historical disclosure of the study in 1972 is correlated with increases in medical mistrust and mortality and decreases in both outpatient and inpatient physician interactions for older black men. Our estimates imply life expectancy at age 45 for black men fell by up to 1.4 years in response to the disclosure, accounting for approximately 35% of the 1980 life expectancy gap between black and white men.

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Are pregnant women happier? Racial and ethnic differences in the relationship between pregnancy and life satisfaction in the United States

Paul Hagstrom & Stephen Wu

Review of Economics of the Household, September 2016, Pages 507-527

Abstract:
This paper examines the relationship between pregnancy and life satisfaction for US women of childbearing age using a large sample from the 2005 to 2009 waves of the Behavioral Risk Factor Surveillance System. The results show strong differences by race and ethnicity. Pregnancy has a significant positive correlation with happiness for Whites and Hispanics, but no relationship for Blacks. This differential in the marginal effect of pregnancy is in addition to a general decrease in satisfaction for Black women, independent of being pregnant. The results cannot be explained by differences in other demographics such age, income, education, or physical health status. Within each racial/ethnic group, the results are consistent across different categories for all these characteristics. Racial and ethnic differences in the effects of pregnancy on support from others can partly explain this result. For Whites and Hispanic women, pregnancy increases their feelings of social and emotional support from others, while pregnant Black women report lower levels of social and emotional support than non-pregnant Black women.

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Active Life Expectancy In The Older US Population, 1982-2011: Differences Between Blacks And Whites Persisted

Vicki Freedman & Brenda Spillman

Health Affairs, August 2016, Pages 1351-1358

Abstract:
Understanding long-range trends in longevity and disability is useful for projecting the likely impact of the baby-boom generation on long-term care utilization and spending. We examine changes in active life expectancy in the United States from 1982 to 2011 for white and black adults ages sixty-five and older. For whites, longevity increased, disability was postponed to older ages, the locus of care shifted from nursing facilities to community settings, and the proportion of life at older ages spent without disability increased. In contrast, for blacks, longevity increases were accompanied by smaller postponements in disability, and the percentage of remaining life spent active remained stable and well below that of whites. Older black women were especially disadvantaged in 2011 in terms of the proportion of years expected to be lived without disability. Public health measures directed at older black adults - particularly women - are needed to offset impending pressures on the long-term care delivery system as the result of population aging.

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What's the Matter with Kansas? Now It's the High White Death Rate

Frank Young

Sociological Forum, forthcoming

Abstract:
This article reports empirical tests for an explanation of the anomalous finding that Case and Deaton recently identified. They found that middle-aged white people were dying at increased rates during the 1998-2013 years. By contrast, the Hispanic and African Americans enjoyed lower rates. The explanation proposed here for this deviant trend is that the middle-aged whites are especially vulnerable to the stress of "white status loss" as measured by the decline in the county white population. Using data for the 105 Kansas counties, the analysis replicates the divergent mortality trends and shows that white population decline predicts the rising mortality rate for the middle-aged segment of the population. This explanation opens the door to a new branch of public health, one based on social problems, not pathogens.

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The Racial Structure of Economic Inequality in the United States: Understanding Change and Continuity in an Era of "Great Divergence"

Rodney Hero & Morris Levy

Social Science Quarterly, September 2016, Pages 491-505

Abstract:
The "great divergence" of America's rich from its middle class and poor has led some observers to see a country increasingly stratified by income and wealth, more so than by race. In this article, the first in a two-part series, we argue that this conclusion overlooks the persistent importance of the racial "structure" of inequality. A decomposition of income inequality between 1980 and 2010 using the Theil Index shows that inequality between racial groups accounts for a rising share of total income inequality over this period nationally and in most states. We also demonstrate that within-state trends in the between-race component of inequality are not fully accounted for by trends in income inequality and racial diversity per se. These findings lay the groundwork for a forthcoming companion piece in Social Science Quarterly that shows that between-race inequality is strongly linked to welfare policy outcomes in the United States.

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At a Loss for Words: Measuring Racial Inequality in America

Major Coleman

Review of Black Political Economy, June 2016, Pages 177-192

Abstract:
Scholars of race tend to measure racial inequality in either absolute or relative terms. How much Blacks have advanced from their historical antebellum status is an absolute measure. How the status of Blacks compares with that of Whites is a relative measure. A more revealing measure might be how much racial equality will be strategically necessary to avoid a major politico-economic crisis like the ones that occurred during the civil war and the 1960s. Though it is easier to measure absolute or relative equality, measures of strategic equality yield more important information. Using the Current Population Survey, General Social Survey, Center for Education Statistics, Multi-City Study of Urban Inequality, and Census Bureau estimates, I find that, strategically, America is actually declining in racial equality, not advancing.

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The Shadow of the Politics of Deservedness? The Implications of Group-Centric Policy Context for Environmental Policy Implementation Inequalities in the United States

Jiaqi Liang

Journal of Public Administration Research and Theory, July 2016, Pages 552-570

Abstract:
Despite considerable evidence indicating that racial minorities are more likely to reside in communities surrounding the sources of environmental risks or live with higher levels of pollutant emissions, relatively little research focuses on how broader political and institutional contexts pertaining to people of color impacts routine environmental policy implementation at the state level in the post-facility-siting period. Drawing on theories of group-centric, degenerative policy, and the politics of group recognition, this study explores the effects of the minority group-specific policy context on administrative outputs for the vulnerable African American communities. Examining the National Pollutant Discharge Elimination System permit program of the Clean Water Act from 1996 to 2010, findings from a multilevel modeling analysis show that generosity of welfare benefits is positively related to state agencies' regulatory inspection and enforcement activities for predominantly black counties, while stringent welfare eligibility and sanctions are negatively associated with those efforts from government for those counties. Implications are then derived for the essential role of public administration in shaping the entitlements of the marginalized members of society to public services in an era within which social equity has emerged on government's policy agenda.

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Racial and Ethnic Disparities in Mental Health Care for Children and Young Adults: A National Study

Lyndonna Marrast, David Himmelstein & Steffie Woolhandler

International Journal of Health Services, forthcoming

Abstract:
Psychiatric and behavior problems are common among children and young adults, and many go without care or only receive treatment in carceral settings. We examined racial and ethnic disparities in children's and young adults' receipt of mental health and substance abuse care using nationally representative data from the 2006-2012 Medical Expenditure Panel Surveys. Blacks' and Hispanics' visit rates (and per capita expenditures) were about half those of non-Hispanic whites for all types and definitions of outpatient mental health services. Disparities were generally larger for young adults than for children. Black and white children had similar psychiatric inpatient and emergency department utilization rates, while Hispanic children had lower hospitalization rates. Multivariate control for mental health impairment, demographics, and insurance status did not attenuate racial/ethnic disparities in outpatient care. We conclude that psychiatric and behavioral problems among minority youth often result in school punishment or incarceration, but rarely mental health care.

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The Effects of Allostatic Load on Racial/Ethnic Mortality Differences in the United States

Jeffrey Howard & Johnelle Sparks

Population Research and Policy Review, August 2016, Pages 421-443

Abstract:
This study expands on previous findings of racial/ethnic and allostatic load (AL) associations with mortality by addressing whether differential AL levels by race/ethnicity may explain all-cause mortality differences. This study used data from the third National Health and Nutrition Survey public-use file, gathered between 1988 and 1994, with up to 18 years of mortality follow-up (n = 11,733). AL scores were calculated using a 10-biomarker algorithm based on clinically determined thresholds. Results of discrete-time hazard models suggest that AL is associated with increased mortality risks, independent of other factors, including race/ethnicity and SES. The results also suggest that the AL-mortality association is stronger for non-Hispanic blacks than for non-Hispanic whites, and that at low levels of AL observed mortality differences between non-Hispanic blacks and non-Hispanic whites are non-significant. These findings suggest that mortality differences between non-Hispanic blacks and non-Hispanic whites may be the result of how early life exposure causes premature aging and increased mortality risks. More attention to resource allocation and local environments is needed to understand why non-Hispanic blacks experience premature aging that leads to differential mortality risks compared to non-Hispanic whites.

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Perceived electoral malfeasance and resentment over the election of Barack Obama

David Wilson & Tyson King-Meadows

Electoral Studies, December 2016, Pages 35-45

Abstract:
Controversies over voting outcomes, and subsequent laws to seemingly curb irregularities, have led to increased scrutiny over the process of voting day activities. While studies find evidence that majorities perceive rampant fraud, the explanations for these opinions have mainly pointed to political predispositions, largely ignoring the influence of racial attitudes. We propose that contemporary opinions on electoral malfeasance are shaped by the context of a popularly elected African American president, Barack Obama, and subsequent racial resentments. Analyses of data from the 2010 Cooperative Congressional Election Study reveals that racial resentment significantly predicts higher perceived electoral malfeasance, even after controlling for political predispositions. Surprisingly, significant racial resentment effects exist among both Obama and McCain supporters, and these effects are strongest among those who perceived Obama won because of his race. Our results highlight the hyper racialized spill-over effects into judgements about the political system.

By KEVIN LEWIS | 09:00:00 AM

Monday, August 22, 2016

Runners

What Doesn't Kill You Will Only Make You More Risk-Loving: Early-Life Disasters and CEO Behavior

Gennaro Bernile, Vineet Bhagwat & Raghavendra Rau

Journal of Finance, forthcoming

Abstract:
The literature on managerial style posits a linear relation between a CEO's past experiences and firm risk. We show that there is a nonmonotonic relation between the intensity of CEOs’ early-life exposure to fatal disasters and corporate risk-taking. CEOs who experience fatal disasters without extremely negative consequences lead firms that behave more aggressively, whereas CEOs who witness the extreme downside of disasters behave more conservatively. These patterns manifest across various corporate policies including leverage, cash holdings, and acquisition activity. Ultimately, the link between CEOs’ disaster experience and corporate policies has real economic consequences on firm riskiness and cost of capital.

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FORE! An Analysis of CEO Shirking

Lee Biggerstaff, David Cicero & Andy Puckett

Management Science, forthcoming

Abstract:
Using golf play as a measure of leisure, we provide direct evidence that some CEOs shirk their responsibilities to the detriment of firm shareholders. CEOs with lower equity-based incentives play more golf and those that golf the most are associated with firms that have lower operating performance and firm values. Numerous tests accounting for the possible endogenous nature of these relations support a conclusion that CEO shirking causes lower firm performance. New CEOs and those at firms with more independent boards are more likely to be replaced when they shirk, but those with long tenures or less independent boards appear to avoid discipline.

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Do CEOs Affect Employee Political Choices?

Ilona Babenko, Viktar Fedaseyeu & Song Zhang

Arizona State University Working Paper, July 2016

Abstract:
Employees donate almost three times more money to CEO-supported political candidates than to candidates not supported by the CEO. After CEO departures, including departures due to death or retirement, employees reduce campaign contributions to candidates supported by the departing CEO and increase campaign contributions to candidates supported by the replacement CEO. CEO influence is strongest in firms that explicitly advocate for political candidates. Further, employees located in areas in which CEOs make political contributions are more likely to vote in elections. Our results suggest that CEOs shape not only firms’ financial and operational decisions but also their employees’ political choices.

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Relative Peer Quality and Firm Performance

Bill Francis et al.

Journal of Financial Economics, forthcoming

Abstract:
We examine the performance impact of the relative quality of a Chief Executive Officer (CEO)’s compensation peers (peers to determine a CEO's overall compensation) and bonus peers (peers to determine a CEO's relative-performance-based bonus). We use the fraction of peers with greater managerial ability scores (Demerjian, Lev, and McVay, 2012) than the reporting firm to measure this CEO's relative peer quality (RPQ). We find that firms with higher RPQ earn higher stock returns and experience higher profitability growth than firms with lower RPQ. Learning among peers and the increased incentive to work harder induced by the peer-based tournament contribute to RPQ's performance effect.

