The B.E. Journal of Economic Analysis & Policy

Published by De Gruyter

Volume 23 Issue 3

July 2023

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

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Contents
Journal Overview

Publicly Available August 1, 2023

Frontmatter

Page range: i-ii

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Research Articles

Open Access May 29, 2023

Bridging the Gap: The Role of the Charity in Voluntary Public Good Provision

Stephanie Karol

Page range: 565-604

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Abstract

This paper investigates how donors to food assistance charities respond to exogenous changes in recipients’ unmet needs. When food insecurity rises by one percentage point, the average food assistance charity increases fundraising by 0.9 %. Without this response, private contributions would have fallen by at least 0.2 %. These results are consistent with a model in which economic inequality simultaneously raises the donor’s marginal benefit of giving and reduces their awareness of the recipient’s circumstances. Charitable fundraising plays a key role in maintaining the charity’s revenues at a time when they are most needed.

March 27, 2023

Food Consumption in Argentina: The Deaton-Paxson Puzzle Beyond Mean Effects

Lucía Echeverría, Jose Alberto Molina

Page range: 605-631

Abstract

Deaton, A., and C. Paxson (1998. “Economies of Scale, Household Size, and the Demand for Food.” Journal of Political Economy 106 (5): 897–930. doi: 10.1086/250035) found the opposite to what theory predicts: food share declines with household size, keeping household per capita expenditure constant. This paper aims to explore the relationship between food demand and household size beyond the conditional mean of food consumption for Argentina using a quantile regression technique. Because standard analysis focuses on the average effects, the existence of the paradox at the lower and upper ends of the conditional food share distribution remains unknown. We find negative and significant effects of household size on food share at the upper tail of the conditional food share distribution, but we find no evidence of the puzzle for households with relatively lower food share that are reasonably richer. Results show the importance of accounting for distributional effects to obtain a complete understanding of food consumption behavior and sheds light on the crucial role of economies of scale in poor households.

May 9, 2023

Unpacking the Financial Incentives in Health by Revisiting India’s “Safe Motherhood Program”

Susmita Baulia

Page range: 633-671

Abstract

This paper investigates India’s nationwide health reform to understand its various channels of effect. The reform entitled socio-economically backward mothers with cash transfer if they chose to give birth at public health institutions, and simultaneously employed ASHAs as a direct link between pregnant women and the public healthcare delivery system. Using variations in mothers’ eligibility and differential implementation of ASHAs across states, birth-related outcomes are evaluated in a difference-in-difference framework. Results show that eligible mothers with both cash transfer and ASHA’s guidance outperformed those receiving only cash transfer, in institutional birth rate and timely initiation of breastfeeding. An improved outcome in the ASHA’s presence alongside the conditional cash transfer argues for the vitality of the former’s role in spreading information on the importance of health and the uptake of public healthcare.

May 5, 2023

Occupational Licensing and Skills Mismatches Among Immigrants and Natives in the United States

Massimiliano Tani

Page range: 673-700

Abstract

This paper studies the effect of occupational licensing on the education-occupation mismatches and the logarithm of hourly wages of natives and immigrants in the United States using longitudinal data from the 2014 sample of the Survey of Income and Program Participation (SIPP). On average, licensing reduces the skills mismatch and raises hourly wages among natives but not among immigrants. Over time there is only minimal convergence between the outcomes experienced by licensed natives and immigrants, highlighting that licensing does not produce uniform benefits, by immigrant status. Rather, it appears to institutionalize substantive differences in the quality of the skill matches and hourly pay of native and immigrant licensed workers and professionals.

June 1, 2023

On the Social Desirability of Centralized Wage Setting when Firms are Run by Biased Managers

Nicola Meccheri

Page range: 701-725

Abstract

This paper compares the welfare outcomes obtained under alternative unionization regimes (decentralized vs. centralized wage setting) in a duopoly market in which shareholders delegate strategic decisions to biased (overconfident or underconfident) managers. In such a framework, the common tenet that consumer surplus and overall welfare are always higher under decentralized wage setting is completely overturned. Indeed, in the presence of centralized unionization (industry-wide union), firm shareholders always prefer to hire more aggressive or less conservative managers and, as a result, output (consumer surplus) and overall welfare are larger than in a decentralized wage setting structure.

June 7, 2023

Public Subsidies and Cooperation in Research and Development. Evidence from the LAB

Antonio Acconcia, Sergio Beraldo, Carlo Capuano, Marco Stimolo

Page range: 727-760

Abstract

We implement an experimental design based on a duopoly game in order to analyse the impact of public subsidies on the willingness to cooperate in research and development (R&D) activities. We first implement six experimental markets by exogenously varying the level of knowledge spillovers (low or high) and the intensity of competition in the product market (low, intermediate, or high). We find that the probability of cooperation increases in the level of spillovers and decreases in that of market competition. We then replicate the six experimental markets by subsidising subjects who cooperate. Whenever they are sufficient to change the incentive structure of the game, subsidies substantially increase the probability of cooperation, causing, however, a reduction of R&D investments. Overall, our evidence suggests that, depending on the characteristics of the market, the provision of subsidies is not always desirable. These might be redundant because firms have sufficient private incentives to invest cooperatively in R&D, or even counterproductive, as they might induce firms to significantly reduce R&D investments compared to the noncooperative scenario.

