nep-neu New Economics Papers
on Neuroeconomics
Issue of 2018‒07‒09
three papers chosen by

  1. Nonlinear Class Size Effects on Cognitive and Noncognitive Development of Young Children By Marie Connolly; Catherine Haeck
  2. Eliciting temptation and self-control through menu choices: a lab experiment By Toussaert, Séverine
  3. Long-run Effects of Lottery Wealth on Psychological Well-being By Erik Lindqvist; Robert Östling; David Cesarini

  1. By: Marie Connolly (Department of Economics, University of Quebec in Montreal); Catherine Haeck (Department of Economics, University of Quebec in Montreal)
    Abstract: We estimate the nonlinear impact of class size on student achievement by exploiting regulations that cap class size at 20 students per class in kindergarten. Using student-level information from a previously unexploited large-scale census survey of kindergarten students, this study provides clear evidence of the nonlinearity of class size effects on both cognitive and noncognitive measures. While the effects are largest on cognitive development, class size reductions also improve social competence and communication skills in small classes of fewer than 15 students. Above that threshold, the impacts of class size reduction are limited. We also find stronger effects for students in disadvantaged areas. These findings suggest that sizeable class size reductions targeted at disadvantaged areas would achieve better results than a marginal reduction across the board, and even that large reductions in a limited number of classes could be financed by marginal increases in the vast majority of schools not experiencing high poverty rates.
    Keywords: class size, cognitive development, noncognitive development, kindergarten, nonlinear effects
    JEL: I21 I28 J24 C31
    Date: 2018–06
  2. By: Toussaert, Séverine
    Abstract: Unlike present‐biased individuals, agents who suffer self‐control costs as in Gul and Pesendorfer, 2001 may choose to restrict their choice set even when they expect to resist temptation. To identify these self‐control types, I design an experiment in which the temptation was to read a story during a tedious task. The identification strategy relies on a two‐step procedure. First, I measure commitment demand by eliciting subjects' preferences over menus that did or did not allow access to the story. I then implement preferences using a random mechanism, allowing to observe subjects who faced the choice yet preferred commitment. A quarter to a third of subjects can be classified as self‐control types according to their menu preferences. When confronted with the choice, virtually all of them behaved as they anticipated and resisted temptation. These findings suggest that policies restricting the availability of tempting options could have larger welfare benefits than predicted by standard models of present bias.
    Keywords: temptation; self-control; menu choice; curiosity; experiment
    JEL: C91 D83 D99
    Date: 2018–05
  3. By: Erik Lindqvist; Robert Östling; David Cesarini
    Abstract: We surveyed a large sample of Swedish lottery players about their psychological well-being and analyzed the data following pre-registered procedures. Relative to matched controls, large-prize winners experience sustained increases in overall life satisfaction that persist for over a decade and show no evidence of dissipating with time. The estimated treatment effects on happiness and mental health are significantly smaller, suggesting that wealth has greater long-run effects on evaluative measures of well-being than on affective ones. Follow-up analyses of domain-specific aspects of life satisfaction clearly implicate financial life satisfaction as an important mediator for the long-run increase in overall life satisfaction.
    JEL: D69 I31
    Date: 2018–05

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