arXiv daily: General Economics

arXiv daily: General Economics (econ.GN)

1.Computer says 'no': Exploring systemic hiring bias in ChatGPT using an audit approach

Authors:Louis Lippens

Abstract: Large language models offer significant potential for optimising professional activities, such as streamlining personnel selection procedures. However, concerns exist about these models perpetuating systemic biases embedded into their pre-training data. This study explores whether ChatGPT, a chatbot producing human-like responses to language tasks, displays ethnic or gender bias in job applicant screening. Using a correspondence audit approach, I simulated a CV screening task in which I instructed the chatbot to rate fictitious applicant profiles only differing in names, signalling ethnic and gender identity. Comparing ratings of Arab, Asian, Black American, Central African, Dutch, Eastern European, Hispanic, Turkish, and White American male and female applicants, I show that ethnic and gender identity influence ChatGPT's evaluations. The ethnic bias appears to arise partly from the prompts' language and partly from ethnic identity cues in applicants' names. Although ChatGPT produces no overall gender bias, I find some evidence for a gender-ethnicity interaction effect. These findings underscore the importance of addressing systemic bias in language model-driven applications to ensure equitable treatment across demographic groups. Practitioners aspiring to adopt these tools should practice caution, given the adverse impact they can produce, especially when using them for selection decisions involving humans.

1.How to foster innovation in the social sciences? Qualitative evidence from focus group workshops at Oxford University

Authors:Fabian Braesemann, Moritz Marpe

Abstract: This report addresses challenges and opportunities for innovation in the social sciences at the University of Oxford. It summarises findings from two focus group workshops with innovation experts from the University ecosystem. Experts included successful social science entrepreneurs and professional service staff from the University. The workshops focused on four different dimensions related to innovative activities and commercialisation. The findings show several challenges at the institutional and individual level, together with features of the social scientific discipline that impede more innovation in the social sciences. Based on identifying these challenges, we present potential solutions and ways forward identified in the focus group discussions to foster social science innovation. The report aims to illustrate the potential of innovation and commercialisation of social scientific research for both researchers and the university.

2.The Price of Empire: Unrest Location and Sovereign Risk in Tsarist Russia

Authors:Christopher A. Hartwell, Paul M. Vaaler

Abstract: Research on politically motivated unrest and sovereign risk overlooks whether and how unrest location matters for sovereign risk in geographically extensive states. Intuitively, political violence in the capital or nearby would seem to directly threaten the state's ability to pay its debts. However, it is possible that the effect on a government could be more pronounced the farther away the violence is, connected to the longer-term costs of suppressing rebellion. We use Tsarist Russia to assess these differences in risk effects when unrest occurs in Russian homeland territories versus more remote imperial territories. Our analysis of unrest events across the Russian imperium from 1820 to 1914 suggests that unrest increases risk more in imperial territories. Echoing current events, we find that unrest in Ukraine increases risk most. The price of empire included higher costs in projecting force to repress unrest and retain the confidence of the foreign investors financing those costs.

3.Government Investments and Entrepreneurship

Authors:Joao Ricardo Faria, Laudo Ogura, Mauricio Prado, Christopher J. Boudreaux

Abstract: How can governments attract entrepreneurs and their businesses? The view that new business creation grows with the optimal level of government investments remains appealing to policymakers. In contrast with this active approach, we build a model where governments may adopt a passive approach to stimulating business creation. The insights from this model suggest new business creation depends positively on factors beyond government investments--attracting high-skilled migrants to the region and lower property prices, taxes, and fines on firms in the informal sector. These findings suggest whether entrepreneurs generate business creation in the region does not only depend on government investments. It also depends on location and skilled migration. Our model also provides methodological implications--the relationship between government investments and new business creation is endogenously determined, so unless adjustments are made, econometric estimates will be biased and inconsistent. We conclude with policy and managerial implications.

