Economics Commons^™

Public Libraries And Political Participation, 1870-1940, Michael J. Kevane, William A. Sundstrom

Economics

The public library movement of the late 19th and early 20th centuries fostered a rapid increase in the number and quality of public libraries in cities and towns across the United States. One important argument for libraries was that they would enhance American democracy by promoting virtues of citizenship and enabling access to information. This paper examines how voter turnout was affected, in the short-term, by the establishment of public libraries, using a county-by-election year panel. Our empirical strategy exploits the founding dates of public libraries as discrete events that should have influenced subsequent voting behavior. Over the wide range …

Reading Fiction And Economic Preferences Of Rural Youth In Burkina Faso, Michael J. Kevane

Economics

This paper presents results from a reading program for youth living in villages in south-western Burkina Faso. Standard experimental games were used to measure the effects of increased reading of fiction on several attitudes and preferences important for economic development. After six months of access and encouragement to read appropriate young adult fiction, there were few differences in any of four measured outcomes (trust, contribution to public goods, risk, and patience) between those participating in the reading program and the control group. Since the rise of mass-distributed novels in the 1800s, many have hypothesized that fiction would have significant effects …

State Promotion Of Local Public Goods: The Case Of Public Libraries, 1880-1929, Michael J. Kevane, William A. Sundstrom

Economics

The public library movement of the late nineteenth and early twentieth centuries led to a significant expansion of library services across the United States. We study the impact of state-level institutional development on the creation of local public goods. State library commissions were modestly funded state entities charged with helping localities establish libraries. State library associations were voluntary organizations with a similar mission, having as members the librarians of existing public libraries. Library-enabling legislation clarified the legality and taxation possibilities for local government entities such as towns, municipalities and counties to support libraries. Employing panel data drawn from a series …

Social-Family Network And Self-Employment: Evidence From Temporary Rural–Urban Migrants In China, Junfu Zhang, Zhong Zhao

Economics

We hypothesize that individuals with a larger social-family network are more likely to choose self-employment. We test this hypothesis using data on temporary rural–urban migrants in China. The size of a migrant’s social-family network is measured by the number of relatives and friends this migrant greeted during the past Spring Festival. After controlling for endogeneity using an instrumental variable approach, our results show that a rural–urban migrant with a larger social-family network is more likely to be self-employed. This finding is robust to alternative model specifications and various restrictions on the estimation sample.

The Recent Growth Of International Reserves In Developing Economies: A Monetary Perspective, Gonçalo Pina

Economics

The massive accumulation of international reserves in developing economies is a puzzling recent development in the world economy. This paper studies reserve accumulation as the outcome of a simple model in which the central bank smooths inflation. I explore the view that central banks accumulate reserves to face large fiscal shocks that need monetary financing. Central bank revenues are obtained through inflation, but inflation is distortionary. As a result, the central bank optimally accumulates international reserves in order to spread the costs associated with inflation over time. A simple numerical exercise for an average developing economy using data between 1970 …

Comparing Advantages: Us Trade With The Rest Of The World, 1968-2008, Roger White, David Buelher

Economics

Calibrating a stylized version of the Dornbusch-Fischer-Samuelson model, this paper finds that relative to a cohort of 97 trading partners, the US capital stock, labor force, and nominal GDP per capita decreased, while the level of technology embodied in its output increased. These observed dynamics suggest a shift in comparative advantage that, coupled with increased production at the extensive and intensive margins, yields an expectation of labor market churning. Grouping trading partners by World Bank income classifications reveals that observed changes for low and lower middle income cohorts resulted in more pronounced shifts in comparative advantage. Examining employment and earnings …

California’S Flawed Surface Water Rights, Michael Hanemann, Caitlin Dyckman, Damian Park

Economics

California sprang into existence following the discovery of gold in 1848. Aside from domestic use, the first major use of water in California was in mining. The first mining consisted of placer mining of alluvial deposits in stream beds throughout the Sierra foothills. As those deposits were depleted, hydraulic mining arose, in which high-pressure jets of water were used to remove overlying earth from upland gold- bearing deposits. That type of mining, first employed in 1853, required substantial water diversions.

