Intergenerational Transfers: An Integrative Approach

The empirical literature was unable to conclude whether intergenerational transfers are motivated mainly by altruistic or strategic motivations. I suggest that both may be plausible, namely that people are neither pure altruists who derive utility simply from being good to others, nor pure egoists who consider only strategic selfish considerations, but are actually driven by a combination of incentives. I show that assuming a combination of motives changes, sometimes dramatically, the results obtained in the traditional models and resolves the puzzle concerning the empirical results.     

When Galatea cares about her reputation: How having faith in your workers reduces their motivation to shine

We develop a theory of leadership that focuses on the role managers play in motivating employees through their attitudes towards employees. We model a manager's attitude as her perception about employees' abilities of successfully completing challenging tasks. We show that a positive attitude motivates employees who are driven by monetary rewards. A negative attitude may motivate employees who are driven by concerns about their reputation for being able. When employees are driven by monetary rewards and care about their reputations, an increase in the reward for successfully completing challenging tasks may lead employees to shy away from these tasks.     

History,utility and liberty: John Stuart Mill's critical examination of Auguste Comte

This paper shows that Mill's assessment of Comte's work casts light on his own attitude towards the historicity of social phenomena and on the way he connects the notions of utility and liberty. It underlines the relative stability of Mill's views. While the tone of his remarks about Comte varied through time, their content remained basically unchanged. The paper untangles the complex web of the two thinkers’ intellectual relationship by gathering information scattered across many texts, assesses the effects of the Comtian influence on Mill's epistemology and shows how Mill's liberalism was partly built on his opposition to Comte's ideas.     

A theory of self-fulfilling political expectations

In their pursuit of being re-elected, politicians might not choose high-quality policies but just conform to popular wisdom. The larger are the office spoils, and the more precise is an incumbent's knowledge of voter opinion, the more likely that she will resort to such populism. My main result is that the public's trust or distrust in politicians' behavior may be self-fulfilling. When voters assess the quality of an incumbent politician, they will compare her policy choices with their own prior opinion. If voters think that the incumbent was just trying to conform, a failure to do so will be even more damaging for the incumbent's election chances. However, this only increases the incumbent's incentives to conform, which indeed confirm voters' skepticism. Loosely put, a skeptic voter attitude tends to generate conformist politicians, while a trusting attitude tends to generate confident ones.     

Fiscal Policy when Individuals Differ with Regard to Altruism and Labor Supply

This paper studies the incidence of tax-transfer policy in a growth model wherein individuals differ according to their level of intergenerational altruism and have an endogenous labor supply. The main result is that public debt is neutral at the macro level but redistributes resources from nonaltruists to altruists. Capital income taxation can hurt the nonaltruists who do not have any wealth more than it hurts the altruists who own all of it. Whether or not the altruists supply a positive amount of labor makes a big difference as to the incidence of alternative tax transfer policies.     

Optimal contracting with altruism and reciprocity

Motivated by the recent experimental evidence on altruistic behavior, we study a simple principal–agent model where each player cares about other players' utility, and may reciprocate their attitude towards him. We show that, relative to the selfish benchmark, efficiency improves when players are altruistic. Nevertheless, in contrast to what may be expected, an increase in the degree of the agent's altruism as well as a more reciprocal behavior by players has ambiguous effects on efficiency. We also consider the effects of the presence of spiteful players and discuss how monetary transfers between players depend on their degrees of altruism and spitefulness.     

Altruism and charitable giving in a fully replicated economy

In this paper, an economy is analyzed where one group of agents, the altruists, cares about the well-being of another group of agents, the recipients. It is asked how changes in the size of these groups affect the altruists' charitable giving in the Nash equilibrium. I show that a pure group size effect, i.e., a proportional expansion of both subgroups can lead to less free riding and to a lower degree of underprovision relative to the efficient level of charitable giving.     

Implementing Steady State Efficiency in Overlapping Generations Economies with Environmental Externalities

We consider in this paper overlapping generations economies with pollution resulting from both consumption and production. The competitive equilibrium steady state is compared to the optimal steady state from the social planner's viewpoint. We show that the dynamical inefficiency of a competitive equilibrium steady state with capital–labor ratio exceeding the golden rule ratio still holds. Moreover, the range of dynamically efficient steady state capital ratios increases with the effectiveness of the environment maintenance technology, and decreases for more polluting production technologies. We characterize some tax and transfer policies that decentralize as a competitive equilibrium outcome the transition to the social planner's steady state.     

