nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2018‒10‒15
four papers chosen by
Maximo Rossi
Universidad de la República

  1. Relative Income and Happiness: An Experiment By Ifcher, John; Zarghamee, Homa; Houser, Daniel; Diaz, Lina
  2. Early Stimulation and Nutrition: The Impacts of a Scalable Intervention By Orazio Attanasio; Helen Baker-Henningham; Raquel Bernal; Costas Meghir; Diana Pineda; Marta Rubio-Codina
  3. Do Equal Employment Opportunity Statements Backfire? Evidence From A Natural Field Experiment On Job-Entry Decisions By Andreas Leibbrandt; John A. List
  4. Exits from the Poverty Trap and Growth Accelerations in a Dual Economy Model By Jean-Claude BERTHELEMY

  1. By: Ifcher, John (Santa Clara University); Zarghamee, Homa (Barnard College); Houser, Daniel (George Mason University); Diaz, Lina (George Mason University)
    Abstract: John Stuart Mill claimed that "men do not desire merely to be rich, but richer than other men." Do people desire to be richer than others? Or is it that people desire favorable comparisons to others more generally, and being richer is merely a proxy for this ineffable relativity? We conduct an online experiment absent choice in which we measure subjective wellbeing (SWB) before and after an exogenous shock that reveals to subjects how many experimental points they and another subject receive, and whether or not points are worth money. We find that subjects like receiving monetized points significantly more than non-monetized points but dislike being "poorer" than others in monetized and non-monetized points equally, suggesting relative money is valued only for the relative points it represents. We find no evidence that subjects like being "richer" than others. Subgroup analyses reveal women have a strong(er) distaste for being "richer" and "poorer" (than do men), and conservatives have a strong(er) distaste for being "poorer" (than do progressives). Our experimental-SWB approach is easy to administer and can provide some insights a revealed-preference approach cannot, suggesting that it may complement choice-based tasks in future experiments to better estimate preference parameters.
    Keywords: subjective well-being, relative income, others' income, income comparisons, happiness, experiments
    JEL: C91 D31 D63 I31
    Date: 2018–08
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp11763&r=ltv
  2. By: Orazio Attanasio; Helen Baker-Henningham; Raquel Bernal; Costas Meghir; Diana Pineda; Marta Rubio-Codina
    Abstract: This paper evaluates the effects of the implementation of a structured early stimulation curriculum combined with a nutritional intervention through public large-scale parenting support services for vulnerable families in rural Colombia, known as FAMI, using a clustered randomized controlled trial. We randomly assigned 87 towns in rural areas to treatment and control and 1,460 children younger than 1 year of age were assessed at baseline. The interventions were also complemented with training, supervision and coaching of FAMI program facilitators. We assessed program effects on children’s nutritional status, and on cognitive and socio-emotional development; as well as on parental practices. The interventions had a positive and significant effect on a cognitive development factor based on the Bayley-III of 0.15 standard deviations. We also report a reduction of 5.8 percentage points in the fraction of children whose height-for-age is below -1 standard deviation. We do not find any effects on socio-emotional development. We report positive and statistically significant effects on the quality of the home environment (0.34 SD).
    JEL: H43 I10 I20 J13
    Date: 2018–09
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:25059&r=ltv
  3. By: Andreas Leibbrandt; John A. List
    Abstract: Labor force composition and the allocation of talent remain of vital import to modern economies. For their part, governments and companies around the globe have implemented equal employment opportunity (EEO) regulations to influence labor market flows. Even though such regulations are pervasive, surprisingly little is known about their impacts. We use a natural field experiment conducted across 10 U.S. cities to investigate if EEO statements in job advertisements affect the first step in the employment process, application rates. Making use of data from nearly 2,500 job seekers, we find considerable policy effects, but in an unexpected direction: the presence of an EEO statement dampens rather than encourages racial minorities’ willingness to apply for jobs. Importantly, the effects are particularly pronounced for educated job seekers and in cities with white majority populations. Complementary survey evidence suggests the underlying mechanism at work is “tokenism”, revealing that EEO statements backfire because racial minorities avoid environments in which they are perceived as regulatory, or symbolic, hires rather than being hired on their own merits. Beyond their practical and theoretical importance, our results highlight how field experiments can significantly improve policymaking. In this case, if one goal of EEO regulations is to enhance the pool of minority applicants, then it is not working.
    JEL: C93 J71 J82 J88 K31
    Date: 2018–09
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:25035&r=ltv
  4. By: Jean-Claude BERTHELEMY (Université Paris I Panthéon-Sorbonne)
    Abstract: We propose a simple theoretical dual economy model to study the dynamics of an economy in which individuals move out of a poverty trap. These dynamics are characterized by growth acceleration. This model implies that poverty reduction could, under some circumstances, cause growth, rather than the other way around. We define a measurement of the growth impulse that could be triggered by independent exits from poverty and correlate it with observed growth accelerations. This correlation is both positive and significant, and it passes various robustness checks.
    Keywords: growth acceleration, poverty trap, poverty reduction
    JEL: O11 I32 D31
    Date: 2018–09
    URL: http://d.repec.org/n?u=RePEc:fdi:wpaper:4500&r=ltv

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