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on Neuroeconomics |
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Issue of 2015‒02‒22
seven papers chosen by |
| By: | Schildberg-Hörisch, Hannah; Deckers, Thomas; Falk, Armin; Kosse, Fabian |
| Abstract: | We show that parental socioeconomic status (SES) is a powerful predictor of many facets of a child's personality. The facets of personality we investigate encompass time preferences, risk preferences, and altruism that are important noncognitive skills, as well as crystallized, fluid, and overall IQ that represent cognitive skills. We measure parental SES by the mother's and father's average years of education and household income. Our results show that children from families with higher SES are more patient, less likely to be risk-seeking, and score higher on IQ tests. About 20 to 40% of this relationship can be explained by dimensions of a child's environment that are shown to di ffer by parental SES: quantity and quality of time parents spend with their children, parenting style, the mother's IQ and economic preferences, a child's initial conditions at birth, and family structure. Personality profiles that vary systematically with parental SES off er an explanation for social immobility. |
| JEL: | J24 J13 C91 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc14:100285&r=neu |
| By: | Börjesson, Maria; Fosgerau, Mogens |
| Abstract: | This paper studies how response times vary between unlabeled binary choice occasions in a stated choice (SC) experiment, with alternatives differing with respect to in-vehicle travel time and travel cost. The pattern of response times is interpreted as an indicator of the cognitive processes employed by the respondents when making their choices. We find clear signs of reference-dependence in response times in the form of a strong gain-loss asymmetry. Moreover, different patterns of response times for travel time and travel cost indicate that these attributes are processed in different ways by respondents. This may be of particular relevance for choice experiments in the transportation field, where the travel time attribute is central. |
| Keywords: | Response Times; Stated Choice; Data collection; Value of time |
| JEL: | C83 D87 R41 |
| Date: | 2015–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:62002&r=neu |
| By: | Giovanni Dosi; Luigi Marengo; Evita Paraskevopoulou; Marco Valente |
| Abstract: | This work analyzes and models the nature and dynamics of organizational memory, as such an essential ingredient of organizational capabilities. There are two sides to it, namely a cognitive side, involving the beliefs and interpretative frameworks by which the organization categorizes the states of the world and its own internal states, and an operational one, including routines and procedures that store the knowledge of how to do things. We formalize both types of memory by means of evolving systems of condition-action rules and investigate their performance in different environments characterized by varying degrees of complexity and non-stationarity. Broadly speaking, in simple and stable environments memory does not matter, provided it satisfies some minimal requirements. In more complex and gradually changing ones more memory is better. However there is some critical level of environmental instability above which forgetfulness is evolutionary superior from the point of view of long term performance. Moreover, above some (modest) complexity threshold stable and robust cognitive categorizations and routinized behavior emerge. |
| Keywords: | organizational memory, routines, cognitive categories, condition-action rules |
| Date: | 2015–04–02 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2015/01&r=neu |
| By: | Fedorets, Alexandra |
| Abstract: | In the present paper I provide novel evidence on the formation of the gender pay gap with respect to directly measured job task contents. Using high-quality administrative employment data for Germany, and augmenting these by individual-level task information, I provide detailed evidence on the evolution of task contents and their gender-specific remuneration across and within occupations for both genders. The main finding of the paper is that the formation of the pay gap is substantially driven by the relative prices for non-routine cognitive tasks. Moreover, I document convergence in prices for non-routine cognitive tasks and convergence of tasks contents within occupational groups. The only exception from this general finding constitutes the top of the wage distribution, where the substantial difference in prices for non-routine cognitive tasks is persistent and the pay gap is not narrowing. |
| JEL: | J24 J31 J16 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc14:100362&r=neu |
| By: | Proto, Eugenio (University of Warwick); Rustichini, Aldo (University of Minnesota) |
| Abstract: | We use personality traits to better understand the relationship between income and life satisfaction. Personality traits mediate the effect of income on life satisfaction. The effect of neuroticism, which measures sensitivity to threat and punishment, is strong in both the British Household Panel Survey and the German Socioeconomic Panel. Neuroticism increases the usually observed concavity of the relationship: individuals with a higher neuroticism score enjoy extra income more than those with a lower score if they are poorer, and enjoy extra income less if they are richer. When the interaction between income and neuroticism is introduced, income does not have a significant effect on its own. To interpret the results, we present a simple model based on Prospect Theory, where we assume that: (i) life satisfaction is dependent on the gap between aspired and realized income, and this is modulated by neuroticism; and (ii) income increases in aspirations with a slope less than unity, so that the gap between aspired and realized income increases with aspirations. From the estimation of this model we argue that poorer individuals tend to over-shoot in their aspirations, while the rich tend to under-shoot. The estimation of the model also shows a substantial effect of traits on income. |
| Keywords: | life satisfaction, income, personality traits, neuroticism, prospect theory |
| JEL: | D03 D87 C33 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8837&r=neu |
| By: | Ronni Pavan |
| Abstract: | Data indicate that on average firstborn children outperform their younger siblings on measures such as test score, wages, educational attainment, employment, etc. Using data from the Children of the National Longitudinal Survey of Youth 1979, I also find evidence of a sizeable firstborn effect on many cognitive tests, a pattern that is robust to the inclusion of family level fixed effects and other controls. However, I also document considerable gaps in parental investment across birth order. Using a framework similar to Cunha and Heckman (2008) and Cunha et al. (2010), I estimate that differences in the provision of parental inputs across siblings can account for 20% to 45% of the gap in cognitive skills between firstborn children and their subsequent siblings. This framework can control for endogeneity in parental inputs, measurement error, missing observations, and for the dynamic impact of parental investments. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed014:976&r=neu |
| By: | Schwandt, Hannes |
| Abstract: | An emerging economic literature has found evidence that wellbeing follows a U-shape over age. Some theories have assumed that the U-shape is caused by unmet expectations that are felt painfully in midlife but beneficially abandoned and experienced with less regret during old age. In a unique panel of 132,609 life satisfaction expectations matched to subsequent realizations, I find that future life satisfaction is strongly overestimated when young and underestimated during old age. This pattern is stable over time and observed within cohorts as well as across socio-economic groups. These findings support theories that unmet expectations drive the age U-shape in wellbeing. |
| JEL: | I30 J10 D84 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc14:100360&r=neu |