nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2005‒04‒03
ten papers chosen by
Maximo Rossi
Universidad de la República

  1. Trust, Reciprocity, and Contract Enforcement: Experiments on Satisfaction Guaranteed By James Andreoni
  2. Trust, Trust Games and Stated Trust: Evidence from Rural Bangladesh By Johansson-Stenman, Olof; Mahmud, Minhaj; Martinsson, Peter
  3. Trust and Religion: Experimental Evidence from Bangladesh By Johansson-Stenman, Olof; Mahmud, Minhaj; Martinsson, Peter
  4. The Persistent Segregation of Girls into Lower-Paying Jobs while in School By Kooreman, Peter
  5. Suicidal Behavior and the Labor Market Productivity of Young Adults By Erdal Tekin; Sara Markowitz
  6. How Do Alternative Minimum Wage Variables Compare? By Sara Lemos
  7. Income and Democracy By Daron Acemoglu; Simon Johnson; James Robinson; Pierre Yared
  8. Belief in a Just World and Redistributive Politics By Roland Benabou; Jean Tirole
  9. The Labor Market Impact of High-Skill Immigration By George J. Borjas
  10. Changes in the Labor Supply Behavior of Married Women: 1980-2000 By Francine D. Blau; Lawrence M. Kahn

  1. By: James Andreoni
    Date: 2005–03–18
    URL: http://d.repec.org/n?u=RePEc:cla:levrem:666156000000000679&r=ltv
  2. By: Johansson-Stenman, Olof (Department of Economics, School of Economics and Commercial Law, Göteborg University); Mahmud, Minhaj (Department of Economics, School of Economics and Commercial Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Economics and Commercial Law, Göteborg University)
    Abstract: Levels of trust are measured by asking standard survey questions on trust and by observing the behaviour in a trust game using a random sample in rural Bangladesh. Follow-up questions and correlations between the sent amount in the trust game and stated expectations reveal that the amount sent in the trust game is a weak measure of trust. The fear of future punishment, either within or after this life, for not being sufficiently generous to others, was the most frequently stated motive behind the respondents’ behaviour, highlighting the potential importance of motives that cannot be inferred directly from people’s behaviour. <p>
    Keywords: Trust; trust game; social capital; field experiment; Bangladesh
    JEL: C93 Z13
    Date: 2005–03–31
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0166&r=ltv
  3. By: Johansson-Stenman, Olof (Department of Economics, School of Economics and Commercial Law, Göteborg University); Mahmud, Minhaj (Department of Economics, School of Economics and Commercial Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Economics and Commercial Law, Göteborg University)
    Abstract: Trust is measured using both survey questions and a standard trust experiment using a random sample of individuals in rural Bangladesh. We found no significant effect of the social distance between Hindus and Muslims in the trust experiment in terms of fractions sent or returned, but the responses to the survey questions indicate significant differences: Hindus, the minority, trust other people less in general, and Hindus trust Muslims more than the other way around. <p>
    Keywords: social capital; trust; social distance; religion; trust game; field experiment; Bangladesh
    JEL: C93 Z13
    Date: 2005–03–31
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0167&r=ltv
  4. By: Kooreman, Peter (University of Groningen and IZA Bonn)
    Abstract: This paper analyzes gender differences in jobs while in high school. The availability of school class based samples with detailed information on teenage jobs allows for a comparison of the behavior of boys and girls who are in the same school class, and thus have virtually identical education levels. Even within these highly homogeneous groups, boys earn substantially more than girls. The earnings gap cannot be explained by differences in participation rates and hours of work, nor by gender wage gaps within job types. It is entirely due to the fact that girls work more in job types with relatively low wages, in particular babysitting. During the period considered, 1984-2001, the gender patterns of jobs while in school largely remained unchanged.
    Keywords: labor market, gender differences, teenage behavior
    JEL: J16 J22
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp1535&r=ltv
  5. By: Erdal Tekin (Georgia State University, NBER and IZA Bonn); Sara Markowitz (Rutgers University, Newark and NBER)
    Abstract: This paper provides a comprehensive analysis of the link between suicidal behaviors and labor market productivity of young adults in the United States. Using data from the National Survey of Adolescent Health (Add Health), we estimate the effects of suicide thoughts and suicide attempts on the work and schooling activities of young adults as well as on their hourly wage rates. The richness of the data set allows us to implement several strategies to control for unobserved heterogeneity and the potential reverse causality. These include using a large set of control variables that are likely to be correlated with both the suicidal behavior and the outcome measures, an instrumental variables method, and a twin fixed effects analysis from the subsample of twin pairs contained in the data. The longitudinal nature of the data set also allows us to control for past suicide thoughts and attempts of the individuals from their high school years as well as the suicide behaviors of the members of their family. Results from the different identification strategies consistently indicate that both suicide thoughts and suicide attempts decrease the hourly wage rate and the probability that a young adult individual works and/or attends school. The results are found to be robust to various specification tests.
    Keywords: suicide, wage, employment
    JEL: I1 J24
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp1547&r=ltv
  6. By: Sara Lemos
