Virtual Book Club and Seminar Series

We are currently running a virtual book club and seminar series aimed at PhD students, postdoctoral researchers and faculty associated with the behavioural work in Geary and Stirling. If you would like to be included and haven't already been emailed, please let me know. Due to technology constraints, spaces are very limited so will not at present be able to make them more widely available though if you are a loyal reader working in this space and really want to be involved let me know by email and we can try to accommodate.

Gilles St. Paul The Tyranny of Utility

Will organise an online bookclub on this recent publication from Princeton University Press in the near future. Description below.

"The general assumption that social policy should be utilitarian--that society should be organized to yield the greatest level of welfare--leads inexorably to increased government interventions. Historically, however, the science of economics has advocated limits to these interventions for utilitarian reasons and because of the assumption that people know what is best for themselves. But more recently, behavioral economics has focused on biases and inconsistencies in individual behavior. Based on these developments, governments now prescribe the foods we eat, the apartments we rent, and the composition of our financial portfolios. The Tyranny of Utility takes on this rise of paternalism and its dangers for individual freedoms, and examines how developments in economics and the social sciences are leading to greater government intrusion in our private lives.

Gilles Saint-Paul posits that the utilitarian foundations of individual freedom promoted by traditional economics are fundamentally flawed. When combined with developments in social science that view the individual as incapable of making rational and responsible choices, utilitarianism seems to logically call for greater governmental intervention in our lives. Arguing that this cannot be defended on purely instrumental grounds, Saint-Paul calls for individual liberty to be restored as a central value in our society.

Exploring how behavioral economics is contributing to the excessive rise of paternalistic interventions, The Tyranny of Utility presents a controversial challenge to the prevailing currents in economic and political discourse.

Gilles Saint-Paul is professor of economics at the Toulouse School of Economics. His books includeInnovation and Inequality (Princeton)."

Monkeynomics

TED talk by Laurie Santos from a while back. This is really interesting. About seven minutes in, we see some clips of monkeys using money tokens to pay for food. It seems they also learn pretty well how to use them in a normal demand fashion but also make some similar reasoning mistakes.

Benartzi TED talk on Save More Tomorrow

The 2004 JPE paper "Save more tomorrow" by Thaler and Benartzi is one of the most famous papers in behavioural economics and behavioural finance. Drawing on the principle of myopic loss aversion, they designed a pension scheme whereby people enrolled but contributions did not start until first pay increase. This increased substantially the savings rate and the paper has been replicated in many contexts and is a very famous application of behavioural economics research.

Benartzi gives a fascinating TED talk on this paper but also more generally on behavioural finance and the role of behavioural economics in facilitating more rational saving and investment patterns.

Ipsos MORI: Public Opinion on Behaviour Change Policy

Ipsos MORI recently published a report detailing research carried out into the acceptability of governmental interventions, available here.

The poll assessed public perceptions of a hierarchy of policy interventions, from providing information to banning products outright. A majority of participants supported each of the interventions, though it did decrease as they became more severe. However, a substantial number of participants also felt that government should not get involved in individual choices. This 'cognitive polyphasia', a willingness to support specific interventions while also opposing governmental involvement, is seemingly contradictory. The authors suggest that it may point to a desire for government to tackle a particular issue while maintaining a level of suspicion about their involvement. It may also reflect a willingness to support legislation for the bad choices  of others, while maintaining a desire to retain your own freedom of choice.

There were differences in support for interventions between countries, with richer countries less likely to support the more severe interventions. In another seeming contradiction, within countries, richer respondents were more likely to endorse the more stringent interventions, perhaps because they do not feel themselves to be the targets of the policies.

Overall, the report suggests that public attitudes towards interventions like incentives, restrictions and bans is quite positive. Those who object to such measures may be in a passionate minority.

