nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2017‒10‒15
nine papers chosen by
Maximo Rossi
Universidad de la República

  1. Subjective Well-being and Partnership Dynamics; Are Same-sex Relationships Different? By Chen, Shuai; van Ours, Jan
  2. Understanding effective approaches to promoting mental health and preventing mental illness By David McDaid; Emily Hewlett; A-La Park
  3. The healthy immigrant paradox and health convergence By Constant, Amelie
  4. Intergenerational equity under catastrophic climate change By Aurélie Méjean; Antonin Pottier; Stéphane Zuber; Marc Fleurbaey
  5. I Can't Sleep! Relative Concerns and Sleep Behavior By Akay, Alpaslan; Martinsson, Peter; Ralsmark, Hilda
  6. Richard H. Thaler: Integrating Economics with Psychology By Committee, Nobel Prize
  7. Was Brexit Caused by the Unhappy and the Old? By Liberini, Federica; Oswald, Andrew J; Proto, Eugenio; Redoano, Michela
  8. A Note on the Economics of Philanthropy By Nathalie Monnet; Ugo Panizza;
  9. Taxation, redistribution and observability in social dilemmas By Daniel A. Brent; Lata Gangadharan; Anca Mihut; Marie Claire Villeval

  1. By: Chen, Shuai (Tilburg University, Center For Economic Research); van Ours, Jan (Tilburg University, Center For Economic Research)
    Abstract: Partnered individuals are happier than singles. This can be because partnership leads to more satisfactory subjective well-being or because happier people are more likely to find a partner. We analyze Dutch panel data to investigate whether there is a causal effect of partnership on subjective well-being. Our data allow us to distinguish between marriage and cohabitation and between same-sex partnerships and opposite-sex ones. Our results support the short-term crisis model and adaptation theory. We find that marital partnership improves well-being and that these benefits are homogeneous to sexual orientation. The well-being gains of marriage are larger than those of cohabitation. Investigating partnership formation and disruption, we discover that the well-being effects are symmetric. Finally, we find that marriage improves well-being for both younger and older cohorts while cohabitation only benefits younger cohort.
    Keywords: subjective well-being; Happiness; marriage; Cohabitation; sexuel orientation
    JEL: I31 J12 J16
    Date: 2017
  2. By: David McDaid (London School of Economics); Emily Hewlett (OECD); A-La Park (London School of Economics)
    Abstract: The health, social and economic consequences of poor mental health are substantial. More attention is focusing now on the development of actions to promote better mental health and wellbeing and prevent mental ill-health. This paper provides an overview of the development of approaches to promoting mental wellbeing and preventing mental ill-health in OECD countries, together with an assessment of what is known on their effectiveness and cost effectiveness. The paper finds that there is a sound and quite extensive evidence base for effective and cost effective actions which can promote mental wellbeing and prevent mental ill-health. However, the existence of actions and programmes in mental health promotion and prevention is uneven both between countries, and across different points of the life course. Many countries could stand to scale-up their promotion and prevention efforts in the mental health field, and further efforts are particularly needed to introduce interventions targeted at unemployed and older populations.
    JEL: I10 I12
    Date: 2017–10–10
  3. By: Constant, Amelie (Princeton University, GLO, UNU-MERIT, and CESifo)
    Abstract: The health status of people is a precious commodity and central to economic, socio-political, and environmental dimensions of any country. Yet it is often the missing statistic in all general statistics, demographics, and presentations about the portrait of immigrants and natives. In this paper we are concerned with international migration and health outcomes in the host countries. Through a general literature review and examination of specific immigration countries, we provide insights into the Healthy Immigrant Paradox and the health assimilation of immigrants as we also elucidate selection and measurement challenges. While health is part of human capital, health assimilation is the mirror image of earnings assimilation. Namely, immigrants arrive with better health compared to natives and their health deteriorates with longer residence in the host country, converging to the health of natives or becoming even worse. A deeper understanding of immigrant health trajectories, and disparities with natives and other immigrants is of great value to societies and policymakers, who can design appropriate policy frameworks that address public health challenges, and prevent the health deterioration of immigrants.
    Keywords: Health status, Healthy Immigrant Paradox, International migration, Assimilation, Age-Cohort-Period effects, Selection, Aging
    JEL: I10 I12 I14 I18 F22 J11 J14 J15 J24 J61 O15
    Date: 2017–09–26
  4. By: Aurélie Méjean (CIRED - CNRS); Antonin Pottier (Centre d'Economie de la Sorbonne); Stéphane Zuber (Paris School of Economics - Centre d'Economie de la Sorbonne); Marc Fleurbaey (Woodrow Wilson School of Public and International Affairs, Princeton University)
    Abstract: Climate change raises the issue of intergenerational equity. As climate change threatens irreversible and dangerous impacts, possibly leading to extinction, the most relevant trade-off may not be between present and future consumption, but between present consumption and the mere existence of future generations. To investigate this trade-off, we build an integrated assessment model that explicity accounts for the risk of extinction of future generations. We compare different climate policies, which change the probability of catastrophic outcomes yielding an early extinction, within the class of variable population utilitarian social welfare functions. We show that the risk of extinction is the main driver of the preferred policy over climate damages. We analyze the role of inequality aversion and population ethics. Usually a preference for large populations and a low inequality aversion favour the most ambitious climate policy, although there are cases where the effect of inequality aversion is reversed
