Economica最新文献

Research on sports betting has generally found a favourite–longshot bias: bets on longshots lose more than bets on favourites. Existing research focuses largely on pari-mutuel betting, but favourite–longshot bias is also evident in fixed-odds online betting markets of the type that are growing rapidly around the world. Explanations for this bias in previous work on pari-mutuel markets cannot explain why it would be a feature of competitive fixed-odds betting markets. We show how disagreement among gamblers and risk aversion on the part of bookmakers in a competitive market can produce a pattern of favourite–longshot bias resembling the empirical evidence.

This paper demonstrates how tax administrations can evaluate future compliance gains from risk-based tax enforcement that audits all taxpayers above a risk threshold. Expanding tax enforcement in this setting means reducing the audit threshold. The compliance gains from such an expansion consist of a mechanical audit correction effect and a behavioural effect that reflects changes in self-reporting in the subsequent years. We estimate this behavioural effect in a regression discontinuity analysis with the risk score as the forcing variable. We find that taxpayers at the margin had a significant reduction in self-reported deductions in the next years' tax filing. The behavioural effect over a three-year post-audit period is estimated to be of a magnitude similar to that of the direct adjustment of the audit. This compliance effect does not change when we include the reporting of the spouse. We find that the risk score threshold that maximizes net public revenue from the audits is considerably below current practice.

Passenger transport has significant externalities, including carbon emissions and air pollution. Public health research has identified additional social gains from active travel, due to the health benefits of physical exercise. Per mile, these benefits greatly exceed the external costs from car use. We introduce active travel into an optimal fuel taxation model and characterize analytically the second-best optimal fuel tax. We find that accounting for active travel benefits increases the optimal fuel tax by 44% in the USA and 38% in the UK. Fuel taxes should be implemented jointly with other policies aimed at increasing the uptake of active travel.

Aversion to ‘stigma’—disutility associated with a programme or activity due to beliefs about how it is perceived—may affect labour market choices and utilization of social programmes, but empirical evidence of its importance is scarce. Using two randomized field experiments, we show that stigma can affect consequential labour market decisions. Treatments designed to alleviate stigma concerns about taking entry-level jobs—such as how those jobs are perceived by society—had small average effects on take-up of job assistance programmes. However, using compositional analysis and machine learning methods, we document large heterogeneity in the responses to our treatments. Stigma significantly affects the composition of who takes up a programme: the treatments were more successful in overcoming stigma for older, wealthier and working respondents. For other people, we show that our treatments merely increased the salience of the stigma without dispelling it. We conclude that social image concerns affect labour market decisions and that messaging surrounding programmes can have important effects on programme take-up and composition.

This paper analyses the effect of trade policy uncertainty in a customs union on export-platform foreign direct investment (FDI). First, I develop a partial equilibrium framework with heterogeneous firms based on the proximity–concentration trade-off that involves trade policy uncertainty about trade costs inside a customs union. Second, I derive an empirical equation that I test by exploiting the 2016 Brexit referendum as a natural experiment and using data on manufacturing greenfield FDI projects. The results show that trade policy uncertainty impacted negatively the decisions of firms to invest in export-platform activities in the UK following the Brexit referendum. Moreover, I find that extra-EU manufacturing firms preferred EU countries as opposed to the UK for new investments after the 2016 referendum.

This study examines the relationship between expanded access to driver's licences among undocumented immigrants and the number of post-mortem organ donors, using difference-in-differences modelling and event study estimation techniques. Results suggest that the adoption of laws that grant driver's licences to undocumented immigrants effectively increased the population of licensed drivers by about 2.7%. These increments eventually led to subsequent increases in the number of Hispanic organ donors by 28%, and the outcome is driven mainly by young adult Hispanic donors. Moreover, DLU laws are further credited with an approximately 17% increase in organ transplants, particularly among Hispanics, although transplant waiting list addition numbers are not significantly affected. As these laws pave the way for more undocumented drivers to register as organ donors, such legislation could help to alleviate organ shortage issues and narrow the ‘ethnic waiting period gap’ for organ transplants.

In this study, we analyse the effects of unemployment on consumption and time use. To do so, we employ a micro panel dataset for the Netherlands containing a large set of expenditure and time use categories. Our results show a small negative effect of unemployment on expenditures, and large positive effects on time spent on home production and leisure activities. We do not find evidence for complementarity between leisure and consumption or for substitution between home production and expenditures. We use our results to estimate a ratio of relevant lifecycle parameters, and show that the point estimates and their precision depend strongly on the expenditure and time use categories considered.