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- Measuring success in education: the role of effort on the test itself
by maximorossi in NEP-LTV blog, 2018-03-20 13:38:00 UTC
Uri Gneezy ; John List ; Jeffrey Livingston ; Xiangdong Qin ; Sally Sadoff ; Yang Xu
Tests measuring and comparing educational achievement are an important policy tool. We experimentally show that offering students extrinsic incentives to put forth effort on such achievement tests has differential effects across cultures. Offering incentives to U.S. students, who generally perform poorly on assessments, improved performance substantially. In contrast, Shanghai students, who are top performers on assessments, were not affected by incentives. Our findings suggest that in [...]
- Field experiments on the development of time preferences
by maximorossi in NEP-LTV blog, 2018-03-20 13:36:26 UTC
James Andreoni ; Michael Kuhn ; John List ; Anya Samek ; Charles Sprenger
Time preferences have been correlated with a range of life outcomes, yet little is known about their early development. We conduct a field experiment to elicit time preferences of nearly 1,000 children ages 3-12, who make several inter temporal decisions. To shed light on how such primitives form, we explore various channels that might affect time preferences, from background characteristics to the causal impact of an early schooling program that we developed and operated. Our results suggest that time [...]
- Correlations of Brothersâ Earnings and Intergenerational Transmission
by maximorossi in NEP-LTV blog, 2018-03-20 13:35:03 UTC
Paul Bingley ; Lorenzo Cappellari
Correlations between parent and child earnings reflect intergenerational mobility and, more broadly, correlations between siblingsâ€ earnings reflect shared community and family background. These earnings relationships capture important aspects of relations in socio-economic status more generally. We estimate intergenerational transmission and sibling correlations of life-cycle earnings jointly within a unified framework that nests previous models. Using data on the Danish population of father/first-son/second-son triads we find that intergeneratio [...]
- Crime and Violence: Desensitization in Victims to Watching Criminal Events
by maximorossi in NEP-LTV blog, 2018-03-20 13:34:07 UTC
Rafael Di Tella (Harvard Business School, Business, Government and the International Economy Unit) ; Lucía Freira (Universidad Torcuato Di Tella) ; Ramiro H. Gálvez (Universidad Torcuato Di Tella) ; Ernesto Schargrodsky (Universidad Torcuato Di Tella) ; Diego Shalom (Universidad Torcuato Di Tella) ; Mariano Sigman (Universidad Torcuato Di Tella)
We study desensitization to crime in a lab experiment by showing footage of criminal acts to a group of subjects, some of whom have been previously victimized. We measure biological markers of stress and behavioral indices of cogni [...]
- Tougher capital regulation pays off
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-03-19 11:31:29 UTC
Banks continue to lobby for weaker financial regulation: capital requirements are excessive, liquidity requirements are overly restrictive, and stress tests are too burdensome. Yes, in the aftermath of the 2007-09 financial crisis, we needed reforms, they say, but Basel III and Dodd-Frank have gone too far. Unfortunately, these complaints are finding sympathetic ears in a variety of places. U.S. authorities are considering changes that would water down existing standards. In the name of supporting community banks , the Senate has approved a bill to relax the regulation of large banks , in part [...]
- What do earnings tell us?
by chris in Stumbling and Mumbling, 2018-03-15 13:52:38 UTC
Sam Gyimah’s proposal that universities be ranked by graduates’ earnings has been criticized as missing the point that the purpose of a university education is more than personal enrichment. There are, however, other problems with it. I’ll take just seven:
First, at what stage of graduates’ careers do you measure earnings? If you do so soon after graduation, a course that produces lots of (say) investment bankers will seem better than one that produces lots of (say) barristers, because bankers earn big money quickly whilst barristers take longer to make it. If, however, you measure earnings la [...]
- Thesis Thursday: Sarah Zheng
by Chris Sampson in The Academic Health Economists' Blog, 2018-03-15 07:00:19 UTC
On the third Thursday of every month, we speak to a recent graduate about their thesis and their studies. This month’s guest is Dr Sarah Zheng who has a PhD from Boston University . If you would like to suggest a candidate for an upcoming Thesis Thursday, get in touch.