SSRN Working paper: Physiology and Economics

Economics Under My Skin: Introducing Physiological Observations in the Sciences of Decision-Making

Clement Levallois 

Erasmus University Rotterdam

January 2, 2012

Abstract:      
Following the 'Decade of the Brain', increased intellectual exchanges have developed between neuroscience and the social sciences and humanities (SSH). This essay examines how these new contacts between SSH and neuroscience reshaped the practices of observation of social scientists. Focusing on economists and the newly emerged field of neuroeconomics, we point first to the novelty of this episode – experimentation in the lab was foreign to economists’s practices for most of the twentieth century. We then layout the frictions generated by these new practices, showing that new technologies and conventions of interpretation, such as pictorial forms of evidence, run against deep-seated conceptions of what an economist’s skills and standards of observation should consist of. The multiplicity of technologies of observation offered by neuroscience and the increasing number of actors (academic or not) claiming expertise in them are making even more complex the process of adoption of hybrid practices, and the creation of 'neuro-SSH'.

Number of Pages in PDF File: 26

Keywords: neuroeconomics, neuroimaging, interdisciplinarity, scientific practices, observation

JEL Classifications: A12, B4, D87

Working Paper Series

Some links for R

Thanks to Keith O'Hara for sending these links on for some people looking for them

First, if you're not already using it, I strongly recommend RStudio, a great (free) IDE for R:

http://rstudio.org/

It works similar to do-files with Stata, being able to setup projects for storing code and running these directly from a do-file-like window into the R terminal.

There's also a large community around finance and R, with a lot of R finance blogs aggregated on R-Bloggers (I suggest bookmarking this site) which acts as a feed for around 300 R-focused blogs:

http://www.r-bloggers.com/

Grant Farnsworth wrote a good set of notes on econometrics through R (though it might be a little dated now):

http://cran.r-project.org/doc/contrib/Farnsworth-EconometricsInR.pdf 

Some other guides and documents:

http://cran.r-project.org/other-docs.html

There's a good quick-start website directed at those who use Stata/SPSS/etc but are moving to R:

http://www.statmethods.net/

Rmetrics is probably the largest collection of finance packages for R; take a look and see what might be of use:

https://www.rmetrics.org/

https://wiki.rmetrics.org/install_rmetrics

R also produces the best visualisations of data, based on any software package that I'm aware, through the ggplot2 package, written by Hadley Wickham. I strongly recommend learning the syntax for this. His website is here:

http://had.co.nz/ggplot2/

Last year's Rfinance conference (with slides) might be of interest:

http://www.rinfinance.com/RinFinance2011/agenda/

Discrete Choice Course in NUIG

Discrete Choice Modeling

Professor William Greene

Stern School of Business, New York University

at

National University of Ireland, Galway

with funding from NUI Galway's Millennium Fund

July 4-6, 2012

The National University of Ireland Galway, J.E. Cairnes School of Business and Economics is delighted to host a three day intensive course on 'Discrete Choice Modeling' with Professor William Greene of the Stern School of Business at New York University. Discrete choice models have become an essential tool for the analysis of individual choice behavior and can be applied to choice problems in a wide variety of diverse fields including environmental management, urban planning, transportation, energy, telecommunications, and healthcare. This course will present the most recent developments in theory and methods of estimation for discrete choice models. A number of applications from different areas of the professional literature to illustrate these techniques will be discussed.

The presentation will include roughly ten morning classroom meetings. In the afternoon of each day, we will do some hands on analysis using “live” data sets and a familiar computer package.

Course Fee

The course fee is €350 if registered on or before May 15th 2012 and €420 thereafter. Places are limited to 50 so early booking is recommended. The fee includes refreshments throughout the course.

Conference Venue

The conference will be held at the National University of Ireland, Galway in the Aras Moyola Building.

Conference 2012

Immediately prior to the econometrics summer school on July, 3rd 2012, NUI Galway is holding the Applied Microeconometrics and Public Policy Conference. Please click here for details.

Volvo Ocean Race

Galway is a vibrant and exciting city all year round. However, if you need an added incentive for your trip, the final leg of the Volvo Ocean Race is due to arrive in Galway a few days before the start of the course. This will attract tens of thousands of visitors to Galway with many special events planned over a two week period. Delegates are recommended to book early to obtain best value in hotel rates.

