|
on Neuroeconomics |
|
Issue of 2009‒04‒25
five papers chosen by |
| By: | Robert Kaestner |
| Abstract: | While it is widely acknowledged that the family and childhood environments affect adult well being, why they matter is still an area of significant debate. Previous research concerned with this issue has focused on the influence of family income, family structure, and cognitive ability. Much of this research has focused on economic and social outcomes. Notably, the influence of childhood environments on adult health has not received as much attention as other outcomes, and when health has been the focus, interest has been mainly on childhood health. Here, I present a descriptive analysis of the associations between cognitive and non-cognitive traits measured at the end of childhood (age 14) and mental and physical health at age 41. Results suggest that, on average, adolescent cognitive ability and self esteem have a significant association with health at age 41. Other non-cognitive factors such as locus of control and adolescent substance use do not have significant associations with adult health. Net of adolescent influences, completed education has a significant association with adult health. |
| JEL: | I12 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14924&r=neu |
| By: | Sabourian, Hamid; Sibert, Anne |
| Abstract: | Confirmation bias refers to cognitive errors that bias one towards one's own prior beliefs. A vast empirical literature documents its existence and psychologists identify it as one of the most problematic aspects of human reasoning. In this paper, we present three related scenarios where rational behaviour leads to outcomes that are observationally equivalent to different types of conformation bias. As an application, the model provides an explanation for how the reward structure in the financial services industry led to the seemingly irrational behaviour of bankers and other employees of financial institutions prior to the financial crisis of that erupted in the summer of 2007. |
| Keywords: | belief persistence; confirmation bias; financial crisis; overconfidence; signalling |
| JEL: | D81 D82 D83 G21 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7263&r=neu |
| By: | Aurora A.C. Teixeira (CEF.UP, Faculdade de Economia, Universidade do Porto; INESC Porto); Rosa Portela Forte (CEF.UP, Faculdade de Economia, Universidade do Porto) |
| Abstract: | Entrepreneurial activities are seen as key drivers of innovation, job creation, and economic growth. Recent efforts are being pursued by several entities, including governments to promote entrepreneurial skills amongst the youngest. However, to design effective programs, policy makers have to uncover the determinants of entrepreneurship. To avoid that such efforts would be fruitless we argue that a multidisciplinary account of entrepreneurial intents among students is mandatory, circumventing past biased analysis towards business and engineering areas. Thus, in this paper we present the results of a survey to all final year university students of the largest Portuguese university. It encompasses a sample of 2431 students enrolled in 60 different undergraduate courses of 14 schools/faculties. Results evidence that the average entrepreneurial intents reaches a reasonable (by international standards) figure of 27%, with students enrolled in non-traditionally entrepreneurial focused areas – Humanities, Sports, Health and Sciences – and courses - Pharmacy, Veterinary, Law, Languages, History, History of the Arts and Archaeology, Sports, Biology and Chemistry, Dentistry - revealing higher entrepreneurial intents. Based on logit estimations, we further found that psychological factors, such as risk propensity, leadership profile, and creativeness, are the most important (positive) determinants of students’ entrepreneurial intents. Contextual factors (e.g., family background and professional experience) failed to emerge as critical factors in explaining students’ entrepreneurial intents - only business context emerged as important. Despite such results might at a first glance convey the idea that education policy for promoting entrepreneurship has limited application, we argue that it is not the case. What is required is different policy measures targeting students’ attitudes and behaviors in both business and non business areas, avoiding the long-established mistake of confining entrepreneurial education related programs within business schools. |
| Keywords: | Entrepreneurship; Intents; Students; Higher Education; Multidisciplinary; Portugal |
| JEL: | M13 I21 A22 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:322&r=neu |
| By: | A'Hearn, Brian; Baten, Jörg; Crayen, Dorothee |
| Abstract: | Age data frequently display excess frequencies at attractive numbers, such as multiples of five. We use this "age heaping" to measure cognitive ability in quantitative reasoning, or "numeracy". We construct a database of age heaping estimates with exceptional geographic and temporal coverage, and demonstrate a robust correlation of literacy and numeracy, where both can be observed. Extending the temporal and geographic range of our knowledge of human capital, we show that Western Europe had already diverged from the East and reached high numeracy levels by 1600, long before the rise of mass schooling or the onset of industrialization. |
| Keywords: | Age Heaping; Europe; Human Capital; Literacy; Long-term Growth |
| JEL: | E24 I20 N13 O14 O40 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7277&r=neu |
| By: | Lindqvist, Erik (Research Institute of Industrial Economics (IFN)); Westman, Roine (New York University) |
| Abstract: | We use data from the military enlistment for a large representative sample of Swedish men to assess the importance of cognitive and noncognitive ability for labor market outcomes. The measure of noncognitive ability is based on a personal interview conducted by a psychologist. Unlike survey-based measures of noncognitive ability, this measure is a substantially stronger predictor of labor market outcomes than cognitive ability. In particular, we find strong evidence that men who fare badly in the labor market in the sense of long-term unemployment or low annual earnings lack noncognitive but not cognitive ability. We point to a technological explanation for this result. Noncognitive ability is an important determinant of productivity irrespective of occupation or ability level, though it seems to be of particular importance for workers in a managerial position. In contrast, cognitive ability is valuable only for men in qualified occupations. As a result, noncognitive ability is more important for men at the verge of being priced out of the labor market. |
| Keywords: | Personality; Noncognitive ability; Cognitive ability; Intelligence; Human capital |
| JEL: | J21 J24 J31 |
| Date: | 2009–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0794&r=neu |