This paper provides evidence of a novel facet of peer effects by showing how peer personality affects educational achievement. We exploit random assignment of students to university sections and find that students perform better in the presence of more persistent peers and more risk-averse peers. In particular, low-persistence students benefit from highly-persistent peers without devoting additional efforts to studying. However, highly-persistent students are not affected by the persistence of their peers. The personality peer effects that we document are distinct from other observable peer characteristics and suggest that the personality traits of peers causally affect human capital accumulation.
Although almost all employees have heard of or witnessed their colleagues being mistreated, we have an incomplete understanding of how employees perceive and respond to such events. Whereas past research has established that observer emotions can be congruent with victim emotions, we examine observer schadenfreude, an incongruent emotion that is also prevalent in organizations. Based on appraisal theories of emotion, we propose a process model of schadenfreude emergence and development: initial schadenfreude occurs when observers appraise mistreatment incidents as relevant and conducive to their goals; this initial feeling evolves into either righteous or ambivalent schadenfreude, depending on observers' secondary appraisals of victim deservingness. We also address the implications of schadenfreude for observer behavior and the moderating effects of observers' moral foundations and organizational civility climates. Our model extends current knowledge about observer reactions and helps us understand the persistence and pervasiveness of workplace mistreatment.
Das Interesse an der Verteilung von Einkommen und Vermögen ist in jüngster Zeit wieder neu entbrannt. Nicht zuletzt, weil nach vielen Jahren der Stabilität die Ungleichheit in vielen Ländern wieder zunimmt. Auch in der Schweiz geniesst die Frage nach der Einkommens- und Vermögensverteilung in der öffentlichen und politischen Diskussion grosse Aufmerksamkeit. Die Analyse über die letzten 100 Jahre zeigt, dass im Ländervergleich das Niveau der Einkommen und Löhne in der Schweiz hoch ist, die Ungleichheit zwischen Arm und Reich wenig stark ausgeprägt ist und sich die Öffnung der Einkommensschere über die Zeit in engen Grenzen hält. Die Ausnahme bilden die Superreichen, deren Anteile in jüngster Zeit deutlich zugenommen haben. Die relativ egalitäre Primärverteilung der Einkommen und Löhne und die föderale Struktur mit ihrem Steuerwettbewerb führen dazu, dass Bedarf und Ausmass der Umverteilung relativ gering ausfallen. Als Kehrseite der Medaille ist die hohe Stabilität wohl ein Grund dafür, dass die Einkommensmobilität im internationalen Vergleich gering ausfällt. Dafür fällt das Durchschnittsniveau der Einkommen rekordhoch aus. Die gefundenen Aussagen gelten verstärkt für die Vermögen. Diese reagieren viel träger auf Einzelereignisse, weil sie über Jahrzehnte aufgebaut werden. Die anhaltende politische Stabilität und die berechenbare Wirtschaftspolitik haben der Schweiz neben sehr hohen Durchschnittsvermögen eine sehr persistente Vermögensverteilung beschert, womit sie unter Industrieländern eine grosse Ausnahme darstellt. Entsprechend ist die Vermögenskonzentration im internationalen Vergleich sehr hoch. Das Ausmass relativiert sich aber, wenn wir die für die Schweiz wichtigen Pensionskassenvermögen miteinbeziehen.
Increased competition for viewers’ time is threatening the viability of public-service broadcasters (PSBs) around the world. Changing regulations regarding advertising minutes might increase revenues, but little is known about the structure of advertising demand. To address this problem, we collect a unique dataset on monthly impacts (quantities) and prices of UK television channels between 2002 and 2009 to estimate the (inverse) demand for advertising on both public and commercial broadcasters. We find that increasing PSB advertising minutes to the level permitted for non-PSBs would increase PSB and industry revenue by 10.5% and 6.7%.
You are warmly invited to the inaugural lecture of Prof. Pablo Koch Medina: "An approximation of … what? Why fundamental research matters in practice: The case of insurance".
This paper presents models for search behavior and provides experimental evidence that behavioral heterogeneity in search is linked to heterogeneity in individual preferences. Observed search behavior is more consistent with a new model that assumes dynamic updating of utility reference points than with models that are based on expected-utility maximization. Specifically, reference point updating and loss aversion play a role for more than a third of the population. The findings are of practical relevance as well as of interest for researchers who incorporate behavioral heterogeneity into models of dynamic choice behavior in, for example, consumer economics, labor economics, finance, and decision theory.
Contingent sovereign debt can create important welfare gains. Nonetheless, there is almost no issuance today. Using hand-collected archival data, we examine the first known case of large-scale use of state-contingent sovereign debt in history. Philip II of Spain entered into hundreds of contracts whose value and due date depended on verifiable, exogenous events such as the arrival of silver fleets. We show that this allowed for effective risk sharing between the king and his bankers. The existence of state-contingent debt also sheds light on the nature of defaults—they were simply contingencies over which Crown and bankers had not contracted previously.
Throughout human history, informal sanctions by peers were ubiquitous and played a key role in the enforcement of social norms and the provision of public goods. However, a considerable body of evidence suggests that informal peer sanctions cause large collateral damage and efficiency costs. This raises the question whether peer sanctioning systems exist that avoid these costs and whether other, more centralized, punishment systems are superior and will be preferred by the people. Here, we show that efficient peer sanctioning without much need for costly punishment emerges quickly if we introduce two relevant features of social life into the experiment: (i) subjects can migrate across groups with different sanctioning institutions and (ii) they have the chance to achieve consensus about normatively appropriate behavior. We also show that subjects universally reject peer sanctioning without a norm consensus opportunity –an institution that has hitherto dominated research in this field – in favor of our efficient peer sanctioning institution or an equally efficient institution where they delegate the power to sanction to an elected judge. Migration opportunities and normative consensus building are key to the quick emergence of an efficient culture of universal cooperation because the more prosocial subjects populate the two efficient institutions first, elect prosocial judges (if institutionally possible), and immediately establish a social norm of high cooperation. This norm appears to guide subjects’ cooperation and punishment choices, including the virtually complete removal of antisocial punishment when judges make the sanctioning decision.