    Abstract: Several minimum wage variables have been suggested in the literature. Such a variety of variables makes it difficult to compare the associated estimates across studies. One problem is that these estimates are not always calibrated to represent the effect of a 10% increase in the minimum wage. Another problem is that these estimates measure the effect of the minimum wage on the employment of different groups of workers. In this paper we critically compare employment effect estimates using five minimum wage variables common in the literature: real minimum wage, "Kaitz index", "fraction affected", "fraction at" and " fraction below" the minimum wage. Our principal finding is that the sign of this effect is robust across minimum wage variables, but its magnitude and significance are sensitive to the minimum wage variable used.
    Keywords: minimum wage; labour cost; employment; hours; Brazil
    JEL: J38
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:lec:leecon:05/6&r=ltv
  7. By: Daron Acemoglu; Simon Johnson; James Robinson; Pierre Yared
    Abstract: We revisit one of the central empirical findings of the political economy literature that higher income per capita causes democracy. Existing studies establish a strong cross-country correlation between income and democracy, but do not typically control for factors that simultaneously affect both variables. We show that controlling for such factors by including country fixed effects removes the statistical association between income per capita and various measures of democracy. We also present instrumental-variables using two different strategies. These estimates also show no causal effect of income on democracy. Furthermore, we reconcile the positive cross-country correlation between income and democracy with the absence of a causal effect of income on democracy by showing that the long-run evolution of income and democracy is related to historical factors. Consistent with this, the positive correlation between income and democracy disappears, even without fixed effects, when we control for the historical determinants of economic and political development in a sample of former European colonies.
    JEL: P16 O10
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:11205&r=ltv
  8. By: Roland Benabou; Jean Tirole
    Abstract: International surveys reveal wide differences between the views held in different countries concerning the causes of wealth or poverty and the extent to which people are responsible for their own fate. At the same time, social ethnographies and experiments by psychologists demonstrate individuals' recurrent struggle with cognitive dissonance as they seek to maintain, and pass on to their children, a view of the world where effort ultimately pays off and everyone gets their just deserts. This paper offers a model that helps explain: i) why most people feel such a need to believe in a "just world"; ii) why this need, and therefore the prevalence of the belief, varies considerably across countries; iii) the implications of this phenomenon for international differences in political ideology, levels of redistribution, labor supply, aggregate income, and popular perceptions of the poor. The model shows in particular how complementarities arise endogenously between individuals' desired beliefs or ideological choices, resulting in two equilibria. A first, "American" equilibrium is characterized by a high prevalence of just-world beliefs among the population and relatively laissez-faire policies. The other, "European" equilibrium is characterized by more pessimism about the role of effort in economic outcomes and a more extensive welfare state. More generally, the paper develops a theory of collective beliefs and motivated cognitions, including those concerning "money" (consumption) and happiness, as well as religion.
    JEL: D31 D72 D80 E62
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:11208&r=ltv
  9. By: George J. Borjas
    Abstract: The rapid growth in the number of foreign students enrolled in American universities has transformed the higher education system, particularly at the graduate level. Many of these newly minted doctorates remain in the United States after receiving their doctoral degrees, so that the foreign student influx can have a significant impact in the labor market for high-skill workers. Using data drawn from the Survey of Earned Doctorates and the Survey of Doctoral Recipients, the study shows that a foreign student influx into a particular doctoral field at a particular time had a significant and adverse effect on the earnings of doctorates in that field who graduated at roughly the same time. A 10 percent immigration-induced increase in the supply of doctorates lowers the wage of competing workers by about 3 percent.
    JEL: J1 J4
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:11217&r=ltv
  10. By: Francine D. Blau; Lawrence M. Kahn
    Abstract: Using March Current Population Survey (CPS) data, we investigate married women's labor supply behavior from 1980 to 2000. We find that their labor supply function for annual hours shifted sharply to the right in the 1980s, with little shift in the 1990s. In an accounting sense, this is the major reason for the more rapid growth of female labor supply observed in the 1980s, with an additional factor being that husbands' real wages fell slightly in the 1980s but rose in the 1990s. Moreover, a major new development was that, during both decades, there was a dramatic reduction in women's own wage elasticity. And, continuing past trends, women's labor supply also became less responsive to their husbands' wages. Between 1980 and 2000, women's own wage elasticity fell by 50 to 56 percent, while their cross wage elasticity fell by 38 to 47 percent in absolute value. These patterns hold up under virtually all alternative specifications correcting for: selectivity bias in observing wage offers; selection into marriage; income taxes and the earned income tax credit; measurement error in wages and work hours; and omitted variables that affect both wage offers and the propensity to work; as well as when education groups and mothers of small children are analyzed separately.
    JEL: J1 J2
    Date: 2005–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:11230&r=ltv

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