New Economics Papers
on Neuroeconomics
Issue of 2012‒07‒01
four papers chosen by

  1. How do people cope with an ambiguous situation when it becomes even more ambiguous? By Eichberger, Jürgen; Oechssler, Jörg; Schnedler, Wendelin
  2. Unemployment Persistence: How Important Are Non-Cognitive Skills? By Blázquez Cuesta, Maite; Budría, Santiago
  3. How do education, cognitive skills, cultural and social capital account for intergenerational earnings persistence? Evidence from the Netherlands By Büchner Charlotte; Cörvers Frank; Traag Tanja; Velden Rolf van der
  4. Examining Mechanisms of Personality Maturation: The Impact of Life Satisfaction on the Development of Bif Five Personality Traits By Jule Specht; Boris Egloff; Stefan C. Schmukle

  1. By: Eichberger, Jürgen; Oechssler, Jörg; Schnedler, Wendelin
    Abstract: As illustrated by the famous Ellsberg paradox, many subjects prefer to bet on events with known rather than with unknown probabilities, i.e., they are ambiguity averse. In an experiment, we examine subjects’ choices when there is an additional source of ambiguity, namely, when they do not know how much money they can win. Using a standard independence assumption, we show that ambiguity averse subjects should continue to strictly prefer the urn with known probabilities. In contrast, our results show that many subjects no longer exhibit such a strict preference. This should have important ramifications for modeling ambiguity aversion.
    Keywords: ambiguity aversion; uncertainty; minmax-expected utility
    JEL: D81 C91
    Date: 2012–06–21
  2. By: Blázquez Cuesta, Maite (Universidad Autónoma de Madrid); Budría, Santiago (University of Madeira)
    Abstract: Using a random effects dynamic panel data model and the 2000-2008 waves of the German SOEP this paper shows that non-cognitive skills have a predictive power on unemployment transitions.
    Keywords: non-cognitive skills, dynamic random effects model, unemployment persistence
    JEL: C33 J64
    Date: 2012–06
  3. By: Büchner Charlotte; Cörvers Frank; Traag Tanja; Velden Rolf van der (ROA rm)
    Abstract: This study analyzes four different transmission mechanisms, through which father’searnings affect son’s earnings: the educational attainment, cognitive skills, the culturalcapital of the family and the social capital in the neighborhood. Using a unique dataset that combines panel data from a birth cohort with earnings data from a largenationwide income survey and national tax files, our findings show that cognitive skillsand schooling of the son account for 50% of the father-son earnings elasticity. Educationby far accounts for the largest part, while cognitive skills mainly work indirectly througheducational attainment. Social capital of the neighborhood and cultural capital of theparents account for an additional 6% of the intergeneration income persistence. Fromthese two additional mechanisms, social capital appears to play a stronger role than thecultural capital of the parents. This means that 44% of the intergenerational persistenceis due to other unobserved characteristics for example personality traits or spillovereffects of family assets.
    Keywords: labour economics ;
    Date: 2012
  4. By: Jule Specht; Boris Egloff; Stefan C. Schmukle
    Abstract: Individuals are expected to mature with increasing age, but it is not yet fully understood which factors contribute to this maturation process. Using data of a representative sample of Germans (N = 14,718) who gave information about their Big Five personality traits twice over a period of 4 years, we identified satisfaction with life, which was reported yearly, as an important variable for explaining mechanisms and interindividual differences in personality maturation. Dual latent change models suggest that more satisfied (compared to less satisfied) individuals experience more positive changes in Emotional Stability, Agreeableness, and Conscientiousness and that positive changes in life satisfaction are associated with positive changes in personality. Furthermore, maturation processes were examined for individuals who faced a social role transition, namely, marriage, birth of a child, or entering the job market. Again, differential effects highlight the importance of life satisfaction for personality maturation.
    Keywords: Personality development, Big Five personality traits, life satisfaction, personality maturation, longitudinal latent modeling
    Date: 2012

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