A forbidden zones theorem, mathematical approach and model are proposed in the present article. In particular, the approach supposes that people decide as if there were some biases of the expectations of measurement data. The article is motivated by the need of a theoretical support for the practical analysis performed for the purposes of utility and prospect theories, behavioral economics, psychology, decision and social sciences. Possible general consequences and applications of the theorem and approach for a noise and biases of measurement data are preliminary considered as well.
{"title":"Forbidden Zones and Biases for the Expectation: New Mathematical Results for Behavioral and Social Sciences","authors":"A. Harin","doi":"10.2139/ssrn.3173184","DOIUrl":"https://doi.org/10.2139/ssrn.3173184","url":null,"abstract":"A forbidden zones theorem, mathematical approach and model are proposed in the present article. In particular, the approach supposes that people decide as if there were some biases of the expectations of measurement data. The article is motivated by the need of a theoretical support for the practical analysis performed for the purposes of utility and prospect theories, behavioral economics, psychology, decision and social sciences. Possible general consequences and applications of the theorem and approach for a noise and biases of measurement data are preliminary considered as well.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"17 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-05-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129902419","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Several recent studies have found that Chinese CPI understates changes in the cost of living. This finding is surprising because common CPI biases cause CPI to overstate changes in cost of living. Using data on average prices, this paper explores whether a type of new-good bias could be responsible for the bias in Chinese CPI. We do not find evidence of a new-good bias, and political tampering appears to be the most likely cause of this bias. China's large-scale migration may also cause changes in the cost of living that are not reflected in CPI.
{"title":"Using Food Prices and Consumption to Examine Chinese Cost of Living","authors":"Jonathan A Cook, F. Gale","doi":"10.1111/1468-0106.12282","DOIUrl":"https://doi.org/10.1111/1468-0106.12282","url":null,"abstract":"Several recent studies have found that Chinese CPI understates changes in the cost of living. This finding is surprising because common CPI biases cause CPI to overstate changes in cost of living. Using data on average prices, this paper explores whether a type of new-good bias could be responsible for the bias in Chinese CPI. We do not find evidence of a new-good bias, and political tampering appears to be the most likely cause of this bias. China's large-scale migration may also cause changes in the cost of living that are not reflected in CPI.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"7 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126846707","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The federal government encourages human capital investment through lending and grant programs, but resources from these programs may also finance non-education activities for students whose liquidity is otherwise restricted. This paper explores this possibility, using administrative data for the universe of federal student loan borrowers linked to tax records. We examine the effects of a sharp discontinuity in program limits?generated by the timing of a student borrower?s 24th birthday?on household formation early in the lifecycle. After demonstrating that this discontinuity induces a jump in federal support, we estimate an immediate and persistent increase in homeownership, with larger effects among those most financially constrained. In the first year, borrowers with higher limits also earn less but are more likely to save; however, there are no differences in subsequent years. Finally, effects on marriage and fertility lag homeownership. Altogether, the results appear to be driven by liquidity rather than human capital or wealth effects.
{"title":"A Day Late and a Dollar Short: Liquidity and Household Formation Among Student Borrowers","authors":"Sarena Goodman, A. Isen, Constantine Yannelis","doi":"10.17016/FEDS.2018.025","DOIUrl":"https://doi.org/10.17016/FEDS.2018.025","url":null,"abstract":"The federal government encourages human capital investment through lending and grant programs, but resources from these programs may also finance non-education activities for students whose liquidity is otherwise restricted. This paper explores this possibility, using administrative data for the universe of federal student loan borrowers linked to tax records. We examine the effects of a sharp discontinuity in program limits?generated by the timing of a student borrower?s 24th birthday?on household formation early in the lifecycle. After demonstrating that this discontinuity induces a jump in federal support, we estimate an immediate and persistent increase in homeownership, with larger effects among those most financially constrained. In the first year, borrowers with higher limits also earn less but are more likely to save; however, there are no differences in subsequent years. Finally, effects on marriage and fertility lag homeownership. Altogether, the results appear to be driven by liquidity rather than human capital or wealth effects.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"47 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-04-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124108868","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper investigates the relationship between partner's mental health and individual life satisfaction, using a sample of married and cohabitating couples from the Household, Income and Labour Dynamics of Australia Survey (HILDA). We use panel data models with fixed effects to estimate the life satisfaction impact of several different measures of partner's mental health and to calculate the Compensating Income Variation (CIV) of them. To the best of our knowledge, this is the first paper to study the effect of partner's mental health on individual's wellbeing and to measure the impact of reduced life satisfaction in monetary terms. We also provide some new insights into adaptation and coping mechanisms. Accounting for measurement error and endogeneity of income, partners' mental health has a significant and sizeable association with individual well-being. The additional income needed to compensate someone living with a partner with a long term mental condition is substantial (over USD 60,000). Further, individuals do not show significant adaptation to partners' poor mental health conditions, and coping mechanisms show little influence on life satisfaction. The results have implications for policy-makers wishing to value the wider effects of policies that aim to impact on mental health and overall levels of well-being.
