Many countries are forging ahead with convenient balloting methods, in particular electronic and postal voting, in order to re-engage voters. In this paper, we test whether thencost reductions with postal voting increase turnout. The empirical analysis is based on annewly collected data set on the introduction of postal voting in Swiss cantons. We take advantage of the unique fact that voting by mail was introduced at different times across cantons. This allows identifying the impact of postal voting on turnout, independent of time,nissue and canton specific effects. The estimated average effect on turnout is roughly 4.1npercentage points for an average turnout of 43 percent between 1970 and 2005.
This paper studies the theoretical properties of a channel system of interestratencontrol in a dynamic general equilibrium model. Agents are subject to liquidity shocks which can be partially insured in a secured money market, ornat a standing facility operated by the central bank. We show that it is optimal to have a strictly positive interest rate corridor and that a shift of the corridor affects the money market rate one for one. Moreover, the central bank canntighten its policy without changing its policy rate by simply increasing the corridor symmetrically around the policy rate.
This paper studies a program that extends the maximum duration of unemployment benefits from 30 weeks to 209 weeks. Interestingly, this program is targeted to individuals aged 50nyears or older, living in certain eligible regions in Austria. In the evaluation, I use sharp discontinuities in treatment assignment at age 50 and at the border between eligible regions and control regions to identify the effect of extended benefits on unemployment duration. Resultsnindicate that the duration of job search is prolonged by at least .09 weeks per additional week of benefits among men, whereas unemployment duration increases by at least .32 weeks per additional week of benefits among women. The salient differences between men and women are consistent with the lower minimum age for early retirement applying to women.
This paper explicitly introduces norms in games, assuming that they shape (some) players’ utility and beliefs. People feel badly when they deviate from anbinding norm, and the less other players deviate, the more badly they feel.nFurther, people anger at transgressors and get pleasure from punishing them. Inthen study how social norms and emotions affect cooperation, coordination, and punishment in a variety of games. The model is consistent with abundantnexperimental evidence that alternative models of social preferences cannotnexplain.
In the television show Affari Tuoi an individual faces a sequence of binary choicesnbetween a risky lottery with equiprobable prizes of up to half a million euros and anmonetary amount for certain. The decisions of 114 show participants are used to test the predictions of ten decision theories: risk neutrality, expected utility theory, fanning-out hypothesis (weighted utility theory, transitive skew-symmetric bilinear utility theory), (cumulative) prospect theory, regret theory, rank-dependent expected utility theory, Yaari’s dual model, prospective reference theory and disappointment aversion theory.nAssumptions of risk neutrality and loss aversion are clearly violated, respectively, byn55% and 46% of all contestants. There appears to be no evidence of nonlinear probabilitynweighting or disappointment aversion. Observed decisions are generally consistent withnthe assumption of regret aversion and there is strong evidence for the fanning-outnhypothesis. Nevertheless, we find no behavioral patterns that cannot be reconciled withinnthe expected utility framework (or prospective reference theory that gives identicalnpredictions).
We conducted an experiment to describe how social learners use information about the relation between payoffs and behavior. Players chose between twontechnologies repeatedly. Payoffs were random, but one technology was better because its expected payoff was higher. Players were divided into two groups:n1) individual learners who knew their realized payoffs after each choice andn2) social learners, who had no private feedback about their own payoffs, but in each period could choose to learn which behavior had produced the lowestnpayoff among the individual learners or which behavior had produced the highest payoff. When social learners chose to know the behavior producing the highest payoff, a model of imitating this successful behavior matches the data verynclosely. When social learners chose to know the behavior producing the lowest payoff, they tended to choose the opposite behavior in early periods, while increasingly choosing the same behavior in late periods. This kind of rapidntemporal heterogeneity in the use of social information has received little or no attention in the theoretical study of social learning.
It has often been pointed out in the literature that a symbiotic relationship exists betweennterrorist groups and the media. As yet, however, no formal model has been built based on thisnissue and only very little empirical research has been done in this field. The presentncontribution builds a simple game theoretic model, focussing on the social interactionsnbetween terrorists and the media. The model has features of a common-interest-game andnresults in multiple equilibria. After a discussion of the policy implications of the model, annempirical analysis is performed. Using newspaper coverage, terror incidents and terror fatalities data, it is shown that media attention and terrorism do mutually Granger cause eachnother, as predicted by the model. Moreover, it is explained why terror attacks tend to ben“bloodier” in developing countries than in Europe and the United States.
The traditional economic approach to tax evasion does not appear to be particularly successful in explaining the extent of tax compliance. We argue instead that a psychological tax contractnwhich establishes a fiscal exchange between the state and the citizens shapes tax compliance to a large extent. In that respect, a case study of Switzerland is useful because the small size of the cantons and their direct democratic political systems procedurally establish a close exchangenrelationship between taxpayers and tax authorities. In this paper, evidence is discussednon how tax evasion and tax morale in Switzerland evolved over time. In addition, the impact of economic, legal, socio-demographic, psychological and institutional factors on Swiss tax evasion is discussed.
In this paper we present a two period model, where the agent'snpreferences are described by prospect theory as proposed by Kahneman and Tversky. We solve for the agent's portfolio decision. Our findings are that the changes in portfolio weights depend crucially on the reference point and the ratio between the reference point and the current wealth, and thus only indirectly on the performance of the risky asset. Our model explains why investor keep on holding, or even buy, loosing investments.
"In this paper, we propose a decision framework where people are individually asked to either actively consent or dissent to some pro-social behavior. We hypothesize that confronting individuals with the choice of engaging in a specific pro-social behavior contributes to the formation of issue-specific altruistic preferences while simultaneouslyninvolving a commitment. The hypothesis is tested in a large-scale field experiment on blood donation. We find that this ""active-decision"" intervention substantially increases the stated willingness to donate blood, as well as the actual donation behavior of people who have not fully formed preferences beforehand."