1.Dual Effects of the US-China Trade War and COVID-19 on United States Imports: Transfer of China's industrial chain?

Authors:Wei Luo, Siyuan Kang, Sheng Hu, Lixian Su, Rui Dai

Abstract: The trade tension between the U.S. and China since 2018 has caused a steady decoupling of the world's two largest economies. The pandemic outbreak in 2020 complicated this process and had numerous unanticipated repercussions. This paper investigates how U.S. importers reacted to the trade war and worldwide lockdowns due to the COVID-19 pandemic. We examine the effects of the two incidents on U.S. imports separately and collectively, with various economic scopes. Our findings uncover intricate trading dynamics among the U.S., China, and Southeast Asia, through which businesses relocated portions of their global supply chain away from China to avoid high tariffs. Our analysis indicates that increased tariffs cause the U.S. to import less from China. Meanwhile, Southeast Asian exporters have integrated more into value chains centered on Chinese suppliers by participating more in assembling and completing products. However, the worldwide lockdowns over pandemic have reversed this trend as, over this period, the U.S. effectively imported more goods directly from China and indirectly through Southeast Asian exporters that imported from China.

1.Preventing Others from Commercializing Your Innovation: Evidence from Creative Commons Licenses

Authors:Erdem Dogukan Yilmaz, Tim Meyer, Milan Miric

Abstract: Online innovation communities are an important source of innovation for many organizations. While contributions to such communities are typically made without financial compensation, these contributions are often governed by licenses such as Creative Commons that may prevent others from building upon and commercializing them. While this can diminish the usefulness of contributions, there is limited work analyzing what leads individuals to impose restrictions on the use of their work. In this paper, we examine innovators imposing restrictive licenses within the 3D-printable design community Thingiverse. Our analyses suggest that innovators are more likely to restrict commercialization of their contributions as their reputation increases and when reusing contributions created by others. These findings contribute to innovation communities and the growing literature on property rights in digital markets.

1.Metawisdom of the Crowd: How Choice Within Aided Decision Making Can Make Crowd Wisdom Robust

Authors:Jon Atwell, Marlon Twyman II

Abstract: Quality information can improve individual judgments but nonetheless fail to make group decisions more accurate; if individuals choose to attend to the same information in the same way, the predictive diversity that enables crowd wisdom may be lost. Decision support systems, from business intelligence software to public search engines, present individuals with decision aids -- discrete presentations of relevant information, interpretative frames, or heuristics -- to enhance the quality and speed of decision making, but have the potential to bias judgments through the selective presentation of information and interpretative frames. We redescribe the wisdom of the crowd as often having two decisions, the choice of decision aids and then the primary decision. We then define \emph{metawisdom of the crowd} as any pattern by which the collective choice of aids leads to higher crowd accuracy than randomized assignment to the same aids, a comparison that accounts for the information content of the aids. While choice is ultimately constrained by the setting, in two experiments -- the prediction of inflation (N=947, pre-registered) and a tightly controlled estimation game (N=1198) -- we find strong evidence of metawisdom. It comes about through diverse errors arising through the use of diverse aids, not through widespread use of the aids that induce the most accurate estimates. Thus the microfoundations of crowd wisdom appear in the first choice, suggesting crowd wisdom can be robust in information choice problems. Given the implications for collective decision making, more research on the nature and use of decision aids is needed.

1.Managing Congestion in Two-Sided Platforms: The Case of Online Rentals

Authors:Caterina Calsamiglia, Laura Doval, Alejandro Robinson-Cortés, Matthew Shum

Abstract: Thick two-sided matching platforms, such as the room-rental market, face the challenge of showing relevant objects to users to reduce search costs. Many platforms use ranking algorithms to determine the order in which alternatives are shown to users. Ranking algorithms may depend on simple criteria, such as how long a listing has been on the platform, or incorporate more sophisticated aspects, such as personalized inferences about users' preferences. Using rich data on a room rental platform, we show how ranking algorithms can be a source of unnecessary congestion, especially when the ranking is invariant across users. Invariant rankings induce users to view, click, and request the same rooms in the platform we study, greatly limiting the number of matches it creates. We estimate preferences and simulate counterfactuals under different ranking algorithms varying the degree of user personalization and variation across users. In our case, increased personalization raises both user match utility and congestion, which leads to a trade-off. We find that the current outcome is inefficient as it lies below the possibility frontier, and propose alternatives that improve upon it.