Intergenerational Transfer of Human Capital and Optimal Education Policy

We study the design of education policies (subsidies and public education) when parents' investment in education is motivated by warm‐glow altruism and determines the probability that a child has a high ability. The optimal subsidy is not necessarily positive. It is determined by two conflicting terms: a Pigouvian term (warm‐glow altruists do not properly account for the impact of education on future generations) and a “paternalistic” effect (the warm‐glow term may not be fully included in social welfare). Finally, total crowding out of private expenditure (for one of the types) by public education may be desirable.     

The notion of private information in a modern perspective: a reappraisal of Hayek's contribution

Hayek's critical attitude towards Walrasian modelling was based on informational considerations. In his view, a meaningful notion of equilbrium has to deal with the consistency of agents' plans which information is dispersed throughout the economy. He emphasized that only in this context could the role of market prices as aggregators of information be correctly analysed. Recent developments in general equilbrium theory with rational expectations have taken up the issue formally. In this paper, Haek's main ideas about the competiitive mechanism are compared with these recent results. It is argued that Hayek's notion of private information is different from that used in modern equilibrium theory, not only because of its dynamic content, as many critics observed ex post, as is usually in a general equilibrium framework. This issue of whether modern notions of private information, namel that used in conract theory, are good substitutes for Hayek' notion of personal knowledge is also examined in detail. From this analysis, it is possible to conclude that Hayek's notion of equilibrium neither entails Pareto optimality prperties nor full informational efficiency.     

Self-serving altruism? The lure of unethical actions that benefit others

In three experiments, we propose and find that individuals cheat more when others can benefit from their cheating and when the number of beneficiaries of wrongdoing increases. Our results indicate that people use moral flexibility to justify their self-interested actions when such actions benefit others in addition to the self. Namely, our findings suggest that when people's dishonesty would benefit others, they are more likely to view dishonesty as morally acceptable and thus feel less guilty about benefiting from cheating. We discuss the implications of these results for collaborations in the social realm.     

Optimal social security tax with myopic agents

Myopic agents lack the foresight to save for their own old age. It is generally believed that correcting myopia is a rationale for a pay-as-you-go (PAYG) pension system. This view has been supported by existing literature showing that the optimal PAYG social security tax should increase when people are more myopic. In this paper we obtain new results opposed to the traditional view. By establishing a very standard general equilibrium OLG model with myopic agents and endogenized marginal product of capital, we show that the optimal social security tax should be lower when people are more myopic. Our numerical analysis also shows that the welfare cost of the social security tax increases with people's degree of myopia. These results suggest that correcting myopia is not a clear rationale for the PAYG social security.     

CAPABILITIES AS FUNDAMENTAL ENTITLEMENTS: SEN AND SOCIAL JUSTICE

Amartya Sen has made a major contribution to the theory of social justice, and of gender justice, by arguing that capabilities are the relevant space of comparison when justice-related issues are considered. This article supports Sen's idea, arguing that capabilities supply guidance superior to that of utility and resources (the view's familiar opponents), but also to that of the social contract tradition, and at least some accounts of human rights. But I argue that capabilities can help us to construct a normative conception of social justice, with critical potential for gender issues, only if we specify a definite set of capabilities as the most important ones to protect. Sen's "perspective of freedom" is too vague. Some freedoms limit others; some freedoms are important, some trivial, some good, and some positively bad. Before the approach can offer a valuable normative gender perspective, we must make commitments about substance.     

J.M. Keynes's Theory of the State as a Path to his Social Economics of Reform in The General Theory

This article focuses on Adam Smith's attitude toward wages as the natural price of labor. It argues that his subsistence wage had similarities with the medieval Schoolmen's notion of the just wage as being established through markets. He further agreed with them that the market wage had to be sufficient to nurture community standards of virtue. His application of the concept differed from theirsn due to his recognition of the problems caused by social distance. In a commercial society, impersonal relations added difficulties to the attainment of a just wage and could diminish virtue. As a result, sympathy from employers and from public

officials was needed as part of the Smithian standard of wages.     

WHOSE LOSSES COUNT? EXAMINING SOME CLAIMS ABOUT AGGREGATION RULES FOR NATURAL RESOURCES DAMAGES

Compensation for natural resources damage may be provided, in principle, by a payment equal to the value of damage, a compensating restoration project, or partial restoration plus a compensating payment. Applicable laws have a pronounced tilt toward restoration. When determining the value of damage, no welfare-economic reason exists to count as an offsetting benefit any utility enjoyed by rubberneckers; nor should damages be excluded when incurred by those unaware of the injury, those whose motivations are thought "non-economic," those who are resource-loving passive users, or those who are parentalistic altruists. Money compensation required on behalf of nonparentalistic altruists drops to zero as active users are fully compensated. However, if (for whatever reason) active users cannot sustain a claim for full compensation, nonparentalistic altruists will suffer compensable losses.     

