Behavioral Economics Commons^™

Expenditure, Confidence, And Uncertainty: Identifying Shocks To Consumer Confidence Using Daily Data, Marta Lachowska

Upjohn Institute Working Papers

The importance of consumer confidence in stimulating economic activity is a disputed issue in macroeconomics. Do changes in confidence represent autonomous fluctuations in optimism, independent of information on economic fundamentals, or are they a reflection of economic news? I study this question by using high-frequency microdata on spending and consumer confidence, and I find that consumer confidence contains information relevant to predicting spending, independent from other indicators. The exogenous movements in consumer confidence lead to very short fluctuations in consumer spending, consistent with the hypothesis that more consumer confidence reflects less uncertainty about the future.

The Status Costs Of Subordinate Cultural Capital: At-Home Fathers' Collective Pursuit Of Cultural Legitimacy Through Capitalizing Consumption Practices, Gokcen Coskuner-Balli, Craig J. Thompson

Business Faculty Articles and Research

Consumer researchers have primarily conceptualized cultural capital either as an endowed stock of resources that tend to reproduce socioeconomic hierarchies among consumer collectivities or as constellations of knowledge and skill that consumers acquire by making identity investments in a given consumption field. These studies, however, have given scant attention to the theoretical distinction between dominant and subordinate forms of cultural capital, with the latter affording comparatively lower conversion rates for economic, social, and symbolic capital. To redress this oversight, this article presents a multimethod investigation of middle-class men who are performing the emergent gender role of at-home fatherhood. Our analysis …

Against Endowment Theory: Experimental Economics And Legal Scholarship, Gregory Klass, Kathryn Zeiler

Georgetown Law Faculty Publications and Other Works

Endowment theory holds the mere ownership of a thing causes people to assign greater value to it than they otherwise would. The theory entered legal scholarship in the early 1990s and quickly eclipsed other accounts of how ownership affects valuation. Today, appeals to a generic “endowment effect” can be found throughout the legal literature. More recent experimental results, however, suggest that the empirical evidence for endowment theory is weak at best. When the procedures used in laboratory experiments are altered to rule out alternative explanations, the “endowment effect” disappears. This and other recent evidence suggest that mere ownership does not …

How Does Childbirth Alter Intrahousehold Resource Allocation?: Evidence From Japan, Tomoki Fujii, Ryuichiro Ishikawa

Research Collection School Of Economics

Exploiting unique panel data that include direct measurements of resource allocation within households, we investigated the impact of childbirth on intrahousehold allocation for married Japanese couples. Based on a collective model of the household, we developed reduced-form and structural-form estimation equations that allow us to focus on private goods to track the changes in intrahousehold resource allocation. We found one additional child is associated with a reduction in the wife's private expenditure share by at least two percentage points. This may be because she substitutes more say in decisions on the children for her own private expenditure share.

Ancillary Revenue And Price Fairness: An Exploratory Study Pre & Post Flight, Blaise P. Waguespack, Tamilla Curtis

Publications

The growing impact of Ancillary Revenue on consumer choice and shopping behavior continues to be a highly debated issue. In the US, the Department of Transportation (DOT) has stepped into the debate and is investigating the possibility of new rules on how airlines must report and display such ancillary offerings. While the DOT collects data, reports on the amount of ancillary revenue earned by the airlines continue to rise. Examining past research on price fairness from the marketing literature and the impact of revenue management on price fairness from the aviation literature, this article joins new research appearing on the …

The Fii Model As An Investment In Patience: Exploring Time Preferences In Medellin, Colombia, Jennifer Graham

Master's Theses

The motivation for this research is to explore the success behind the Oakland based Family Independence Initiative (FII) as a model for poverty alleviation. During the period of June-December 2012, nearly 200 small business owners in Medellin, Colombia participated in a field experiment intended to replicate the FII model by randomizing the treatments of setting goals, receiving conditional payments, and participating in self-help groups, as well as the combinations thereof. The data shows that the subjects in the full FII treatment group achieve more goals and have significantly higher monthly sales than those subjects in any other treatment or control …

Incentives To Improve Economic Conditions: A Field Experiment In Medellin, Colombia, Lauren Skora

