Three Essays in Economics of Gender

During recent decades, economists' interest in gender-related issues has risen. Researchers aim to show how economic theory can be applied to gender related topics such as peer effect, labor market outcomes, and education. This dissertation aims to contribute to our understandings of the interaction, inequality and sources of differences across genders, and it consists of three empirical papers in the research area of gender economics. The aim of the first paper ("Separating gender composition effect from peer effects in education") is to demonstrate the importance of considering endogenous peer effects in order to identify gender composition effect. This fact is analytically illustrated by employing Manski's (1993) linear-in-means model. The paper derives an innovative solution to the simultaneous identification of endogenous and exogenous peer effects: gender composition effect of interest is estimated from auxiliary reduced-form estimates after identifying the endogenous peer effect by using Graham (2008) variance restriction method. The paper applies this methodology to two different data sets from American and Italian schools. The motivation of the second paper ("Gender differences in vulnerability to an economic crisis") is to analyze the different effect of recent economic crisis on the labor market outcome of men and women. Using triple differences method (before-after crisis, harder-milder hit sectors, men-women) the paper used British data at the occupation level and shows that men suffer more than women in terms of probability of losing their job. Several explanations for the findings are proposed. The third paper ("Gender gap in educational outcome") is concerned with a controversial academic debate on the existence, degree and origin of the gender gap in test scores. The existence of a gap both in mean scores and the variability around the mean is documented and analyzed. The origins of the gap are investigated by looking at wide range of possible explanations.

Electroencephalographic topography measures of experienced utility

Economic theory distinguishes two concepts of utility: decision utility, objectively quantifiable by choices, and experienced utility, referring to the satisfaction by an obtainment. To date, experienced utility is typically measured with subjective ratings. This study intended to quantify experienced utility by global levels of neuronal activity. Neuronal activity was measured by means of electroencephalographic (EEG) responses to gain and omission of graded monetary rewards at the level of the EEG topography in human subjects. A novel analysis approach allowed approximating psychophysiological value functions for the experienced utility of monetary rewards. In addition, we identified the time windows of the event-related potentials (ERP) and the respective intracortical sources, in which variations in neuronal activity were significantly related to the value or valence of outcomes. Results indicate that value functions of experienced utility and regret disproportionally increase with monetary value, and thus contradict the compressing value functions of decision utility. The temporal pattern of outcome evaluation suggests an initial (∼250 ms) coarse evaluation regarding the valence, concurrent with a finer-grained evaluation of the value of gained rewards, whereas the evaluation of the value of omitted rewards emerges later. We hypothesize that this temporal double dissociation is explained by reward prediction errors. Finally, a late, yet unreported, reward-sensitive ERP topography (∼500 ms) was identified. The sources of these topographical covariations are estimated in the ventromedial prefrontal cortex, the medial frontal gyrus, the anterior and posterior cingulate cortex and the hippocampus/amygdala. The results provide important new evidence regarding “how,” “when,” and “where” the brain evaluates outcomes with different hedonic impact.

Book Review of “Human Behaviour and the Social Environment: Models, Metaphors, and Maps for Applying Theoretical Perspectives to Practice”. 640 pages, Thomson Brooks/Cole, 2007, by James A. Forte

This voluminous book which draws on almost 1000 references provides an important theoretical base for practice. After an informative introduction about models, maps and metaphors, Forte provides an impressive presentation of several perspectives for use in practice; applied ecological theory, applied system theory, applied biology, applied cognitive science, applied psychodynamic theory, applied behaviourism, applied symbolic interactionism, applied social role theory, applied economic theory, and applied critical theory. Finally he completes his book with a chapter on “Multi theory practice and routes to integration.”

Egalitarianism under Earmark Constraints

Agents with single-peaked preferences share a resource coming from different suppliers; each agent is connected to only a subset of suppliers. Examples include workload balancing, sharing earmarked funds, and rationing utilities after a storm. Unlike in the one supplier model, in a Pareto optimal allocation agents who get more than their peak from underdemanded suppliers, coexist with agents who get less from overdemanded suppliers. Our Egalitarian solution is the Lorenz dominant Pareto optimal allocation. It treats agents with equal demands as equally as the connectivity constraints allow. Together, Strategyproofness, Pareto Optimality, and Equal Treatment of Equals, characterize our solution.

Monopsony Power, Pay Structure and Training

Although interest in monopsonistic influences on labor market outcomes has revived in recent years, only a few empirical studies provide direct evidence on this topic. In this article, the authors analyze the effect of monopsony power on pay structure, using a direct measure of labor market thinness. The authors find evidence of monopsony power, as firms facing fewer local competitors offer lower wages to skilled labor and trainees, but not to unskilled labor. The findings have important implications for the economic theory of training, as most recent models assume monopsonistic pay-setting for skilled labor, but not for trainees.