2.Crowdsourced data indicates broadband has a positive impact on local business creation

Authors:Yifeng Philip Chen, Edward J. Oughton, Jakub Zagdanski, Maggie Mo Jia, Peter Tyler

Abstract: Broadband connectivity is regarded as generally having a positive macroeconomic effect, but we lack evidence as to how it affects key economic activity metrics, such as firm creation, at a very local level. This analysis models the impact of broadband Next Generation Access (NGA) on new business creation at the local level over the 2011-2015 period in England, United Kingdom, using high-resolution panel data. After controlling for a range of factors, we find that faster broadband speeds brought by NGA technologies have a positive effect on the rate of business growth. We find that in England between 2011-2015, on average a one percentage increase in download speeds is associated with a 0.0574 percentage point increase in the annual growth rate of business establishments. The primary hypothesised mechanism behind the estimated relationship is the enabling effect that faster broadband speeds have on innovative business models based on new digital technologies and services. Entrepreneurs either sought appropriate locations that offer high quality broadband infrastructure (contributing to new business establishment growth), or potentially enjoyed a competitive advantage (resulting in a higher survival rate). The findings of this study suggest that aspiring to reach universal high capacity broadband connectivity is economically desirable, especially as the costs of delivering such service decline.

1.Choice Architecture, Privacy Valuations, and Selection Bias in Consumer Data

Authors:Tesary Lin, Avner Strulov-Shlain

Abstract: We study how choice architecture that companies deploy during data collection influences consumers' privacy valuations. Further, we explore how this influence affects the quality of data collected, including both volume and representativeness. To this end, we run a large-scale choice experiment to elicit consumers' valuation for their Facebook data while randomizing two common choice frames: default and price anchor. An opt-out default decreases valuations by 14-22% compared to opt-in, while a \$0-50 price anchor decreases valuations by 37-53% compared to a \$50-100 anchor. Moreover, in some consumer segments, the susceptibility to frame influence negatively correlates with consumers' average valuation. We find that conventional frame optimization practices that maximize the volume of data collected can have opposite effects on its representativeness. A bias-exacerbating effect emerges when consumers' privacy valuations and frame effects are negatively correlated. On the other hand, a volume-maximizing frame may also mitigate the bias by getting a high percentage of consumers into the sample data, thereby improving its coverage. We demonstrate the magnitude of the volume-bias trade-off in our data and argue that it should be a decision-making factor in choice architecture design.

1.Discrimination and Constraints: Evidence from The Voice

Authors:Anuar Assamidanov

Abstract: Gender discrimination in the hiring process is one significant factor contributing to labor market disparities. However, there is little evidence on the extent to which gender bias by hiring managers is responsible for these disparities. In this paper, I exploit a unique dataset of blind auditions of The Voice television show as an experiment to identify own gender bias in the selection process. The first televised stage audition, in which four noteworthy recording artists are coaches, listens to the contestants blindly (chairs facing away from the stage) to avoid seeing the contestant. Using a difference-in-differences estimation strategy, a coach (hiring person) is demonstrably exogenous with respect to the artist's gender, I find that artists are 4.5 percentage points (11 percent) more likely to be selected when they are the recipients of an opposite-gender coach. I also utilize the machine-learning approach in Athey et al. (2018) to include heterogeneity from team gender composition, order of performance, and failure rates of the coaches. The findings offer a new perspective to enrich past research on gender discrimination, shedding light on the instances of gender bias variation by the gender of the decision maker and team gender composition.