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CEO Severance Pay and Corporate Tax Avoidance

John Campbell et al.

University of Georgia Working Paper, June 2016

Abstract:
We examine the association between CEO severance pay (i.e., payment the CEO would receive if s/he is involuntarily terminated) and corporate tax avoidance. We find that corporate tax avoidance is increasing in the amount of CEO severance pay. This finding is consistent with the notion that CEO severance pay encourages otherwise risk averse managers to take reasonable amounts of risk and, thus, fits into the optimal executive incentive scheme as a form of efficient contracting. Further analysis reveals that the association between CEO severance pay and corporate tax avoidance is stronger in situations where we expect the risk-taking incentives provided by severance pay to matter more – when the CEO is otherwise more risk averse and when firms exhibit a higher business risk. Overall, our findings suggest that firms can contract with their managers using CEO severance pay to provide incentives for them to engage in tax avoidance activities.

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Common Ownership, Competition, and Top Management Incentives

Miguel Anton et al.

Yale Working Paper, July 2016

Abstract:
Standard corporate finance theories assume the absence of strategic product market interactions or that shareholders don't diversify across industry rivals; the optimal incentive contract features pay-for-performance relative to industry peers. Empirical evidence, by contrast, indicates managers are rewarded for rivals' performance as well as for their own. We propose common ownership of natural competitors by the same investors as an explanation. We show theoretically and empirically that executives are paid less for own performance and more for rivals' performance when the industry is more commonly owned. The growth of common ownership also helps explain the increase in CEO pay over the past decades.

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A Corporate Beauty Contest

John Graham, Campbell Harvey & Manju Puri

Management Science, forthcoming

Abstract:
We provide new evidence that the subjective “look of competence” rather than beauty is important for CEO selection and compensation. Our experiments, studying the facial traits of CEOs using nearly 2,000 subjects, link facial characteristics to both CEO compensation and performance. In one experiment, we use pairs of photographs and find that subjects rate CEO faces as appearing more “competent” than non-CEO faces. Another experiment matches CEOs from large firms against CEOs from smaller firms and finds large-firm CEOs look more competent. In a third experiment, subjects numerically score the facial traits of CEOs. We find competent looks are priced into CEO compensation, more so than attractiveness. Our evidence suggests this premium has a behavioral origin. First, we find no evidence that the premium is associated with superior performance. Second, we separately analyze inside and outside CEO hires and find that the competence compensation premium is driven by outside hires — the situation where first impressions are likely to be more important.

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The Facial Appearance of CEOs: Faces Signal Selection but Not Performance

Janka Stoker, Harry Garretsen & Luuk Spreeuwers

PLoS ONE, July 2016

Abstract:
Research overwhelmingly shows that facial appearance predicts leader selection. However, the evidence on the relevance of faces for actual leader ability and consequently performance is inconclusive. By using a state-of-the-art, objective measure for face recognition, we test the predictive value of CEOs’ faces for firm performance in a large sample of faces. We first compare the faces of Fortune500 CEOs with those of US citizens and professors. We find clear confirmation that CEOs do look different when compared to citizens or professors, replicating the finding that faces matter for selection. More importantly, we also find that faces of CEOs of top performing firms do not differ from other CEOs. Based on our advanced face recognition method, our results suggest that facial appearance matters for leader selection but that it does not do so for leader performance.

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CEO Materialism and Corporate Social Responsibility

Robert Davidson, Aiyesha Dey & Abbie Smith

University of Chicago Working Paper, March 2016

Abstract:
We study the role of individual CEOs in explaining corporate social responsibility (CSR) scores. We show that CEO fixed-effects explain 63% of the variation in CSR scores, a significant portion of which is attributable to a CEO’s “materialism” (relatively high luxury asset ownership). Specifically, firms led by materialistic CEOs have lower CSR scores, and increases in CEOs’ materialism are associated with declining scores. Finally, CSR scores in firms with non-materialistic CEOs are positively associated with accounting profitability. In contrast, CSR scores in firms with materialistic CEOs are unrelated to profitability on average; however this association is decreasing in CEO power.

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Did Regulation Fair Disclosure Prevent Selective Disclosure? Direct Evidence from Intraday Volume and Returns

John Campbell, Brady Twedt & Benjamin Whipple

University of Georgia Working Paper, July 2016

Abstract:
Regulation Fair Disclosure (Reg FD) prohibits managers from releasing material information in non-public forums. Prior research concludes that Reg FD was effective at curtailing selective disclosure. However, these results have been called into question due to confounding events, an inability to ensure the disclosure was intended to comply with Reg FD, and an inability to identify the timing of the disclosure. We address these limitations and offer new evidence on the effectiveness of Reg FD. First, we find significant increases in abnormal trading volume during the trading hour immediately prior to the public release of Reg FD disclosures. Specifically, we find that 20 percent of the volume reaction over the two hour window surrounding Reg FD disclosures occurs during the hour before the disclosure. Second, this pre-disclosure increase in trading volume is larger when the information is of greater consequence to the market. Finally, stock returns during the trading hour immediately prior to Reg FD filings predict returns during the trading hour immediately after the filings, but only for the disclosure of consequential, negative information. Additional analysis reveals that selective disclosure is larger for firms with greater growth opportunities and weaker information environments, and that corporate insiders and large traders account for about 50 percent of the trading in the hour leading up to Reg FD filings. Overall, our results suggest that, despite Reg FD's goal of providing information to all investors simultaneously, disclosure provided pursuant to the regulation appears to be selectively disclosed to subsets of investors beforehand.

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Rank and File Employees and the Discovery of Misreporting: The Role of Stock Options

Andrew Call, Simi Kedia & Shivaram Rajgopal

Journal of Accounting and Economics, forthcoming

Abstract:
We find that firms grant more rank and file stock options when involved in financial reporting violations, consistent with managements’ incentives to discourage employee whistle-blowing. Violating firms grant more rank and file options during periods of misreporting relative to control firms and to their own option grants in non-violation years. Moreover, misreporting firms that grant more rank and file options during violation years are more likely to avoid whistle-blowing allegations. Although the Dodd-Frank Act (2010) offers financial rewards to encourage whistle-blowing, our findings suggest that firms discourage whistle-blowing by giving employees incentives to remain quiet about financial irregularities.

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The effect of price targets on the composition of CEO pay

Giuliano Bianchi

Applied Economics, Summer 2016, Pages 4299-4311

Abstract:
This article analyzes the impact of price targets from the IBES Detail Price History Target database on CEO compensation retained from Execucomp. The two databases are merged at fiscal year frequency and an OLS regression with fixed effect is used to analyze the impact of price target on CEO compensation. The analysis reveals that analysts’ price targets affect top executives’ compensation: when analysts predict a growth in the share price for a company, the compensation package tilts towards stock options, when analysts forecast a drop in the share price, the compensation package tilts towards cash-based compensation and restricted stocks. I argue that the result is more aligned with the managerial power model of compensation (which assumes the board of directors maximizes managers’ compensation) than with the arm’s length bargaining model (that states that managers’ compensation is set to maximize shareholders’ profit).

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Do Institutional Investors Demand Public Disclosure?

Andrew Bird & Stephen Karolyi

Review of Financial Studies, forthcoming

Abstract:
We examine the effect of institutional ownership on corporate disclosure policy using a regression discontinuity design. Using a novel dataset comprising every 8-K filing between 1996 and 2006, we find that positive shocks to institutional ownership around Russell index reconstitutions increase the quantity, form, and quality of disclosure. Compared with those at the bottom of the Russell 1000 index, firms at the top of the Russell 2000 index increase institutional ownership by 9.8%, and disclose 4.7% longer 8-K filings with 21.3% more embedded graphics. This incremental disclosure significantly increases the information content of 8-K filings for the market and for analysts.

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Does going private add value through operating improvements?

Brian Ayash & Harm Schütt

Journal of Corporate Finance, October 2016, Pages 192–215

Abstract:
Previous studies document a large positive effect of private equity ownership on operating performance between 1980 and 1990 while evidence on the more recent buyout wave is mixed. We revisit the evidence on post-LBO performance and offer an additional explanation for the varied and time-inconsistent results found in the literature: the effect of accounting for LBO transactions and its change over time. Using hand-collected financial statements for 183 U.S. public-to-private LBOs, we illustrate how previously used proxies for operating performance suffer from an accounting distortion induced by the buyout transaction. We reproduce the results of previous studies. However, once proxies are modified slightly to account for the LBO process, we find no robust evidence of post-buyout improvements in public-to-private LBOs, regardless of the time period of the study.

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CEO Personality and Firm Policies

Ian Gow et al.

University of Chicago Working Paper, July 2016

Abstract:
Based on two samples of high quality personality data for chief executive officers (CEOs), we use linguistic features extracted from conferences calls and statistical learning techniques to develop a measure of CEO personality in terms of the Big Five traits: agreeableness, conscientiousness, extraversion, neuroticism, and openness to experience. These personality measures have strong out-of-sample predictive performance and are stable over time. Our measures of the Big Five personality traits are associated with financing choices, investment choices and firm operating performance.

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Golden hellos: Signing bonuses for new top executives

Jin Xu & Jun Yang

Journal of Financial Economics, forthcoming

Abstract:
We examine signing bonuses awarded to executives hired for or promoted to named executive officer (NEO) positions at Standard & Poor's 1500 companies during the period 1992–2011. Executive signing bonuses are sizable and increasing in use, and they are labeled by the media as “golden hellos.” We find that executive signing bonuses are mainly awarded at firms with greater information asymmetry and higher innate risks, especially to younger executives, to mitigate the executives’ concerns about termination risk. When termination concerns are strong, signing bonus awards are associated with better performance and retention outcomes.

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Are Ex Ante CEO Severance Pay Contracts Consistent with Efficient Contracting?

Brian Cadman, John Campbell & Sandy Klasa

Journal of Financial and Quantitative Analysis, June 2016, Pages 737-769

Abstract:
Efficient contracting predicts that ex ante severance pay contracts are offered to chief executive officers (CEOs) as protection against downside risk and to encourage investment in risky projects with a positive net present value (NPV). Consistent with this prediction, we find that ex ante contracted severance pay is positively associated with proxies for a CEO’s risk of dismissal and costs the CEO would incur from dismissal. Additionally, we show that the contracted severance payment amount is positively associated with CEO risk taking and the extent to which a CEO invests in projects that have a positive NPV. Overall, our findings imply that ex ante severance pay contracts are consistent with efficient contracting.

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The financial reporting consequences of proximity to political power

Christian Gross et al.

Journal of Accounting and Public Policy, forthcoming

Abstract:
In this study, we apply a new concept, corporate proximity to political power, to accounting research and examine its consequences on corporate financial reporting. Prior literature shows that higher proximity to political power leads to higher policy risk, i.e., uncertainty regarding the impact of future administration policies on the cash flow of the firm. An increase in policy risk implies an increase in the opaqueness of the information environment and in the expected volatility of future operating profitability; we argue that these effects both encourage and facilitate earnings management. Drawing on recent research in finance and political science, we use a measure of the alignment along party lines between politicians elected at the state level and the federally elected President as our main measure of proximity to political power. We find a significant positive association between the political alignment of firms’ home states and their level of absolute discretionary accruals. Consistent with the idea that firms engage in corporate political activities (lobbying and financial contributions) to hedge against policy risk, our results only hold for firms not engaging in such activities.

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Do corporate governance mandates impact long-term firm value and governance culture?

Reena Aggarwal, Jason Schloetzer & Rohan Williamson

Journal of Corporate Finance, forthcoming

Abstract:
Motivated by recent changes to corporate governance standards around the world, we use a regulatory shock that substantially altered the governance structure for some firms to shed light on the long-term impact of mandates that are of global interest. Firms affected by this shock had lower values and non-mandated governance practices that were less shareholder friendly before the mandates were in effect when compared to unaffected matched peers. In the post-mandate period, we document a 48% tightening of the relative value gap, and show that this gap relates to the continued use of less shareholder friendly non-mandated governance practices. Our results suggest that governance mandates can tighten, but not eliminate, the value gap between poorly and well governed firms, and that firms affected by the shock continue to have less shareholder friendly governance cultures long after regulatory intervention.

