Income distribution and firm formation

This paper investigates equilibria associated with alternative income-distribution schemes in economies where firm formation is endogenous. The income realizable by a firm depends upon the membership of the firm. An entrepreneurial equilibrium, where agents form and/or join firms so as to maximize their individual incomes, has firm structures that maximize aggregate income but does not have good existence properties. Two alternative equilibrium concepts that have better existence properties than the entrepreneurial equilibrium but weaker optimality properties are considered. The results are applied to the debate on the optimality of average-income-per-worker maximization within a market-socialist firm.     

Does education promote social capital? Evidence from IV analysis and nonparametric-bound analysis

This study uses the British National Child Development Study to examine the effect of educational attainment on social capital at the individual level. Social trust and membership of voluntary groups are considered as two basic indicators of social capital. We employ the IV analysis and nonparametric bound analysis to tackle the problem of education endogeneity. Both the approaches reveal that the OLS estimator of the educational effect suffers from an upward bias in the study of group membership. We do not observe any significant bias in the educational effect on social trust. Our empirical findings indicate that education has a positive influence in promoting social trust and membership of voluntary groups.     

Group identification

I study a model of group identification in which individuals' opinions as to the membership of a group are aggregated to form a list of group members. Potential aggregation rules are studied through the axiomatic approach. I introduce two axioms, meet separability and join separability, each of which requires the list of members generated by the aggregation rule to be independent of whether the question of membership in a group is separated into questions of membership in two other groups. I use these axioms to characterize a class of one-vote rules, in which one opinion determines whether an individual is considered to be a member of a group. I then show that the only anonymous one-vote rule is self-identification, in which each individual determines for himself whether he is a member of the group.     

部分群体资格：以高校学生入党经历为例

任何非先赋的群体资格的获得,都需经过一个非群体资格一部分群体资格一完备群体资格的过程,即群体资格具有梯度特征,是一个连续统。部分群体资格在现实生活中广泛存在却为人们所忽视。本文以高校学生入党经历为例,探讨了部分群体资格的构造和获得过程。论文指出,部分群体资格的设置,既为个人提供了勘查和学习的机会,并激起更强烈的认同;也为群体提供了筛选成员的机会,并确立了群体权威和合法性。部分群体资格的获得,由内外群成员共同决定,但两者依据的标准不同。仪式在该过程中起到重要作用,而部分群体资格成员会运用策略进行积极的筹划和回应。论文在最后讨论了部分群体资格的理论内涵和现实意义。     

A test of a unitary model on labour supply using the information of household decision-making systems

This article tests whether a unitary model is consistent with household behaviour using the data of two-earner couples. It focuses on the unitary model assuming that all family members have the same utility function. The analysis investigates the difference in a husband's and wife's labour supply between the household that determines the wife to be the main decision-maker and the household that selects a different decision-making system under the control of individual and household characteristics. The estimation employs a treatment effects model to consider the selectivity bias caused by unmeasured characteristics. Results show that the household with the wife as the main decision-maker increases the husband's working hours by 15% and decreases the wife's working hours by 59%, compared to the household that selects a different decision-making system. This implies that the unitary model is rejected. Additionally, the husband's wage rate, the husband's and wife's health status, and their gambling addiction determine the household decision-making system such as the variables that determine the reservation utility of not being married. The effect of the decision-making system on the labour supply and that of the determinant factors on the decision-making system are consistent with the implications obtained from Nash bargaining models and collective models.     

Barking up the right tree: Are small groups rational agents?

Both mainstream economics and its critics have focused on models of individual rational agents even though most important decisions are made by small groups. Little systematic work has been done to study the behavior of small groups as decision-making agents in markets and other strategic games. This may limit the relevance of both economics and its critics to the objective of developing an understanding of how most important decisions are made. In order to gain some insight into this issue, this paper compares group and individual economic behavior. The objective of the research is to learn whether there are systematic differences between decisions made by groups and individual agents in market environments characterized by risky outcomes. A quantitative measure of deviation from minimally-rational decisions is used to compare group and individual behavior in common value auctions. JEL Classification D44, C91, C92     

Sovereign debt assistance and democratic decision-making

Organizational reforms stimulating democratic decision-making play a role in the economic effectiveness of concessional debt and debt relief. Effectiveness is defined as the increase in project approval produced by debt assistance. This claim is supported by a theoretic model illustrating the role of democratic decision-making in increasing lending as well as in determining the effectiveness of debt assistance. Using the framework of group decision-making in a fixed-size committee, we suggest a novel explanation to the advantage of conditioning debt assistance on organizational reforms that target the decision-making structure in organizations. The results imply that if the aid organization can affect the level of democratization in organizations, it can exploit its advantage and set the debt assistance that induces the maximal increase in project approval. We derive conditions under which organizational reforms that impose various forms of democratic norms in decision-making are important for increasing the effectiveness of debt assistance. We also point to the case where replacing an autocratic decision maker can cause debt assistance effectiveness to decline.     

