nep-neu New Economics Papers
on Neuroeconomics
Issue of 2024‒05‒06
four papers chosen by

  1. Food Coma Is Real: The Effect of Digestive Fatigue on Adolescents' Cognitive Performance By Hervé, Justine; Mani, Subha; Behrman, Jere R.; Laxminarayan, Ramanan; Nandi, Arindam
  2. Bad Luck or Bad Decisions? Macroeconomic Implications of Persistent Heterogeneity in Cognitive Skills and Overconfidence By Oliver Pfäuti; Fabian Seyrich; Jonathan Zinman
  3. Daycare Enrollment Age and Child Development By Gørtz, Mette; Jensen, Vibeke Myrup; Sander, Sarah
  4. Unethical decision making and sleep restriction: Experimental evidence By David L. Dickinson; David Masclet

  1. By: Hervé, Justine (Stevens Institute of Technology); Mani, Subha (Fordham University); Behrman, Jere R. (University of Pennsylvania); Laxminarayan, Ramanan (Princeton University); Nandi, Arindam (The Population Council)
    Abstract: Food coma, also known as postprandial somnolence, is a commonly cited reason for experiencing reduced alertness during mid-afternoon worldwide. By using exogenous variation in the timing of tests and, hence, by extension, plausibly exogenous variation in the temporal distance between an individual's last meal and the time of test, we examine the causal impact of postprandial somnolence on cognitive capacities. Analyzing novel time use data on ~ 4, 600 Indian adolescents and young adults, we find that testing within an hour after a meal reduces test-takers' scores on English, native language, math, and Raven's tests by 8, 8, 8, and 16 percent, respectively, compared to test-takers who took the tests more than an hour after their meal. We further find that the negative effect of postprandial somnolence on cognition operates through increased feelings of fatigue and depletion of cognitive resources that become more pronounced while dealing with more challenging test questions.
    Keywords: post-meal fatigue, cognitive skills, low-stakes tests, India, adolescents
    JEL: I12 I18 I21 J24
    Date: 2024–04
  2. By: Oliver Pfäuti; Fabian Seyrich; Jonathan Zinman
    Abstract: Business cycle models often abstract from persistent household heterogeneity, despite its potentially significant implications for macroeconomic fluctuations and policy. We show empirically that the likelihood of being persistently financially constrained decreases with cognitive skills and increases with overconfidence thereon. Guided by this and other micro evidence, we add persistent heterogeneity in cognitive skills and overconfidence to an otherwise standard HANK model. Overconfidence proves to be the key innovation, driving households to spend instead of precautionary save and producing empirically realistic wealth distributions and hand-to-mouth shares and MPCs across the income distribution. We highlight implications for various fiscal policies.
    JEL: D01 D91 E03 E2 E21 E22 E32 E62 G51 H31 H6
    Date: 2024–04
  3. By: Gørtz, Mette (University of Copenhagen); Jensen, Vibeke Myrup (Aarhus University); Sander, Sarah (University of Copenhagen)
    Abstract: Many parents return to work, placing their child in nonparental care before the age of one. Using variations in daycare vacancy rates, we estimate the causal effects of enrollment age in universal daycare on child development. In general, we find no evidence that earlier enrollment harms early child development, except for a temporary health shock. Children who enter later initially have fewer primary care visits, but the effects fade in preschool. Conversely, the results suggest some positive effects of early enrollment. Children who enter daycare later are more likely to demonstrate inadequate language skills by age five, particularly among boys.
    Keywords: daycare, child development, health, cognitive skills
    JEL: I00 J13 J24
    Date: 2024–03
  4. By: David L. Dickinson (Appalachian State University - UNC - University of North Carolina System, IZA - Forschungsinstitut zur Zukunft der Arbeit - Institute of Labor Economics); David Masclet (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, CIRANO - Centre interuniversitaire de recherche en analyse des organisations - UQAM - Université du Québec à Montréal = University of Québec in Montréal)
    Abstract: Insufficient sleep is costly to organizations (e.g., direct health costs, cognitive errors, accident risk, and lower labor productivity). In this current study, we examine another more hidden cost associated with insufficient sleep- unethical behaviors. Using a hybrid field/lab experimental approach, participants were randomly assigned to a week of sleep -restriction or well-rested sleep levels in their at-home (naturalistic) environment prior to decision making. We found that sleep restricted participants cheated significantly more in two honesty tasks, while anti-social choices were, surprisingly, not affected. Because sleep restriction promotes reduced deliberation, these results contribute to our understanding of the cognitive underpinnings of decision making. Importantly, these findings have practical implications to managers who want to reduce dishonesty in the workplace. For example, our results suggest that workplace health promotion programs focused on good sleep hygiene would additionally benefit the company in terms of indirectly promoting ethical conduct in the workplace.and COPY; 2023 Elsevier Inc. All rights reserved.
    Keywords: Ethical choice, Dishonesty, Antisocial behavior, Sleep
    Date: 2023

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