This paper investigates whether there is a link between cognitive ability, risk aversion, and impatience, using a representative sample of roughly 1,000 German adults. Subjects participate in choice ...experiments with monetary incentives measuring risk aversion, and impatience over an annual horizon, and conduct two different, widely used, tests of cognitive ability. We find that lower cognitive ability is associated with greater risk aversion, and more pronounced impatience. These relationships are significant, and robust to controlling for personal characteristics, education, income, and measures of credit constraints. We perform a series of additional robustness checks, which help rule out other possible confounds. PUBLICATION ABSTRACT
This paper investigates the hypothesis that the casual effect of life expectancy on income per captia growth is non-monotic. This hypothesis follows from the recent literature on unified growth, in ...which the demographic transition represents an important turning point for population dynamics and hence plays a central role for the transition from stagenation to growth. Results from different empirical specifications and identification strategies document that the effect is non-monotonic, negative (but often insignificant) before the onset of the demographic transition, but strongly positive after its onset. The results provide a new interpretation of the contradictory existing evidence and have relevant policy implications.
This paper provides an empirical investigation of the hypothesis that population shocks such as the repeated outbreaks of the plague affected the timing of the demographic transition. The empirical ...analysis uses disaggregate data from Germany and exploits geographic variation in the exposure to medieval plague shocks. The findings document that areas with greater exposure to plague outbreaks exhibited an earlier onset of the demographic transition. The results are consistent with the predictions of the unified growth literature and provide novel insights into the largely unexplored empirical determinants of the timing of the transition from stagnation to growth.
This paper studies risk attitudes using a large representative survey and a complementary experiment conducted with a representative subject pool in subjects' homes. Using a question asking people ...about their willingness to take risks "in general", we find that gender, age, height, and parental background have an economically significant impact on willingness to take risks. The experiment confirms the behavioral validity of this measure, using paid lottery choices. Turning to other questions about risk attitudes in specific contexts, we find similar results on the determinants of risk attitudes, and also shed light on the deeper question of stability of risk attitudes across contexts. We conduct a horse race of the ability of different measures to explain risky behaviors such as holdings stocks, occupational choice, and smoking. The question about risk taking in general generates the best all-round predictor of risky behavior.
PATHOGENS, WEATHER SHOCKS AND CIVIL CONFLICTS Cervellati, Matteo; Sunde, Uwe; Valmori, Simona
The Economic journal (London),
December 2017, Letnik:
127, Številka:
607
Journal Article
Recenzirano
Odprti dostop
This article documents a statistically strong and quantitatively relevant effect of high exposure to infectious diseases on the risk of civil conflicts. The analysis exploits data on the presence and ...endemicity of multi-host vector-transmitted pathogens in a country, which is closely related to geoclimatic conditions due to the specific features of these pathogens. Exploiting within-country variation over time shows that this effect of pathogen exposure is significantly amplified by weather shocks. The results indicate health shocks and the outbreak of epidemics as a potential channel, while we find no evidence that the effect works through alternative channels like income, population dynamics, or institutions.
We provide a unified theory of the transition in income, life expectancy, education, and population size from a nondeveloped environment to sustained growth. Individuals optimally trade off the time ...cost of education with its lifetime returns. Initially, low longevity implies a prohibitive cost for human capital formation for most individuals. A positive feedback loop between human capital and increasing longevity, triggered by endogenous skill-biased technological progress, eventually provides sufficient returns for widespread education. The transition is not based on scale effects and induces population growth despite unchanged fertility. A simulation illustrates that the dynamics fit historical data patterns.
Using newly available data, this note provides new evidence suggesting that private insurance penetration mitigates the negative economic effects of natural disasters. The results document ...heterogeneous effects across differentially institutionalized countries and across different disaster types.
•New empirical evidence about the economic effects of natural disasters.•The effect of natural disasters is mitigated by access to insurance.•Insurance penetration and good institutions are complements in mitigating disaster effects.•Differences in effects across different types of disasters.
This paper investigates to what extent individuals' risk preferences are correlated with the cross-sectional earnings risk of their occupation. We exploit data from the German Socio-Economic Panel, ...which contains a direct survey question about willingness to take risks that has been shown to be a behaviorally valid measure of risk aversion. As a measure of earnings risk, we use the cross-sectional variation in earnings that is left unexplained by human capital variables in Mincerian wage regressions. Our evidence shows that individuals with low willingness to take risks are more likely to work in occupations with low earnings risk. This pattern is found regardless of the level of occupation categories, region, gender and labor market experience.
This paper provides evidence about the determinants of trust and reciprocal inclinations, that is, a tendency for people to respond in kind to hostile or kind actions, in a representative setting. We ...investigate the prevalence of reciprocity in the population, the correlation between trust and positive and negative reciprocal inclinations within person, the individual determinants of reciprocity, and the relationship with psychological measures of personality. We find that most people state reciprocal inclinations, in particular in terms of positive reciprocity, as well as substantial heterogeneity in the degree of trust and reciprocity. Trust and positive reciprocity are only weakly correlated, while trust and negative reciprocity exhibit a negative correlation. In terms of determinants, being female and increasing age are associated with stronger positive and weaker negative reciprocal tendencies. Taller people are more positively reciprocal, but height has no impact on negative reciprocity. Psychological traits also affect trust and reciprocity. (JEL D63, J3, J6)
•New empirical evidence about the consequences of global warming for conflict.•Positive effect of temperature extremes on conflict.•Crucial role of population dynamics and land degradation.•Global ...warming increases frequency of extreme events and conflict.
This paper contributes to the debate whether climate change and global warming cause conflicts by providing novel evidence about the role of extreme temperature events for armed conflict based on high-frequency high-resolution data for the entire continent of Africa. The analysis of monthly data for 4826 grid cells of 0.75° latitude × longitude over the period 1997–2015 documents a positive effect of the occurrence of temperature extremes on conflict incidence. These effects are larger the more severe the extremes in terms of duration, and are larger in highly densely populated regions, in regions with lower agricultural productivity, and in regions with more pronounced land degradation. The results also point towards heterogeneity of the effect with respect to the type of violence and the crucial role of population dynamics. Considering the consequences of increases in the frequency of extreme events in a long-differences analysis delivers evidence for a positive effect on conflict.
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