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Customer Concentration and Corporate Tax Avoidance

Henry He Huang et al.

Journal of Banking & Finance, forthcoming

Abstract:
Firms with a concentrated corporate customer base need to hold more cash and have a stronger incentive to manage earnings upwards. Since tax planning can increase both cash flow and accounting earnings, firms with a concentrated customer base may be more likely to engage in tax avoidance. We find evidence of a positive association between the level of corporate customer concentration and the extent of tax avoidance. In addition, we find that the positive relation between corporate customer concentration and tax avoidance is more pronounced when a firm has a lower market share in its industry, enjoys less revenue diversification, and engages less in real earnings management. In contrast to corporate major customers, governmental major customers provide stable cash flow to suppliers, which is likely to alleviate supplier firms’ need for tax avoidance. We find that firms engage in lower levels of tax avoidance when they have a governmental major customer, and that this association is less pronounced under Democratic presidencies. Taken together, our findings indicate that a firm's customer concentration (i.e., corporate and governmental major customers) has a significant effect on the extent to which it avoids taxes.

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Executives’ Legal Records and Insider Trading Activities

Robert Davidson, Aiyesha Dey & Abbie Smith

University of Chicago Working Paper, May 2016

Abstract:
We examine how and why insider trading varies across senior executives and their firms. As predicted, the profitability of both purchases and sales are higher for “recordholder” executives (those who have a record of legal infractions), than for other “non-recordholder” executives at the same firms. The profitability of recordholder executives’ purchases and sales decrease significantly with proxies for strong information and governance environments, suggesting that recordholders have a relatively higher propensity to exploit inside information given the opportunity to do so. Finally, our classification of executives (recordholder status) can predict future returns and firm-specific information events.

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Corruption culture and corporate misconduct

Xiaoding Liu

Journal of Financial Economics, forthcoming

Abstract:
Despite significant interest in corporate culture, there is little empirical research on its role in influencing corporate misconduct. Using cultural background information on key company insiders, I construct a measure of corporate corruption culture, capturing a firm's general attitude toward opportunistic behavior. Firms with high corruption culture are more likely to engage in earnings management, accounting fraud, option backdating, and opportunistic insider trading. I further explore the inner workings of corruption culture and find evidence that it operates both as a selection mechanism and by having a direct influence on individual behavior.

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Do Private Firms Invest Differently than Public Firms? Taking Cues from the Natural Gas Industry

Erik Gilje & Jerome Taillard

Journal of Finance, August 2016, Pages 1733–1778

Abstract:
We study how listing status affects investment behavior. Theory offers competing hypotheses on how listing-related frictions affect investment decisions. We use detailed data on 74,670 individual projects in the U.S. natural gas industry to show that private firms respond less than public firms to changes in investment opportunities. Private firms adjust drilling activity for low capital-intensity investments. However, they do not increase drilling in response to new capital-intensive growth opportunities. Instead, they sell these projects to public firms. Our evidence suggests that differences in access to external capital are important in explaining the investment behavior of public and private firms.

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Anticipated vs. Actual Synergy in Merger Partner Selection and Post-Merger Innovation

Vithala Rao, Yu Yu & Nita Umashankar

Marketing Science, forthcoming

Abstract:
Past research has primarily focused on what happens after a merger. This research attempts to determine whether anticipated benefits from the merger actually accrue. We characterize the effects of observed variables on whether pairs of firms merge, vis-à-vis roommate matching, and then link these factors to post-merger innovation (i.e., number of patents). We jointly estimate the two models using Markov Chain Monte Carlo methods with a unique panel data set of 1,979 mergers between 4,444 firms across industries and countries from 1992 to 2008. We find that similarity in national culture and technical knowledge has a positive effect on partner selection and post-merger innovation. Anticipated synergy from subindustry similarity, however, is not realized in post-merger innovation. Furthermore, some key synergy sources are unanticipated when selecting a merger partner. For example, financial synergy from higher total assets and complementarity in total assets and debt leverage as well as knowledge synergy from breadth and depth of knowledge positively influence innovation but not partner selection. Furthermore, factors that dilute synergy (e.g., higher debt levels) are unanticipated, and firms merge with firms that detract from their innovation potential. Overall, the results reveal some incongruity between anticipated and realized synergy.

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Securities fraud and corporate board turnover: New evidence from lawsuit outcomes

Christopher Baum, James Bohn & Atreya Chakraborty

International Review of Law and Economics, October 2016, Pages 14–25

Abstract:
We examine the relationship between outcomes of securities fraud class action lawsuits (SFCAs) and corporate board turnover rates. Our results indicate that turnover rates for board members are higher when a firm settles a lawsuit than when a suit is dismissed. Outside director turnover is most sensitive to SFCA outcomes, perhaps reflecting reputational effects. Results demonstrate that involvement in securities fraud is costly for corporate board members.

By KEVIN LEWIS | 09:00:00 AM

Sunday, August 21, 2016

Uplifting

Heads or Tails: The Impact of a Coin Toss on Major Life Decisions and Subsequent Happiness

Steven Levitt

NBER Working Paper, August 2016

Abstract:
Little is known about whether people make good choices when facing important decisions. This paper reports on a large-scale randomized field experiment in which research subjects having difficulty making a decision flipped a coin to help determine their choice. For important decisions (e.g. quitting a job or ending a relationship), those who make a change (regardless of the outcome of the coin toss) report being substantially happier two months and six months later. This correlation, however, need not reflect a causal impact. To assess causality, I use the outcome of a coin toss. Individuals who are told by the coin toss to make a change are much more likely to make a change and are happier six months later than those who were told by the coin to maintain the status quo. The results of this paper suggest that people may be excessively cautious when facing life-changing choices.

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The Happiness Gap Between Conservatives and Liberals Depends on Country-Level Threat: A Worldwide Multilevel Study

Emma Onraet et al.

Social Psychological and Personality Science, forthcoming

Abstract:
In the present study, we investigated the much debated “happiness gap” between conservatives and liberals, approaching the issue from a multilevel person × context perspective. More specifically, we investigated whether this relationship depends on country-level threat. We used individual-level data for right-wing attitudes and psychological well-being from 94 large, representative samples collected worldwide (total N = 137,890) and objective indicators of country-level threat as the contextual variable. Our results suggest that, especially in countries characterized by high levels of threat, individuals with right-wing attitudes experienced greater well-being than individuals with left-wing attitudes. In countries with a low level of threat, this relationship was considerably weaker or even absent. Our findings corroborate the view that right-wing attitudes may serve a self-protective function, helping individuals to manage and cope with threat.

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New Evidence on Trust and Well-being

John Helliwell, Haifang Huang & Shun Wang

NBER Working Paper, July 2016

Abstract:
This paper first uses data from three large international surveys – the Gallup World Poll, the World Values Survey and the European Social Survey – to estimate income-equivalent values for social trust, with a likely lower bound equivalent to a doubling of household income. Second, the more detailed and precisely measured trust data in the European Social Survey (ESS) show that social trust is only a part of the overall climate of trust. While social trust and trust in police are the most important elements, there are significant additional benefits from trust in three aspects of the institutional environment: the legal system, parliament and politicians. Thus estimates of the total well-being value of a trustworthy environment are larger than those based on social trust alone. Third, the ESS data show that living in a high-trust environment makes people more resilient to adversity. Being subject to discrimination, ill-health or unemployment, although always damaging to subjective well-being, is much less damaging to those living in trustworthy environments. These results suggest a fresh set of links between trust and inequality. Individuals who are subject to discrimination, ill-health or unemployment are typically concentrated towards the lower end of any national distribution of happiness. Thus the resilience-increasing feature of social trust reduces well-being inequality by channeling the largest benefits to those at the low end of the well-being distribution.

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The emotional cost of distance: Geographic social network dispersion and post-traumatic stress among survivors of Hurricane Katrina

Katherine Ann Morris & Nicole Deterding

Social Science & Medicine, September 2016, Pages 56–65

Methods: We use longitudinal, mixed-methods data from the Resilience in Survivors of Katrina (RISK) Project to capture the long-term effects of Hurricane Katrina on low-income mothers from New Orleans. Baseline surveys occurred approximately one year before the storm and follow-up surveys and in-depth interviews were conducted five years later. We use a sequential explanatory analytic design. With logistic regression, we estimate the association of geographic network dispersion with the likelihood of post-traumatic stress. With linear regressions, we estimate the association of network dispersion with the three post-traumatic stress sub-scales. Using maximal variation sampling, we use qualitative interview data to elaborate identified statistical associations.

Results: We find network dispersion is positively associated with the likelihood of post-traumatic stress, controlling for individual-level socio-demographic characteristics, exposure to hurricane-related trauma, perceived social support, and New Orleans residency. We identify two social-psychological mechanisms present in qualitative data: respondents with distant network members report a lack of deep belonging and a lack of mattering as they are unable to fulfill obligations to important distant ties.

Conclusion: Results indicate the importance of physical proximity to emotionally-intimate network ties for long-term psychological recovery.

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Smartphone Applications Utilizing Biofeedback Can Aid Stress Reduction

Alison Dillon et al.

Frontiers in Psychology, June 2016

Methods: We compared a control game to gaming-style smartphone applications combined with a skin conductance biofeedback device (the Pip). Fifty participants aged between 18 and 35 completed the Trier Social Stress Test. They were then randomly assigned to the intervention (biofeedback game) or control group (a non-biofeedback game) for thirty minutes. Perceived stress, heart rate and mood were measured before and after participants had played the games.

Results: A mixed factorial ANOVA showed a significant interaction between time and game type in predicting perceived stress [F(1,48) = 14.19, p < 0.001]. Participants in the biofeedback intervention had significantly reduced stress compared to the control group. There was also a significant interaction between time and game in predicting heart rate [F(1,48) = 6.41, p < 0.05]. Participants in the biofeedback intervention showed significant reductions in heart rate compared to the control group.

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Do Our Facebook Friends Make Us Feel Worse? A Study of Social Comparison and Emotion

Jiangmeng Liu et al.

Human Communication Research, forthcoming

Abstract:
People often compare themselves to others to gain a better understanding of the self in a process known as social comparison. The current study discusses how people engage in a social comparison process on Facebook, and how observing content from their Facebook friends may affect their emotions. A 2 (comparison direction) × 2 (relational closeness) × 2 (self-esteem) between-subjects experiment was conducted with 163 adult participants. The results revealed a significant 3-way interaction such that people with high self-esteem would be happier receiving positive information than negative information from their close friends, but the effect would be the opposite if the information was from a distant friend. There was no such difference for people with low self-esteem.

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The Relationship between Facebook Use and Well-Being depends on Communication Type and Tie Strength

Moira Burke & Robert Kraut

Journal of Computer-Mediated Communication, July 2016, Pages 265–281

Abstract:
An extensive literature shows that social relationships influence psychological well-being, but the underlying mechanisms remain unclear. We test predictions about online interactions and well-being made by theories of belongingness, relationship maintenance, relational investment, social support, and social comparison. An opt-in panel study of 1,910 Facebook users linked self-reported measures of well-being to counts of respondents' Facebook activities from server logs. Specific uses of the site were associated with improvements in well-being: Receiving targeted, composed communication from strong ties was associated with improvements in well-being while viewing friends' wide-audience broadcasts and receiving one-click feedback were not. These results suggest that people derive benefits from online communication, as long it comes from people they care about and has been tailored for them.