Further Information

Contact conference secretariat: Trish Carney
Email: p.carney4@nuigalway.ie

Behavioural Economics in Song - the Pixies

Its been a while since we have had some behavioural music on the blog. Below one of the finest, courtesy of the Pixies.

Barrett and Kamiya IZA Paper: Child Sexual Abuse and Later-Life Economic Consequences

ABSTRACT
Childhood Sexual Abuse and Later-Life Economic Consequences*

The impact of childhood sexual abuse (CSA) on later-life health outcomes has been studied extensively and links with depression, anxiety and self-harm have been established. However, there has been relatively little research undertaken on the possible impact of CSA on later-life economic outcomes. Here, we explore whether older men who report having experienced CSA have weaker labour force attachment and lower incomes compared to other men. We use data from the first wave of the new Irish Longitudinal Study on Ageing (TILDA) which is a nationally-representative survey of people aged 50 and over. We find that  male victims of CSA are almost four times more likely to be out of the labour force due to sickness and disability. They also spent a higher proportion of their potential working lives out of the labour force for these reasons and have lower incomes. These effects remain even when we control for mental health difficulties and negative health behaviors. Among the policy implications are the need to be more aware of the complex effects of CSA when designing labour market activation strategies such as training for the unemployed. The results are also relevant in the legal context where compensation awards are determined.

Online research seminars

I tested out google hangout with some people the other day and we will use this for some informal group seminars. I will post details here. If anyone has something they would like to present, then please let me know. Hangout allows 9 people to sit in on an online seminar which should be fine for informal ones. I can post something in more detail at a later stage. For now I think it would be a good mechanism to present something early stage before presenting to an external audience, similar to how we used the irregular 'interdisciplinary' series in Geary when I was based there.

Do teachers make better parents? How teachers' children do better at school

My doctor used to have pictures of his kids on his surgery wall and it occurred to me, during a consultation, that they must be very healthy. Well that is what you would expect I think? One would expect them to have a healthy lifestyle and generally not to go short on medical care. It then occurred to me that, by a similar logic, one might expect the children of educators to do well at school. There might be a genetic link, of course. Educator-parents could offer practical help with tuition or perhaps just help imbue an appreciation of education. And in a world where information on school quality is very limited (Ireland being a particularly good example, alas) one would expect teachers to make better decisions about the choice of schools for their own kids: when you are in the business you know what’s what.

So I decided to investigate using PISA data which has detailed data on parents occupation and other relevant data. The resulting paper has just been published in Regional and Sectoral Economic Studies.

Do teachers make better parents? The differential performance of teachers children at school

This paper investigates whether teenagers are educationally advantaged if their parents are educators, using data from the Program for International Student Assessment (PISA) for Great Britain and Ireland from 2000. Examining whether teachers’ children do better at tests of reading ability, the results show that children whose fathers teach at third level or whose mothers teach at second level do better. The paper also shows that teenagers are more likely to be helped with their schoolwork if their mothers are educators. The evidence tends to suggest that where teenagers benefit from a parent as a teacher it is through specific assistance from the mother and a more general effect from the father.

Are Retrospective Data on Childhood Conditions Reliable?

It is becoming increasingly clear that early environment plays a key role in both human capital (http://www.heckmanequation.org/) and health outcomes (http://www.thebarkertheory.org/) in later life. Measuring childhood circumstance contemporaneously would require us to wait until we reach the outcome of interest; in the case of something like retirement this might take a while. One alternative would be to survey people and the time of interest and link to official records or macro level data on early life conditions. Another would be to ask individuals to recall events from their childhood, an approach adopted in both SHARE and the HRS. Clearly there are potential concerns about recall, however the article below provides a basis for believing that the data are credible in the US case, and now a new working paper has examined this issue for SHARE.

Smith, J. (2009). "Reconstructing childhood health histories." Demography 46(2): 387-403.