{"title":"The Transmission of Mental Health within Households: Does One Partner's Mental Health Influence the Other Partner's Life Satisfaction?","authors":"S. Mendolia, Paul McNamee, Oleg Yerokhin","doi":"10.2139/ssrn.3158116","DOIUrl":"https://doi.org/10.2139/ssrn.3158116","url":null,"abstract":"This paper investigates the relationship between partner's mental health and individual life satisfaction, using a sample of married and cohabitating couples from the Household, Income and Labour Dynamics of Australia Survey (HILDA). We use panel data models with fixed effects to estimate the life satisfaction impact of several different measures of partner's mental health and to calculate the Compensating Income Variation (CIV) of them. To the best of our knowledge, this is the first paper to study the effect of partner's mental health on individual's wellbeing and to measure the impact of reduced life satisfaction in monetary terms. We also provide some new insights into adaptation and coping mechanisms. Accounting for measurement error and endogeneity of income, partners' mental health has a significant and sizeable association with individual well-being. The additional income needed to compensate someone living with a partner with a long term mental condition is substantial (over USD 60,000). Further, individuals do not show significant adaptation to partners' poor mental health conditions, and coping mechanisms show little influence on life satisfaction. The results have implications for policy-makers wishing to value the wider effects of policies that aim to impact on mental health and overall levels of well-being.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-04-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127808363","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In January 2018, households’ savings contracted against debt growth on bank loans, which is very unordinary for the first month of the year. Consumption indexes—retail trade turnover and spending on paid services—continued growing. The households strive to maintain acceptable standard of living by mobilizing all available financial possibilities.
{"title":"Bank Deposits and Lending in January 2018: Unusual Development","authors":"M. Khromov","doi":"10.2139/ssrn.3139743","DOIUrl":"https://doi.org/10.2139/ssrn.3139743","url":null,"abstract":"In January 2018, households’ savings contracted against debt growth on bank loans, which is very unordinary for the first month of the year. Consumption indexes—retail trade turnover and spending on paid services—continued growing. The households strive to maintain acceptable standard of living by mobilizing all available financial possibilities.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"45 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-03-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126641980","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
I. Gazeley, Ros Holmes, Cecilia T. Lanata Briones, A. Newell, Kevin Reynolds, Héctor Gutiérrez Rufrancos
The article reports an analysis of the findings of a search for household budget surveys for Latin America for the period from the earliest surveys to the late 1960s. Over one hundred studies were located. References to these surveys are available at http://www.sussex.ac.uk/globalincomeinequality/. In Appendix 1 we offer a synopsis of the history, context and contents of all the surveys, including those that did not contain useable data. We discuss the comparability of each country's surveys in turn, offering a table for each country with indicator of size, scope and other features. Our final work is to model the progress of inequality, as reflected in Gini coefficients, 90/10 and 50/10 percentile ratios in the region. We find that the bulk of the measured rise is inequality from the 1930s to the 1960s is due to changing survey methods and objectives, in particular the expansion of the scope of the surveys from a narrow focus on urban manual worker-headed households to a later broad focus on the population. Finally, we predict the pattern of inequality over time that might have been found had the earlier surveys been unrestricted in terms of target population and randomly sampled. We find a modest increase from the early years to the 1960s in Gini inequality.