When California entered the Union in 1850, the English common law was adopted as the “rule of decision” in courts, …

Do Immigrants Reduce Bilateral Trade Costs? An Empirical Test, Roger White, Bedassa Tadesse

Economics

We use the first comprehensive estimates of bilateral trade costs to test the extensively stated, but rarely evaluated, hypothesis that immigrants reduce trade-related transaction costs. Our results provide robust and direct evidence supporting this often-posited hypothesis. We examine the period from 1995 through 2010 using data that represent 174 immigrant home countries and 19 OECD member host countries. We find that a 10% increase in the stock of immigrants from a given home country that reside in a given host country corresponds with a 1.04% decrease in the overall bilateral trade costs between the home and host countries. While different …

Cognitive Function And Human Capital Accumulation Across The Day: Evidence From Randomized School Schedules, Teny Maghakian Shapiro, Kevin M. Williams, James E. West

Economics

This study examines how variation of within-day cognitive function affects human capital accumulation. Cognitive function, which neurobiologists have found varies widely across the day, has thus far been an important omission in the economics literature. We quantify its role on human capital accumulation using data from five cohorts of college freshman at the United States Air Force Academy, where students face randomized scheduling and a common set of classes and exams. We find clear evidence that daily fluctuations in cognitive function affects academic achievement-a student does 0.25 standard deviations better at her highest observed ability than at her worst. Cognitive …

Availability Of Higher Education And Educational Outcomes: Quantifying The Impacts Of College Openings And Cohort Size, Teny Maghakian Shapiro

Economics

Research has established the benefits of higher education and the importance of affordability, however less is known about how the availability of higher education affects educational attainment. By constructing a comprehensive dataset on college openings in the U.S. from 1969 to 1991, I show that exogenous variation in two-year and four-year college availability, caused by changed birth cohort sizes and local college openings, substantially affects educational attainment. New four-year colleges increase the likelihood of obtaining a Bachelor's degree, while new two-year colleges only affect Associate's degree attainment. Additionally, results show that students from larger cohorts are crowded out of four-year …

Gold Mining And Economic And Social Change In West Africa, Michael Kevane

Economics

Economic theory often suggests that social institutions are strongly influenced by specific geographic features of regions. The history of gold mining in West Africa, however, suggests that the relationship between mineral resources and social organization is complex and fluid. First, over the centuries gold mining revenues may have encouraged state formation, but at the same time opportunities for conflict and corruption may have undermined state functioning. Second, while gold extraction and trade required social organization, the interpersonal relationships engendered by gold mining also led to new identities and social institutions. These dialectical considerations illustrate how simple theories of how geography …

Do Footprint-Based Cafe Standards Make Car Models Bigger?, Brianna Marie Jean

Economics

Corporate Average Fuel Economy (CAFE) standards have historically been set equal across all manufacturer fleets of the same type. Concerns about varying costs across firms and safety implications of standards that are set homogeneously across firms and models resulted in a policy shift towards footprint-based standards. Under this type of standard, individual car models face targets based on the size of the area between the wheelbase and wheel track, so that larger models face less stringent standards, and manufacturers who make, on average, larger cars will face a lighter fleet standard. Theoretical models have shown that this type of policy …

The Pattern Of Macroeconomics And Economic Integration: Evidence On D-8 Economic Cooperation, Lukman Hakim, Mostafa Aboelsoud, Jauhari Dahalan

Economics

The Organization of the Islamic Conference (OIC) is the second largest inter- governmental organization after the United Nations Organization (UNO) with its 57 members. But until now, the OIC has not focused on economic integration as a whole. Several OIC countries members initiate to build the D-8 which consists of Bangladesh, Egypt, Indonesia, Iran, Malaysia, Nigeria, Pakistan, and Turkey, and try to develop a more intense economic cooperation. Therefore, this research will explore the possibility of D-8 economic integration as well as to identify the macroeconomics conditions that would support the existence of such economic integration. Several techniques are employed …

A Simple Solution To The Distance Puzzle: Balanced Data And Poisson Estimation, Roger White, David Buehler

Economics

We propose the use of a balanced panel data set and Poisson regression as a solution to the distance puzzle. Employing annual data for the period 1972–2010, we confirm the existence of the puzzle by applying OLS regression to both an unbalanced panel data set and a narrowly defined balanced panel. We find that Poisson regression remedies the distance puzzle, producing a constant trend for the distance coefficient when the unbalanced panel is examined and a positive trend for the balanced data. The findings confirm the common intuition that the influence of transport costs on trade flows has decreased over …

Decision Making And Underperformance In Competitive Environments: Evidence From The National Hockey League, Gueorgu I. Kolev, Gonçalo Pina, Federico Todeschini

Economics

We find evidence of suboptimal decisions leading to underperformance in a policy experiment where two teams of professionals compete in a tournament (National Hockey League shootout) performing a task (penalty shot) sequentially. Before an exogenous policy change, home teams had to perform the task second in the sequence. After the policy change, home teams were given the choice to lead or to follow in the sequence. Home teams should move first only when this is optimal, and this should lead them to winning the tournament more often.We find that after given the choice, home teams most of the time choose …