Abstract

This article provides evidence about the quality of retrospective childhood health histories given to respondents in the Health and Retirement Survey (HRS) and the Panel Study of Income Dynamics (PSID). Even though information on early life health events is critical, there is legitimate skepticism about the ability of older respondents to remember specific health problems that they had during childhood. The evidence presented in this article suggests that this view is too negative. Respondents appear to remember salient childhood events about themselves, such as the illnesses they had during childhood, quite well. Moreover, these physical and psychological childhood health events are important correlates of adult health during middle age.

CAN WE TRUST OLDER PEOPLE’S STATEMENTS ON THEIR CHILDHOOD CIRCUMSTANCES? EVIDENCE FROM SHARELIFE

Enkelejda Havari and Fabrizio Mazzonna

Working Paper Series 05-2011

Abstract
This study provides evidence about the quality of retrospective assessments of individuals aged 50+ regarding their childhood histories in 3rd wave of the Survey of Health Ageing and Retirement in Europe (SHARE). Early life events are important to social scientists in predicting individuals’ outcomes in adulthood. Nevertheless, there is wide skepticism about the ability of old age respondents to recall with good accuracy events which happened decades ago. We assess the internal and external consistency of some measures of childhood health and socio-economic status and find that overall respondents seem to remember well their health status and living conditions between ages 0-15. Thanks to the cross-country dimension of SHARE (13 European countries), we are able to compare individual responses with aggregate data (e.g. GDP per capita) at country level. The results we find should mitigate doubts on retrospective data collection and promote their use for research purposes.

PhD Studentships Stirling Research Center

The PhD studentship advertisement for the Stirling Economics and Psychology research group is now live.

Health in Crisis Conference

The Critical Issues in Irish Society Network wishes to announce a call for abstracts for a one-day conference, Health in Crisis?

Following on from the success of last year’s seminar series, the CIISN present the one-day conference ‘Health in Crisis?’. This conference will bring together PhD students, researchers and prominent international academics, as well as health campaigners from the public eye to discuss issues critical to health and well being in our society. It will offer researchers the opportunity to network, as well as a chance to reach new audiences beyond the academic sphere.

Presentations and presentation posters will be structured around streams that include:

1. Experiences of Health and Illness

2. Chronic conditions

3. Patient organisation and support groups

4. Health policy, service delivery and organisation

5. Health technologies and genetics

6. Inequalities

7. Gender& Ethnicity

8. Life-course: reproductive health, ageing, death and dying

9. Ethics

10. Individual, collective and global risk

11. Preventive Health

12. Theory

13. Methods

The abstract submission is now open. Closing deadline is Friday 24th February2012.

The conference will be held in University College Dublin April 2012.

Upcoming details will be available on http://ciisn.wordpress.com/

New IZA Working Paper: The Effects of World War II on Economic and Health Outcomes across Europe

IZA DP No. 6296

Iris Kesternich, Bettina Siflinger, James P. Smith, Joachim K. Winter:

The Effects of World War II on Economic and Health Outcomes across Europe

Abstract:
In this paper, we investigate the long-run effects of World War II on socio-economic status (SES) and health of older individuals in Europe. Physical and psychological childhood events are important predictors for labor market and health outcomes in adult life, but studies that quantify these effects in large samples that cover entire diverse populations are still rare. We will analyze data from SHARELIFE, a retrospective survey conducted as part of the Survey on Health, Aging, and Retirement in Europe (SHARE) in 2009. This survey provides detailed data on events in childhood including those during the war as well as several measures of exposure to war shocks such as experience of dispossession, persecution, combat in local areas, and hunger periods for over 20,000 individuals in 13 European countries. We find that exposure to the war itself, and even more importantly to individual-level shocks caused by the war such as hunger periods, significantly predict old-age outcomes at older ages.

http://ftp.iza.org/dp6296.pdf

Psychology and Economics UC Berkeley Online Course, Fall 2011 , Prof. Daniel J. Acland

Berkeley's Fall 2011 course on Psychology and Economics is available here 

UC Berkely lecture on principles of economics

Non-economists, in particular, might find this useful. It is an intro lecture to an environment economics class in UC Berkely outlining the 'ten principles' of Economics, a pedagogical tool drawing on Mankiw's textbook and used in universities all over the world. There is some debate at present as to whether this approach should face more competition (see e.g. recent debate around walk-out from Greg Mankiw's class). Mankiw's ten principles are written down here.