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Stress and Subjective Age: Those With Greater Financial Stress Look Older

Stefan Agrigoroaei, Angela Lee-Attardo & Margie Lachman

Research on Aging, forthcoming

Abstract:
Subjective indicators of age add to our understanding of the aging process beyond the role of chronological age. We examined whether financial stress contributes to subjective age as rated by others and the self. The participants (N = 228), aged 26–75, were from a Boston area satellite of the Midlife in the United States (MIDUS) longitudinal study. Participants reported how old they felt and how old they thought they looked, and observers assessed the participants’ age based on photographs (other-look age), at two occasions, an average of 10 years apart. Financial stress was measured at Time 1. Controlling for income, general stress, health, and attractiveness, participants who reported higher levels of financial stress were perceived as older than their actual age to a greater extent and showed larger increases in other-look age over time. We consider the results on accelerated aging of appearance with regard to their implications for interpersonal interactions and in relation to health.

By KEVIN LEWIS | 09:00:00 AM

Saturday, August 20, 2016

It's what you want

Paying for Performance: Performance Incentives Increase Desire for the Reward Object

Julia Hur & Loran Nordgren

Journal of Personality and Social Psychology, forthcoming

Abstract:
The current research examines how exposure to performance incentives affects one’s desire for the reward object. We hypothesized that the flexible nature of performance incentives creates an attentional fixation on the reward object (e.g., money), which leads people to become more desirous of the rewards. Results from 5 laboratory experiments and 1 large-scale field study provide support for this prediction. When performance was incentivized with monetary rewards, participants reported being more desirous of money (Study 1), put in more effort to earn additional money in an ensuing task (Study 2), and were less willing to donate money to charity (Study 4). We replicated the result with nonmonetary rewards (Study 5). We also found that performance incentives increased attention to the reward object during the task, which in part explains the observed effects (Study 6). A large-scale field study replicated these findings in a real-world setting (Study 7). One laboratory experiment failed to replicate (Study 3).

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Why Focusing on the Similarity of Substitutes Leaves a Lot to Be Desired

Zachary Arens & Rebecca Hamilton

Journal of Consumer Research, forthcoming

Abstract:
Consumers frequently choose substitutes for products that are out-of-stock, unavailable, too unhealthy, or too expensive. A series of studies shows that focusing on differences between the substitute and the unattained alternative reduces the consumer’s desire for the unattained alternative more than focusing on similarities between them. Whether consumers were dieting, listening to songs, or consuming snacks in the lab, focusing on differences reduced their desire for the unattained alternative – and subsequent consumption of this item after consuming the substitute – more than focusing on similarities. This suggests that consumers can reduce overconsumption by focusing on how the substitutes they consume differ from the alternatives they wish to avoid.

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The Implicit Meaning of (My) Change

Ed O’Brien & Michael Kardas

Journal of Personality and Social Psychology, forthcoming

Abstract:
The concept of change simply entails the totality of ways in which a particular entity has grown better and grown worse. Five studies suggest that this is not how people actually understand it for themselves. Rather, when asked to assess how they have “changed” over time, people bring to mind only how they have improved and neglect other trajectories (e.g., decline) that they have also experienced; global change is specifically translated as directional change for the better. This tendency emerged across many populations, time frames, measures, and methodologies (Studies 1–3), and led to important downstream effects: people who reflected on “change” from their pasts experienced enhanced mood, meaning, and satisfaction in their presents, precisely because they had assumed to only think about personal improvement (Study 4). A final study shed light on mechanisms: people evaluated the word change in a speeded response task as more positive when they were instructed to interpret the word in relation to themselves versus a friend, while no differences emerged between conditions for nonchange control words (Study 5). This suggests that the basic pattern across studies stems (at least partly) from traditional self-enhancement motives — our own change spontaneously brings to mind only the ways in which we have improved, whereas change in someone else is not so immediately and uniformly associated with improvement. Taken together, these findings reveal novel insights into the content and consequences of change perception, and they more broadly highlight unforeseen biases in when and why people might subjectively (mis)interpret otherwise objective constructs.

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When being far away is good: Exploring how mortality salience, regulatory mode, and goal progress affect judgments of meaning in life

Matthew Vess et al.

European Journal of Social Psychology, forthcoming

Abstract:
Research indicates that death-relevant thoughts (mortality salience) have a nuanced effect on judgments of life's meaningfulness. Thoughts of death diminish meaning in life only among people who lack or do not readily engage psychological structures that confer meaning. Building on this past research, the current research examined how an important source of meaning, long-term goal progress, affects the ways that death-relevant cognitions impact judgments of life's meaning. In Study 1 (N = 118), mortality salience decreased perceptions of meaning in life only among participants who were induced to feel closer to (vs. farther from) completing a long-term goal. Study 2 (N = 259) extended these findings by demonstrating the moderating influence of individual differences in locomotion. Mortality salience again decreased perceptions of meaning in life among participants who felt closer to accomplishing a long-term goal, but it only did so among people who do not quickly adopt new goals to pursue (i.e., those low in locomotion). The implications of these findings for better understanding how people maintain meaning in the face of existential concerns and how aspects of goal pursuit affect these processes are discussed.

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Anthropomorphized Helpers Undermine Autonomy and Enjoyment in Computer Games

Sara Kim, Rocky Peng Chen & Ke Zhang

Journal of Consumer Research, forthcoming

Abstract:
Although digital assistants with humanlike features have become prevalent in computer games, few marketing studies have demonstrated the psychological mechanisms underlying consumers’ reactions to digital assistants and their subsequent influence on consumers’ game enjoyment. To fill this gap, the current study examined the effect of anthropomorphic representations of computerized helpers in computer games on game enjoyment. In the current research, consumers enjoyed a computer game less when they received assistance from a computerized helper imbued with humanlike features than from a helper construed as a mindless entity. We offer a novel mechanism that the presence of an anthropomorphized helper can undermine individuals’ perceived autonomy during a computer game. Across six experiments, we show that the presence of an anthropomorphized helper reduced game enjoyment across three different games. By measuring participants’ perceived autonomy (study 1) and employing moderators such as importance of autonomy (studies 2, 3, and 4), we also provide evidence that the reduced feeling of autonomy serves as the mechanism underlying the backfiring effect. Finally, we demonstrate that the effect of anthropomorphism on game enjoyment can be extended to other game-related outcomes, such as individuals’ motivation to persist in the game (studies 4 and 5).

By KEVIN LEWIS | 09:00:00 AM

Friday, August 19, 2016

Picking sides

Income Inequality, Media Fragmentation, and Increased Political Polarization

John Duca & Jason Saving

Contemporary Economic Policy, forthcoming

Abstract:
The increasing polarization of congressional voting has been linked to legislators' inability to reach consensus on many pressing economic issues. We examine two potential factors driving polarization: greater income inequality and the increasingly fragmented state of American media. Using cointegration techniques, we find evidence indicating that media fragmentation has played a more important role than inequality. Periods of rising media fragmentation are followed by increased polarization. If recent patterns of media structure and income inequality persist, a polarized policymaking environment will likely continue to impede efforts to address major challenges, such as the long-run fiscal imbalances facing the United States.

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Measuring Polarization in High-Dimensional Data: Method and Application to Congressional Speech

Matthew Gentzkow, Jesse Shapiro & Matt Taddy

NBER Working Paper, July 2016

Abstract:
We study trends in the partisanship of Congressional speech from 1873 to 2009. We define partisanship to be the ease with which an observer could infer a congressperson’s party from a fixed amount of speech, and we estimate it using a structural choice model and methods from machine learning. The estimates reveal that partisanship is far greater today than at any point in the past. Partisanship was low and roughly constant from 1873 to the early 1990s, then increased dramatically in subsequent years. Evidence suggests innovation in political persuasion beginning with the Contract with America, possibly reinforced by changes in the media environment, as a likely cause. Naive estimates of partisanship are subject to a severe finite-sample bias and imply substantially different conclusions.

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Culturally Antagonistic Memes and the Zika Virus: An Experimental Test

Dan Kahan et al.

University of Pennsylvania Working Paper, July 2016

Abstract:
This paper examines a remedy for a defect in existing accounts of public risk perceptions. The accounts in question feature two dynamics: the affect heuristic, which emphasizes the impact of visceral feelings on information processing; and the cultural cognition thesis, which describes the tendency of individuals to form beliefs that reflect and reinforce their group commitments. The defect is the failure of these two dynamics, when combined, to explain the peculiar selectivity of public risk controversies: despite their intensity and disruptiveness, such controversies occur less frequently than the affect heuristic and the cultural cognition thesis seem to predict. To account for this aspect of public risk perceptions, the paper describes a model that adds the phenomenon of culturally antagonistic memes — argumentative tropes that fuse positions on risk with contested visions of the best life. Arising adventitiously, antagonistic memes transform affect and cultural cognition from consensus-generating, truth-convergent influences on information processing into conflictual, identity-protective ones. The paper supports this model with experimental results involving perceptions of the risk of the Zika virus: a general sample of U.S. subjects, whose members were not polarized when exposed to neutral information, formed culturally polarized affective reactions when exposed to information that was pervaded with antagonistic memes linking Zika to global warming; when exposed to comparable information linking Zika to unlawful immigration, the opposed affective stances of the subjects flipped in direction. Normative and prescriptive implications of these results are discussed.

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Religious Identity and Descriptive Representation

Walter Schmidt & Matthew Miles

Politics and Religion, forthcoming

Abstract:
Drawing on the descriptive representation literature, we argue that religious identity is a social identity similar to gender or race, which leads a person to feel represented by someone who shares their religious identity. We argue that religious identity motivates approbation for public officials that is distinct from partisanship. We find that constituents who share the religious identity of their congressional representatives are significantly more likely to approve of their representative's performance in office. In addition, those who share a religious identity with President Obama are more trusting of him; particularly among those for whom religion is important. Finally, we find that shared religious identity moderates the relationship between partisanship and trust in the President. All else equal, Republicans who share a religious identity with President Obama are 500% more likely to trust him than a Republican who does not.

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Subpartisan Cues and Ideological Distinctions: The Effect of the Tea Party Label on Voter Perceptions of Congressional Candidates

Bryan Gervais & Jeffrey Taylor

Social Science Quarterly, forthcoming

Objective: We aim to fill a gap in the voter heuristic literature by estimating the impact of subparty cues — labels that connect candidates to an intraparty faction — on perceptions of candidates’ ideological positions. We argue that the Tea Party label acts as a subpartisan cue, and should affect perceptions of both Republicans and their Democratic opponents.

Methods: We measure ideological perceptions using data from the Cooperative Congressional Election Study (CCES), and measure Tea Party “saliency” based on how often candidates were linked with the Tea Party in news media. Using probit regression, we estimate the impact of Tea Party saliency on ideological perceptions of candidates.

Results: We find that Republican candidates often associated with the Tea Party are more likely to be perceived as conservative or very conservative, even when we control for candidate and voter ideology, while their Democratic opponents are perceived to be more moderate.

Conclusion: The results suggest that extremizing cues like the Tea Party label can have a moderating effect on opponents. These findings shed new light on the role and interaction of party-related voting cues, and have important implications for elections, campaigns, and voter opinion and behavior.

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Cognitive Ability Rivals the Effect of Political Sophistication on Ideological Voting

Stig Hebbelstrup Rye Rasmussen

Political Research Quarterly, forthcoming

Abstract:
This article examines the impact of cognitive ability on ideological voting. We find, using a U.S. sample and a Danish sample, that the effect of cognitive ability rivals the effect of the traditionally strongest predictor of ideological voting, political sophistication. Furthermore, the results are consistent with the effect of cognitive ability being partly mediated by political sophistication. Much of the effect of cognitive ability remains, however, and is not explained by differences in education or openness to experience either. The implications of these results for democratic theory are discussed.