1.From Mundane to Meaningful: AI's Influence on Work Dynamics -- evidence from ChatGPT and Stack Overflow

Authors:Quentin Gallea

Abstract: This paper illustrates how generative AI could give opportunities for big productivity gains but also opens up questions about the impact of these new powerful technologies on the way we work and share knowledge. More specifically, we explore how ChatGPT changed a fundamental aspect of coding: problem-solving. To do so, we exploit the effect of the sudden release of ChatGPT on the 30th of November 2022 on the usage of the largest online community for coders: Stack Overflow. Using quasi-experimental methods (Difference-in-Difference), we find a significant drop in the number of questions. In addition, the questions are better documented after the release of ChatGPT. Finally, we find evidence that the remaining questions are more complex. These findings suggest not only productivity gains but also a fundamental change in the way we work where routine inquiries are solved by AI allowing humans to focus on more complex tasks.

1.Wisdom of the Crowds or Ignorance of the Masses? A data-driven guide to WSB

Authors:Valentina Semenova, Dragos Gorduza, William Wildi, Xiaowen Dong, Stefan Zohren

Abstract: A trite yet fundamental question in economics is: What causes large asset price fluctuations? A tenfold rise in the price of GameStop equity, between the 22nd and 28th of January 2021, demonstrated that herding behaviour among retail investors is an important contributing factor. This paper presents a data-driven guide to the forum that started the hype -- WallStreetBets (WSB). Our initial experiments decompose the forum using a large language topic model and network tools. The topic model describes the evolution of the forum over time and shows the persistence of certain topics (such as the market / S\&P500 discussion), and the sporadic interest in others, such as COVID or crude oil. Network analysis allows us to decompose the landscape of retail investors into clusters based on their posting and discussion habits; several large, correlated asset discussion clusters emerge, surrounded by smaller, niche ones. A second set of experiments assesses the impact that WSB discussions have had on the market. We show that forum activity has a Granger-causal relationship with the returns of several assets, some of which are now commonly classified as `meme stocks', while others have gone under the radar. The paper extracts a set of short-term trade signals from posts and long-term (monthly and weekly) trade signals from forum dynamics, and considers their predictive power at different time horizons. In addition to the analysis, the paper presents the dataset, as well as an interactive dashboard, in order to promote further research.

2.Discretionary Extensions to Unemployment-Insurance Compensation and Some Potential Costs for a McCall Worker

Authors:Rich Ryan

Abstract: Unemployment insurance provides temporary cash benefits to eligible unemployed workers. Benefits are sometimes extended by discretion during economic slumps. In a model that features temporary benefits and sequential job opportunities, a worker's reservation wages are studied when policymakers can make discretionary extensions to benefits. A worker's optimal labor-supply choice is characterized by a sequence of reservation wages that increases with weeks of remaining benefits. The possibility of an extension raises the entire sequence of reservation wages, meaning a worker is more selective when accepting job offers throughout their spell of unemployment. The welfare consequences of misperceiving the probability and length of an extension are investigated. In a numerical example, the costs of misperception are small, which has implications for policymakers considering economic slumps, virus pandemics, extreme heat, and natural disasters.

3.Managers' Choice of Disclosure Complexity

Authors:Jeremy Bertomeu

Abstract: Aghamolla and Smith (2023) make a significant contribution to enhancing our understanding of how managers choose financial reporting complexity. I outline the key assumptions and implications of the theory, and discuss two empirical implications: (1) a U-shaped relationship between complexity and returns, and (2) a negative association between complexity and investor sophistication. However, the robust equilibrium also implies a counterfactual positive market response to complexity. I develop a simplified approach in which simple disclosures indicate positive surprises, and show that this implies greater investor skepticism toward complexity and a positive association between investor sophistication and complexity. More work is needed to understand complexity as an interaction of reporting and economic transactions, rather than solely as a reporting phenomenon.

