nep-neu New Economics Papers
on Neuroeconomics
Issue of 2019‒03‒04
five papers chosen by

  1. Happy to Take Some Risk: A More Accurate Assessment of the Dependence of Risk Preferences on Mood Using Biometric Data By Kassas, Bachir; Palma, Marco; Porter, Maria
  2. Toward an Understanding of the Development of Time Preferences: Evidence from Field Experiments By James Andreoni; Michael A. Kuhn; John A. List; Anya Samek; Kevin Sokal; Charles Sprenger
  3. Actors in the Child Development Process By Daniela Del Boca; Christopher J. Flinn; Ewout Verriest; Matthew J. Wiswall
  4. Parental ethnic identity and child development By Stuart Campbell; Ana Nuevo-Chiquero; Gurleen Popli; Anita Ratcliffe
  5. Toward a cognitive science of markets: Economic agents as sense-makers By Johnson, Samuel G. B.

  1. By: Kassas, Bachir; Palma, Marco; Porter, Maria
    Keywords: Institutional and Behavioral Economics, Risk & Uncertainty
    Date: 2019–02
  2. By: James Andreoni; Michael A. Kuhn; John A. List; Anya Samek; Kevin Sokal; Charles Sprenger
    Abstract: Time preferences have been correlated with a range of life outcomes, yet little is known about their early development. We conduct a field experiment to elicit time preferences of over 1,200 children ages 3-12, who make several intertemporal decisions. To shed light on how such primitives form, we explore various channels that might affect time preferences, from background characteristics to the causal impact of an early schooling program that we developed and operated. Our results suggest that time preferences evolve substantially during this period, with younger children displaying more impatience than older children. We also find a strong association with race: black children, relative to white or Hispanic children, are more impatient. Finally, assignment to different schooling opportunities is not significantly associated with child time preferences.
    JEL: C9 C93 D03
    Date: 2019–02
  3. By: Daniela Del Boca; Christopher J. Flinn; Ewout Verriest; Matthew J. Wiswall
    Abstract: We construct and estimate a model of child development in which both the parents and children make investments in the child’s skill development. In each period of the development process, partially altruistic parents act as the Stackelberg leader and the child the follower when setting her own study time. We then extend this non-cooperative form of interaction by allowing parents to offer incentives to the child to increase her study time, at some monitoring cost. We show that this incentive scheme, a kind of internal conditional cash transfer, produces efficient outcomes and, in general, increases the child’s cognitive ability. In addition to heterogeneity in resources (wage offers and non-labor income), the model allows for heterogeneity in preferences both for parents and children, and in monitoring costs. Like their parents, children are forward-looking, but we allow children and parents to have different preferences and for children to have age-varying discount rates, becoming more “patient” as they age. Using detailed time diary information on the allocation of parent and child time linked to measures of child cognitive ability, we estimate several versions of the model. Using model estimates, we explore the impact of various government income transfer policies on child development.
    JEL: J13
    Date: 2019–02
  4. By: Stuart Campbell (University College London); Ana Nuevo-Chiquero (University of Edinburgh and IZA); Gurleen Popli (Department of Economics, University of Sheffield, UK); Anita Ratcliffe (Department of Economics, University of Sheffield, UK)
    Abstract: We examine the relationship between parental ethnic identity and cognitive developmentin ethnic minority children. This aspect of parental identity may shape children’s cognitive outcomes through a direct influence on parenting behaviour, or by mediating parental access to social resources. Drawing an ethnic minority sample from a detailed UK cohort study, we find a negative association between maternal majority identity and children’s cognitive test scores. This result is driven by poor households, by those who lack local family support networks, and by those who mostly speak a foreign language at home. We suggest that differential access to social resources is the most persuasive explanation of this result. Differences in parenting behaviour do not seem to play an important role.
    Keywords: ethnic identity; national identity; child development
    JEL: I21 J13 J15
    Date: 2019–02
  5. By: Johnson, Samuel G. B.
    Abstract: Behavioral economics characterizes decision-makers using psychologically-informed models. Cognitive science produces psychologically-informed models. Why don't these disciplines talk more? Here, the author presents several arguments for why cognitive science should inform behavioral economics - it characterizes internal psychological states, builds a richer conception of human nature, pays equal attention to cognition's successes and failures, embraces multidisciplinary insights, and avoids blind spots produced by behavioral economics' intellectual lineage. The author illustrates these principles using the cognitive science of sense-making - how humans understand information - including mental tools such as heuristics, stories, and theories. The science of mind can produce new insights to enrich economics.
    Keywords: cognitive science,behavioral economics,experimental economics,behavioral finance,economics methodology,information processing,decision-making under uncertainty
    JEL: A12 B4 D01 D11 D7 D8 D9
    Date: 2019

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