{"title":"Latin American Household Budget Surveys 1913-1970 and What They Tell Us About Economic Inequality Among Households","authors":"I. Gazeley, Ros Holmes, Cecilia T. Lanata Briones, A. Newell, Kevin Reynolds, Héctor Gutiérrez Rufrancos","doi":"10.2139/ssrn.3158115","DOIUrl":"https://doi.org/10.2139/ssrn.3158115","url":null,"abstract":"The article reports an analysis of the findings of a search for household budget surveys for Latin America for the period from the earliest surveys to the late 1960s. Over one hundred studies were located. References to these surveys are available at http://www.sussex.ac.uk/globalincomeinequality/. In Appendix 1 we offer a synopsis of the history, context and contents of all the surveys, including those that did not contain useable data. We discuss the comparability of each country's surveys in turn, offering a table for each country with indicator of size, scope and other features. Our final work is to model the progress of inequality, as reflected in Gini coefficients, 90/10 and 50/10 percentile ratios in the region. We find that the bulk of the measured rise is inequality from the 1930s to the 1960s is due to changing survey methods and objectives, in particular the expansion of the scope of the surveys from a narrow focus on urban manual worker-headed households to a later broad focus on the population. Finally, we predict the pattern of inequality over time that might have been found had the earlier surveys been unrestricted in terms of target population and randomly sampled. We find a modest increase from the early years to the 1960s in Gini inequality.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"108 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132377744","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2018-01-31DOI: 10.1108/IJM-04-2016-0083
Eleftherios Giovanis
Purpose There is an increasing concern on the quality of jobs and productivity witnessed in the flexible employment arrangements. The purpose of this paper is to examine the relationship between various flexible employment arrangements and the workplace performance. Design/methodology/approach Home-based working, teleworking, flexible timing and compressed hours are the main employment types examined using the Workplace Employee Relations Survey (WERS) over the years 2004 and 2011 in Great Britain. The workplace performance is measured by two outcomes – the financial performance and labour productivity. First, the determinants of these flexible employment types are explored. Second, the ordinary least squares (OLS) method is followed. Third, an instrumental variable (IV) approach is applied to account for plausible endogeneity and to estimate the causal effects of flexible employment types on firm performance. Findings The findings show a significant and positive relationship between the flexible employment arrangements and the workplace performance. Education, age, wage, quality of relations between managers-employees, years of experience, the area of the market the workplace is operated and the competition are significant factors and are positively associated with the propensity of the implementation of flexible employment arrangements. Social implications The insights derived from the study can have various profound policy implications for employees, employers and the society overall, including family-work balance, coping with family demands, improving the firm performance, reducing traffic congestion and stress among others. Originality/value It is the first study that explores the relationship between flexible employment types and workplace performance using an IV approach. This allows us to estimate the causal effects of flexible employment types and the possible associated social implications.
{"title":"The Relationship Between Flexible Employment Arrangements and Workplace Performance in Great Britain","authors":"Eleftherios Giovanis","doi":"10.1108/IJM-04-2016-0083","DOIUrl":"https://doi.org/10.1108/IJM-04-2016-0083","url":null,"abstract":"Purpose \u0000 \u0000 \u0000 \u0000 \u0000There is an increasing concern on the quality of jobs and productivity witnessed in the flexible employment arrangements. The purpose of this paper is to examine the relationship between various flexible employment arrangements and the workplace performance. \u0000 \u0000 \u0000 \u0000 \u0000Design/methodology/approach \u0000 \u0000 \u0000 \u0000 \u0000Home-based working, teleworking, flexible timing and compressed hours are the main employment types examined using the Workplace Employee Relations Survey (WERS) over the years 2004 and 2011 in Great Britain. The workplace performance is measured by two outcomes – the financial performance and labour productivity. First, the determinants of these flexible employment types are explored. Second, the ordinary least squares (OLS) method is followed. Third, an instrumental variable (IV) approach is applied to account for plausible endogeneity and to estimate the causal effects of flexible employment types on firm performance. \u0000 \u0000 \u0000 \u0000 \u0000Findings \u0000 \u0000 \u0000 \u0000 \u0000The findings show a significant and positive relationship between the flexible employment arrangements and the workplace performance. Education, age, wage, quality of relations between managers-employees, years of experience, the area of the market the workplace is operated and the competition are significant factors and are positively associated with the propensity of the implementation of flexible employment arrangements. \u0000 \u0000 \u0000 \u0000 \u0000Social implications \u0000 \u0000 \u0000 \u0000 \u0000The insights derived from the study can have various profound policy implications for employees, employers and the society overall, including family-work balance, coping with family demands, improving the firm performance, reducing traffic congestion and stress among others. \u0000 \u0000 \u0000 \u0000 \u0000Originality/value \u0000 \u0000 \u0000 \u0000 \u0000It is the first study that explores the relationship between flexible employment types and workplace performance using an IV approach. This allows us to estimate the causal effects of flexible employment types and the possible associated social implications.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-01-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129082175","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper presents a new model of the household that is able to explain a variety of consumption patterns that existing models cannot describe, most notably, those associated with the Deaton and Paxson (1998) paradox. The most distinctive feature of this model is the presence of common-pool goods (rival and non-excludable) previously ignored in the literature. Under regularity conditions, the model can be interpreted as a hybrid between non-cooperative and a collective models of the household. Empirically, the paper revisits the Deaton-Paxson paradox exploiting household splits in longitudinal data and computes the elusive indifference scales coefficients.