The Effect Of Corruption On Carbon Dioxide Emissions In The Mena Region, Hoda Hassaballa

Economics

Corruption has always been accused of having adverse effects on growth. This is because it decreases productivity, leads to accumulation of additional costs and discourages investment. Recently, high concerns are raised about the impact of corruption on the environment. Corruption plays a substantial role in increasing pollution emissions level. In spite of this, empirical investigation of such an issue is still incomplete. For that, this research work represents a step forward in understanding the relationship between corruption and the environment in general and in filling the gap present in the literature in analyzing this relationship in the Middle East and …

Trends In The Happiness Of Single Mothers: Evidence From The General Social Survey, John Ifcher, Homa Zarghamee

Economics

We study the subjective well being (SWB) of single mothers from 1972 to 2008 using data from the General Social Survey. While past literature has examined the outcomes of single mothers, an investigation of SWB is warranted, since it has been shown that there are potentially large slippages between economic indicators and SWB. Our results indicate that (i) single mothers report being significantly less happy than non-single-mothers, and (ii) this "happiness gap" shrank between 1972 and 2008.

Capital In The Twenty-First Century: A Review Essay, Alexander J. Field

Economics

In the title of his 1968 review of early research in Cliometrics, Lance Davis opined that “it will never be literature.” One of Thomas Piketty's many achievements in Capital in the Twenty-First Century is to prove Davis wrong. Piketty's book is both an exemplary work in quantitative economic history and economic literature in the finest sense, written with the Cartesian clarity we associate with the French scientific tradition. It is, moreover, quite remarkably, also about literature, about the novels of Jane Austen, Henry James, and Honoré de Balzac, and the nineteenth-century wealth dynamics they brought to life. From the vantage …

Source-Destination Cultural Differences, Immigrants’ Skill Levels, And Immigrant Stocks: Evidence From Six Oecd Member Host Countries, Roger White, Nicole Yamasaki

Economics

Examining data for 79 immigrant source countries and six OECD member destination countries during the years 1975–2000, we find that source-destination cultural differences inhibit international migration. We also report that existing immigrant stocks act to offset, at least in part, the migration-inhibiting effects of cultural differences. Employing educational attainment as a proxy for skill, we find variation across low-, medium-, and high-skilled immigrant cohorts both with respect to the cultural distance-migration relationship and in terms of the extent to which existing immigrant stocks offset the influence of cultural differences. Our results appear robust to econometric techniques, sample composition, and endogeneity …

Prosociality And The Military, Alexander J. Field

Economics

In this paper, I consider a body of observational evidence not commonly studied by social scientists, namely the behavior of men and women (mostly men) in the military. I focus here on two issues: first the behavioral foundations for creating an effective military unit and second, evidence that infantrymen have historically been reluctant to fire on the enemy and how this reluctance has been overcome in the last half century through changes in military training. The evidence in each of these areas reinforces the appeal of the idea of cognitive modularity, the view that thought and behavior are influenced by …

The Interwar Housing Cycle In The Light Of 2001-2012: A Comparative Historical Approach, Alexander J. Field

Economics

The Financial crisis of 2008 to 2009 and the Great Recession it precipitated forced a rethinking among macroeconomists about the origin, prevention, and potential mitigation of such events. One of the conclusions emerging from a considered examination of the run-up to and the fallout from the events is the limitation of framing the policy issues solely in terms of whether Chairman Bernanke and the Federal Reserve System, as well as President Obama and the Congress, did the right thing when the crisis hit. Most observers believe that the response to the immediate crisis was correct in the sense that they …

Capital Markets For Community Development Lenders: Q & A., Michael E. Swack

Economics

No abstract provided.

Schelling, Von Neumann, And The Event That Didn’T Occur, Alexander J. Field

Economics

Thomas Schelling was recognized by the Nobel Prize committee as a pioneer in the application of game theory and rational choice analysis to problems of politics and international relations. However, although he makes frequent references in his writings to this approach, his main explorations and insights depend upon and require acknowledgment of its limitations. One of his principal concerns was how a country could engage in successful deterrence. If the behavioral assumptions that commonly underpin game theory are taken seriously and applied consistently, however, nuclear adversaries are almost certain to engage in devastating conflict, as John von Neumann forcefully asserted. …

A Factor Endowment Explanation For China’S Emergence As An International Trading Power: Calibrating The Dornbusch-Fischer-Samuelson Model For China’S Trade, 1968-2008, Roger White