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Residential Building Restrictions, Cost of Living, and Partisanship

Jason Sorens

Dartmouth College Working Paper, July 2016

Abstract:
Why have richer U.S. states become more Democratic and poorer states more Republican? I find that this phenomenon actually reflects cost of living, driven by residential building restrictions. Such restrictions have come under intense scrutiny from economists in recent years. By making housing supply less responsive to price, land-use regulation increases house prices in locations that are highly desirable for either amenities or production. High house prices are the most important component of general cost of living. High cost of living deters in-migration of lower-income households, especially those that do not highly value amenities. Holding median household income constant, higher-cost locations will tend over time to attract and keep households that highly value amenities. It is hypothesized that these households will be more Democratic. Accordingly, raising residential building requirements in high-amenity areas should cause those areas to move gradually to the left. The hypotheses are tested on a variety of individual- and state-level data.

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Ideological Reactivity: Political Conservatism and Brain Responsivity to Emotional and Neutral Stimuli

Shona Tritt et al.

Emotion, forthcoming

Abstract:
Conservatives are often thought to have a negativity bias — responding more intensely to negative than positive information. Yet, recent research has found that greater endorsement of conservative beliefs follows from both positive and negative emotion inductions. This suggests that the role of affect in political thought may not be restricted to negative valence, and more attention should be given to how conservatives and liberals respond to a wider range of stimulation. In this vein, we examined neural responses to a full range of affective stimuli, allowing us to examine how self-reported ideology moderated these responses. Specifically, we explored the relationship between political orientation and 2 event-related potentials (1 late and 1 early) previously shown to covary with the subjective motivational salience of stimuli — in response to photographs with standardized ratings of arousal and valence. At late time points, conservatives exhibited sustained heightened reactivity, compared with liberals, specifically in response to relatively unarousing and neutral stimuli. At early time points, conservatives exhibited somewhat enhanced neural activity in response to all stimulus types compared with liberals. These results may suggest that conservatives experience a wide variety of stimuli in their environment with increased motivational salience, including positive, neutral, and low-arousal stimuli. No effects of valence were found in this investigation. Such findings have implications for the development and refinement of psychological conceptions of political orientation.

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Driving a Wedge Between Evidence and Beliefs: How Online Ideological News Exposure Promotes Political Misperceptions

Kelly Garrett, Brian Weeks & Rachel Neo

Journal of Computer-Mediated Communication, forthcoming

Abstract:
This article has 2 goals: to provide additional evidence that exposure to ideological online news media contributes to political misperceptions, and to test 3 forms this media-effect might take. Analyses are based on representative survey data collected during the 2012 U.S. presidential election (N = 1,004). Panel data offer persuasive evidence that biased news site use promotes inaccurate beliefs, while cross-sectional data provide insight into the nature of these effects. There is no evidence that exposure to ideological media reduces awareness of politically unfavorable evidence, though in some circumstances biased media do promote misunderstandings of it. The strongest and most consistent influence of ideological media exposure is to encourage inaccurate beliefs regardless of what consumers know of the evidence.

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Are neoliberals more susceptible to bullshit?

Joanna Sterling, John Jost & Gordon Pennycook

Judgment and Decision Making, July 2016, Pages 352–360

Abstract:
We conducted additional analyses of Pennycook et al.’s (2015, Study 2) data to investigate the possibility that there would be ideological differences in “bullshit receptivity” that would be explained by individual differences in cognitive style and ability. As hypothesized, we observed that endorsement of neoliberal, free market ideology was significantly but modestly associated with bullshit receptivity. In addition, we observed a quadratic association, which indicated that ideological moderates were more susceptible to bullshit than ideological extremists. These relationships were explained, in part, by heuristic processing tendencies, faith in intuition, and lower verbal ability. Results are inconsistent with approaches suggesting that (a) there are no meaningful ideological differences in cognitive style or reasoning ability, (b) simplistic, certainty-oriented cognitive styles are generally associated with leftist (vs. rightist) economic preferences, or (c) simplistic, certainty-oriented cognitive styles are generally associated with extremist (vs. moderate) preferences. Theoretical and practical implications are briefly addressed.

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Network Structure and Patterns of Information Diversity on Twitter

Jesse Shore, Jiye Baek & Chrysanthos Dellarocas

Boston University Working Paper, July 2016

Abstract:
Social media have great potential to support diverse information sharing, but there is widespread concern that platforms like Twitter do not result in communication between those who hold contradictory viewpoints. Because users can choose whom to follow, prior research suggests that social media users exist in “echo chambers” or become polarized. We seek evidence of this in a complete cross section of hyperlinks posted on Twitter, using previously validated measures of the political slant of news sources to study information diversity. Contrary to prediction, we find that the average account posts links to more politically moderate news sources than the ones they receive in their own feed. However, members of a tiny network core do exhibit cross-sectional evidence of polarization and are responsible for the majority of tweets received overall due to their popularity and activity, which could explain the widespread perception of polarization on social media.

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Civic education: Do liberals do it better?

Jason Gainous & Allison Martens

Journal of Political Ideologies, Fall 2016, Pages 261-279

Abstract:
Recent research has found that civic education improves the democratic capacity of students and that teachers who employ an ‘open classroom’ approach seem to perform better at accomplishing this goal. We build on behavioural literature suggesting that variation in personality traits across ideology may account for why liberal middle school teachers would be more likely to foster an open classroom climate and as a result do a better job than their conservative counterparts at stimulating in their students’ political knowledge, an important component of democratic capacity. We estimate a series of quasi-experimental multilevel models using data from a survey of American students and teachers. The results indicate that liberal teachers tend to use an open classroom approach more frequently and that the students with the highest levels of political knowledge are in classes taught by liberal teachers. This effect holds up when controlling for individual-level predictors of student knowledge.

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A few bad apples: Communication in the presence of strategic ideologues

Daniel Stone

Southern Economic Journal, forthcoming

Abstract:
I propose a very simple model of strategic communication. The motivation is to help explain widespread persistent disagreement about objective facts. In the model, there is a message sender and a receiver, and two possible states of the world, left or right. The sender is one of three types: honest, or a leftist or rightist “ideologue.” The honest type observes a private signal in {0,1,...,N}, with higher values implying stronger support for the right state, and reports the observed value truthfully. Ideologues strategically choose any message from this set to maximize the receiver's belief in their preferred state, ignoring any private information they may have. I show that a small presence of ideologues can have a large effect on communication: while we might expect ideologues to just send extreme messages, in most equilibria ideologues use “strategic understatement,” and in many cases actually mix over all non-neutral (non-N∕2) messages to mimic honest types and gain credibility. This distorts the interpretation of these messages such that all messages on a side of the spectrum (above or below N∕2) have the same effect on receiver beliefs. This coarsened communication is less informative than even the weakest non-neutral messages in the absence of ideologues. I show by example how ideologues can cause large delays in the time required for receiver beliefs to converge to truth.

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Group identification as a means of attitude restoration

Joshua Clarkson et al.

Journal of Experimental Social Psychology, January 2017, Pages 139–145

Abstract:
This paper investigates the possibility that individuals selectively identify with groups as a means of restoring certainty in their attitudes. Specifically, we contend that (i) groups offer social validation in the form of attitudinal norms, (ii) individuals heighten their identification with groups that offer norms that are consistent with attitudes that have been undermined, and (iii) access to these norms reduces attitude uncertainty. Two experiments support this hypothesis by demonstrating greater identification following a loss of attitude certainty, though only with groups offering relevant attitudinal norms. Moreover, this identification is subsequently shown to promote attitude restoration in the form of increased certainty. Consequently, groups serve an important role in attitude restoration by protecting attitudes against uncertainty when a relevant group is available to bolster the attitude.

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Is ideology the enemy of inquiry? Examining the link between political orientation and lack of interest in novel data

Alexa Tullett et al.

Journal of Research in Personality, August 2016, Pages 123–132

Abstract:
Four studies examined the relationship between political orientation and data selection. In each study participants were given the opportunity to select data from a large data set addressing a specific issue: the justness of the world (Pilot Study), the efficacy of social safety nets (Studies 1–3), and the benefits of social media (Study 3). Participants were given no knowledge of what the data would tell them in advance. More conservative participants selected less data, and in Study 3 this relationship was partly accounted for by an increased tendency to question the value of science as a way of learning about the world. These findings may reveal one factor contributing to political polarization: an asymmetrical interest in scientific data.

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Mixed Partisan Households and Electoral Participation in the United States

Eitan Hersh & Yair Ghitza

Yale Working Paper, June 2016

Abstract:
Research suggests that partisans are increasingly avoiding members of the other party — in their choice of neighborhood, social network, even their spouse. But little is known about partisan intermingling in the United States, since surveys rarely shed light on groups. Leveraging a national database of voter registration records, we analyze mixed-partisan households in the U.S. Three in ten married couples have mismatched party affiliations. We first evaluate the rate of sorting, as well as the relationship between inter-party marriage and gender, age, and geography. Then, we test whether mixed-partisan couples participate less actively in politics. We find that voter turnout is strongly correlated with the party of one’s spouse. A partisan who is married to a co-partisan is far more likely to vote. The effect is especially pronounced in closed primaries, suggesting an effect of cohabitation, not just low-participation voters sorting into mixed-party marriages.

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History Made: The Rise of Republican Tim Scott

Scott Huffmon, Gibbs Knotts & Seth McKee

PS: Political Science & Politics, July 2016, Pages 405-413

Abstract:
In a time of unprecedented racial polarization in partisan voting, and in a staunchly Republican Deep South state, one black Republican managed to reach the pinnacle of public office. This article examines Tim Scott’s rise by analyzing precinct-level data to better understand his 2010 election to the US House and data from the Winthrop Poll to explore his more recent US Senate victory. To better understand support for Scott, we also report results from an embedded-survey experiment to assess respondents’ favorability toward Scott when he is characterized by two different frames: (1) “Tea Party favorite,” and (2) “first African American Senator from South Carolina since Reconstruction.” We found that conservatives, evangelicals, and less-educated individuals respond more positively to Scott when he is described as a “Tea Party favorite.” More than an intriguing case study, Scott’s rise tells a broader story of the complicated relationships among race, ideology, and partisanship in the contemporary American South.

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Re-construing politics: The dual impacts of abstraction on political ideology

Eugene Chan

European Journal of Social Psychology, forthcoming

Abstract:
The influence of construal level on political ideology is unclear. Some research says that abstraction polarizes political attitudes by making liberals more liberal and conservatives more conservative. Other research instead argues that an abstract construal causes people to exhibit similar political attitudes as each other. The current research presents two experiments in which abstraction polarizes political attitudes on issues of social inequality. However, abstraction also increases traditionalism, and so it increases a preference for maintaining the societal status quo, such as by increasing one's disagreement with or opposition to homosexuality. The dual impacts of abstraction parallel the two distinct dimensions of political ideology (i.e., acceptance of social inequality and preference for the status quo), both of which prior research on construal level has not yet considered. Overall, the current findings indicate that the effects of construal level and the dimensions underlying political ideology need to be teased apart to fully understand the exact relationship between the two.

By KEVIN LEWIS | 09:00:00 AM

Thursday, August 18, 2016

How you seem

Numbers Are Gendered: The Role of Numerical Precision

Dengfeng Yan

Journal of Consumer Research, forthcoming

Abstract:
Marketing communications often contain numerical information that can be expressed more or less precisely. Earlier research has identified a number of ways in which consumers respond differently to precise versus round numbers. The current research attempts to enrich this literature by introducing a new theoretical perspective. Drawing on recent findings in the numerical cognition literature, this work proposes that individuals project gendered meanings to precise versus round numbers, with precise numbers seen as more masculine relative to round ones. Seven studies provided convergent evidence for this proposition and demonstrated its marketing implications. Studies 1, 2, and 3, employing various approaches, show that participants do subscribe to this precision-masculinity intuition, at both implicit and explicit levels. Study 4 suppresses this effect by priming participants with examples where precision is connected to femininity. Building on these findings, subsequent studies demonstrate that marketing communications using precise (round) numbers lead to more favorable evaluations when the products or attributes are positioned as masculine (feminine).