Design for performance: studies on cost and quality in U.S. health care
Z. Justin Ren , Kimberley H. Geissler , Janelle Heineke , Anita Tucker
In the context of your PhD research, what does ‘design for performance’ mean?
“Design for performance” is a furthe [...]
- Monetary theory reversed: Virtual currency issuance and minersâ remuneration
by Christian Zimmermann in NEP-DGE blog, 2018-03-14 09:51:01 UTC
By Luca Marchiori
This study analyzes the macroeconomic implications of virtual currency issuance. It builds on a standard cash-in-advance model extended with (i) ‘virtual’ goods, sold against virtual currency, and (ii) miners, the agents providing payment services. The main finding is that virtual currency growth may have effects opposite to those predicted by monetary theory when miners are rewarded with newly created coins. Declining currency issuance, as in Bitcoin, raises the price of virtual goods, which counteracts the traditional i [...]
- Trumpâs Tariffs Could Actually Work â If He Has A Plan
by Evan Horowitz in FiveThirtyEight Economics, 2018-03-13 09:58:43 UTC
Republicans are in revolt . Economists on the left and right are deeply skeptical. President Trump’s top economic adviser resigned rather than be party to it. The culprit: tariffs, and specifically the president’s decision to slap duties on imported steel (25 percent) and aluminum (10 percent) .
Though they are widely vilified, tariffs actually can work, providing protection for a few vulnerable companies, safeguarding entire industries , maybe even encouraging a wholesale reassessment of what counts as fair trade. Tariffs also come with considerable costs and risks, however, and making the ga [...]
- How We Learned Not to Say No to Goldâ¦ In International Reserves
by avgevorkyan in Development Economics, 2018-03-12 21:21:03 UTC
By Aleksandr V. Gevorkyan (St. John’s University) and Tarron Khemraj (New College of Florida)
In May 2016, economist Kenneth Rogoff argued that central banks in emerging markets should add gold to their reserves. Rogoff stated “that a shift in emerging markets toward accumulating gold would help the international financial system function more smoothly and benefit everyone.” Despite initial disagreement, we find there may actually be some justification for this view in a recent paper coming out in Emerging Markets Finance and Trade .
Until recently, literature on the optimal composition of fo [...]
- Ten Years After Bear
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-03-12 12:26:11 UTC
"The holders of the cash reserve must be ready … to advance it most freely for the liabilities of others. They must lend to merchants, to minor bankers, to ‘this man and that man,’ whenever the security is good.” Walter Bagehot, Lombard Street: A Description of the Money Market (II.41), 1873. “In my preferred paraphrase of Bagehot’s famous dictum, central banks should make clear that they stand ready to lend early and freely (i.e. without limit) to sound firms, against good collateral, and at rates higher than those prevailing in normal market conditions.” Paul Tucker , 2014. Ten years ago thi [...]
- Sam Watsonâs journal round-up for 12th March 2018
by Sam Watson in The Academic Health Economists' Blog, 2018-03-12 12:00:42 UTC
Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch .
[While the journal round-up is not on strike this week, academics and other university staff across the UK continue to be. Please support these staff members and the university sector that produces much of the g [...]
- For Your Procrastination: Haven't Gathered Up One of These in a While...
by ? in Grasping Reality with the Invisible Hand, 2018-03-11 20:22:23 UTC
Robert Waldmann: A Comment on the Return of “It’s Baaaack”: "Twenty years ago, Paul Krugman warned that the liquidity trap was not just an issue in the economic history of the 30s...
Paul Krugman: It’s Baaack, Twenty Years Later: "In early 199 [...]
- Immigration: the wrong battle
by chris in Stumbling and Mumbling, 2018-03-11 12:36:06 UTC
Jeremy Corbyn is being criticized for claiming that immigration cuts wages. I suspect his critics are right, if not quite for the reasons some of them might think.