The Determinants of Personal Income Tax Progressivity Around the Globe

This paper utilizes a novel database collected by the authors to document features of the progressivity of personal income tax systems across 209 countries for the years 1980-2009. We measure progressivity in several ways. First, we associate it with the increase in effective average (marginal) tax rates between a wage of zero and ten times the average wage in a country. Second, we consider the curvature of the tax schedule expressed as the difference between the effective average (marginal) tax schedule from a wage of zero to ten times the average wage and a linear average tax schedule and, alternatively, the diference between the effective average (marginal) tax schedule from the minimum positive taxable income, to ten times the average wage as opposed to a linear average tax schedule. Moreover, the paper assesses patterns regarding the conditional correlation of country-specifc tax progressivity measures with a host of economic and political country-specific characteristics and find the labor supply elasticity and the income replacement rates for the unemployed to be key determinants of progressivity around the globe, in line with economic theory.

Indicating Commitment: The Notion of dépense in the Study of Ritual and Religion

By analysing two cases from the recent history of Vaishnavism (a temple festival in Vrindavan; the development of the International Society for Krishna Consciousness, or ISKCON), this paper shows that the notion of dépenseas developed by Marcel Mauss, Robert Hertz and Georges Bataille can be applied as an analytical tool in the study of rituals and religion as an indicator of religious commitment. At the same time it is possible to show that, by constructing a kind of macro-economic theory that includes religious behaviour, recent theories of religious economics are part of, and reproduce, a modern discourse of rationality that rules out, rather than understands, forms of irrationality such as unproductive expenditure (dépense).

Using negotiated budgets for planning and performance evaluation: An experimental study : an experimental study

Budgets are often simultaneously used for the conflicting purposes of planning and performance evaluation. While economic theory suggests that firms should use separate budgets for conflicting purposes this contrasts with existing evidence that firms rarely do so. We address two open questions related to these observations in an experiment. Specifically, we investigate how a planning task that is in conflict with the performance evaluation task affects behavior in budget negotiations and their outcomes. Additionally, we analyze whether a single budget can be effectively used for both purposes compared to two separate budgets. We develop theory to predict that adding a planning task that is in conflict with the superior’s performance evaluation task increases the subordinate’s cooperation in and after the negotiation of a performance evaluation budget. Moreover, we predict that subordinate cooperation increases even more when the superior is restricted to use a single budget for both purposes. Our results broadly support our hypotheses. Specifically, we find that when budgets are used for both planning and performance evaluation, this increases the subordinate’s budget proposals during the negotiation and his performance after the negotiation. These effects tend to be even larger when the superior is restricted to a single budget rather than separate budgets for planning and performance evaluation, particularly with respect to subordinate performance. In our experimental setting, the benefits of increased subordinate cooperation even more than offset the loss in flexibility from the superior’s restriction to a single budget. The results of this study add to the understanding of the interdependencies of conflicting budgeting purposes and contribute to explain why firms often use a single budget for multiple purposes.

Evaluating the impact of vertical integration on health system peformance

Vertical integration is grounded in economic theory as a corporate strategy for reducing cost and enhancing efficiency. There were three purposes for this dissertation. The first was to describe and understand vertical integration theory. The review of the economic theory established vertical integration as a corporate cost reduction strategy in response to environmental, structural and performance dimensions of the market. The second purpose was to examine vertical integration in the context of the health care industry, which has greater complexity, higher instability, and more unstable demand than other industries, although many of the same dimensions of the market supported a vertical integration strategy. Evidence on the performance of health systems after integration revealed mixed results. Because the market continues to be turbulent, hybrid non-owned integration in the form of alliances have increased to over 40% of urban hospitals. The third purpose of the study was to examine the application of vertical integration in health care and evaluate the effects. The case studied was an alliance formed between a community hospital and a tertiary medical center to facilitate vertical integration of oncology services while maintaining effectiveness and preserving access. The economic benefits for 1934 patients were evaluated in the delivery system before and after integration with a more detailed economic analysis of breast, lung, colon/rectal, and non-malignant cases. A regression analysis confirmed the relationship between the independent variables of age, sex, location of services, race, stage of disease, and diagnosis, and the dependent variable, cost. The results of the basic regression model, as well as the regression with first-order interaction terms, were statistically significant. The study shows that vertical integration at an intermediate health care system level has economic benefits. If the pre-integration oncology group had been treated in the post-integration model, the expected cost savings from integration would be 31.5%. Quality indicators used were access to health care services and research treatment protocols, and access was preserved in the integrated model. Using survival as a direct quality outcome measure, the survival of lung cancer patients was statistically the same before and after integration. ^

Legal Change: Integrating Selective Litigation, Judicial Preferences, and Precedent

The claim that the common law displays an economic logic is a centerpiece of the positive economic theory of law. A key question in this literature is whether this outcome is due to the conscious efforts of judges, or the result of invisible hand processes. This paper develops a model in which to two effects combine to determine the direction of legal change. The main conclusions are, first, that judicial bias can prevent the law from evolving toward efficiency if the fraction of judges biased against the efficient rule is large enough; and second, that precedent affects the rate of legal change but not its direction.

