The B.E. Journal of Economic Analysis & Policy

Published by De Gruyter

Volume 19 Issue 4 -

October 2019

Issue of The B.E. Journal of Economic Analysis & Policy

Contents
Journal Overview

research-articles

June 21, 2019

To Be a Blood Donor or Not to Be? Investigating Institutional and Student Characteristics at a Military College

Bing Jiang, Samuel K. Allen

Article number: 20180104

Abstract

Using data from 21 voluntary blood drives over a five-year period, we establish connections between undergraduate students’ blood donation behaviors and their demographic, academic, leadership, and military characteristics at a military college in the United States. We find that blood donation participation rates for students at this military college are much higher than the national average for the 18- to 24-year-olds. Certain characteristics such as fitness, athletic status, academic performance, and intent to pursue a military career after graduation are significantly correlated with blood donation. We also find that college students’ blood donation behaviors may be influenced by their attitudes toward civic responsibility, time constraints, incentives, peer effects and the characteristics of blood collection agencies. This study provides new insights into individual characteristics that correlate with blood donation. It also highlights the role of unique military education and institutional characteristics in promoting better fitness, the pursuit of a military career, and selfless service among young people, all of which might help explain demonstrated higher blood donation participation than their peers elsewhere.

July 26, 2019

Do School Counselors Exhibit Bias in Recommending Students for Advanced Coursework?

Dania V. Francis, Angela C. M. de Oliveira, Carey Dimmitt

Article number: 20180189

Abstract

In this paper, we seek to understand minority and female underrepresentation in advanced STEM courses in high school by investigating whether school counselors exhibit racial or gender bias during the course assignment process. Using an adapted audit study, we asked a sample of school counselors to evaluate student transcripts that were identical except for the names on the transcripts, which were varied randomly to suggestively represent a chosen race and gender combination. Our results indicate that black female students were less likely to be recommended for AP Calculus and were rated as being the least prepared. Our results have policy implications for any program that asks individuals to make recommendations that may be subject to bias – whether conscious or unconscious.

June 15, 2019

Internal Migration and Public Policy

Michele G. Giuranno, Rongili Biswas

Article number: 20180203

Abstract

This paper studies the relation between internal migration and public spending on public goods. We describe centralized public policy when a central government is comprised of elected representatives from local electoral districts. Internal migration determines the median voter in the districts. The median voters decide the equilibrium policy through bargaining. We find the conditions under which voters’ mobility results in larger or smaller public spending. Furthermore, the distance between the actual size and the efficient size of government spending depends on the way internal migration changes the distribution of income within and between districts.

July 20, 2019

Efficiency Wages in Cournot-Oligopoly

Marco de Pinto, Laszlo Goerke

Article number: 20180236

Abstract

In a Cournot-oligopoly with free but costly entry and business stealing, output per firm is too low and the number of competitors excessive, assuming labor productivity to depend on the number of employees only or to be constant. However, a firm can raise the productivity of its workforce by paying higher wages. We show that such efficiency wages accentuate the distortions occurring in oligopoly. Specifically, excessive entry is aggravated and the welfare loss due to market power rises.

August 13, 2019

Public Good Provision Financed by Nonlinear Income Tax Under Reduction of Envy

Takuya Obara, Shuichi Tsugawa

Article number: 20180252

Abstract

We examine optimal taxation and public good provision by a government that considers reduction of envy as a constraint. We adopt the extended envy-freeness proposed by Diamantaras and Thomson (1990. “A Refinement and Extension of the No-Envy Concept.” Economics Letters 33: 217–22), called λ -equitability. We derive the modified Samuelson rule under an optimal nonlinear income tax and show, using a constant elasticity of substitution utility function, that the direction of distorting the original Samuelson rule to relax the λ envy-free constraint is crucially determined by the elasticity of substitution. Furthermore, we numerically show that the optimal level of provision increases (decreases) in the degree of envy-freeness when the original Samuelson rule is upwardly (downwardly) distorted.

August 6, 2019

Horizontal Mergers in a Dynamic Cournot Market: Solving the Free Riding Issue Without Efficiency Gains

Marc Escrihuela-Villar, Walter Ferrarese

Article number: 20180321

Abstract

We discuss horizontal mergers in a linear, homogeneous, symmetric Cournot market where the new entity repeatedly competes with outside firms over an indefinite horizon and efficiency gains are ruled out. If the degree of collusion among the outside firms is large enough, then, despite the large payoff of each outsider, we obtain output configurations solving both the profitability and the free riding issues. Such a result requires that mergers involve a sufficiently small number of firms, which is in sharp contrast with the findings in the literature and rationalize the empirical fact that relatively small mergers, even in absence of synergies, do actually occur and that, although outside firms may benefit from the merger of their rivals, insiders end up being better off. Finally, we show that merging can often be a more advantageous alternative than a fully collusive agreement, in which, moreover, the free riding component is not solved.