Corbyn said he wanted to
prevent] employers being able to import cheap agency labour to undercut existing pay and conditions in the name of free market orthodoxy.
One can read this not as a call for immigration controls but for restrictions on employment agencies.
Such a reading, however, doesn’t exonerate Corbyn.
For one thing, social pressure and market forces have already reined in bad agencies. Transline – the supplier of labo [...]
- Working High: Whoâs on Top in Office Buildings?
by Jason Barr in Building the skyline, 2018-03-08 17:11:18 UTC
Jason M. Barr March 8, 2018
Imagine that one day, walking through a crowded business district, you discover that you have a new power: you can see directly inside a skyscraper office building, as if one of the glass facades had just been removed. Before you is your very own ant farm.
Five thousand men and women are going about their daily work routines, without knowledge that you are observing them. On the 10 th floor, a cluster of cubicle dwellers stares at their screens. On the 20 th floor, three men in a hallway are talking about basketball. On the 30 th floor, a nervous college gradu [...]
- Under Siege and Under Fire: German Angst, the Second World War and the Long-Term Psychological Impact
by crowleymarkj in NEP-HIS blog, 2018-03-08 08:02:29 UTC
Did Strategic Bombing in the Second World War lead to ‘German Angst’? A Large-Scale Empirical Test across 89 German Cities.
Martin Obschonka ( Queensland University of Technology, Australia ), Michael Stützer ( Baden Wuerttemberg Cooperative State University and Ilmenau University of Technology, Germany) , P. Jason Rentfrow (University of Cambridge, UK), Jeff Potter ( Atof Inc., USA ), Samuel D. Gosling ( University of Texas at Austin, USA , and School of Psychological Sciences, University of Melbourne, Parkville, VIC, Australia)
Abstract : A widespread stereotype holds that the Germans are no [...]
- Do Chinese women get half the credit for holding up half the sky?
by Jane Golley in East Asia Forum, 2018-03-07 23:00:46 UTC
Author: Jane Golley, ANU
A ‘moderately prosperous society’ with no Chinese individual left behind — that was the vision set out by Chinese President Xi Jinping in his epic speech to the 19th National Congress on 18 October 2017. He mentioned gender just once in the speech. It may have deserved more attention than that.
There have been marked improvements in the socio-economic status of Chinese women during the communist era. Under Mao, from 1949 to 1976, women were considered essential for socialist construction and said to ‘hold up half the sky’. In the post-Mao era, successive leaders — incl [...]
- Management vs managerialism
by chris in Stumbling and Mumbling, 2018-03-07 14:01:42 UTC
Stian Westlake made a very good point yesterday :
Attacks on managerialism sometimes (often?) become a sort of wholesale denial of the importance of management (which IMO is a mistake).
He’s right. Good management makes a big difference to productivity, wealth and even happiness .
We should, therefore, distinguish between management and managerialism. I’ll list just five such differences: these might be rather stylized and I’m perhaps exaggerating to make a point.
1. Managerialism contains elements of magical thinking and a Messiah complex: it believes that if the right man is in charge, suc [...]
- Family, Community and Life-Cycle Earnings: Evidence from Siblings and Youth Peers
by maximorossi in NEP-LTV blog, 2018-03-06 13:02:57 UTC
Paul Bingley ; Lorenzo Cappellari ; Konstantinos Tatsiramos
Using longitudinal data based on administrative registers for the population of Danish men we develop a model which accounts for the joint earnings dynamics of siblings and youth community peers. We are the first to decompose the sibling correlation of permanent earnings into family and community effects allowing for life-cycle dynamics; finding that family is the most important factor influencing earnings inequality over the life cycle. Community background explains a substantial share of the sibling correlation of earn [...]
- Behavioral Inattention
by maximorossi in NEP-LTV blog, 2018-03-06 13:02:08 UTC
Inattention is a central, unifying theme for much of behavioral economics. It permeates such disparate fields as microeconomics, macroeconomics, finance, public economics, and industrial organization. It enables us to think in a rather consistent way about behavioral biases, speculate about their origins, and trace out their implications for market outcomes. This survey first discusses the most basic models of attention, using a fairly unified framework. Then, it discusses the methods used to measure attention, which present a number of challenges on which much progress [...]