Master's Theses

The motivation for this research is to replicate the Oakland based Family Independence Initiative (FII) and to test the components of this model. The FII program claims its success stems from a bottom-up approach structured around setting life-improving goals, mutual support groups, and small monetary incentives to achieve results. As the popularity of this program continues to gain momentum in the United States, we designed a field experiment to measure the impact of incentives on goal achievement and economic conditions as well as the overall impact of the FII model. We enrolled close to 200 small business owners in four …

Does Child Sponsorship Have A Positive Impact On The Quality Of Life And Social Behavior Of Sponsored Children? Evidence From Indonesia, Mario Carrillo

Master's Theses

Relaxing an internal constraint of an individual at early stages of life is an approach that complements traditional policy interventions aimed to alleviate poverty. The Compassion International child sponsorship program focuses their work on the emotional, social, and spiritual development of sponsored children. This study investigates the impacts of child sponsorship on the quality of life and social behavior of sponsored children using age-eligibility as an instrument for sponsorship, a time preference experiment and a trust game. The study looks specifically at self-esteem, optimism, social trust, educational outcomes, patience and reciprocity of 286 sponsored children and 234 non-sponsored children between …

Do Self-Help Groups Work On Achieving Economic Goals? New Evidence From A Field Experiment In Medellin, Colombia, Paulina Aguinaga Lezcano

Master's Theses

Abstract: This research is the first study to introduce an experimental setting to test the implication of a poverty alleviation model inspired by the Family Independence Initiative (FII) in a developing country. The FII is a poverty alleviation approach that has shown remarkable results in improving the living conditions of low-income individuals in three cities of the United States. It promotes self-improvement through setting goals, incentive schemes, and self-help groups (SHGs). The results suggest that the FII model can be successfully implemented as a poverty alleviation policy in a developing country. The model does have a positive and significant effect …

Taxing The Opposition: Cactus League Attendance And The Efficiency Of The 'Cubs Tax', Michael C. Davis, Craig Palsson, Joseph Price

Economics Faculty Research & Creative Works

In 2010, a plan to finance a new spring training stadium for the Cubs through a ticket surcharge on all games in the Cactus League was proposed. We find that the Cubs increase attendance when they are the away team by about 37%. Thus, the surcharge would be economically justified as long as the price elasticity of tickets is less than 0.32, which many prior studies find to be the case. This tax provides one of the few examples in which the cost of a subsidized stadium would be born primarily by the group that benefits the most from the …

A Policymaker's Guide To Feed-In Tariffs: Encouraging A Responsible Transition To Renewable Electricity In California, Roland P. Thayer

Pomona Senior Theses

The feed-in tariff is a flexible, yet effective mechanism in promoting the proliferation of renewable electricity in California. The tariff creates a stable investment environment that protects both the utilities and the renewable electricity generators. Not only does the system foster capacity growth, but also technological advancement to the point where renewable electricity can compete in the market without assistance. From an environmental standpoint, the feed-in tariff contributes significantly towards achieving the emissions reduction goals set forth by AB32 without causing harmful increases to electricity prices.

The feed-in tariff model has been used in countries all over the world and …

Institutional Distance And Entry Mode: How Do Emerging-Market Multinational Companies Overcome Competitive Disadvantages In A Developed Market?, Ru-Shiun Liou

Graduate Theses and Dissertations

As latecomers to global business competition, emerging-market multinational companies (EMNCs) utilize cross-border merger and acquisitions to swiftly acquire strategic assets, such as brands and distribution channels, compensating for their competency deficiency. Developed markets with well-established firms and well-developed market-supporting institutions become important destinations for EMNCs' strategic asset-seeking investments. Institutional distance, national differences in the institutional environment, constitutes a major source of competitive disadvantage for foreign firms competing with indigenous firms. Foreign firms need to overcome the challenges of unfamiliarity, relational, and discriminatory hazards to establish legitimacy in the host market. Compared to established multinationals that originate from other advanced markets …

Has Government Tax Policy In Greece Led To A Large Shadow Economy?, Nils Thompson

Honors Projects in Economics

This capstone investigates the impact that tax policy has on the shadow economy in Greece. Greece has one of the largest shadow economies in the world and the largest in the European Union, with tax evasion being one of the main drivers. While previous research has provided measures of the shadow economy, none matches the shadow economy estimations with policies, laws, and agencies enacted by the government, specifically over the period in time of 1990-2012. This study contributes to the literature by connecting the policies implemented by the government with the size of the shadow economy in Greece, along with …

