Nea presidential address, 1993: Why black economists?

This article looks, with humor, at the role of black economists in academia and in the economics profession.     

Herd Behaviour in Adoption of Network Technologies

In technology adoption, herd behaviour can lead to a suboptimal outcome as shown, among others, by Choi (1997). However, empirics find little support for the idea that a less efficient technology can conquer the market and lock out a more efficient one. Accordingly, we improve and generalize Choi's results, by introducing an additional source of uncertainty: the economic environment. We investigate how the economic environment can affect herding and consequently the efficiency of the technology choice. The result is a smaller adoption bias. In the limit, firms may optimally experiment with the new technology that turns out to be social welfare improving.     

Income Inequality and Macroeconomic Volatility: An Empirical Investigation

We explore the impact of macroeconomic volatility on the distribution of income. Using a cross‐section of developed and developing countries, we find that greater output volatility, defined as the standard deviation of the rate of output growth, is associated with a higher Gini coefficient and income share of the top quintile. The coefficients suggest that a strong effect on inequality resulting from a reduction in volatility: the Gini coefficient of a country like Chile would fall by 6 points if it were to reduce its volatility to the same level as Sweden or Norway. Our results seem not to be driven by the high‐inequality/high‐volatility Latin American countries.     

Education and the empowerment of women in household decision‐making in Spain

It was analysed whether investment in the education of both women and men serves to empower wives resulting in more balanced household decisions being taken on matters related to consumption and financial management. They considered that household decision‐making could be made by mainly the wife, mainly the husband or the couple acting jointly. They then applied multinomial probit models to the Spanish Living Conditions Survey of 2010. Results show that, when controlling for demographic, family and labour market characteristics, the level of education of both the husband and wife has a positive effect in terms of a more egalitarian decision‐making process in relation to three areas of expenditure: daily shopping, expensive purchases of consumer durables and significant expenditure on children. However, only women's education has a positive effect on borrowing money and no effect of education is observed with regard to the use of savings. Results are less conclusive for households where decisions are taken primarily by the wife or husband, since men's education increases the role of husbands in the household making‐decision process whereas no effect of wives' education is observed.     

Who Has the Time? Community College Students’ Time-Use Response to Financial Incentives

We evaluate the effect of performance-based scholarship programs for post-secondary students on student time use and effort and whether these effects are different for students we hypothesize may be more or less responsive to incentives. To do so, we administered a time-use survey as part of a randomized experiment in which community college students in New York City were randomly assigned to be eligible for a performance-based scholarship or to a control group that was only eligible for the standard financial aid. This paper contributes to the literature by attempting to get inside the “black box” of how students respond to a monetary incentive to improve their educational attainment. We find that students eligible for a scholarship devoted more time to educational activities, increased the quality of effort toward and engagement with their studies, and allocated less time to leisure. Additional analyses suggest that students who were plausibly more myopic (place less weight on future benefits) were more responsive to the incentives, but we find no evidence that students who are arguably more time constrained were less responsive to the incentives.

     

Negotiating Effectively: Justice in International Environmental Negotiations

Are negotiators who rely on justice principles in the process of bargaining and drafting agreements more—or rather less—effective than others? This article examines whether adherence to principles of procedural and distributive justice in negotiations contributes to more effective results, with a focus on international environmental negotiations. Effectiveness is defined in terms of the extent of agreement (among parties and on issues), time to reach agreement, and comprehensiveness of the agreement. A set of hypotheses is evaluated on a selection of bilateral and multilateral cases of environmental negotiations, using statistical methods. The analyses reveal that adherence to principles of procedural justice contributes to more effective results in multilateral environmental negotiations. These principles are found to hinder effectiveness in the bilateral cases. On the other hand, adherence to principles of distributive justice is only moderately related to effectiveness in both the bilateral and multilateral cases.     

Bridging Business and Society: The Abrinq Foundation in Brazil

This article presents the process of creation and expansion of the Fundação Abrinq pelos Direitos da Criança et do Adolescente (Abrinq Foundation for Rights of Children and Adolescents). Established in 1990 by a group of entrepreneurs from the Brazilian Toy Manufacturers’ Association (ABRINQ), the Fundação Abrinq has been successful at raising the issue of children in Brazilian society by bridging business and several other sectors of society. This article more particularly examines (1) the societal challenges related to the situation of children in Brazil; (2) the creation and development of the Abrinq Foundation; and (3) the achievements of this innovative bridging organization over 15 years.