4.Paths to Influence: How Coordinated Influence Operations Affect the Prominence of Ideas

Authors:Darren L. Linvill, Patrick L. Warren

Abstract: This paper presents four examples of different ways that coordinated influence operations exert pressure on the prominence of ideas on social networks. We argue that these examples illustrate the four archetypical paths to influence: promotion by strengthening, promotion by weakening, demotion by strengthening, and demotion by weakening. We formalize this idea in a stylized economic model of the optimal behavior of the influence operator and derive some predictions about when we should expect each path to be followed. Finally we sketch out how one might go about quantitatively estimating the key parameters of (a variant of) this model and how it applies much more broadly than in the international political influence examples that motivate it.

1.Entrepreneurial Higher Education Education, Knowledge and Wealth Creation

Authors:Rahmat Ullah, Rashid Aftab, Saeed Siyal, Kashif Zaheer

Abstract: This book presents detailed discussion on the role of higher education in terms of serving basic knowledge creation, teaching, and doing applied research for commercialization. The book presents an historical account on how this challenge was addressed earlier in education history, the cases of successful academic commercialization, the marriage between basic and applied science and how universities develop economies of the regions and countries. This book also discusses cultural and social challenges in research commercialization and pathways to break the status quo.

2.Decarbonizing the European energy system in the absence of Russian gas: Hydrogen uptake and carbon capture developments in the power, heat and industry sectors

Authors:Goran Durakovic, Hongyu Zhang, Brage Rugstad Knudsen, Asgeir Tomasgard, Pedro Crespo del Granado

Abstract: Hydrogen and carbon capture and storage are pivotal to decarbonize the European energy system in a broad range of pathway scenarios. Yet, their timely uptake in different sectors and distribution across countries are affected by supply options of renewable and fossil energy sources. Here, we analyze the decarbonization of the European energy system towards 2060, covering the power, heat, and industry sectors, and the change in use of hydrogen and carbon capture and storage in these sectors upon Europe's decoupling from Russian gas. The results indicate that the use of gas is significantly reduced in the power sector, instead being replaced by coal with carbon capture and storage, and with a further expansion of renewable generators. Coal coupled with carbon capture and storage is also used in the steel sector as an intermediary step when Russian gas is neglected, before being fully decarbonized with hydrogen. Hydrogen production mostly relies on natural gas with carbon capture and storage until natural gas is scarce and costly at which time green hydrogen production increases sharply. The disruption of Russian gas imports has significant consequences on the decarbonization pathways for Europe, with local energy sources and carbon capture and storage becoming even more important.

3.Econometrics Modelling Approach to Examine the Effect of STEM Policy Changes on Asian Students Enrollment Decision in USA

Authors:Prathamesh Muzumdar, George Kurian, Ganga Prasad Basyal, Apoorva Muley

Abstract: Academic research has shown significant interest in international student mobility, with previous literature primarily focusing on the migration industry from a political and public policy perspective. For many countries, international student mobility plays a crucial role in bolstering their economies through financial gains and attracting skilled immigrants. While previous studies have explored the determinants of mobility and country economic policies, only a few have examined the impact of policy changes on mobility trends. In this study, the researchers investigate the influence of immigration policy changes, particularly the optional practical training (OPT) extension on STEM programs, on Asian students' preference for enrolling in STEM majors at universities. The study utilizes observational data and employs a quasi-experimental design, analysing the information using the difference-in-difference technique. The findings of the research indicate that the implementation of the STEM extension policy in 2008 has a significant effect on Asian students' decisions to enroll in a STEM major. Additionally, the study highlights the noteworthy role of individual factors such as the specific STEM major, terminal degree pursued, and gender in influencing Asian students' enrollment decisions.

