Measuring success in education: the role of effort on the test itself

By:	Uri Gneezy ; John List ; Jeffrey Livingston ; Xiangdong Qin ; Sally Sadoff ; Yang Xu
Tests measuring and comparing educational achievement are an important policy tool. We experimentally show that offering students extrinsic incentives to put forth effort on such achievement tests has differential effects across cultures. Offering incentives to U.S. students, who generally perform poorly on assessments, improved performance substantially. In contrast, Shanghai students, who are top performers on assessments, were not affected by incentives. Our findings suggest that in the absence of extrinsic incentives, ranking countries based on low-stakes assessments is problematic because test scores reflect differences in intrinsic motivation to perform well on the test itself, and not just differences in ability.
URL:	http://d.repec.org/n?u=RePEc:feb:framed:00614&r=ltv

Field experiments on the development of time preferences

By:	James Andreoni ; Michael Kuhn ; John List ; Anya Samek ; Charles Sprenger
Time preferences have been correlated with a range of life outcomes, yet little is known about their early development. We conduct a field experiment to elicit time preferences of nearly 1,000 children ages 3-12, who make several inter temporal decisions. To shed light on how such primitives form, we explore various channels that might affect time preferences, from background characteristics to the causal impact of an early schooling program that we developed and operated. Our results suggest that time preferences evolve substantially during this period with younger children displaying more impatience than older children. We also find a strong association with race: black children, relative to white or Hispanic children, are more impatient. Interestingly, parents of black children are also much more impatient than parents of white and Hispanic children. Finally, assignment to different schooling opportunities is not significantly associated with child time preferences.
URL:	http://d.repec.org/n?u=RePEc:feb:artefa:00615&r=ltv

Correlations of Brothers’ Earnings and Intergenerational Transmission

By:	Paul Bingley ; Lorenzo Cappellari
Correlations between parent and child earnings reflect intergenerational mobility and, more broadly, correlations between siblings’ earnings reflect shared community and family background. These earnings relationships capture important aspects of relations in socio-economic status more generally. We estimate intergenerational transmission and sibling correlations of life-cycle earnings jointly within a unified framework that nests previous models. Using data on the Danish population of father/first-son/second-son triads we find that intergenerational effects account for on average 72 percent of sibling correlations. This share is higher than all previous studies because we allow for heterogeneous intergenerational transmission between families. Sibling correlations exhibit a U-shape over the working life, consistent with differences in human capital investments between families.
Keywords:	sibling correlations, intergenerational transmission
JEL:	D31 J62
URL:	http://d.repec.org/n?u=RePEc:ces:ceswps:_6473&r=ltv

Crime and Violence: Desensitization in Victims to Watching Criminal Events

By:	Rafael Di Tella (Harvard Business School, Business, Government and the International Economy Unit) ; Lucía Freira (Universidad Torcuato Di Tella) ; Ramiro H. Gálvez (Universidad Torcuato Di Tella) ; Ernesto Schargrodsky (Universidad Torcuato Di Tella) ; Diego Shalom (Universidad Torcuato Di Tella) ; Mariano Sigman (Universidad Torcuato Di Tella)
We study desensitization to crime in a lab experiment by showing footage of criminal acts to a group of subjects, some of whom have been previously victimized. We measure biological markers of stress and behavioral indices of cognitive control before and after treated participants watch a series of real, crime-related videos (while the control group watches non-crime-related videos). Not previously victimized participants exposed to the treatment video show significant changes in cortisol level, heart rate, and measures of cognitive control. Instead, previously victimized individuals who are exposed to the treatment video show biological markers and cognitive performance comparable to those measured in individuals exposed to the control video. These results suggest a phenomenon of desensitization or habituation of victims to crime exposure.
Keywords:	crime, biological markers, experiment, victimization, desensitization
JEL:	K42
URL:	http://d.repec.org/n?u=RePEc:hbs:wpaper:18-039&r=ltv

Family, Community and Life-Cycle Earnings: Evidence from Siblings and Youth Peers

By:	Paul Bingley ; Lorenzo Cappellari ; Konstantinos Tatsiramos
Using longitudinal data based on administrative registers for the population of Danish men we develop a model which accounts for the joint earnings dynamics of siblings and youth community peers. We are the first to decompose the sibling correlation of permanent earnings into family and community effects allowing for life-cycle dynamics; finding that family is the most important factor influencing earnings inequality over the life cycle. Community background explains a substantial share of the sibling correlation of earnings early in the working life, but its importance diminishes over time and becomes negligible after age 30.
Keywords:	sibling correlation, neighborhoods, schools, long-term inequality
JEL:	D31 J62
URL:	http://d.repec.org/n?u=RePEc:ces:ceswps:_6743&r=ltv

