nep-neu New Economics Papers
on Neuroeconomics
Issue of 2023‒01‒09
five papers chosen by
Daniel Houser
George Mason University

  1. How early nutrition and foundational cognitive skills interconnect? Evidence from two developing countries By Alan Sánchez; Marta Favara; Margaret Sheridan; Jere Behrman
  2. Maternal Genetic Risk for Depression and Child Human Capital By Menta, Giorgia; Lepinteur, Anthony; Clark, Andrew E.; Ghislandi, Simone; D'Ambrosio, Conchita
  3. Do Pension Benefits Accelerate Cognitive Decline? Evidence from Rural China By Nikolov, Plamen; Hossain, Md Shahadath
  4. The Effect of Brazil's Family Health Program on Cognitive Skills By Gunes, Pinar Mine; Tsaneva, Magda
  5. The gender gap in top jobs – the role of overconfidence By Anna Adamecz-Völgyi; Nikki Shure

  1. By: Alan Sánchez (Grupo de Análisis para el Desarrollo (GRADE)); Marta Favara (University of Oxford); Margaret Sheridan (University of North Carolina); Jere Behrman (University of Pennsylvania)
    Abstract: We use unique data collected in Ethiopia and Peru as part of the Young Lives Study to investigate the relationship between early undernutrition and four foundational cognitive skills, the first two of which measure executive functioning: working memory, inhibitory control, long-term memory, and implicit learning. We exploit the rich longitudinal data available to control for potential confounders at the household level and for time-invariant community characteristics. We also exploit the availability of data for paired-siblings to obtain household fixed-effects estimates. Overall, we find robust evidence that stunting is negatively related with the development of executive functions, predicting reductions in working memory and inhibitory control by 12.6% and 5.8% of a standard deviation. Our results shed light on the mechanisms that explain the relationship between early nutrition and school achievement tests suggesting that good nutrition is an important determinant of children’s learning capacities.
    Keywords: foundational cognitive skills; early nutrition; executive functions; Ethiopia; Peru
    JEL: I15 I25 J24
    Date: 2022–12–16
  2. By: Menta, Giorgia (LISER); Lepinteur, Anthony (University of Luxembourg); Clark, Andrew E. (Paris School of Economics); Ghislandi, Simone (Bocconi University); D'Ambrosio, Conchita (University of Luxembourg)
    Abstract: We here address the causal relationship between the maternal genetic risk for depression and child human capital using UK birth-cohort data. We find that an increase of one standard deviation (SD) in the maternal polygenic risk score for depression reduces their children's cognitive and non-cognitive skill scores by 5 to 7% of a SD throughout adolescence. Our results are robust to a battery of sensitivity tests addressing, among others, concerns about pleiotropy and dynastic effects. Our Gelbach decomposition analysis suggests that the strongest mediator is genetic nurture (through maternal depression itself), with genetic inheritance playing only a marginal role.
    Keywords: human capital, maternal depression, ALSPAC
    JEL: I14 J24
    Date: 2022–12
  3. By: Nikolov, Plamen (State University of New York); Hossain, Md Shahadath (State University of New York)
    Abstract: Economists have mainly focused on human capital accumulation, rather than on the causes and consequences of human capital depreciation in late adulthood. To investigate how human capital depreciates over the life cycle, we examine how a newly introduced pension program, the National Rural Pension Scheme, affects cognitive performance in rural China. We find significant adverse effects of access to pension benefits on cognitive functioning among the elderly. We detect the most substantial impact of the program on delayed recall, a cognition measure linked to the onset of dementia. In terms of mechanisms, we find that cognitive deterioration in late adulthood is mediated by a substantial reduction in social engagement, volunteering, and activities fostering mental acuity.
    Keywords: life cycle, human capital, cognitive functioning, cognition, middleincome countries, LMICs, developing countries
    JEL: H55 J24 I31 O12 J26 J14 H75
    Date: 2022–11
  4. By: Gunes, Pinar Mine (University of Alberta); Tsaneva, Magda (Clark University)
    Abstract: This paper examines the effect of Brazil's Family Health Program (Programa Saude da Familia, FHP) on cognitive skills of fifth-grade students. We use biennial data from national exams between 2007 and 2015, and variation in the FHP implementation date across municipalities, birth cohort, and test year to identify the effect of the program on language and mathematics test scores. We find that, in northern municipalities, students exposed to FHP at or prior to birth have 0.88 points higher language and 1.30 points higher mathematics test scores compared to those exposed to FHP in childhood. The estimated effects are intent-to-treat effects and correspond to increases of 0.021sd and 0.030sd in language and mathematics test scores. We use an event-study analysis demonstrating that the largest effects of FHP on cognitive skills are for those students exposed at or prior to birth, with trivial effects if exposed after birth. We do not find evidence for changes in parental investment behavior or child school attendance, which suggests that the effects are likely due to the direct impact of the program on child cognitive development.
    Keywords: early life interventions, cognitive skills, community healthcare, Brazil
    JEL: I15 I18 I21
    Date: 2022–12
  5. By: Anna Adamecz-Völgyi (Centre for Economic and Regional Studies, UCL Social Research Institute, University College London); Nikki Shure (UCL Social Research Institute, University College London, Institute of Labor Economics (IZA))
    Abstract: There is a large gender gap in the probability of being in a “top job” in mid-career. Top jobs bring higher earnings, and also have more job security and better career trajectories. Recent literature has raised the possibility that some of this gap may be attributable to women not “leaning in” while men are more overconfident in their abilities. We use longitudinal data from childhood into mid-career and construct a measure of overconfidence using multiple measures of objective cognitive ability and subjective estimated ability. Our measure confirms previous findings that men are more overconfident than women. We then use linear regression and decomposition techniques to account for the gender gap in top jobs including our measure of overconfidence. Our results show that men being more overconfident explains 5-11 percent of the gender gap in top job employment. This indicates that while overconfidence matters for gender inequality in the labor market and has implications for how firms recruit and promote workers, other individual, structural, and societal factors play a larger role.
    Keywords: gender gaps, inequality, overconfidence, labor market
    JEL: I24 I26 J24
    Date: 2022–10

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