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Answering Unresolved Questions About the Relationship Between Cognitive Ability and Prejudice

Mark Brandt & Jarret Crawford

Social Psychological and Personality Science, forthcoming

Abstract:
Previous research finds that lower cognitive ability predicts greater prejudice. We test two unresolved questions about this association using a heterogeneous set of target groups and data from a representative sample of the United States (N = 5,914). First, we test “who are the targets of prejudice?” We replicate prior negative associations between cognitive ability and prejudice for groups who are perceived as liberal, unconventional, and having lower levels of choice over group membership. We find the opposite (i.e., positive associations), however, for groups perceived as conservative, conventional, and having higher levels of choice over group membership. Second, we test “who shows intergroup bias?” and find that people with both relatively higher and lower levels of cognitive ability show approximately equal levels of intergroup bias but toward different sets of groups.

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Is Eco-Friendly Unmanly? The Green-Feminine Stereotype and Its Effect on Sustainable Consumption

Aaron Brough et al.

Journal of Consumer Research, forthcoming

Abstract:
Why are men less likely than women to embrace environmentally friendly products and behaviors? Whereas prior research attributes this gender gap in sustainable consumption to personality differences between the sexes, we propose that it may also partially stem from a prevalent association between green behavior and femininity, and a corresponding stereotype (held by both men and women) that green consumers are more feminine. Building on prior findings that men tend to be more concerned than women with gender identity maintenance, we argue that this green-feminine stereotype may motivate men to avoid green behaviors in order to preserve a macho image. A series of seven studies provides evidence that the concepts of greenness and femininity are cognitively linked and shows that, accordingly, consumers who engage in green behaviors are stereotyped by others as more feminine and even perceive themselves as more feminine. Further, men’s willingness to engage in green behaviors can be influenced by threatening or affirming their masculinity, as well as by using masculine rather than conventional green branding. Together, these findings bridge literatures on identity and environmental sustainability and introduce the notion that due to the green-feminine stereotype, gender identity maintenance can influence men’s likelihood of adopting green behaviors.

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Proximity under Threat: The Role of Physical Distance in Intergroup Relations

Jenny Xiao, Michael Wohl & Jay Van Bavel

PLoS ONE, July 2016

Abstract:
Throughout human history, social groups have invested immense amounts of wealth and time to keep threatening out-groups at a distance. In the current research, we explored the relationship between intergroup threat, physical distance, and discrimination. Specifically, we examined how intergroup threat alters estimates of physical distance to out-groups and how physical proximity affects intergroup relations. Previous research has found that people judge threatening out-groups as physically close. In Studies 1 and 2, we examined ways to attenuate this bias. In Study 1 a secure (vs. permeable) US-Mexico border reduced the estimated proximity to Mexico City among Americans who felt threatened by Mexican immigration. In Study 2, intergroup apologies reduced estimates of physical proximity to a threatening cross-town rival university, but only among participants with cross-group friendships. In Study 3, New York Yankees fans who received an experimental induction of physical proximity to a threatening out-group (Boston Red Sox) had a stronger relationship between their collective identification with the New York Yankees and support for discriminatory policies toward members of the out-group (Red Sox fans) as well as how far they chose to sit from out-group members (Red Sox fans). Together, these studies suggest that intergroup threat alters judgment of physical properties, which has important implications for intergroup relations.

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Do Americans Prefer Coethnic Representation?: The Impact of Race on House Incumbent Evaluations

Stephen Ansolabehere & Bernard Fraga

Stanford Law Review, June 2016, Pages 1553-1594

Abstract:
Theories of representation often assert that citizens prefer representatives who are of the same racial or ethnic background as themselves. Examining surveys of over 80,000 individuals, this Article quantifies the preference for coethnic representation among whites, blacks, and Hispanics. The large sample size provides sufficient statistical power to study constituents in districts with minority representatives, as well as those with white representatives. We find that individuals strongly prefer representatives who share their ethnic background, yet partisanship explains most of the preference for coethnic representation. Controlling for party, whites express a slight preference for white representation, but blacks and Hispanics express equal support for minority and white incumbents. The differential preference for white representation among white Democrats is explained by a bias associated with attitudes about race-related policy. These findings suggest that legal and political theories of race, especially regarding the Voting Rights Act, must be tied to voters’ policy and party preferences, not merely their racial identity.

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Past Threat, Present Prejudice: The Impact of Adolescent Racial Context on White Racial Attitude

Seth Goldman & Daniel Hopkins

University of Pennsylvania Working Paper, June 2016

Abstract:
Extensive research on racial threat suggests that white Americans living near black Americans adopt more negative racial attitudes. Theoretically, local inter-group exposure has been conceptualized as acting contemporaneously, despite political socialization research indicating that experiences in adolescence are especially influential. Here, we test the impact of adolescent racial contexts on whites' prejudice using two data sets. The first is the Youth-Parent Socialization Panel Survey, which followed one cohort from 1965 to 1997. The second is a population-based panel with novel measures of inter-group proximity conducted between 2007 and 2013. Our analyses demonstrate the enduring influence of adolescent contexts: while the racial composition of whites' current counties is not a consistent predictor of racial prejudice, the racial composition of their county during high school is. Exposure during one's formative years appears to increase racial prejudice decades later, providing new insight about the roots of racial threat and prejudice.

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Is it always good to feel valued? The psychological benefits and costs of higher perceived status in one’s ethnic minority group

Christopher Begeny & Yuen Huo

Group Processes & Intergroup Relations, forthcoming

Abstract:
Two studies (N = 1,048) examined how Blacks’, Asians’, and Latinos’ perceived value within their own ethnic group (ethnic intragroup status) shapes mental health (depression, anxiety, psychological distress). The proposed intragroup status and health (ISAH) model predicts that feeling valued among ethnic ingroup members has benefits for health, but also indirect costs. Costs arise because individuals who feel highly valued in their ethnic group see their ethnicity as more central to their self-concept; with stronger identity-centrality, individuals more frequently view daily social interactions through the “lens” of their ethnicity and ultimately perceive/experience more discrimination. Discrimination, in turn, adversely shapes mental health. Results of structural equation modeling supported these predictions across all groups in both studies. Thus, feeling valued in one’s minority group may be a double-edged sword for mental health. Overall, the ISAH model reveals how intragroup processes, when considered from an intergroup perspective, advance our understanding of minority mental health.

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Sexually Objectifying Pop Music Videos, Young Women’s Self-Objectification, and Selective Exposure: A Moderated Mediation Model

Kathrin Karsay & Jörg Matthes

Communication Research, forthcoming

Abstract:
There is intense discussion among experts about the potential negative impact of sexually objectifying media content on young women. This article presents an experimental study in which young women were either exposed to pop music videos high in sexual objectification or to pop music videos low in sexual objectification. Women’s self-objectification and their subsequent media selection behavior were measured. The results indicate that exposure to sexually objectifying media increased self-objectification, which in turn increased the preference for objectifying media content. Self-esteem, the internalization of appearance ideals, and body mass index (BMI) did not influence these relationships. Implications of these findings are discussed.

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On the Borders of Harmful and Helpful Beauty Biases: The Biasing Effects of Physical Attractiveness Depend on Sex and Ethnicity

Maria Agthe et al.

Evolutionary Psychology, June 2016

Abstract:
Research with European Caucasian samples demonstrates that attractiveness-based biases in social evaluation depend on the constellation of the sex of the evaluator and the sex of the target: Whereas people generally show positive biases toward attractive opposite-sex persons, they show less positive or even negative biases toward attractive same-sex persons. By examining these biases both within and between different ethnicities, the current studies provide new evidence for both the generalizability and the specificity of these attractiveness-based social perception biases. Examining within-ethnicity effects, Study 1 is the first to demonstrate that samples from diverse ethnic backgrounds parallel the finding of European Caucasian samples: The advantageous or adverse effects of attractiveness depend on the gender constellation of the evaluator and the evaluated person. Examining between-ethnicity effects, Study 2 found that these attractiveness-based biases emerge almost exclusively toward targets of the evaluator’s own ethnic background; these biases were reduced or eliminated for cross-ethnicity evaluations and interaction intentions. We discuss these findings in light of evolutionary principles and reflect on potential interactions between culture and evolved cognitive mechanisms.

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The threatening nature of “rap” music

Adam Dunbar, Charis Kubrin & Nicholas Scurich

Psychology, Public Policy, and Law, August 2016, Pages 280-292

Abstract:
Rap music has had a contentious relationship with the legal system, including censorship, regulation, and artists being arrested for lewd and profane performances. More recently, rap lyrics have been introduced by prosecutors to establish guilt in criminal trials. Some fear this form of artistic expression will be inappropriately interpreted as literal and threatening, perhaps because of stereotypes. Only a handful of studies have examined whether rap lyrics are evaluated using stereotypes, yet these studies were conducted in the 1990s — a period of heightened scrutiny for rap — and used nonoptimal methods. This study presents 3 experiments that examine the impact of genre-specific stereotypes on the evaluation of violent song lyrics by manipulating the musical genre (rap vs. country) while holding constant the actual lyrics. Study 1, a direct replication of previous research, found that participants deemed identical lyrics more literal, offensive, and in greater need of regulation when they were characterized as rap compared with country. Study 2 was a conceptual replication (i.e., same design but different stimuli), and again detected this effect. Study 3 used the same approach but experimentally manipulated the race of the author of the lyrics. A main effect was detected for the genre, with rap evaluated more negatively than country or a control condition with no label. However, no effects were found for the race of the lyrics’ author nor were interactions were detected. Collectively, these findings highlight the possibility that rap lyrics could inappropriately impact jurors when admitted as evidence to prove guilt.

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Generalizing Baseball: Holding and Applying Stereotypes to America’s Pastime

Patrick Ferrucci et al.

Journal of Sports Media, Spring 2016, Pages 101-121

Abstract:
Prior content analyses of sports coverage have revealed sports journalists ascribe particular adjectives to athletes based on race. A recurring pattern is the brain-versus-brawn dichotomy. In a 2 (race: Black versus White player) x 2 (description: consistent versus inconsistent stereotype) x 2 (source: journalist vs. blogger) within-subjects experiment, we empirically tested if the same set of stereotypes holds true among those exposed to these media stereotypes. Using both implicit (response latency) and explicit (credibility rating) measures, we found a consistent pattern of stereotyping Black athletes. Stereotypes were activated most quickly by a stereotypical description of a Black athlete. A journalist was also rated most credible when stereotypically describing a Black athlete.

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The Social Causes and Political Consequences of Group Empathy

Cigdem Sirin, Nicholas Valentino & José Villalobos

Political Psychology, forthcoming

Abstract:
Recent scholarship has discovered significant racial/ethnic group variation in response to political threats such as immigration and terrorism. Surprisingly, minority groups often simultaneously perceive themselves to be at greater risk from such threats and yet still prefer more open immigration policies and civil liberties protections. We suggest a group-level empathy process may explain this puzzle: Due to their higher levels of empathy for other disadvantaged groups, many minority group members support protections for others even when their own interests are threatened. Little is known, however, about the unique properties of group empathy or its role in policy opinion formation. In this study, we examine the reliability and validity of our new measure of group empathy, the Group Empathy Index (GEI), demonstrating that it is distinct from other social and political predispositions such as ethnocentrism, social dominance orientation, authoritarianism, ideology, and partisanship. We then propose a theory about the development of group empathy in reaction to life experiences based on one's race/ethnicity, gender, age, and education. Finally, we examine the power of group empathy to predict policy attitudes and political behavior.

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What Lies Beneath? Minority Group Members’ Suspicion of Whites’ Egalitarian Motivation Predicts Responses to Whites’ Smiles

Jonathan Kunstman et al.

