This paper investigates the influence of political regimes on the relative importance of conspicuous consumption. We use the division of Germany into the communist GDR and the democratic FRG and its ...reunification in 1990 as a natural experiment. Relying on household data that are representative for Germany, our empirical results strongly indicate that conspicuous consumption is relatively more important in East Germany. Significantly, although we find some convergence, a considerable gap in conspicuous consumption expenditures remains even 18 years after the German reunification.
•This paper shows the influence of political regimes on individual preferences.•We treat the separation of Germany as a natural experiment.•We use nationally representative data on consumption.•We focus on the relative importance of conspicuous consumption expenditures.•Conspicuous consumption is higher in the East (even 18 years after reunification).
► We test concerns for relative standing with respect to different items. ► Participants rate items according observability and non-psychological externalities. ► Non-psychological externalities play ...an important role for items’ positionality. ► No statistically significant observability-effect on items’ degree of positionality.
We test concerns for relative standing with respect to private consumption, income, leisure, savings, and personal characteristics, using data from a classroom survey. Our results show highest degrees of positionality for personal characteristics and income. In order to explain positionality, we employ survey participants’ ratings of items with respect to (i) observability and (ii) non-psychological negative externalities on others. Based on these ratings, our results show that non-psychological externalities play an important role for an item’s degree of positionality. In contrast to previous research, we find that there is no statistically significant effect of an item’s observability on its degree of positionality.
Do voters use ballot paper information on the personal characteristics of political candidates as cues in low-information elections? Using a unique dataset containing 4423 political candidates from ...recent elections in Germany, we show that candidates' occupations do play an important role in their electoral success. The occupational impact is far greater than gender or doctoral degree effects for a large number of occupations. We discuss three possible explanations for these “occupational effects”: (a) an occupation's public reputation, (b) the extent to which individuals carrying out certain occupations are known within their communities, and (c) occupation specific competence related to issues relevant for local politics. Looking at polls on the reputation/prestige of certain jobs, we find a strong correlation between an occupation's reputation and the electoral success of a candidate carrying out this occupation. Therefore, voters appear to use occupational reputation as a cue in low-information elections.
•Voters rely on information shortcuts in low-information elections.•Candidates' occupations do play an important role in their electoral success.•The occupational impact is far greater than gender or doctoral degree effects.•Occupational effects are strongly correlated with occupations' public reputation.•Voters appear to use occupational reputation as a cue in low-information elections.
Using an experimental design, this explorative study provides unique empirical evidence of the effects of an integrated reporting assurance (IRA) on nonprofessional investors’ (NPIs) financial ...decision-making in a laboratory experiment. For this purpose, two independent experiments were carried out, one relying on a sample of Master’s students, and one focusing on managers of large corporations. In line with our agency theoretical reasoning, we find that students value an IRA positively, evidenced through significantly higher investments, while, contrary to expectations, an IRA has the opposite effect for managers. The results reveal that, dependent on the empirical model, an IRA has either no, or even an investment-decreasing, impact on executives. In order to assess the sense-making process underlying this conundrum, subsequent interviews with the managers were carried out which revealed three dimensions that shape practitioners’ critical attitudes towards assurance engagements. First, managers expressed a general disbelief in the decision usefulness of integrated reporting (IR) to (nonprofessional) investors. Second, interlocutors referred to negative practical experiences with audit and assurance engagements and had technical doubts specific to IRA. Third, managers voiced emotional caveats regarding the audit and assurance profession. These findings indicate a prevailing divergence between the extolled theoretical contribution of an IRA to report credibility and its actual nature in practice. In the further course of the investigation, we also find that the assurance provider (Big 4 auditor versus specialized consultant) does not affect investment decisions, but that a higher assurance level leverages investments among students. The results of this study add to the growing, albeit still small, IRA research body and deliver valuable insights for research, regulators, and practice.
•Experiment: integrated reporting (IR) assurance and nonprofessional investors.•IR assurance and higher assurance levels increase Masters students’ investments.•Unexpectedly, IR assurance rather decreases investments among managers.•Subsequent interviews reveal three reasons for managers’ dismissive attitude.