July 9, 2019

Does Television Kill Your Sex Life? Microeconometric Evidence from 80 Countries

Adrienne M. Lucas, Nicholas L. Wilson

Article number: 20180361

Abstract

The canonical consumer demand model predicts that as the price of a substitute decreases, quantity demanded for a good decrease. In the case of demand for sexual activity and availability of alternative leisure activities, popular culture expresses this prediction as “television kills your sex life.” This paper examines the association between television ownership and coital frequency using data from nearly 4 million individuals in national household surveys in 80 countries from 5 continents. The results suggest that while television may not kill your sex life, it is associated with some sex life morbidity. Under our most conservative estimate, we find that television ownership is associated with approximately a 6 % reduction in the likelihood of having had sex in the past week, consistent with a small degree of substitutability between television viewing and sexual activity. Household wealth and reproductive health knowledge do not appear to be driving this association.

September 18, 2019

How Do Intermediaries Affect the Effectiveness of the Four-Eyes-Principle? An Experimental Investigation

Liangcong Fan, Zechun Ying, Yuemei Yuan, Xinchao Zhang, Bin Xu

Article number: 20190059

Abstract

Corrupt deals are commonly arranged by intermediaries. However, attempts to deter corruption pay little attention to the role of intermediaries in corrupt deals. This paper reports a laboratory bribery experiment on corruption designed to investigate how intermediaries with information about the lowest bribe that the official is willing to accept in a briber-initiated corrupt deal affect the effectiveness of the four-eyes-principle (FEP) on deterring corruption. We find that the introduction of the FEP significantly decreases the corruption level by increasing uncertainty. However, the presence of intermediaries with information completely offsets the positive effect of introducing the FEP on preventing corruption. Our findings suggest that further research on corruption should allow a more active role of intermediaries, and legislators should take the role of intermediaries into account when designing anti-corruption mechanisms.

September 17, 2019

University Program Characteristics and Education-Job Mismatch

Aleksander Kucel, Montserrat Vilalta-Bufí

Article number: 20190083

Abstract

Over-education has been demonstrated to be frequent and persistent across countries. It often goes together with working in a job not related to the field of study (horizontal mismatch) or in a job that requires lower skills than acquired (skill mismatch). We study which program characteristics help university graduates to obtain a good job match. We do the analysis for Spain since the presence of over-education is strong in this country. We analyze the three types of mismatch: over-education, horizontal mismatch, and over-skills. We focus on the role of program characteristics in avoiding over-education in the first job after graduation, and in exiting over-education in the early career. We find that those programs that are academically prestigious and those that promote entrepreneurial skills help avoid being mismatched in the first job and, in case of being mismatched in the first job, they help exit this situation. Overall, our results give support to policies promoting the development of entrepreneurial skills in the Spanish education system.

Letter

August 7, 2019

Believe It or Not: Strategic Licensing Makes R&D Alliance Profitable

Tannista Banerjee, Aditi Sengupta

Article number: 20180358

Abstract

We consider a market where firms (that compete in the product market) invest in the research and development (R&D) activities with no guaranteed success and engage in a patent race for intellectual property rights. We analyze the effects of a strategic ( ex ante ) licensing contract on the equilibrium investment behavior of competing firms that form a research and development (R&D) alliance to win a patent race. We show that the R&D alliance members that sign strategic licensing contract invest more in the R&D and earn higher expected profits compared to the firms in an R&D cartel and R&D joint venture cartel without any strategic licensing as well as the firms that aggressively compete in the innovation market to win the patent race.

August 22, 2019

China’s Only Children and Their Spillover Effects on Academic Performance in the Classroom

Haining Wang, Rong Zhu

Article number: 20190058

Abstract

This paper examines the causal effect of students who are the only child in their family on the academic performance of their classmates, exploiting the random assignment of students to classes within schools in China. We find that a higher proportion of classmates as the only child in their family improves the academic outcomes of students in the same classroom. We also find evidence of positive but heterogeneous peer effects by student and class characteristics. Our findings suggest that the academic performance of Chinese students has benefited indirectly from the one-child policy because of this positive peer influence within the classroom.

September 11, 2019

Myopic Mergers across Borders with Incomplete Information in GOLE

Hamid Beladi, Avik Chakrabarti, Daniel Hollas

Article number: 20190281

Abstract

In this paper, we present a tractable general equilibrium model capturing the incentives for myopic mergers in oligopolistic industries with incomplete information about rivals’ costs. We demonstrate that ex-ante gains from myopic mergers between firms with incomplete information about rival’s cost are larger when the difference between unknown components of their costs is wider. We also show that ex-ante gains from myopic mergers between firms across countries with large differences in factor endowments, ceteris paribus , would be greater than the ex-ante gains from mergers between countries with relatively similar factor endowments.

About this journal

Objective
The B.E. Journal of Economic Analysis & Policy (BEJEAP) welcomes submissions that employ microeconomics to analyze issues in organizational economics, consumer behavior, and public policy. Articles submitted to BEJEAP can come in two formats: research papers and letters. Authors should bring to their analysis whatever microeconomic theoretical, experimental or econometric tools are helpful. We publish both empirical work and applied theory (though not more abstract forms of applied theory), and our aim is to disseminate papers that have practical implications for public policy, organizational or individual decision making.

Topics

Design of organizations and institutions
Industrial organization
Health economics
Public finance
Labour Economics
Economics of education, family, development, law, or the environment
Effects of domestic and international policy

Article formats
Research Papers, Letters

> Information on submission process