Website for research center

The website for the Stirling research center is provisionally http://stirlingeconpsych.squarespace.com/ Teaching resources will be made available on this, as well as details of people involved, events, vacancies and contact details. Overtime podcasts and publications will also be made available. As said before, would very much welcome contact from people interested in getting involved or suggestions from students and colleagues about aspects to develop. Several people have already given some terrific suggestions and I am very grateful for that.

Open Online Classes

This post contains a list of online (mainly through audio or video) classes that readers of this blog may be interested in. The list certainly isn’t exhaustive, so suggestions are welcome.

Coursera
Those who follow these courses as they progress online will have the chance to participate in class quizzes, exams and a Q&A forum with teaching staff. Available courses commencing this month include:

- Scott E. Page (University of Michigan) - Model Thinking
- Matthew O. Jackson and Yoav Shoham (both Stanford) - Game Theory
- Daphne Koller (Stanford) - Probabilistic Graphical Models

MIT OpenCourseWare
MIT were one of the early movers in terms of putting content online, with content available for a wide range of subjects. The economics department has lecture notes, assignments and exams at last partially available for almost every module, however there is no multimedia content as of yet. The mathematics department does have multimedia content for some modules.

Open Michigan
Most of the content here is in pdf and PowerPoint format. Courses of interest in the School of Information may include game theory and information economics. The School of Public Policy also has a small number of courses available.

UC Berkeley
Berkeley’s school of economics has a wide range of course available, mostly through iTunes U but with some on YouTube. There are also resources in psychology and statistics.

Carnegie Mellon University has two basic statistics classes with materials including instructions for following the course with Excel, Minitab, R or a TI calculator.

John Hopkins Bloomberg School for Public Health provides access to content for some courses.

There is also much more content available from iTunes U.

Updates:

Yale has a small number of economics and psychology courses online. Harvard Justice classes apply political philosophy to current issues such as bank bailouts and inequality. The Charlie Rose Brain Series interviews scientists and researchers to examine different subjects of the brain. (h/t to Graeme Walsh for those)

PhD opportunities in the Institute of Education, London

You may be interested in fully funded, tax-free scholarships (around £18k p.a. for up to 4 years) for PhD study in the Department for Quantitative Social Science at the Institute of Education, University of London.

These scholarships are funded by our Economic and Social Research Council (ESRC) Doctoral Training Centre.

Applications are welcome from people with interests in either developing or applying quantitative methods in the social sciences, for example in economics, psychology, social policy, social statistics or sociology. The scholarships are open to students from any country worldwide, within or beyond the EU.

For details, see:

http://www.ioe.ac.uk/Study_Home/Quantitative_Methods_Cluster_PhD_Information_2012_Entry.pdf

For details of the Department and potential supervisors, see:

http://www.ioe.ac.uk/study/departments/369.html

Anyone interested in applying should contact Professor Lorraine Dearden (l.dearden@ioe.ac.uk) as soon as possible. Please note that although the initial deadline of February 1st mentioned in the further details has passed, the effective deadline is February 27th.

A Lesson in Policy Evaluation: Moving to Opportunity

“Moving to Opportunity” (MTO) is a very fine example of a well thought-out evaluation of a potential policy aimed at tackling one (possibly) important source of disadvantage for low income families. There has long been a debate about the role of neighbourhood effects in determining outcomes; does living in a high poverty environment adversely affect your life chances, would individuals in these neighbourhoods be badly off anyway where ever they were, or do they live there because they are have bad economic outcomes? Any decent social scientist (or indeed anyone interested in evidenced based policies) will tell you that these explanations are extremely difficult to disentangle.

