nep-neu New Economics Papers
on Neuroeconomics
Issue of 2017‒03‒12
four papers chosen by
Daniel Houser
George Mason University

  1. Born to Lead? The Effect of Birth Order on Non-Cognitive Abilities By Black, Sandra E.; Grönqvist, Erik; Öckert, Björn
  2. More Effort with Less Pay: On Information Avoidance, Belief Design, and Performance By Szech, Nora; Huck, Steffen; Wenner, Lukas
  3. Cognitive Skills, Noncognitive Skills, and School-to-Work Transitions in Rural China By Glewwe, Paul; Huang, Qiuqiong; Park, Albert
  4. Why are cognitive abilities of children so different across countries? The link between major socioeconomic factors and PISA test scores By Burhan, Nik Ahmad Sufian; Md. Yunus, Melor; Tovar, María Elena Labastida; Burhan, Nik Mohd Ghazi

  1. By: Black, Sandra E. (University of Texas at Austin); Grönqvist, Erik (IFAU); Öckert, Björn (IFAU)
    Abstract: We study the effect of birth order on personality traits among men using population data on enlistment records and occupations for Sweden. We find that earlier born men are more emotionally stable, persistent, socially outgoing, willing to assume responsibility, and able to take initiative than later-borns. In addition, we find that birth order affects occupational sorting; first-born children are more likely to be managers, while later-born children are more likely to be self-employed. We also find that earlier born children are more likely to be in occupations that require leadership ability, social ability and the Big Five personality traits. Finally, we find a significant role of sex composition within the family. Later-born boys suffer an additional penalty the larger the share of boys among the older siblings. When we investigate possible mechanisms, we find that the negative effects of birth order are driven by post-natal environmental factors. We also find evidence of lower parental human capital investments in later-born children.
    Keywords: birth order, personality, occupation choice
    JEL: J12 J24
    Date: 2017–02
  2. By: Szech, Nora; Huck, Steffen; Wenner, Lukas
    Abstract: In a tedious real effort task, subjects know that their piece rate is either low or ten times higher. When subjects are informed about their piece rate realization, they adapt their performance. One third of subjects nevertheless forego this instrumental information when given the choice — and perform stunningly well. Agents who are uninformed regarding their piece rate tend to outperform all others, even those who know that their piece rate is high. This also holds for enforced instead of self-selected information avoidance. All our findings can be captured by a model of optimally distorted expectations following Brunnermeier and Parker (2005).
    JEL: D83 D84 J31
    Date: 2016
  3. By: Glewwe, Paul (University of Minnesota); Huang, Qiuqiong (University of Arkansas, Fayetteville); Park, Albert (Hong Kong University of Science & Technology)
    Abstract: Economists have long recognized the important role of formal schooling and cognitive skills on labor market participation and wages. More recently, increasing attention has turned to the role of personality traits, or noncognitive skills. This study is among the first to examine how both cognitive and noncognitive skills measured in childhood predict educational attainment and early labor market outcomes in a developing country setting. Analyzing longitudinal data on rural children from one of China's poorest provinces, we find that both cognitive and noncognitive skills, measured when children are 9-12, 13-16, and 17-21 years old, are important predictors of whether they remain in school or enter the work force at age 17-21. The predictive power of specific skill variables differ between boys and girls. Conditioning on years of schooling, there is no strong evidence that skills measured in childhood predict wages in the early years of labor market participation.
    Keywords: cognitive skills, noncognitive skills, school-to-work transition, schooling, rural China
    JEL: I25 J16 J24 O53
    Date: 2017–02
  4. By: Burhan, Nik Ahmad Sufian; Md. Yunus, Melor; Tovar, María Elena Labastida; Burhan, Nik Mohd Ghazi
    Abstract: Path analysis was employed to examine the effects of socioeconomic factors on children’s level of cognitive ability (measured by PISA scores) at a cross-country level (N=55). The results showed that children’s level of schooling had a positive direct effect on their cognitive ability, while the direct effects of adult fertility rate and child mortality were significantly negative. As we found that child mortality had the largest total effect on cognitive ability, the results also confirmed that per capita income had indirectly channeled its positive effect on cognitive ability through the reduction in child mortality. Moreover, in the long term, parents’ education level had the largest positive indirect effect on cognitive ability because it significantly increased children’s schooling rate and reduced the fertility rate. We suggest that, in the countries considered herein, well-educated parents have higher awareness of quality of life that indirectly raises the cognitive ability of their children.
    Keywords: cognitive ability; cross-country analysis; education; parents; PISA scores; socioeconomic
    JEL: I25 J13 O20
    Date: 2016–09–29

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