Economics

Much has been made of the rise of China‘s economy and its emergence as a global trading power. Standard trade theory holds that comparative advantage is the basis for mutually beneficial exchange and, as such, it is the basis for international trade. In this chapter, we examine changes in labor supplies, capital stocks, and technology as possible explanations for the rise of China as an international trading power. Calibration of the Dornbusch-Fisher-Samuelson model suggests that China has gained comparative advantage relative to the US and to the cohort of high income countries considered in this study. Even though US production …

The Role Of Polices In Speeding The Demographic Transition: A Case Study Of Some East Asian Countries And Lessons Learnt, Sarah El-Khishin, Magued Osman, Heba Nassar

Economics

برزت إشكالية البحث عندما أكدت توقعات مستقلبية دولية عديدة قدرة الاقتصاد المصري على تحقيق طفرات تنموية ناتجة من معدلات نمو متسارعة خلال العقود المقبلة قد تمكنها من أن تصبح ضمن أسرع دول العالم من حيث معدلات النمو. ولكن هذه التقارير ربطت قدرة الاقتصاد المصري على تحقيق هذه الطفرات باستغلاله مقومات التنمية التي كان من أهمها فرصة النافذة الديمغرافي( ١)، حيث يتميز الهيكل العمري للسكان في مصر حالي ً ا بوجود شريحة كبيرة ومتزايدة منهم في سن العمل؛ نتيجة لتراجع معدلات وفيات الأطفال والخصوبة، وهو الأمر الذي يمثل مورد ً ا هام ً ا في عملية التنمية وإمكانية كبيرة للمساهمة في …

Affect And Overconfidence: A Laboratory Investigation, John Ifcher, Homa Zarghamee

Economics

We conduct two incentivized random-assignment experiments to investigate whether overconfidence is impacted by (1) incidental mild positive affect, or (2) incidental mild negative affects-anger, fear, and sadness. We measure overconfidence using overestimation of past quiz-performance and overestimation of past quiz-performance compared to peers. The results of the first experiment indicate that the effect of positive affect on both measures of overconfidence is positive and significant for male subjects. While mood-inducement is equally successful for female subjects, their overconfidence is unaffected by positive affect. These positive-affect results are robust to various specification checks. In the second experiment, we find consistent evidence …

The Development Of Public Libraries In The United States, 1870–1930: A Quantitative Assessment, Michael Kevane, William A. Sundstrom

Economics

The period 1870–1930 witnessed the emergence of the local public library as a widespread and enduring American institution. We document the expansion of public libraries in the United States using data drawn from library surveys conducted by the federal Bureau of Education. We then review causal accounts for that expansion. Exploiting cross-state and temporal variation in the data, we use statistical techniques to assess a number of plausible demand-and-supply factors affecting the pace of library development. Social and economic variables in the analysis include state income or wealth, urbanization, ethnic composition, and gender ratios. We also examine the effect of …

Location, Location, Location: The Importance Of Proximity In Student Peer Evaluation, Roger White

Economics

The appropriateness of physical distances as a proxy for interpersonal networks is examined using data on peer evaluation scores collected from undergraduate student presentations in econometrics courses during the spring 2010 and spring 2011 semesters at Franklin & Marshall College. Employing the Tobit regression technique and decomposing the resulting coefficient estimates into marginal effects, we find that greater physical distance is negatively related to peer evaluation scores in the sense that greater distance lowers scores and reduces the likelihood that the evaluating student will assign the maximum possible score. Similarly, evaluating students assign higher scores to those student presenters they …

Do African Immigrants Enhance Their Home Nations’ Trade With Their Hosts?, Roger White, Bedassa Tadesse

Economics

Employing data on the immigrant stocks of 43 African home countries who reside in 110 host countries and on trade flows between these countries during the year 2005, we examine whether African immigrants exert positive effects on their home countries’ trade with the typical host country. Estimates from Tobit regression models indicate a one percent increase in the number of African immigrants in a given host country increases that country’s exports to and imports from the typical home country by 0.132 percent and 0.259 percent, respectively. Further evaluation of these effects from the perspective of each African home country reveals …

Is Cultural Distance A Determinant Of International Migration Flows? Evidence From Denmark, Germany, And The Netherlands, Roger White

Economics

We examine the relationship between source-destination country cultural differences and international migration flows using data for three immigrant destination countries (i.e., Denmark, Germany, and the Netherlands) and a cohort of 66 heterogeneous immigrant source countries during the years 1997-2002. Results obtained from the estimation of our empirical specifications using the Negative Binomial regression technique indicate that, all else equal, cultural distance is negatively related to migration flows and that larger existing immigrant stocks correspond with larger subsequent migration flows. These findings are consistent with the results reported in Belot and Ederveen (2012). Extending the literature, we report that existing immigrant …