Elderly Care and Intrafamily Resource Allocation when Children Migrate

This paper considers the intrafamily allocation of elderly care in the context of international migration where migrant children may be able to provide financial assistance to their parents, but are unable to offer physical care. To investigate the interaction between siblings, I take a non-cooperative view of family decision-making and estimate best response functions for individual physical and financial contributions as a function of siblings' contributions. I address the endogeneity of siblings' contributions and individual migration decisions by using siblings' characteristics as instrumental variables as well as models including family fixed effects. For both migrants and non-migrants, I find evidence that financial contributions function as strategic complements while siblings' time contributions operate as strategic substitutes. This suggests that children's contributions toward elderly care may be based on both strategic bequest and public good motivations.     

The role of income pooling and decision-making responsibilities in material deprivation

This paper analyzes to what extent family arrangements are linked to the level of household material deprivation. This key dimension of individual well-being is defined as the enforced inability to afford financial expenses, durable goods, and adequate housing conditions. We define family arrangements in terms of the degree to which resources are pooled and the main decision maker. Using the EU-SILC dataset, we find that households where decision-making responsibilities fall chiefly on females have lower deprivation levels regardless of the degree of income pooling. In contrast, greater levels of deprivation are more likely in households where decisions are shared and resources are not fully pooled. These findings highlight the importance of integrating family arrangements in the design of actions and initiatives aimed at reducing inequalities and improving the general welfare of the economy.     

Thresholds: A model of religious governance and evolution

Religious organizations set thresholds of belief and behavior required of their members. In a simple model of individual religious behavior, this paper shows that if a religion denies the benefits of membership to those who fall short of the threshold, it stands to gain an increase in compliance with its rules by forcing members to the edge of defection, hence the incentive to set the thresholds strategically. When members’ compliance costs are private information, the model yields several regimes: a pooling contract if costs are close enough to each other, a separating contract if costs are different enough, and an expulsion solution if the proportion of high-cost types in the total membership is too low. Changes in costs and in membership composition trigger changes in thresholds and switches between regimes, thus providing a model of religious governance and evolution. We then review the history of sectarianism in the three monotheistic religions and show that the model can help account for the basic differences between them as well as explain the historical evolution of dogmas and behavioral rules within each of them. A specialized case study focuses on the evolution of Catholic religious orders.     

Modeling technological innovation risks of an entrepreneurial team using system dynamics: An agent-based perspective

Continuous technological innovation has been playing a vital role in ensuring the survival and development of an enterprise in today's economy. This paper studies the problem of technological innovation risk-based decision-making from an entrepreneurial team point of view. We identify the differences between this team decision-making and a traditional individual decision-making problem, where decisions are mainly affected by the decision-maker's risk and value perceptions, and risk preferences. We create a modeling framework for such a new problem, and use system dynamics theory to model it from the agent-based modeling perspective. The proposed approach is validated by a case study of the technological innovation risk decision-making in a Chinese automobile company.     

Social responsibility promotes conservative risk behavior

Previous studies show that group risk taking can be more conservative than individual risk taking. Two common, but untested reasons for this greater caution are the influence of social responsibility and a tendency to conform to the preferences of others. We study changes in risk taking in simple settings, where another’s risk taking can sometimes be observed, and where decisions affect not only one’s own payoffs but sometimes also affect those of a passive, second party. We find that social responsibility leads to more conservative risk behavior in group decision making. Conformism has a more symmetric effect: observing the choice of another tends to lead both individual and social decisions toward whatever the other’s expressed risk preference is. Direct tests fail to link the social behavior we observe to the social preference for distributional fairness common in decision-making under certainty.     

The Fear of Exclusion: Individual Effort when Group Formation is Endogenous*

To secure their membership in a popular group, individuals may contribute more to the group's local public good than they would if group formation were exogenous. Those in the most unpopular group do not have this incentive to contribute. This may result in substantial differences in individual effort level between groups. Our model thus provides one explanation for the existence of group‐specific behavioral norms. A principal will prefer exogenous or endogenous group formation depending on whether he prefers high or low levels of the local public good. We analyze two stylized examples: social interaction in schools, and multiple‐task teamwork.     

