Reference Points and Negative Reciprocity in Simple Sequential Games

We investigate experimentally whether preferences over an outcome depend on what other possible outcomes of the situation under consideration are, i.e., whether choices are “menu dependent.” In simple sequential games we analyze whether reactions to a certain benchmark outcome are influenced by changes in the payoffs of another outcome, not attainable at that time, called the “reference point.” Our data provide evidence that is favorable to the notion of menu dependence. Alterations of the reference point can lead to quantitatively significant changes in behavior at the benchmark outcome. The behavior we observe can be interpreted in terms of negative reciprocity. Journal of Economic Literature Classification Numbers: C91, C92, C72.     

The geographical efficiency of Spain's regional airports: A quantitative analysis

Previous studies of the role of regional airports in the Spanish economy have focused on calculating efficiency using air traffic as the output and airport infrastructure data as the input. We present an alternative quantitative analysis based upon the geographical structure within the airport's market basin. We formulate a ‘geographical efficiency’ model that considers territorial variables within the airport hinterland. Input data for our model include the socio-economic structure of the population, intermodal transport links, industrial and tourism potential and existing leisure-related services. The output is the annual number of passengers associated with such constraints. The result is a relative efficiency estimate that shows uneven patterns of geographical efficiency amongst Spain's regional airports and also provides insights into opportunities for expanding some of these critical items of infrastructure. They suggest that some of Spain's regional airports may be better placed than others to compete in a liberalized market that exhibits a clear tendency in favor of coastal, tourism-based airports.     

Catalan firms and the distribution of products in Europe

The food industry sector has seen major changes in the ways it needs to compete. Spain became linked to the European Community in the early 1970s by an adherence treaty which regulated food exports to the member countries. Subsequently, when Spain became a full European Community member in January 1986, both exports and imports to and from countries (Mediterranean or otherwise) became regulated. There had not previously been a tradition of trade links with most of these countries. After 10 years of full coexistence with the other European members, it is possible to test the effect of free circulation of goods, the major presence of community multinationals in the markets, the restructuring of the food industry sector, and the penetration of Spanish products in European markets. At present, the objectives of economic convergence contemplated in the Maastricht Treaty call for the control of macroeconomic variables (particularly inflation) which affect the food industry (by virtue of its special characteristics) far more than the remaining sectors because of its peculiarities. This paper is a summary and extension of a broader study conducted by Lourdes Viladomiu (Universitat Autònoma de Barcelona), María de los Angeles Gil Estallo (Universitat Pompeu Fabra), Jordi Melé (Universitat de Barcelona), and Manuel Cantos (Universitat Pompeu Fabra) financed by the Fundació Empresa i Ciència of the Universitat Autònoma de Barcelona.     

Gender pairings and accountability effects

We conduct an experiment to investigate how the gender composition of an audience interacts with the gender of a player thereby shaping her/his degree of responsibility in decision-making. Together with the measures of accountability based on decision theory, we employ two physiological measures, blood pressure and heart rate variability, which allow us to disentangle the separate effects of stress and accountability. Our results show that men are more sensitive to changes in the gender composition of the audience; specifically, men lower their accountability when paired with a female audience. By contrast, women display a level of accountability that does not change with gender pairing. Finally, we find that the variation in blood pressure has a significant but small effect only on men's behavior.     

Pay-as-you-go Social Security and the Distribution of Altruistic Transfers

This paper studies the impact of an unfunded social security system on the distribution of altruistic transfers in a framework where savings are due to both life cycle and random altruistic motivations. We show that the effect of social security on the distribution of these transfers depends crucially on the strength of the bequest motive in explaining savings behaviour. We measure this strength by the expected weight that individuals attach to the utility of future generations. On the one hand, if the bequest motive is strong, then an increase in the social security tax raises the bequests left by altruistic parents. On the other hand, when the importance of altruism in motivating savings is sufficiently low, the increase in the social security tax could result in a reduction of the bequests left by altruistic parents under some conditions on the attitude of individuals toward risk and on the relative returns associated with private saving and social security. Some implications concerning the transitional effects of introducing an unfunded social security scheme are also discussed.     

Efficient and stable collective choices under gregarious preferences

We consider collective choice problems where a set of agents have to choose an alternative from a finite set and agents may or may not become users of the chosen alternative. An allocation is a pair given by the chosen alternative and the set of its users. Agents have gregarious preferences over allocations: given an allocation, they prefer that the set of users becomes larger. We require that the final allocation be efficient and stable (no agent can be forced to be a user and no agent who wants to be a user can be excluded). We propose a two-stage sequential mechanism whose unique subgame perfect equilibrium outcome is an efficient and stable allocation which also satisfies a maximal participation property.