Behavioral Inattention

By:	Xavier Gabaix
Inattention is a central, unifying theme for much of behavioral economics. It permeates such disparate fields as microeconomics, macroeconomics, finance, public economics, and industrial organization. It enables us to think in a rather consistent way about behavioral biases, speculate about their origins, and trace out their implications for market outcomes. This survey first discusses the most basic models of attention, using a fairly unified framework. Then, it discusses the methods used to measure attention, which present a number of challenges on which much progress has been done. It then examines the various theories of attention, both behavioral and more Bayesian. It finally discusses some applications. For instance, inattention offers a way to write a behavioral version of basic microeconomics, as in consumer theory, producer theory, and Arrow-Debreu. A last section is devoted to open questions in the attention literature. This chapter is a pedagogical guide to the literature on attention. Derivations are self-contained.
JEL:	D03 D11 D51 G02 H2
URL:	http://d.repec.org/n?u=RePEc:nbr:nberwo:24096&r=ltv

Social Welfare Losses Due to Occupational Segregation by Gender and Race/Ethnicity in the U.S.: Are There Differences across Regions?

By:	Coral del Río ; Olga Alonso-Villar
Taking into account the well-being losses or gains that each gender-race/ethnicity group has associated with its occupational sorting, this paper explores the social welfare loss that each U.S. large region experiences due to the different circumstances faced by these groups in each regional labor market. To analyze the period 1980–2012 in those terms, we use novel measures that aggregate the well-being losses or gains of the groups consistently with the literature on deprivation. To take into account that disparities among regions may arise from differences in characteristics, this papers uses a propensity score procedure that allows controlling for gender and racial/ethnic composition, immigration profile, educational level, and industrial structure.
Keywords:	Occupational segregation; social welfare; gender; race, regions
JEL:	D63 D23 J15 J71
URL:	http://d.repec.org/n?u=RePEc:vig:wpaper:1802&r=ltv

Marriage, Labor Supply and the Dynamics of the Social Safety Net

By:	Hamish Low (University Cambridge) ; Costas Meghir (Cowles Foundation, Yale University) ; Luigi Pistaferri (Stanford University, NBER, CEPR and SIEPR) ; Alessandra Voena (University of Chicago, NBER, CEPR and BREAD)
The 1996 PRWORA reform introduced time limits on the receipt of welfare in the United States. We use variation by state and across demographic groups to provide reduced form evidence showing that such limits led to a fall in welfare claims (partly due to \banking” benefits for future use), a rise in employment, and a decline in divorce rates. We then specify and estimate a life-cycle model of marriage, labor supply and divorce under limited commitment to better understand the mechanisms behind these behavioral responses, carry out counterfactual analysis with longer run impacts and evaluate the welfare effects of the program. Based on the model, which reproduces the reduced form estimates, we show that among low educated women, instead of relying on TANF, single mothers work more, more mothers remain married, some move to relying only on food stamps and, in ex-ante welfare terms, women are worse off.
Keywords:	Time limits, Welfare reform, Life-cycle, Marriage and divorce
JEL:	D91 H53 J12 J21
URL:	http://d.repec.org/n?u=RePEc:cwl:cwldpp:3021&r=ltv

People versus Machines: The Impact of Minimum Wages on Automatable Jobs

By:	Lordan, Grace (London School of Economics) ; Neumark, David (University of California, Irvine)
We study the effect of minimum wage increases on employment in automatable jobs – jobs in which employers may find it easier to substitute machines for people – focusing on low-skilled workers for whom such substitution may be spurred by minimum wage increases. Based on CPS data from 1980–2015, we find that increasing the minimum wage decreases significantly the share of automatable employment held by low-skilled workers, and increases the likelihood that low-skilled workers in automatable jobs become nonemployed or employed in worse jobs. The average effects mask significant heterogeneity by industry and demographic group, including substantive adverse effects for older, low-skilled workers in manufacturing. We also find some evidence that the same changes improve job opportunities for higher-skilled workers. The findings imply that groups often ignored in the minimum wage literature are in fact quite vulnerable to employment changes and job loss because of automation following a minimum wage increase.
Keywords:	minimum wage, employment, automation
JEL:	J23 J38
URL:	http://d.repec.org/n?u=RePEc:iza:izadps:dp11297&r=ltv