- Social Welfare Losses Due to Occupational Segregation by Gender and Race/Ethnicity in the U.S.: Are There Differences across Regions?
by maximorossi in NEP-LTV blog, 2018-03-06 12:55:30 UTC
Coral del Río ; Olga Alonso-Villar
Taking into account the well-being losses or gains that each gender-race/ethnicity group has associated with its occupational sorting, this paper explores the social welfare loss that each U.S. large region experiences due to the different circumstances faced by these groups in each regional labor market. To analyze the period 1980–2012 in those terms, we use novel measures that aggregate the well-being losses or gains of the groups consistently with the literature on deprivation. To take into account that disparities among regions may arise from [...]
- Marriage, Labor Supply and the Dynamics of the Social Safety Net
by maximorossi in NEP-LTV blog, 2018-03-06 12:53:36 UTC
Hamish Low (University Cambridge) ; Costas Meghir (Cowles Foundation, Yale University) ; Luigi Pistaferri (Stanford University, NBER, CEPR and SIEPR) ; Alessandra Voena (University of Chicago, NBER, CEPR and BREAD)
The 1996 PRWORA reform introduced time limits on the receipt of welfare in the United States. We use variation by state and across demographic groups to provide reduced form evidence showing that such limits led to a fall in welfare claims (partly due to \banking” benefits for future use), a rise in employment, and a decline in divorce rates. We then specify and est [...]
- People versus Machines: The Impact of Minimum Wages on Automatable Jobs
by maximorossi in NEP-LTV blog, 2018-03-06 12:52:30 UTC
Lordan, Grace (London School of Economics) ; Neumark, David (University of California, Irvine)
We study the effect of minimum wage increases on employment in automatable jobs – jobs in which employers may find it easier to substitute machines for people – focusing on low-skilled workers for whom such substitution may be spurred by minimum wage increases. Based on CPS data from 1980–2015, we find that increasing the minimum wage decreases significantly the share of automatable employment held by low-skilled workers, and increases the likelihood that low-skilled workers in autom [...]
- Are Consumersâ Spending Decisions in Line With an Euler Equation?
by Christian Zimmermann in NEP-DGE blog, 2018-03-06 11:49:11 UTC
By Lena Dr�ger and Giang Nghiem
Evaluating two new survey datasets of German consumers, we test whether individual consumption spending decisions are formed according to an Euler equation derived from consumption life-cycle models. Measured in qualitative individual changes, our results suggest that current and planned spending are positively correlated, thus supporting the hypothesis of consumption smoothing. Also, current spending is positively correlated with inflation expectations, and negatively with nominal interest rate expectations. I [...]
- The First Priority of Antitrust Analysis is Getting It Right, Not Making it Easier
by Hurwitz & Stout in Truth on the Market, 2018-03-05 21:46:26 UTC
Excess is unflattering, no less when claiming that every evolution in legal doctrine is a slippery slope leading to damnation. In Friday’s New York Times, Lina Khan trots down this alarmist path while considering the implications for the pending Supreme Court case of Ohio v. American Express . One of the core issues in the case is the proper mode of antitrust analysis for credit card networks as two-sided markets. The Second Circuit Court of Appeals agreed with arguments, such as those that we have made , that it is important to consider the costs and benefits to both sides of a two-sided mark [...]
- Bank Financing: The Disappearance of Interbank Lending
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-03-05 13:27:04 UTC
“ The Panic of 2007-2008 was a run on the sale and repurchase market (the ‘repo’ market), which is a very large, short-term market that provides financing for a wide range of securitization activities and financial institutions.” Gary Gorton and Andrew Metrick, August 2009 . Retail bank runs are mostly a thing of the past. Every jurisdiction with a banking system has some form of deposit insurance , whether explicit or implicit. So, most customers can rest assured that they will be compensated even should their bank fail. But, while small and medium-sized depositors are extremely unlikely to f [...]