1.Modified Verhulst-Solow model for long-term population and economic growths

Authors:Iram Gleriaa, Sergio Da Silvab, Leon Brenig, Tarcısio M. Rocha Filho, Annibal Figueiredo

Abstract: In this study, we analyze the relationship between human population growth and economic dynamics. To do so, we present a modified version of the Verhulst model and the Solow model, which together simulate population dynamics and the role of economic variables in capital accumulation. The model incorporates support and foraging functions, which participate in the dynamic relationship between population growth and the creation and destruction of carrying capacity. The validity of the model is demonstrated using empirical data.

1.The four types of stablecoins: A comparative analysis

Authors:Matthias Hafner, Marco Henriques Pereira, Helmut Dietl, Juan Beccuti

Abstract: Stablecoins have gained significant popularity recently, with their market cap rising to over $180 billion. However, recent events have raised concerns about their stability. In this paper, we classify stablecoins into four types based on the source and management of collateral and investigate the stability of each type under different conditions. We highlight each type's potential instabilities and underlying tradeoffs using agent-based simulations. The results emphasize the importance of carefully evaluating the origin of a stablecoin's collateral and its collateral management mechanism to ensure stability and minimize risks. Enhanced understanding of stablecoins should be informative to regulators, policymakers, and investors alike.

2.Economic complexity and the sustainability transition: A review of data, methods, and literature

Authors:Bernardo Caldarola, Dario Mazzilli, Lorenzo Napolitano, Aurelio Patelli, Angelica Sbardella

Abstract: Economic Complexity (EC) methods have gained increasing popularity across fields and disciplines. In particular, the EC toolbox has proved particularly promising in the study of complex and interrelated phenomena, such as the transition towards a greener economy. Using the EC approach, scholars have been investigating the relationship between EC and sustainability, proposing to identify the distinguishing characteristics of green products and to assess the readiness of productive and technological structures for the sustainability transition. This article proposes to review and summarize the data, methods, and empirical literature that are relevant to the study of the sustainability transition from an EC perspective. We review three distinct but connected blocks of literature on EC and environmental sustainability. First, we survey the evidence linking measures of EC to indicators related to environmental sustainability. Second, we review articles that strive to assess the green competitiveness of productive systems. Third, we examine evidence on green technological development and its connection to non-green knowledge bases. Finally, we summarize the findings for each block and identify avenues for further research in this recent and growing body of empirical literature.

1.An approach to extend Cross-Impact Balance method in multiple timespans

Authors:Chonghao Zhao

Abstract: Cross-Impact Balance Analysis (CIB) is a widely used method to build scenarios and help researchers to formulate policies in different fields, such as management sciences and social sciences. During the development of the CIB method over the years, some derivative methods were developed to expand its application scope, including a method called dynamic CIB. However, the workflow of dynamic CIB is relatively complex. In this article, we provide another approach to extend CIB in multiple timespans based on the concept 'scenario weight' and simplify the workflow to bring convenience to the policy makers.

1.The Mobilität.Leben Study: a Year-Long Mobility-Tracking Panel

Authors:Allister Loder, Fabienne Cantner, Victoria Dahmen, Klaus Bogenberger

Abstract: The Mobilit\"at.Leben study investigated travel behavior effects of a natural experiment in Germany. In response to the 2022 cost-of-living crisis, two policy measures to reduce travel costs for the population in June, July, and August 2022 were introduced: a fuel excise tax cut and almost fare-free public transport with the so-called 9-Euro-Ticket. The announcement of a successor ticket to the 9-Euro-Ticket, the so-called Deutschlandticket, led to the immediate decision to continue the study. The Mobilit\"at.Leben study has two periods, the 9-Euro-Ticket period and the Deutschlandticket period, and comprises two elements: several questionnaires and a smartphone-based passive waypoint tracking. The entire duration of the study was almost thirteen months. In this paper, we report on the study design, the recruitment strategy, the study participation in the survey, and the tracking parts, and we share our experience in conducting such large-scale panel studies. Overall, 3,080 people registered for our study of which 1,420 decided to use the smartphone tracking app. While the relevant questionnaires in both phases have been completed by 818 participants, we have 170 study participants who completed the tracking in both phases and all relevant questionnaires. We find that providing a study compensation increases participation performance. It can be concluded that conducting year-long panel studies is possible, providing rich information on the heterogeneity in travel behavior between and within travelers.