Personality and Social Psychology Bulletin, September 2016, Pages 1193-1205

Abstract:
Antiprejudice norms and attempts to conceal racial bias have made Whites’ positive treatment of racial minorities attributionally ambiguous. Although some minorities believe Whites’ positivity is genuine, others are suspicious of Whites’ motives and believe their kindness is primarily motivated by desires to avoid appearing prejudiced. For those suspicious of Whites’ motives, Whites’ smiles may paradoxically function as threat cues. To the extent that Whites’ smiles cue threat among suspicious minorities, we hypothesized that suspicious minorities would explicitly perceive Whites’ smiles as threatening (Study 1), automatically orient to smiling White — as opposed to smiling Black — targets (Study 2), and accurately discriminate between Whites’ real and fake smiles (Study 3). These results provide convergent evidence that cues typically associated with acceptance and affiliation ironically function as threat cues among suspicious racial minorities.

By KEVIN LEWIS | 09:00:00 AM

Wednesday, August 17, 2016

So hot

Big Data Sensors of Organic Advocacy: The Case of Leonardo DiCaprio and Climate Change

Eric Leas et al.

PLoS ONE, August 2016

Abstract:
The strategies that experts have used to share information about social causes have historically been top-down, meaning the most influential messages are believed to come from planned events and campaigns. However, more people are independently engaging with social causes today than ever before, in part because online platforms allow them to instantaneously seek, create, and share information. In some cases this “organic advocacy” may rival or even eclipse top-down strategies. Big data analytics make it possible to rapidly detect public engagement with social causes by analyzing the same platforms from which organic advocacy spreads. To demonstrate this claim we evaluated how Leonardo DiCaprio’s 2016 Oscar acceptance speech citing climate change motivated global English language news (Bloomberg Terminal news archives), social media (Twitter postings) and information seeking (Google searches) about climate change. Despite an insignificant increase in traditional news coverage (54%; 95%CI: -144 to 247), tweets including the terms “climate change” or “global warming” reached record highs, increasing 636% (95%CI: 573–699) with more than 250,000 tweets the day DiCaprio spoke. In practical terms the “DiCaprio effect” surpassed the daily average effect of the 2015 Conference of the Parties (COP) and the Earth Day effect by a factor of 3.2 and 5.3, respectively. At the same time, Google searches for “climate change” or “global warming” increased 261% (95%CI, 186–335) and 210% (95%CI 149–272) the day DiCaprio spoke and remained higher for 4 more days, representing 104,190 and 216,490 searches. This increase was 3.8 and 4.3 times larger than the increases observed during COP’s daily average or on Earth Day. Searches were closely linked to content from Dicaprio’s speech (e.g., “hottest year”), as unmentioned content did not have search increases (e.g., “electric car”). Because these data are freely available in real time our analytical strategy provides substantial lead time for experts to detect and participate in organic advocacy while an issue is salient. Our study demonstrates new opportunities to detect and aid agents of change and advances our understanding of communication in the 21st century media landscape.

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The abandoned ice sheet base at Camp Century, Greenland, in a warming climate

William Colgan et al.

Geophysical Research Letters, forthcoming

Abstract:
In 1959 the U.S. Army Corps of Engineers built Camp Century beneath the surface of the northwestern Greenland Ice Sheet. There they studied the feasibility of deploying ballistic missiles within the ice sheet. The base and its wastes were abandoned with minimal decommissioning in 1967, under the assumption they would be preserved for eternity by perpetually accumulating snowfall. Here we show that a transition in ice sheet surface mass balance at Camp Century from net accumulation to net ablation is plausible within the next 75 years, under a business-as-usual anthropogenic emissions scenario (Representative Concentration Pathway 8.5). Net ablation would guarantee the eventual remobilization of physical, chemical, biological, and radiological wastes abandoned at the site. While Camp Century and four other contemporaneous ice sheet bases were legally established under a Danish-U.S. treaty, the potential remobilization of their abandoned wastes, previously regarded as sequestered, represents an entirely new pathway of political dispute resulting from climate change.

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A Forward Looking Ricardian Approach: Do Land Markets Capitalize Climate Change Forecasts?

Christopher Severen, Christopher Costello & Olivier Deschenes

NBER Working Paper, July 2016

Abstract:
The hedonic pricing method is one of the fundamental approaches used to estimate the economic value of attributes that affect the market price of an asset. In environmental economics, such methods are routinely used to derive the economic valuation of environmental attributes such as air pollution and water quality. For example, the Ricardian approach is based on a hedonic regression of land values on historical climate variables. Forecasts of future climate can then be employed to estimate the future costs of climate change. This extensively-applied approach contains an important implicit assumption that current land markets ignore current climate forecasts. While this assumption was defensible decades ago (when this literature first emerged), it is reasonable to hypothesize that information on climate change is so pervasive today that markets may already price in expectations of future climate change. We show how to account for this with a straightforward empirical correction (called the Forward-Looking Ricardian Approach) that can be implemented with readily available data. We apply this empirically to agricultural land markets in the United States and find evidence that these markets already are accounting for climate change forecasts. Failing to account for this would lead a researcher to understate climate change damages by 36% to 66%.

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Political affiliation affects adaptation to climate risks: Evidence from New York City

W.J. Wouter Botzen et al.

Climatic Change, forthcoming

Abstract:
Research reveals that liberals and conservatives in the United States diverge about their beliefs regarding climate change. We show empirically that political affiliation also matters with respect to climate related risks such as flooding from hurricanes. Our study is based on a survey conducted 6 months after Superstorm Sandy in 2012 of over 1,000 residents in flood-prone areas in New York City. Democrats’ perception of their probability of suffering flood damage is significantly higher than Republicans’ and they are also more likely to invest in individual flood protection measures. However, 50% more Democrats than Republicans in our sample expect to receive federal disaster relief after a major flood. These results highlight the importance of taking into account value-based considerations in designing disaster risk management policies.

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Partisan differences in the relationship between newspaper coverage and concern over global warming

Xiaoquan Zhao, Justin Rolfe-Redding & John Kotcher

Public Understanding of Science, July 2016, Pages 543-559

Abstract:
The effects of news media on public opinion about global warming have been a topic of much interest in both academic and popular discourse. Empirical evidence in this regard, however, is still limited and somewhat mixed. This study used data from the 2006 General Social Survey in combination with a content analysis of newspaper coverage of the same time period to examine the relationship between general news climate and public concern about global warming. Results showed a pattern of political polarization, with increased coverage associated with growing divergence between Democrats and Republicans. Further analysis also showed evidence of reactivity in partisan response to coverage from different news outlets. These findings point to a particular form of politically motivated, biased processing of news information.

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Past Actions as Self-Signals: How Acting in a Self-Interested Way Influences Environmental Decision Making

Chang-Yuan Lee et al.

PLoS ONE, July 2016

Abstract:
In the last few decades, awareness of environmental issues has increased significantly. Little has changed, however, in human activities contributing to environmental damage. Why is it so difficult for us to change our behavior in a domain that is clearly so important to the future of humanity? Here we propose and test the possibility that self-signaling, the way we view ourselves based on our past behaviors, is one of the factors contributing to the difficulty of taking environmental action. In three experiments, we show that previous self-interested thoughts or behaviors serve as important signals that hinder the likelihood of acting in line with an individual’s reported concern for the environment. This study not only helps explain the gap between environmental awareness and action, but also suggests alternative strategies for policymakers and environmental agencies to promote proenvironmental behavior.

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How Positive Framing May Fuel Opposition to Low-Carbon Technologies: The Boomerang Model

Gerdien de Vries

Journal of Language and Social Psychology, forthcoming

Abstract:
Low-carbon technologies are necessary to combat global warming. However, they are often opposed by members of the general public, causing costly delays and cancellations. In this article, I argue that language may be a relevant cause of such opposition. I introduce a theoretical model describing a boomerang effect in which positively framed communication about low-carbon technologies may actually lead to opposition in the long run. An example of positive framing is emphasising the climate benefits of a technology while neglecting to mention associated safety risks. I predict that, over time, people begin to perceive positive framing as an attempt to manipulate them into supporting a technology. In turn, this perceived manipulation may make them feel that their freedom to make their own decision to support or oppose the technology is under threat. To counter this behavioural threat, people may begin to oppose low-carbon technologies. My boomerang model further describes how certain characteristics of the source of information as well as of the recipient may influence both the direct and indirect effects of positive framing. I then discuss the model’s implications for effective communication and indicate directions for future research.

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Attributing human mortality during extreme heat waves to anthropogenic climate change

Daniel Mitchell et al.

Environmental Research Letters, July 2016

Abstract:
It has been argued that climate change is the biggest global health threat of the 21st century. The extreme high temperatures of the summer of 2003 were associated with up to seventy thousand excess deaths across Europe. Previous studies have attributed the meteorological event to the human influence on climate, or examined the role of heat waves on human health. Here, for the first time, we explicitly quantify the role of human activity on climate and heat-related mortality in an event attribution framework, analysing both the Europe-wide temperature response in 2003, and localised responses over London and Paris. Using publicly-donated computing, we perform many thousands of climate simulations of a high-resolution regional climate model. This allows generation of a comprehensive statistical description of the 2003 event and the role of human influence within it, using the results as input to a health impact assessment model of human mortality. We find large-scale dynamical modes of atmospheric variability remain largely unchanged under anthropogenic climate change, and hence the direct thermodynamical response is mainly responsible for the increased mortality. In summer 2003, anthropogenic climate change increased the risk of heat-related mortality in Central Paris by ~70% and by ~20% in London, which experienced lower extreme heat. Out of the estimated ~315 and ~735 summer deaths attributed to the heatwave event in Greater London and Central Paris, respectively, 64 (±3) deaths were attributable to anthropogenic climate change in London, and 506 (±51) in Paris. Such an ability to robustly attribute specific damages to anthropogenic drivers of increased extreme heat can inform societal responses to, and responsibilities for, climate change.

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Demographic controls of future global fire risk

W. Knorr, A. Arneth & L. Jiang

Nature Climate Change, August 2016, Pages 781–785

Abstract:
Wildfires are an important component of terrestrial ecosystem ecology but also a major natural hazard to societies, and their frequency and spatial distribution must be better understood. At a given location, risk from wildfire is associated with the annual fraction of burned area, which is expected to increase in response to climate warming. Until recently, however, only a few global studies of future fire have considered the effects of other important global environmental change factors such as atmospheric CO2 levels and human activities, and how these influence fires in different regions. Here, we contrast the impact of climate change and increasing atmospheric CO2 content on burned area with that of demographic dynamics, using ensembles of climate simulations combined with historical and projected population changes under different socio-economic development pathways for 1901–2100. Historically, humans notably suppressed wildfires. For future scenarios, global burned area will continue to decline under a moderate emissions scenario, except for low population growth and fast urbanization, but start to increase again from around mid-century under high greenhouse gas emissions. Contrary to common perception, we find that human exposure to wildfires increases in the future mainly owing to projected population growth in areas with frequent wildfires, rather than by a general increase in burned area.

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Climate consequences of low-carbon fuels: The United States Renewable Fuel Standard

Jason Hill, Liaila Tajibaeva & Stephen Polasky

Energy Policy, October 2016, Pages 351–353

Abstract:
A common strategy for reducing greenhouse gas (GHG) emissions from energy use is to increase the supply of low-carbon alternatives. However, increasing supply tends to lower energy prices, which encourages additional fuel consumption. This “fuel market rebound effect” can undermine climate change mitigation strategies, even to the point where efforts to reduce GHG emissions by increasing the supply of low-carbon fuels may actually result in increased GHG emissions. Here, we explore how policies that encourage the production of low-carbon fuels may result in increased GHG emissions because the resulting increase in energy use overwhelms the benefits of reduced carbon intensity. We describe how climate change mitigation strategies should follow a simple rule: a low-carbon fuel with a carbon intensity of X% that of a fossil fuel must displace at least X% of that fossil fuel to reduce overall GHG emissions. We apply this rule to the United States Renewable Fuel Standard (RFS2). We show that absent consideration of the fuel market rebound effect, RFS2 appears to reduce GHG emissions, but once the fuel market rebound effect is factored in, RFS2 actually increases GHG emissions when all fuel GHG intensity targets are met.