The Impact Of New Product Announcements On Quick Service Restaurant Companies’ Stock Returns, Tim Drechsler-Martell

Honors Projects in Finance

This study seeks to answer two main questions: 1) Do product announcements impact quick service restaurant stock returns? 2) Do economic conditions impact the degree which product announcements impact quick service restaurant stock returns? 159 total product announcements were collected for 6 quick service companies: McDonald’s Corp., YUM! Brands Inc., The Wendy’s Co., AFC Enterprises Inc., Jack in the Box Inc., and Sonic Corp. 84 of these announcements were from 2005-2007 (Labeled “Pre-Recession”), and 75 were from 2009-2011 (Labeled “Post-Recession”). Using historical stock price data, an analysis of the overall trends of the mean-adjusted excess returns was conducted to determine …

Incentives And Improved Economic Conditions: A Field Experiment In Medellin, Colombia, Lauren Skora

Creative Activity and Research Day - CARD

The motivation for this research is to replicate the Oakland based Family Independence Initiative (FII) and to test the components of this model. The FII program claims its success stems from a bottom-up approach structured around setting life improving goals, mutual support groups, and small monetary incentives for achieved results. We enrolled close to 200 small business owners in four experimental treatments (group, no-group, incentives, no-incentives) and a fifth external control group. The experimental data shows that incentives have the strongest overall impact in improving the likelihood of goal achievement and economic performance. Furthermore, the interaction of goal setting, groups, …

Why Risk It? The Effect Of Risk And Time Preferences On Microfinance Loan Default, Nike Start

Creative Activity and Research Day - CARD

Microfinance is widely recognized as a powerful method for poverty alleviation. However, little is known about the characteristics of those who default on their loans. Understanding the behavior of borrowers is important to mitigate default for microfinance lenders. This study investigates whether non-delinquent and delinquent borrowers reveal any difference in their level of risk and time preference through an artefactual field experiment. The results reveal that non-delinquent borrowers are more likely to be risk-seeking individuals and are more impatient than delinquent borrowers, contradicting current literature on risk-aversion and time preference.

Does Child Sponsorship Have A Positive Impact On The Quality Of Life And Social Behavior Of Sponsored Children? Evidence From Indonesia, Mario Carrillo

Creative Activity and Research Day - CARD

Relaxing internal constraints of individuals at early stages of life is an approach that complements traditional policy interventions aimed to alleviate poverty. The Compassion International child sponsorship program focuses their work on the emotional, social, and spiritual development of sponsored children. This study uses age-eligibility as an instrument for sponsorship to investigate the impacts of child sponsorship on self-esteem, aspirational reference points, aspirational capital, reciprocity and patience. It also implements an innovative way of constructing summary indices using a method proposed by Anderson, M (2008). Results reveal child sponsorship does not have an effect on the sponsored children. In fact, …

Socioeconomic Effect On Crime In The Southwest United States Pre- And Post-Great Recession, Kristina Donathan, Jaewon Lim

Graduate Research Symposium (2010 - 2017)

Facing the Great Recession, the Southwest megapolitan cluster in the United States including Las Vegas, Southern California and Sun Corridor in Arizona had a massive negative economic shock. Skyrocketing unemployment, massive foreclosures and other socioeconomic factors may negatively affect our safe environment with changing patterns in crime. This study aims to investigate the impacts of socioeconomic factors on different types of crimes committed in the megapolitan cluster of the Southwest United States. Using annual crime datasets, we look at the three years before the Great Recession and subsequent three years (2005-2010). The metropolitan areas, Los Angeles, CA, Las Vegas, NV, …

Economics And Attitude: The Effects Of Happiness On Economic Development, Chris Pace

Undergraduate Research Conference

No abstract provided.

Go West Young Man: Self-Selection And Endogenous Property Rights, Taylor Jaworski, Bart J. Wilson

Economics Faculty Articles and Research

If, as Hume argues, property is a self-referring custom of a group of people, then property rights depend on how that group forms and orders itself. In this article we investigate how people construct a convention for property in an experiment in which groups of self-selected individuals can migrate between three geographically separate regions. To test a hypothesis of Demsetz's, we vary across two treatments the external benefits of migrating. We find that self-selection has a powerful effect on establishing conventions of property and begetting increases in wealth through exchange and specialization. We also find support for the Demsetz hypothesis.