nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2021‒12‒06
six papers chosen by
Maximo Rossi
Universidad de la República

  1. Gender Differences in Economics PhD Field Specializations with Correlated Choices By Sierminska, Eva; Oaxaca, Ronald L.
  2. Dissecting Inequality-Averse Preferences By Bergolo, Marcelo; Burdin, Gabriel; Burone, Santiago; De Rosa, Mauricio; Giaccobasso, Matias; Leites, Martin
  3. Kind or contented? An investigation of the gift exchange hypothesis in a natural field experiment in Colombia By Bogliacino, Francesco; Grimalda, Gianluca; Pipke, David
  4. Parental Investment, School Choice, and the Persistent Benefits of Intervention in Early Childhood By Lei Wang; Yiwei Qian; Nele Warrinnier; Orazio Attanasio; Scott Rozelle; Sean Sylvia
  5. "Beauty Too Rich for Use": Billionaires' Assets and Attractiveness By Hamermesh, Daniel S.; Leigh, Andrew
  6. Gender Preferences in Job Vacancies and Workplace Gender Diversity By Card, David; Colella, Fabrizio; Lalive, Rafael

  1. By: Sierminska, Eva (LISER (CEPS/INSTEAD)); Oaxaca, Ronald L. (University of Arizona)
    Abstract: We model the process of field specialization choice among beginning economists within a multivariate logit framework that accommodates single and dual primary field specializations and incorporates correlations among field specialization choices. Conditioning on personal, economic, and institutional variables reveals that women graduate students are less likely to specialize in Labor/Health, Macro/Finance, Industrial Organization, Public Economics, and Development/Growth/International and are more likely to specialize in Agricultural/Resource/Environmental Economics. Field-specific gender faculty ratios and expected relative salaries as well as economics department rankings are significant factors for gender doctoral specialization dissimilarity. Preferences and characteristics contribute about equally to field specialization dissimilarity.
    Keywords: gender, economics, specialization, salaries
    JEL: J01 J16 J31
    Date: 2021–10
  2. By: Bergolo, Marcelo (IECON, Universidad de la República); Burdin, Gabriel (Leeds University Business School); Burone, Santiago (University of Antwerp); De Rosa, Mauricio (Universidad de la República, Uruguay); Giaccobasso, Matias (University of California, Los Angeles); Leites, Martin (Universidad de la República, Uruguay)
    Abstract: Although different approaches and methods have been used to measure inequality aversion, there remains no consensus about its drivers at the individual level. We conducted an experiment on a sample of more than 1800 first-year undergraduate economics and business students in Uruguay to understand why people are inequality averse. We elicited inequality aversion by asking participants to make a sequence of choices between hypothetical societies characterized by varying levels of average income and income inequality. In addition, we use randomized information treatments to prime participants into competing narratives regarding the sources of inequality in society. The main findings are that (1) the prevalence of inequality aversion is high: most participants' choices revealed inequality-averse preferences; (2) the extent of inequality aversion depends on the individual's position in the income distribution; (3) individuals are more likely to accept inequality when it comes from effort rather than luck regardless of their income position; (4) the effect of social mobility on inequality aversion is conditional on individual's income position: preferences for mobility reduces inequality aversion for individuals located at the bottom of the income distribution, where risk aversion cannot play any role.
    Keywords: inequality aversion, fairness, risk, effort, luck, redistribution, questionnaire-experiments
    JEL: D63 D64 D81 C13 C91
    Date: 2021–11
  3. By: Bogliacino, Francesco; Grimalda, Gianluca; Pipke, David
    Abstract: The gift exchange hypothesis postulates that workers reciprocate above market-clearing wages with above-minimum effort. This hypothesis has received mixed support in dyadic employer-worker relationships. We present a field-experimental test to assess this hypothesis in the context of a triadic relationship in which only one out of two workers receives a pay increase. We conjecture that inequality aversion motivations may thwart positive reciprocity motivations and analyze the interaction between such motivations theoretically. Across three treatments, the pay increase is justified to workers based on either relative merit or relative need or was arbitrary as no justification was offered. Two conditions in which either none or both workers receive a bonus serve as the reference. In contrast to the gift exchange hypothesis, we find that pay increases lead to a decrease in productivity. Such a decrease is most sizable in the condition where both workers receive the bonus. A post-diction of this result is that workers interpret the monetary bonus as a signal of the employer's contentment with their effort, which makes them feel entitled to reduce their effort. In other treatments, receiving the pay increase while the coworker does not has a positive effect on productivity, especially when the pay increase is based on merit. This result is consistent with statusseeking preferences rather than aversion against advantageous inequality. Conversely, not receiving the pay increase while the coworker does, leads to lower productivity, especially when the pay increase is assigned based on relative needs.