    Keywords: Climate change; catastrophic risk; equity; population; climate-economy
    JEL: D63 Q01 Q54 Q56 Q5
    Date: 2017–09
  5. By: Akay, Alpaslan (Department of Economics, School of Business, Economics and Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University); Ralsmark, Hilda (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: We investigate the effect of relative concerns with respect to income on the quantity and quality of sleep using a long panel dataset on the sleep behavior of people in Germany. We find that relative income has a substantial negative effect on number of hours of sleep on weekdays and overall satisfaction with sleep, i.e., sleep quality, whereas absolute income has no particular effect on sleep behavior. The findings are robust to several specification checks, including measures of relative concerns, reference group, income inequality, and local price differences. The paper also investigates the importance of the potential channels including working hours, time-use activities, and physical and mental health to explain how relative concerns relate to sleep behavior. The results reveal that while all of these channels partially contribute to the effect, it appears to be mainly driven by physical and mental health and overall and financial well-being/stress. We also use a subjective well-being valuation approach to calculate the monetary value of sleep lost due to income comparisons. The total cost is as high as about 2.6 billion euro/year (1.8% of the overall monetary value of sleep and 1.3% of total health expenditures) among the working-age population in Germany.
    Keywords: Relative Income; Sleeping Satisfaction; Hours of Sleep
    JEL: C35 C90 D60
    Date: 2017–10
  6. By: Committee, Nobel Prize (Nobel Prize Committee)
    Abstract: Economists aim to develop models of human behavior and interactions in markets and other economic settings. But we humans behave in complex ways. Although we try to make rational decisions, we have limited cognitive abilities and limited willpower. While our decisions are often guided by self-interest, we also care about fairness and equity. Moreover cognitive abilities, self-control, and motivation can vary significantly across different individuals.
    Keywords: Behavioral economics;
    JEL: D03 D90 G02
    Date: 2017–10–09
  7. By: Liberini, Federica (ETH, Zurich); Oswald, Andrew J (University of Warwick); Proto, Eugenio (University of Warwick); Redoano, Michela (University of Warwick)
    Abstract: On 23 June 2016, the United Kingdom voted to leave the European Union (so-called ‘Brexit’).This paper uses newly released information, from the Understanding Society data set, to examine the characteristics of individuals who were for and against Brexit. Two new findings emerge. First, unhappy feelings contributed to Brexit. However, contrary to commonly heard views, the key channel of influence was not through general dissatisfaction with life. It was through a person’s narrow feelings about his or her own financial situation. Second, despite some commentators’ guesses, Brexit was not caused by old people. Only the very young were substantially pro-Remain.
    Keywords: Referendum, European Union, Brexit, Voting. JEL Classification: D72
    Date: 2017
  8. By: Nathalie Monnet (IHEID, Graduate Institute of International and Development Studies, Geneva); Ugo Panizza (IHEID, Graduate Institute of International and Development Studies, Geneva and CEPR);
    Abstract: This note starts with a short review of the economic literature on philanthropy. Next, it provides some estimates of philanthropic giving in advanced and middle-income economies and discusses how innovative financial instruments can leverage charitable giving. The note concludes with a discussion of the controversial aspects of philanthropic activities.
    Keywords: Philanthropy, Taxation, Redistribution, Social welfare
    JEL: D64 H21 H44
    Date: 2017–09
  9. By: Daniel A. Brent (Department of Economics, Louisiana State University, Business Education Complex, Baton Rouge, LA 70803-6306, U.S.A.); Lata Gangadharan (Department of Economics, Monash University, Clayton, Australia); Anca Mihut (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69130 Ecully, France); Marie Claire Villeval (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69130 Ecully, France)
    Abstract: In the presence of social dilemmas, cooperation is more difficult to achieve when populations are heterogeneous because of conflicting interests within groups. We examine cooperation in the context of a non-linear common pool resource game, in which individuals have unequal extraction capacities and have to decide on their extraction of resources from the common pool. We introduce monetary and nonmonetary policy instruments in this environment. One instrument is based on two variants of a mechanism that taxes extraction and redistributes the tax revenue. The other instrument varies the observability of individual decisions. We find that the two tax and redistribution mechanisms reduce extraction, increase efficiency and decrease inequality within groups. The scarcity pricing mechanism, which is a per-unit tax equal to the marginal extraction externality, is more effective at reducing extraction than an increasing block tax that only taxes units extracted above the social optimum. In contrast, observability impacts only the Baseline condition by encouraging free-riding instead of creating moral pressure to cooperate.
    Keywords: Common Pool Resource game, taxation mechanisms, observability, cooperation, heterogeneity, experiment
    JEL: C92 H23 D74
    Date: 2017

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