1.Limited substitutability, relative price changes and the uplifting of public natural capital values

Authors:Moritz A. Drupp, Zachary M. Turk, Ben Groom, Jonas Heckenhahn

Abstract: As the global economy continues to grow, ecosystem services tend to stagnate or degrow. Economic theory has shown how such shifts in relative scarcities can be reflected in the appraisal of public projects and environmental-economic accounting, but empirical evidence has been lacking to put the theory into practice. To estimate the relative price change in ecosystem services that can be used to make such adjustments, we perform a global meta-analysis of environmental valuation studies to derive income elasticities of willingness to pay (WTP) for ecosystem services as a proxy for the degree of limited substitutability. Based on 749 income-WTP pairs, we estimate an income elasticity of WTP of around 0.78 (95-CI: 0.6 to 1.0). Combining these results with a global data set on shifts in the relative scarcity of ecosystem services, we estimate relative price change of ecosystem services of around 2.2 percent per year. In an application to natural capital valuation of non-timber forest ecosystem services by the World Bank, we show that their natural capital value should be uplifted by more than 50 percent (95-CI: 32 to 78 percent), materially elevating the role of public natural capital. We discuss implications for relative price adjustments in policy appraisal and for improving estimates of comprehensive national accounts.

1.Should we trust web-scraped data?

Authors:Jens Foerderer

Abstract: The increasing adoption of econometric and machine-learning approaches by empirical researchers has led to a widespread use of one data collection method: web scraping. Web scraping refers to the use of automated computer programs to access websites and download their content. The key argument of this paper is that na\"ive web scraping procedures can lead to sampling bias in the collected data. This article describes three sources of sampling bias in web-scraped data. More specifically, sampling bias emerges from web content being volatile (i.e., being subject to change), personalized (i.e., presented in response to request characteristics), and unindexed (i.e., abundance of a population register). In a series of examples, I illustrate the prevalence and magnitude of sampling bias. To support researchers and reviewers, this paper provides recommendations on anticipating, detecting, and overcoming sampling bias in web-scraped data.

1.Trading and wealth evolution in the Proof of Stake protocol

Authors:Wenpin Tang

Abstract: With the increasing adoption of the Proof of Stake (PoS) blockchain, it is timely to study the economy created by such blockchain. In this chapter, we will survey recent progress on the trading and wealth evolution in a cryptocurrency where the new coins are issued according to the PoS protocol. We first consider the wealth evolution in the PoS protocol assuming no trading, and focus on the problem of decentralisation. Next we consider each miner's trading incentive and strategy through the lens of optimal control, where the miner needs to trade off PoS mining and trading. Finally, we study the collective behavior of the miners in a PoS trading environment by a mean field model. We use both stochastic and analytic tools in our study. A list of open problems are also presented.

1.The fiscal implications of stringent climate policy

Authors:Richard S. J. Tol

Abstract: Stringent climate policy compatible with the targets of the 2015 Paris Agreement would pose a substantial fiscal challenge. Reducing carbon dioxide emissions by 95% or more by 2050 would raise 7% (1-17%) of GDP in carbon tax revenue, half of current, global tax revenue. Revenues are relatively larger in poorer regions. Subsidies for carbon dioxide sequestration would amount to 6.6% (0.3-7.1%) of GDP. These numbers are conservative as they were estimated using models that assume first-best climate policy implementation and ignore the costs of raising revenue. The fiscal challenge rapidly shrinks if emission targets are relaxed.

