Can student effort be manipulated? Does it matter?

This article provides evidence that college students’ effort can be manipulated substantially by making changes in the college testing regime and moreover that student effort is a meaningful input in education production. The evidence comes from a quasi-experiment where a mid-semester test with a pass requirement is introduced to a mandatory one-semester Business School course in Macroeconomics. Four cohorts of students – one before and three after the introduction of the pass requirement – have reported their study effort twice during the semester, and the relationship between achievement and study effort is investigated by using a within-subject within-student across-study periods approach.     

Emigration,wage differentials and brain drain: the case of Suriname

In this article, we examine two hypotheses concerning emigration. The first hypothesis is that emigration is positively correlated with wage differentials. The second hypothesis concerns a positive correlation between emigration and higher education in the sending country (the so-called brain gain hypothesis). We analyse unique time-series data for Suriname for the period 1972–2009, for which we fit error correction models to disentangle short-run from long-run effects. We document moderate support for the first hypothesis, but we find strong support for the brain drain (and not brain gain) hypothesis. We conclude with implications of our findings for Suriname.     

R&D,public innovation policy,and productivity: The case of danish manufacturing

The purpose of this paper is to investigate the relationship between private R&D, public innovation support transferred to the private sector, and productivity in Danish manufacturing. Two main conclusions are established. First, public innovation support has a positive and significant effect on private R&D expenditures with an estimated elasticity of 0.062. Second, the indirect effect on productivity from public innovation support is reflected in a positive point estimate which is found to be robust to different specifications of R&D capital.     

Social economy and employment – the case of Sweden

Recent research has shown growing shares of employment in the social economy (or non-profit sector) both in the European Union and in the United States. In the EU, there seems to be growing hopes that the social economy will be capable of contributing to local progress on the unemployment issue in crisis regions. This paper analyses employment in certain entrepreneurial forms, usually considered belonging to the social economy, in Sweden during the 1990s. The results show considerable regional differences of employment in the social economy, but also that its share of the labor market is very limited. The effect of social-economic organizations on employment, therefore, is probably mainly indirect in as much as they function as platforms for cooperation between firms or else as embryos for enterprises by strengthening local entrepreneurship and helping to nurture a deposit of social capital which has visible effects on private business and jobs. However, these effects need more detailed examinations.     

Review Essay

Sen's capability approach has a culturally specific side, with capabilities influenced by social structures and institutions. Although Sen acknowledges this, he expresses his theory in individualistic terms and makes little allowance for culture or social structure. The present paper draws from recent social theory to discuss how the capability approach could be developed to give an explicit treatment of cultural and structural matters. Capabilities depend not only on entitlements but on institutional roles and personal relations: these can be represented openly if capabilities are disaggregated into individual, social and structural capacities. The three layers interact, and a full analysis of capabilities should consider them all. A stratified method implies that raising entitlements will not on its own be enough to enhance capabilities and that cultural and structural changes will be needed.     

Sustainable Development and a Dwindling Carbon Space

Curbing global warming by setting long term maxima for temperature rise or concentrations of greenhouse gases defines spaces within which further emissions of these gases are to remain (referred to here as ‘carbon spaces’). This paper addresses questions related to how to share between countries the carbon space and/or efforts to stay within it, in the perspective of sustainable development; different allocation mechanisms are reviewed, responding to criteria such as ‘responsibility’ for climate change, ‘capability’ to engage in abating it, and ‘potential’ or future contribution. The carbon space remaining at any time will depend on effective mitigation up till that time, and will condense if more stringent maxima are to be set; per capita this space becomes smaller with rising population. Sharing the carbon space in a fair way requires “convergence” of currently widely unequal per capita emissions. If the world is to stay within the carbon space consistent with <2° warming, then developed economies—the wealthiest sources of greenhouse gases should quickly and deeply engage in mitigation. Also, substantial mitigation is to take place in developing countries and that this will require substantial support to developing countries (financially, technologically). Changing development paths can make a major contribution to climate change mitigation; this requires changes in investment, production and consumption patterns. Green New Deals as proposed in the context of a widened response to the current economic crisis could become a first phase of a fundamental transition towards a decarbonised global economy worldwide. Concerns to do with equity as well as sustainability must be incorporated and integrated into coherent transitory strategies.     

Deunionization and job polarization – a macroeconomic model analysis for a small open economy

Declining unionization rates and job polarization are two important labor market developments of recent decades. A large body of literature has analyzed these phenomena separately, but little has been done to see whether there is a link between them. We employ a macroeconomic model for a small open economy with a large input–output core to analyze how deunionization may cause job polarization. Our analysis shows that medium-skilled workers are negatively affected by deunionization, mainly as a result of the heterogeneity of the elasticities of substitution between different types of labor. While the elasticities of substitution between high- and medium-skilled labor are relatively low, the elasticities of substitution between medium- and low-skilled are relatively high. As a result, when deunionization leads to increased wage dispersion, we find that demand for low-skilled increases at the expense of medium-skilled labor, thus yielding a more polarized labor market.     

Revealed smooth nontransitive preferences

In the present paper, we are concerned with the behavioural consequences of consumers having nontransitive preference relations. Data sets consist of finitely many observations of price vectors and consumption bundles. A preference relation rationalizes a data set provided that for every observed consumption bundle, all strictly preferred bundles are more expensive than the observed bundle. Our main result is that data sets can be rationalized by a smooth nontransitive preference relation if and only if prices can normalized such that the law of demand is satisfied. Market data sets consist of finitely many observations of price vectors, lists of individual incomes and aggregate demands. We apply our main result to characterize market data sets consistent with equilibrium behaviour of pure-exchange economies with smooth nontransitive consumers.     

Why Punish? Social reciprocity and the enforcement of prosocial norms

Recently economists have become interested in why people who face social dilemmas in the experimental lab use the seemingly incredible threat of punishment to deter free riding. Three theories with evolutionary microfoundations have been developed to explain punishment. We survey these theories and use behavioral data from surveys and experiments to show that the theory called social reciprocity in which people punish norm violators indiscriminately explains punishment best.JEL Classification: C91, C92, D64, H41 Correspondence to: Jeffrey P. CarpenterWe thank Carolyn Craven, Corinna Noelke and two referees for comments, and Middlebury College for financial assistance. In addition, Carpenter acknowledges the support of the National Science Foundation (SES-CAREER 0092953).