    Keywords: Gift exchange,employer-worker relationship,pay inequality,field experiment,reciprocity,labor market,effort provision,fairness,wage inequality
    Date: 2021
  4. By: Lei Wang; Yiwei Qian; Nele Warrinnier; Orazio Attanasio; Scott Rozelle; Sean Sylvia
    Abstract: We present evidence from a randomized experiment testing the impacts of a six-month early childhood home-visiting program on child outcomes at school entry. Two and a half years after completion of the program, we find persistent effects on child working memory - a key skill of executive functioning that plays a central role in children’s development of cognitive and socio-emotional skills. We also find that the program had persistent effects on parental time investments and preschool enrolment decisions. Children were enrolled earlier and in higher quality preschools, the latter reflecting a shift in preferences over preschool attributes toward quality. Our findings imply an important role for the availability of high-quality subsequent schooling in sustaining the impacts of early intervention programs.
    Keywords: Early Childhood Development, Parenting, China, Poverty
    JEL: J13 I21 I28 H11
    Date: 2021
  5. By: Hamermesh, Daniel S. (Barnard College); Leigh, Andrew (Australian National University)
    Abstract: We examine how the net worth of billionaires relates to their looks, as rated by 16 people of different gender and ethnicity. Surprisingly, their financial assets are unrelated to their beauty; nor are they related to their educational attainment. As a group, however, billionaires are both more educated and better-looking than average for their age. Men, people who reside in Western countries, and those who inherited substantial wealth, are wealthier than other billionaires. The results do not arise from measurement error or nonrandom sample selectivity. They are consistent with econometric theory about the impact of truncating a sample to include observations only from the extreme tail of the dependent variable. The point is underscored by comparing estimates of earnings equations using all employees in the 2018 American Community Survey to those using a sample of the top 0.1 percent. The findings suggest the powerful role of luck within the extremes of the distributions of economic outcomes.
    Keywords: financial wealth, education, sample truncation
    JEL: J24 J40 C24
    Date: 2021–10
  6. By: Card, David (University of California, Berkeley); Colella, Fabrizio (University of Lausanne); Lalive, Rafael (University of Lausanne)
    Abstract: In spring 2005, Austria launched a campaign to inform employers and newspapers that gender preferences in job advertisements were illegal. At the time over 40% of openings on the nation's largest job-board specified a preferred gender. Over the next year the fraction fell to under 5%. We merge data on filled vacancies to linked employer-employee data to study how the elimination of gender preferences affected hiring and job outcomes. Prior to the campaign, most stated preferences were concordant with the firm's existing gender composition, but a minority targeted the opposite gender - a subset we call non-stereotypical vacancies. Vacancies with a gender preference were very likely (>90%) to be filled by someone of that gender. We use pre-campaign vacancies to predict the probabilities of specifying preferences for females, males, or neither gender. We then conduct event studies of the effect of the campaign on the predicted preference groups. We find that the elimination of gender preferences led to a rise in the fraction of women hired for jobs that were likely to be targeted to men (and vice versa), increasing the diversity of hiring workplaces. Partially offsetting this effect, we find a reduction in the success of non-stereotypical vacancies in hiring the targeted gender, and indications of a decline in the efficiency of matching. For the much larger set of stereotypical vacancies, however, vacancy filling times, wages, and job durations were largely unaffected by the campaign, suggesting that the elimination of stated preferences had at most small consequences on overall job match efficiency.
    Keywords: gender preference, workplace gender segregation, anti-discrimination policy
    JEL: J16 J68 J63
    Date: 2021–09

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