Tax Collection in History

Methods of tax collection employed by modern governments seem dull when compared to the rich variety observed in history. Whereas most governments today typically use salaried agents to collect taxes, various other types of contractual relationships have been observed in history, including sharing arrangements which divide the tax revenue between the government and collectors at fixed proportions, negotiated payment schemes based on the tax base, and sale of the revenue to a collector in exchange for a lump-sum payment determined at auction. We propose an economic theory of tax collection that can coherently explain the temporal and spatial variation in contractual forms. We begin by offering a simple classification of tax collection schemes observed in history. We then develop a general economic model of tax collection that specifies the cost and benefits of alternative schemes and identifies the conditions under which a government would choose one contractual form over another in maximizing the net revenue. Finally, we use the conclusions of the model to explain some of the well-known patterns of tax collection observed in history and how choices varied over time and space.

HEALTH CARE COST INCREASES IN METROPOLITAN AREAS

The research project is an extension of the economic theory to the health care field and health care research projects evaluating the influence of demand and supply variables upon medical care inflation. The research tests a model linking the demographic and socioeconomic characteristics of the population, its community case mix, and technology, the prices of goods and services other than medical care, the way its medical services are delivered and the health care resources available to its population to different utilization patterns which, consequently, lead to variations in health care prices among metropolitan areas. The research considers the relationship of changes in community characteristics and resources and medical care inflation.^ The rapidly increasing costs of medical care have been of great concern to the general public, medical profession, and political bodies. Research and analysis of the main factors responsible for the rate of increase of medical care prices is necessary in order to devise appropriate solutions to cope with the problem. An understanding of the community characteristics and resources-medical care costs relationships in the metropolitan areas potentially offers guidance in individual plan and national policy development.^ The research considers 145 factors measuring community milieu (demographic, social, educational, economic, illness level, prices of goods and services other than medical care, hospital supply, physicians resources and techological factors). Through bivariate correlation analysis, the number of variables was reduced to a set of 1 to 4 variables for each cost equation. Two approaches were identified to track inflation in the health care industry. One approach measures costs of production which accounts for price and volume increases. The other approach measures price increases. One general and four specific measures were developed to represent each of the major approaches. The general measure considers the increase on medical care prices as a whole and the specific measures deal with hospital costs and physician's fees. The relationships among changes in community characteristics and resources and health care inflation were analyzed using bivariate correlation and regression analysis methods. It has been concluded that changes in community characteristics and resources are predictive of hospital costs and physician's fees inflation, but are not predictive of increases in medical care prices. These findings provide guidance in the formulation of public policy which could alter the trend of medical care inflation and in the allocation of limited Federal funds.^

Similitudes y limitaciones a las similitudes entre Leibnitz y la teoría económica neoclásica

Se mostrará en este artículo qué similitudes podrían encontrarse entre la teoría económica neoclásica y las concepciones metafísicas de Leibniz y qué limitaciones tiene la pretensión de vincular a Leibniz con la teoría económica neoclásica de modo tal que se intente fundamentar dicha teoría en la ontología de Leibniz. Se analizarán conceptos tales como “mundo posible", “mónada", “Dios", “armonía preestablecida" y “mal", que serán contrastados con algunos conceptos de la teoría económica neoclásica: “individuo (o agente económico) maximizador de la utilidad", “equilibrio" y “escasez".

Le Goff : Balance crítico de un legado

Los primeros trabajos de Jacques Le Goff, sobre mercaderes, banqueros e intelectuales de la Edad Media, presentan cualidades que anuncian su desarrollo posterior: débil teoría económica y mayor desarrollo sobre historia de las ideas. A partir de 1964, con la publicación de La civilización del occidente medieval, se produce un cambio. Ese cambio se inscribe en una nueva orientación general de la escuela de Annales: el estudio de las mentalidades. Le Goff pretende realizar un análisis de la mentalidad del hombre medieval. Su estudio se basa principalmente en textos eruditos eclesiásticos. Se demuestra en este artículo que ese tipo de fuentes permiten acceder a la mentalidad de la parte sacerdotal de la clase de poder. De manera secundaria, Le Goff estudió fuentes literarias que permiten acercarse a la mentalidad de los caballeros. Para el análisis de los campesinos y de distintos sectores subalternos se necesitarían otro tipo de fuentes que nunca fueron utilizadas por Le Goff. Este análisis mantiene algunas semejanzas con el materialismo histórico, pero también tiene profundas diferencias con la doctrina de Marx. En base a esto se determina el alcance del legado de Le Goff