Publicly Available July 25, 2023

Don’t Stop Me Now: Cross-Border Commuting in the Aftermath of Schengen

Angela Parenti, Cristina Tealdi

Page range: 761-806

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Abstract

A Single European Labour Market has not been achieved yet, despite strong efforts in promoting cross-country labour mobility. In this paper, we assess the effectiveness of one of the most important policies implemented to reach this goal: the Schengen Agreement. Using data from the European Labour Force Survey, we show that the individual probability to become a cross-border commuter after the entrance of Switzerland in the Schengen area increased by 0.5 and 4 percentage points among labour force individuals and inter-regional commuters, respectively. We also show evidence of a substantial redirection of internal inter-regional commuters to Swiss regions.

Letters

March 6, 2023

Is There Racial Bias in the Enforcement of Primary Seat Belt Laws? Evidence from Veil of Darkness Tests

Ben Brewer

Page range: 807-819

Abstract

State mandatory seat belt laws have become stricter over time, allowing for a vehicle to be stopped solely for a suspected seat belt infraction. While effective in reducing traffic fatalities, this additional discretion may also come with the possibility of increased racial targeting. Using individual-level traffic stop data, I combine recent advances in the Veil-of-Darkness test with a difference-in-difference identification strategy to estimate whether primary seat belt laws are associated with changes in the racial composition of seat belt stops. Results indicate that under primary seat belt enforcement, a black individual is 1.138–1.222 times more likely than a white individual to be stopped for a seat belt violation under the good visibility of daylight compared to the poor visibility of darkness. These additional stops end mostly in warnings, suggesting the law is used to increase the number of pretextual stops made, specifically on black drivers.

March 20, 2023

Recovery from the COVID-19 Recession: Uneven Effects among Young Workers?

Pinka Chatterji, Yue Li

Page range: 821-842

Abstract

In this paper, we examine the labor market recovery from the COVID-19 recession and test for effects of termination of pandemic unemployment insurance programs among 15–24-year-olds. We use data from the January 2016–October 2022 Current Population Survey. Using regression-based methods, we show that while 15–19-year-olds experienced a brisk, full recovery in labor market outcomes from the COVID-19 recession, the recovery was sluggish and incomplete among 20–24-year-olds, with some work outcomes lagging below pre-pandemic norms well into 2022. Termination of pandemic UI programs led to increased work hours and full-time employment among 20–24-year-olds but did not have these effects among 15–19-year-olds.

Open Access March 27, 2023

Unions and Automation Risk: Who Bears the Cost of Automation?

Changkeun Lee, Olivia Hye Kim

Page range: 843-851

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Abstract

Automation creates winners and losers. By examining establishment-level panel data, we explore how labour unions affect labor adjustment associated with automation. Although automation can increase new hires of junior and unskilled production workers, the presence of labour unions neutralizes these effects. The results suggest that labour unions have incentives to protect incumbent workers negatively affected by automation.

May 31, 2023

Determining the Drivers of Housing Market Seasonality

Mitchell R. Livy

Page range: 853-866

Abstract

Seasonality has been widely observed across the U.S. housing market. However, the extent that housing attributes drive these temporal fluctuations has not been extensively studied. In this research, I examine this relationship by estimating monthly varying measures of housing attributes. The estimates show that both time-varying differences in these variables and their capitalizations explain a substantial amount of the overall observed market seasonality. These results have implications for future housing market studies by showing that the aggregate seasonality is driven by specific sections of the spatial-temporal housing market instead of an overall trend impacting all homes equally.

July 3, 2023

Nudging Pro-social Behavior in a Market Experiment with Carbon Offsets

David McEvoy, Todd L. Cherry, Tanga M. Mohr

Page range: 867-877

Abstract

This study uses controlled experiments to analyze the effectiveness of peer-comparison nudges to promote pro-social behavior. Participants make decisions as consumers in a simple posted-offer market (i.e. buyers are price takers) in which reducing consumption produces positive externalities through the purchase of carbon offsets. We analyze the effectiveness of the nudge under two common pricing schemes (ratepaying and non-ratepaying customers), and examine heterogeneous impacts depending on consumers’ concern about climate change and cultural worldviews. Our findings show that on average peer-comparison nudges are equally effective policy tools in both pricing environments. However, the nudges are only effective for those participants concerned about climate change, and for those with individualist or hierarchical worldviews.

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

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