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Global sea-level rise: Weighing country responsibility and risk

Dean Hardy & Bryan Nuse

Climatic Change, August 2016, Pages 333-345

Abstract:
Accelerated sea-level rise will be one of the most significant effects of global warming. Global mean sea level has risen more than 0.2 m since 1880 and continues rising at above 4 mm yr.−1. Here we allocate responsibility to countries for global sea-level rise commitment (SLRC) over the period 1850 to 2100 and weigh that against their exposure to inundation from sea-level rise. We bridge two lines of climate-related research by combining assessment of countries’ greenhouse gas emissions with predictions of the multi-millennial sea level response to global warming. Under the Intergovernmental Panel on Climate Change’s business-as-usual scenario our findings show that the five most responsible countries for global SLRC are also the most exposed to absolute land loss. This is mostly due to their own emissions, which we call intrinsic risk. We also assess extrinsic risk, defined as a country’s land exposed to inundation due to all other countries’ emissions. We show that for 6 m of global SLRC, the two non-island countries with the highest extrinsic risk are predicted to lose 27 % and 15 % of their own land, yet contributed less than 1.1 % each to the emissions driving SLRC. We anticipate that our findings will directly inform policy discussions in international climate negotiations by identifying the relative degree of country responsibility and risk associated with sea-level rise.

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Future Decreases in Freezing Days Across North America

Michael Rawlins et al.

Journal of Climate, forthcoming

Abstract:
We used air temperatures from a suite of regional climate models participating in the North American Climate Change Assessment Program (NARCCAP) together with two atmospheric reanalysis data sets to investigate changes in freezing days (defined as days with daily average temperature below freezing) likely to occur between 30 year baseline (1971–2000) and mid-century (2041–2070) periods across most of North America. Changes in NARCCAP ensemble mean winter temperature show a strong gradient with latitude, with warming of over 4°C near Hudson Bay. The decline in freezing days ranges from less than 10 days across north-central Canada to nearly 90 days in the warmest areas of the continent that currently undergo seasonally freezing conditions. The area experiencing freezing days contracts by 0.9–1.0 million km2 (5.7%–6.4% of the total area). Areas with mean annual temperature between 2–6°C and a relatively low rate of change in climatological daily temperatures (< 0.2°C day−1) near the time of spring thaw will encounter the greatest decreases in freezing days. Advances in the timing of spring thaw will exceed the delay in fall freeze across much of the US, with the reverse pattern likely over most of Canada.

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Effects of a Warming Climate on Daily Snowfall Events in the Northern Hemisphere

James Danco et al.

Journal of Climate, forthcoming

Abstract:
Using simulations performed with 24 coupled atmosphere-ocean global climate models from phase 5 of the Coupled Model Intercomparison Project (CMIP5), projections of Northern Hemisphere daily snowfall events under the RCP8.5 emissions scenario are analyzed for the periods of 2021-2050 and 2071-2100 and compared to the historical period of 1971-2000. The overall frequency of daily snowfall events is simulated to decrease across much of the Northern Hemisphere, except at the highest latitudes such as northern Canada, northern Siberia, and Greenland. Seasonal redistributions of daily snowfall event frequency and average daily snowfall are also projected to occur in some regions. For example, large portions of the Northern Hemisphere, including much of Canada, Tibet, northern Scandinavia, northern Siberia, and Greenland, are projected to experience increases in average daily snowfall and event frequency in midwinter. But in warmer months, the regions with increased snowfall become fewer in number and are limited to northern Canada, northern Siberia, and Greenland. These simulations also show changes in the frequency distribution of daily snowfall event intensity, including an increase in heavier snowfall events even in some regions where the overall snowfall decreases. The projected changes in daily snowfall event frequency exhibit some dependence on the temperature biases of the individual models in certain regions and times of the year, with colder models typically toward the positive end of the distribution of event frequency changes and warmer models toward the negative end, particularly in regions near the transition zone between increasing and decreasing snowfall.

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Bridging the Gap: Do Fast Reacting Fossil Technologies Facilitate Renewable Energy Diffusion?

Elena Verdolini, Francesco Vona & David Popp

NBER Working Paper, July 2016

Abstract:
The diffusion of renewable energy in the power system implies high supply variability. Lacking economically viable storage options, renewable energy integration has so far been possible thanks to the presence of fast-reacting mid-merit fossil-based technologies, which act as back-up capacity. This paper discusses the role of fossil-based power generation technologies in supporting renewable energy investments. We study the deployment of these two technologies conditional on all other drivers in 26 OECD countries between 1990 and 2013. We show that a 1% percent increase in the share of fast-reacting fossil generation capacity is associated with a 0.88% percent increase in renewable in the long run. These results are robust to various modifications in our empirical strategy, and most notably to the use of system-GMM techniques to account for the interdependence of renewable and fast-reacting fossil investment decisions. Our analysis points to the substantial indirect costs of renewable energy integration and highlights the complementarity of investments in different generation technologies for a successful decarbonization process.

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A retrospective analysis of benefits and impacts of U.S. renewable portfolio standards

Galen Barbose et al.

Energy Policy, September 2016, Pages 645–660

Abstract:
As states consider revising or developing renewable portfolio standards (RPS), they are evaluating policy costs, benefits, and other impacts. We present the first U. S. national-level assessment of state RPS program benefits and impacts, focusing on new renewable electricity resources used to meet RPS compliance obligations in 2013. In our central-case scenario, reductions in life-cycle greenhouse gas emissions from displaced fossil fuel-generated electricity resulted in $2.2 billion of global benefits. Health and environmental benefits from reductions in criteria air pollutants (sulfur dioxide, nitrogen oxides, and particulate matter 2.5) were even greater, estimated at $5.2 billion in the central case. Further benefits accrued in the form of reductions in water withdrawals and consumption for power generation. Finally, although best considered resource transfers rather than net societal benefits, new renewable electricity generation used for RPS compliance in 2013 also supported nearly 200,000 U. S.-based gross jobs and reduced wholesale electricity prices and natural gas prices, saving consumers a combined $1.3–$4.9 billion. In total, the estimated benefits and impacts well-exceed previous estimates of RPS compliance costs.

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Crop Yield Changes Induced by Emissions of Individual Climate-Altering Pollutants

Drew Shindell

Earth's Future, forthcoming

Abstract:
Climate change damages agriculture, causing deteriorating food security and increased malnutrition. Many studies have examined the role of distinct physical processes, but impacts have not been previously attributed to individual pollutants. Using a simple model incorporating process-level results from detailed models, here I show that although carbon dioxide (CO2) is the largest driver of climate change, other drivers dominate agricultural yield changes. I calculate that anthropogenic emissions to date have decreased global agricultural yields by 9.5 ± 3.0%, with roughly 93% stemming from non-CO2 emissions, including methane (-5.2 ± 1.7%) and halocarbons (-1.4 ± 0.4%). The differing impacts stem from atmospheric composition responses: CO2 fertilizes crops, offsetting much of the loss induced by warming; halocarbons do not fertilize; methane leads to minimal fertilization but increases surface ozone which augments warming-induced losses. By the end of the century, strong CO2 mitigation improves agricultural yields by ~3 ± 5%. In contrast, strong methane and hydrofluorocarbon mitigation improve yields by ~16 ± 5% and ~5 ± 4%, respectively. These are the first quantitative analyses to include climate, CO2 and ozone simultaneously, and hence additional studies would be valuable. Nonetheless, as policy makers have leverage over pollutant emissions rather than isolated processes, the perspective presented here may be more useful for decision making than that in the prior work upon which this study builds. The results suggest that policies should target a broad portfolio of pollutant emissions in order to optimize mitigation of societal damages.

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Past and Projected Changes in Western North Pacific Tropical Cyclone Exposure

James Kossin, Kerry Emanuel & Suzana Camargo

Journal of Climate, August 2016, Pages 5725–5739

Abstract:
The average latitude where tropical cyclones (TCs) reach their peak intensity has been observed to be shifting poleward in some regions over the past 30 years, apparently in concert with the independently observed expansion of the tropical belt. This poleward migration is particularly well observed and robust in the western North Pacific Ocean (WNP). Such a migration is expected to cause systematic changes, both increases and decreases, in regional hazard exposure and risk, particularly if it persists through the present century. Here, it is shown that the past poleward migration in the WNP has coincided with decreased TC exposure in the region of the Philippine and South China Seas, including the Marianas, the Philippines, Vietnam, and southern China, and increased exposure in the region of the East China Sea, including Japan and its Ryukyu Islands, the Korea Peninsula, and parts of eastern China. Additionally, it is shown that projections of WNP TCs simulated by, and downscaled from, an ensemble of numerical models from phase 5 of the Coupled Model Intercomparison Project (CMIP5) demonstrate a continuing poleward migration into the present century following the emissions projections of the representative concentration pathway 8.5 (RCP8.5). The projected migration causes a shift in regional TC exposure that is very similar in pattern and relative amplitude to the past observed shift. In terms of regional differences in vulnerability and resilience based on past TC exposure, the potential ramifications of these future changes are significant. Questions of attribution for the changes are discussed in terms of tropical belt expansion and Pacific decadal sea surface temperature variability.

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Long-term dynamics of adaptive evolution in a globally important phytoplankton species to ocean acidification

Lothar Schlüter et al.

Science Advances, July 2016

Abstract:
Marine phytoplankton may adapt to ocean change, such as acidification or warming, because of their large population sizes and short generation times. Long-term adaptation to novel environments is a dynamic process, and phenotypic change can take place thousands of generations after exposure to novel conditions. We conducted a long-term evolution experiment (4 years = 2100 generations), starting with a single clone of the abundant and widespread coccolithophore Emiliania huxleyi exposed to three different CO2 levels simulating ocean acidification (OA). Growth rates as a proxy for Darwinian fitness increased only moderately under both levels of OA [+3.4% and +4.8%, respectively, at 1100 and 2200 μatm partial pressure of CO2 (PCO2)] relative to control treatments (ambient CO2, 400 μatm). Long-term adaptation to OA was complex, and initial phenotypic responses of ecologically important traits were later reverted. The biogeochemically important trait of calcification, in particular, that had initially been restored within the first year of evolution was later reduced to levels lower than the performance of nonadapted populations under OA. Calcification was not constitutively lost but returned to control treatment levels when high CO2–adapted isolates were transferred back to present-day control CO2 conditions. Selection under elevated CO2 exacerbated a general decrease of cell sizes under long-term laboratory evolution. Our results show that phytoplankton may evolve complex phenotypic plasticity that can affect biogeochemically important traits, such as calcification. Adaptive evolution may play out over longer time scales (>1 year) in an unforeseen way under future ocean conditions that cannot be predicted from initial adaptation responses.

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Global climate change driven by soot at the K-Pg boundary as the cause of the mass extinction

Kunio Kaiho et al.

Scientific Reports, July 2016

Abstract:
The mass extinction of life 66 million years ago at the Cretaceous/Paleogene boundary, marked by the extinctions of dinosaurs and shallow marine organisms, is important because it led to the macroevolution of mammals and appearance of humans. The current hypothesis for the extinction is that an asteroid impact in present-day Mexico formed condensed aerosols in the stratosphere, which caused the cessation of photosynthesis and global near-freezing conditions. Here, we show that the stratospheric aerosols did not induce darkness that resulted in milder cooling than previously thought. We propose a new hypothesis that latitude-dependent climate changes caused by massive stratospheric soot explain the known mortality and survival on land and in oceans at the Cretaceous/Paleogene boundary. The stratospheric soot was ejected from the oil-rich area by the asteroid impact and was spread globally. The soot aerosols caused sufficiently colder climates at mid–high latitudes and drought with milder cooling at low latitudes on land, in addition to causing limited cessation of photosynthesis in global oceans within a few months to two years after the impact, followed by surface-water cooling in global oceans in a few years. The rapid climate change induced terrestrial extinctions followed by marine extinctions over several years.

By KEVIN LEWIS | 09:00:00 AM


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