Who you are or whom you know? Consumption interdependences in social networks

This paper presents an analysis of whether a consumer's decision to switch from one mobile phone provider to another is driven by individual consumer characteristics or by actions of other consumers in her social network. Such consumption interdependences are estimated using a unique dataset, which contains transaction data based on anonymized call records from a large European mobile phone carrier to approximate a consumer's social network. Results show that network effects have an important impact on consumers’ switching decisions: switching decisions are interdependent between consumers who interact with each other and this interdependence increases in the closeness between two consumers as measured by the calling data. In other words, if a subscriber switches carriers, she is also affecting the switching probabilities of other individuals in her social circle. The paper argues that such an approach is of high relevance to both switching of providers and to the adoption of new products.     

SELLING A LEMON UNDER DEMAND UNCERTAINTY

We consider a seller who has private information about the quality of her good but is uncertain about buyer arrivals. Assuming that the high‐quality seller insists on a price, we show that the low‐quality seller's surplus and pricing strategy crucially depend on buyers' knowledge about the demand state. If they are also uncertain about demand, then demand uncertainty increases the low‐quality seller's expected payoff, and her optimal strategy is to lower the price after some time. If buyers know the demand state, then demand uncertainty does not affect the low‐quality seller's payoff, but she must employ a sophisticated pricing strategy.     

Asymmetric signals and skewness

This paper develops a model for analyzing skewness in returns when an investor observes a novel skew-normally distributed signal about a risky asset's payoff. The equilibrium third moment increases with the signal's skewness, and its magnitude increases with the signal's noisiness. Using institutional ownership and market capitalization as proxies for information precision, we find that both proxies are significantly and negatively correlated with the future absolute third moment in firm returns in China. We show that these relations are mainly driven by the negative third moment. The two proxies are positively correlated with future skewness, which contradicts the corresponding relations found in the US. Our model can reconcile the opposite findings if the US evidence is driven by positive skewness. This paper suggests that it is more appropriate to forecast positive and negative skewness separately when using information-precision proxies.     

成本粘性影响管理层自愿性盈利预测了吗？--来自中国A股上市公司的证据

文章研究成本粘性与管理层自愿性盈利预测之间的关联。结果发现：成本粘性增加了管理层发布自愿性盈利预测的倾向及频率,同时,成本粘性程度与乐观盈利预测呈正相关,与悲观盈利预测呈负相关。影响机制表明,成本粘性通过提高信息不对称程度和企业经营风险从而影响了管理层自愿性盈利预测披露。进一步研究发现,政府补助加强了成本粘性与管理层自愿性盈利预测披露之间的关系,企业社会责任与经济政策不确定性削弱了两者之间的关系;然而政府补助、企业社会责任与经济政策不确定性对成本粘性与管理层自愿性盈利预测性质之间的关系没有显著影响。此外,成本粘性对管理层自愿性盈利预测的影响在非国有企业、非国际四大审计的公司中更为显著。最后,管理层自愿性盈利预测披露的增加,降低了权益资本成本,提升了企业价值。本文的发现丰富了成本粘性经济后果和自愿披露信息影响因素的研究,并提供了关于管理层的自由裁量权和管理激励在影响企业成本结构和盈利预测信息披露方面的证据。     

Competing Models of Socially Constructed Economic Man: Differentiating Defoe's Crusoe from the Robinson of Neoclassical Economics

Daniel Defoe's Robinson Crusoe has seldom been read as an explicitly political text. When it has, it appears that the central character was designed to warn the early eighteenth-century reader against political challenges to the existing economic order. Insofar as Defoe's Crusoe stands for ‘economic man’, he is a reflection of historically produced assumptions about the need for social conformity, not the embodiment of any genuinely essential economic characteristics. This insight is used to compare Defoe's conception of economic man with that of the neoclassical Robinson Crusoe economy. On the most important of the ostensibly generic principles espoused by neoclassical theorists, their ‘Robinson’ has no parallels with Defoe's Crusoe. Despite the shared name, two quite distinct social constructions serve two equally distinct pedagogical purposes. Defoe's Crusoe extols the virtues of passive middle-class sobriety for effective social organisation; the neoclassical Robinson champions the establishment of markets for the sake of productive efficiency.