The MTO RCT involved providing families (4,600 of them) in public housing with vouchers to move to less disadvantaged neighbourhoods in 5 US cities (Baltimore, Boston, Chicago, LA and New York) in the mid 1990s. Conducted in association with the Department of Housing and Urban Development, the programme has been rigorously evaluated by a team of researchers including Jens Ludwig of Chicago and Larry Katz of Harvard. It goes without saying, or perhaps it doesn’t in Ireland, that the use of a lottery for voucher allocation is what makes this design so powerful. The final impact evaluation is currently being completed; previous academic papers are available below.

http://www.economics.harvard.edu/faculty/katz/papers_katz

A summary of the findings is available here.

http://www.huduser.org/publications/pdf/MTOFHD_summaryreport.pdf

Essentially there was (perhaps surprisingly) little effect of moving to a better neighbhourhood on the economic outcomes of families, or the test scores of children. On the other hand, there were important differences in terms of both physical (in particular obesity and diabetes) and mental health between experimental and control groups. The experimental group also reported higher levels of life satisfaction. On this basis Larry Katz summarized the effects of the treatment as being more a case of “Moving to Tranquility” than “Moving to Opportunity”.

One other important aspect of this programme is a willingness on behalf of the organizers to engage with other researchers, provide data and debate the findings. This adds greatly to the credibility of these studies, something else which does not seem to have been grasped in Ireland. Making data publicly available also goes some way to alleviating concerns about the influence of those commissioning the research. For an example of this, see the following exchange in the American Journal of Sociology on MTO.

Clampet-Lundquist, Susan, and Douglas S. Massey. 2008. “Neighborhood Effects on Economic Self-Sufficiency: A Reconsideration of the Moving to Opportunity Experiment.” American Journal of Sociology 114 (1): 107–43.

http://www.bsos.umd.edu/socy/vanneman/socy789b/ClampetLundquistM08.pdf

Abstract:

This article revisits the Moving to Opportunity housing mobility experiment, which heretofore has not provided strong evidence to support the hypothesis of neighborhood effects on economic self-sufficiency among adults. The authors undertake a conceptual and empirical analysis of the study’s design and implementation to gain a better understanding of the selection processes that occur within the study. The article shows that the study is potentially affected by selectivity at several junctures: in determining who complied with the program’s requirements, who entered integrated versus segregated neighborhoods, and who left neighborhoods after initial relocation. Furthermore, previous researchers have not found an experimental treatment effect on adult economic self-sufficiency, relative to controls. The authors propose an alternative approach that involves measuring the cumulative amount of time spent in different neighborhood environments. With this method, they find evidence that neighborhood is associated with outcomes such as employment, earnings, TANF receipt, and use of food stamps.

What Can We Learn about Neighborhood Effects from the Moving to Opportunity Experiment? Jens Ludwig, Jeffrey B. Liebman, Jeffrey R. Kling, Greg J. Duncan, Lawrence F. Katz, Ronald C. Kessler, and Lisa Sanbonmatsu, American Journal of Sociology 114 (July 2008), 144-88.


http://www.economics.harvard.edu/faculty/katz/files/What%20Can%20We%20Learn%20about%20Neighborhood%20Effects.pdf

Abstract:

Experimental estimates from Moving to Opportunity (MTO) show no significant impacts of moves to lower-poverty neighborhoods on adult economic self-sufficiency four to seven years after random assignment. The authors disagree with Clampet-Lundquist and Massey’s claim that MTO was a weak intervention and therefore uninformative about neighborhood effects. MTO produced large changes in neighborhood environments that improved adult mental health and many outcomes for young females. Clampet-Lundquist and Massey’s claim that MTO experimental estimates are plagued by selection bias is erroneous. Their new nonexperimental estimates are uninformative because they add back the selection problems that MTO’s experimental design was intended to overcome.