{"title":"A Sharing Model of the Household: Explaining the Deaton-Paxson Paradox and Computing Household Indifference Scales","authors":"Federico H. Gutierrez","doi":"10.2139/ssrn.3098290","DOIUrl":"https://doi.org/10.2139/ssrn.3098290","url":null,"abstract":"This paper presents a new model of the household that is able to explain a variety of consumption patterns that existing models cannot describe, most notably, those associated with the Deaton and Paxson (1998) paradox. The most distinctive feature of this model is the presence of common-pool goods (rival and non-excludable) previously ignored in the literature. Under regularity conditions, the model can be interpreted as a hybrid between non-cooperative and a collective models of the household. Empirically, the paper revisits the Deaton-Paxson paradox exploiting household splits in longitudinal data and computes the elusive indifference scales coefficients.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"97 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-01-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114138383","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The economic crisis that hit the United States and Europe in 2007 had a considerable impact on employment. While unemployment has grown throughout OECD’s countries, the only exception was Germany, where actually unemployment decreased between 2008-2009. The main reasons lay on the country’s adjustment mechanism through internal numerical flexibility, as well as on its coordinated market economy system.
{"title":"Why Did the Labour Market in Germany Perform So Well during the Great Recession?","authors":"Mircea Tanasie","doi":"10.2139/ssrn.3133297","DOIUrl":"https://doi.org/10.2139/ssrn.3133297","url":null,"abstract":"The economic crisis that hit the United States and Europe in 2007 had a considerable impact on employment. While unemployment has grown throughout OECD’s countries, the only exception was Germany, where actually unemployment decreased between 2008-2009. The main reasons lay on the country’s adjustment mechanism through internal numerical flexibility, as well as on its coordinated market economy system.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"18 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-12-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122233397","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Using a newly constructed database for 26 countries over 2000-2014, we analyze cross-country and within-country differences in mortgage arrears. We find that restrictive macro-prudential policies, in particular lower regulatory loan-to-value ratios, are significantly associated with a lower share of mortgage arrears in total residential debt. Likewise, better institutions are related with lower delinquency rates, both directly and by enhancing the impact of macro-prudential policies and the right to recourse. We also find that the effect of macro-prudential policies is conditioned by several mortgage market characteristics, such as the maturity of loans, interest rate fixity, and tax deductibility of interest payments.
{"title":"Mortgage Arrears, Regulation and Institutions: Cross-Country Evidence","authors":"Irina Stanga, R. Vlahu, J. de Haan","doi":"10.2139/ssrn.3094242","DOIUrl":"https://doi.org/10.2139/ssrn.3094242","url":null,"abstract":"Using a newly constructed database for 26 countries over 2000-2014, we analyze cross-country and within-country differences in mortgage arrears. We find that restrictive macro-prudential policies, in particular lower regulatory loan-to-value ratios, are significantly associated with a lower share of mortgage arrears in total residential debt. Likewise, better institutions are related with lower delinquency rates, both directly and by enhancing the impact of macro-prudential policies and the right to recourse. We also find that the effect of macro-prudential policies is conditioned by several mortgage market characteristics, such as the maturity of loans, interest rate fixity, and tax deductibility of interest payments.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"124 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-12-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116431004","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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