Dynamic risk management in petroleum project investment based on a variable precision rough set model

In this paper, an adaptive algorithm is designed for dynamic risk management in petroleum project investment based on a variable precision rough set (VPRS) model. In risk management, at each stage of decision-making, experts are invited to identify risk indices and support the decision-maker in evaluating the risk exposure (RE) of individual projects. The VPRS model is used to mine risk rules and determine the significance of risk indices from RE decision tables. Considering that there are multiple risks involved in any petroleum project investment, we use multi-objective programming to obtain the optimal selection of projects with minimum RE, where the significance of risk indices is assigned to each of the corresponding multi-objective functions as a weight. Moreover, we develop a risk ranking model to measure the degree of risk for individual projects in a portfolio. Finally, a numerical example based on a Chinese petroleum company's investments in overseas projects is presented to illustrate the proposed approach, and then conclusions are drawn.     

Women self-help groups and intra-household decision-making in agriculture

This study examines the effect of women-centric agricultural self-help groups (SHGs) on intra-household decision-making in agriculture. Using data collected from an intra-household survey of 815 households, we analyze the effect of women's membership in different types of SHGs on 14 decisions related to farms and households. Specifically, we investigate the discord in decision-making, which is the difference in the perceived decision-making roles of spouses within a household. Our results show that women's participation in SHGs has increased their role in decision-making by 8–13%. However, the effects vary according to the type of intervention and the decision. We found fewer discords in intra-household decision-making in seed SHGs than in micro-finance SHGs. In conclusion, our study suggests that women's engagement in agriculture-based SHG interventions can encourage joint decision-making, but the magnitude of this effect depends on the type of SHG. Development agencies can use this information to design interventions targeted at empowering women through the improvement of the agricultural value chain.     

Why is change so slow? Assessing prospects for United Nations Security Council reform

The article explores how changed patterns of UN membership affected the prospects for UN Security Council institutional reform. First, we outline a theoretical framework based on path dependency, veto player analysis and social choice theory. Second, we offer calculations of decision probability and show that a higher voting threshold lowers chances of winning coalitions in a non-linear fashion. Third, we explore the specific decision-making procedures for UNSC reform and which actors can block reform. We conclude that not only diverging preferences, but that hurdles established early on combined with membership growth have ‘locked in’ the current institutional arrangement.     

Researcher rank stability across alternative output measurement schemes in the context of a time limited research evaluation: the New Zealand case

This article focuses on the stability of rankings of academics by research productivity in the context of short-term decision-making. In particular, the growing use of national research assessment exercises (NRAE) has increased interest in identifying the contributions of individual researchers to an assessment unit’s output and ranking. The article concentrates on the assessment of individuals using plausible journal ranking schemes. We find that despite statistical evidence of a high degree of stability across journal ranking schemes as indicated by rank correlation coefficients, the particular ranking scheme used is of great importance to individual researchers. This applies with particular force to academics working within a NRAE environment based on individual assessment such as New Zealand’s PBRF.     

Social capital access and entrepreneurship

We investigate the effect of social capital access on entrepreneurship. Social capital helps entrepreneurs to overcome resource constraints. This is especially important in small communities where we often see a lack of market-oriented institutions such as venture capital firms. Entrepreneurs gain access to social capital via club memberships. Combining differences in the number of individual club memberships with differences in the importance of social capital across communities, we identify a causal small community mark-up effect of individual club memberships on entrepreneurship. Assuming that unobserved heterogeneity that might influence both the individual's selection into clubs and the occupational choice to be an entrepreneur is independent of community size, we find that the effect of club membership on the propensity to be an entrepreneur is 2.6 percentage points larger in small communities than in large communities. Robustness tests support the validity of our identifying assumption and results.     

Family labour supply: some empirical results from agriculture

The family is often taken as the decision-making unit in utility maximizing theories of labour supply. At a simple level, the family is composed of two elements, dependents and workers. This paper seeks to quantify the influence of these two elements on family labour supply in agriculture. Family farms are particularly suited to such analysis since institutional rigidities, like the fixed working week, are absent. Econometric methods are used on data from farms in the north-west of england for the year 1976/7. The cross-sectional study uses single equation methods. The results show that only family composition determines the labour supply of the farm family: they can then be used to quantify the effects of individual groups of dependents and workers on family labour supply.