We introduce a new microsimulation model built on household transport data to study the distributional effects of carbon-based fuel taxation of private road transport in Germany. Our data includes ...car-specific annual mileage, fuel efficiency, and the distinction between fuel types, allowing for a very detailed analysis. The model enables focusing on different household types as well as identifying effect heterogeneity across the income distribution. We compare the recent fuel tax scheme with three policy reform scenarios to empirically test several hypotheses regarding distributional effects of carbon pricing. We find that the legal status quo of the fuel tax has overall regressive effects, with the tax on petrol being regressive and the tax on diesel being progressive. A transformation of the current tax into a revenue-neutral carbon-harmonised fuel tax yields a progressive distributional effect, while an introduction of a new carbon tax on transport fuels is neither clearly regressive nor progressive. Combining both tax schemes also has non-regressive effects. On aggregate, the distributional effects are modest. Subgroup analyses, however, reveal that the individual burden can be substantial. In sum, our results suggest that policy makers face various options for pricing road transport greenhouse gas emissions without causing an overall disproportionate tax burden on low-income households.
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•We study the distributional effects of carbon-based fuel taxation in Germany.•Our microsimulation compares the status quo with three policy reform scenarios.•Aggregate effects are modest, but subgroups can be significantly burdened.•The policy reforms do not impose a disproportionate burden on low-income households.•The status quo fuel tax on petrol is regressive, the tax on diesel is progressive.
We examine how electoral motives influence active labor market policies that promote (short term) job-creation. Such policies reduce measures of unemployment. Using German state data for the period ...1985 to 2004, we show that election-motivated politicians pushed job-promotion schemes before elections.
This paper constitutes the first economic investigation into the potential detrimental role of smartphones in the workplace based on a field experiment. We exploit the conduct of a nationwide ...telephone survey, for which interviewers were recruited to work individually and in single offices for half a day. This setting allows to randomly impose bans on the use of interviewers' personal smartphones during worktime while ruling out information spillovers between treatment conditions. Although the ban was not enforceable, we observe substantial effort increases from banning smartphones in the routine task of calling households, without negative implications linked to perceived employer distrust. Analyzing the number of conducted interviews per interviewer suggests that higher efforts do not necessarily translate into economic benefits for the employer. In our broad discussion of smartphone bans and their potential impact on workplace performance, we consider further outcomes of economic relevance based on data from employee surveys and administrative phone records. Finally, we complement the findings of our field experiment with evidence from a survey experiment and a survey among managers.
Gambling to leapfrog in status? Friehe, Tim; Mechtel, Mario
Review of economics of the household,
12/2017, Letnik:
15, Številka:
4
Journal Article
Recenzirano
Odprti dostop
This paper tests our theoretical prediction that households with positional concerns use gambling to attempt leapfrogging in the social hierarchy. We rely on household data that is representative for ...Germany and proxy the households’ positional concerns by their expenditures for conspicuous consumption. Our empirical results strongly indicate that households who care about status are not only more likely to participate in gambling but also to invest more in gambling.
Abstract
A large body of evidence shows that social identity affects behaviour. However, our understanding of the substantial variation of these behavioural effects is still limited. We use a novel ...laboratory experiment to measure differences in preferences for social identities as a potential source of behavioural heterogeneity. Facing a trade-off between monetary payments and belonging to different groups, individuals are willing to forego significant earnings to avoid belonging to certain groups. We then show that individual differences in these foregone earnings correspond to the differences in discriminatory behaviour towards these groups. Our results illustrate the importance of considering individual heterogeneity to fully understand the behavioural effects of social identity.
We model individual identification choice as a strategic group formation problem. When choosing a social group to identify with, individuals appreciate high social status and a group stereotype to ...which they have a small social distance. A group׳s social status and stereotype are shaped by the (exogenous) individual attributes of its members and hence endogenous to individuals׳ choices. Unless disutility from social distance is strong enough, this creates a strategic tension as individuals with attributes that contribute little to group status would like to join high-status groups, thereby diluting the latters׳ status and changing stereotypes. Such social free-riding motivates the use of soft exclusion technologies in high-status groups, which provides a unifying rationale for phenomena such as hazing rituals, charitable activities or status symbols that is not taste-based or follows a standard signaling mechanism.
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