1.Only-child matching penalty in the marriage market

Authors:Keisuke Kawata, Mizuki Komura

Abstract: This study explores the marriage matching of only-child individuals and its outcome. Specifically, we analyze two aspects. First, we investigate how marital status (i.e., marriage with an only child, that with a non-only child and remaining single) differs between only children and non-only children. This analysis allows us to know whether people choose mates in a positive or a negative assortative manner regarding only-child status, and to predict whether only-child individuals benefit from marriage matching premiums or are subject to penalties regarding partner attractiveness. Second, we measure the premium/penalty by the size of the gap in partner's socio economic status (SES, here, years of schooling) between only-child and non--only-child individuals. The conventional economic theory and the observed marriage patterns of positive assortative mating on only-child status predict that only-child individuals are subject to a matching penalty in the marriage market, especially when their partner is also an only child. Furthermore, our estimation confirms that among especially women marrying an only-child husband, only children are penalized in terms of 0.57-years-lower educational attainment on the part of the partner.

2.Global air quality inequality over 2000-2020

Authors:Lutz Sager

Abstract: Air pollution generates substantial health damages and economic costs worldwide. Pollution exposure varies greatly, both between countries and within them. However, the degree of air quality inequality and its' trajectory over time have not been quantified at a global level. Here I use economic inequality indices to measure global inequality in exposure to ambient fine particles with 2.5 microns or less in diameter (PM2.5). I find high and rising levels of global air quality inequality. The global PM2.5 Gini Index increased from 0.32 in 2000 to 0.36 in 2020, exceeding levels of income inequality in many countries. Air quality inequality is mostly driven by differences between countries and less so by variation within them, as decomposition analysis shows. A large share of people facing the highest levels of PM2.5 exposure are concentrated in only a few countries. The findings suggest that research and policy efforts that focus only on differences within countries are overlooking an important global dimension of environmental justice.

1.The misuse of law by Women in India -Constitutionality of Gender Bias

Authors:Negha Senthil, Jayanthi Vajiram, Nirmala. V

Abstract: The misuse of law by women in India is a serious issue that has been receiving increased attention in recent years. In India, women are often discriminated against and are not provided with equal rights and opportunities, leading to a gender bias in many aspects of life. This gender bias is further exacerbated by the misuse of law by women. There are numerous instances of women using the law to their advantage, often at the expense of men. This practice is not only unethical but also unconstitutional. The Indian Constitution does not explicitly guarantee gender equality. However, several amendments have been made to the Constitution to ensure that women are treated equally in accordance with the law. The protection of women from all forms of discrimination is considered a fundamental right. Despite this, women continue to be discriminated against in various spheres of life, including marriage, education, employment and other areas. The misuse of law by women in India is primarily seen in cases of domestic violence and dowry-related issues and are punishable by law. However, women often file false dowry harassment cases against their husbands or in-laws in order to gain an advantage in a divorce or property dispute.

2.Exploration of legal implications of air and space travel for international and domestic travel and the Environment

Authors:Jayanthi Vajiram, Negha Senthil, Nean Adhith. P, Ritikaa. VN

Abstract: The rapid growth of air and space travel in recent years has resulted in an increased demand for legal regulation in the aviation and aerospace fields. This paper provides an overview of air and space law, including the topics of aircraft accident investigations, air traffic control, international borders and law, and the regulation of space activities. With the increasing complexity of air and space travel, it is important to understand the legal implications of these activities. This paper examines the various legal aspects of air and space law, including the roles of national governments, international organizations, and private entities. It also provides an overview of the legal frameworks that govern these activities and the implications of international law. Finally, it considers the potential for future developments in the field of air and space law. This paper provides a comprehensive overview of the legal aspects of air and space travel and their implications for international and domestic travel, as well as for international business and other activities in the air and space domains.

1.Economic Analysis of Smart Roadside Infrastructure Sensors for Connected and Automated Mobility

Authors:Laurent Kloeker, Gregor Joeken, Lutz Eckstein

Abstract: Smart roadside infrastructure sensors in the form of intelligent transportation system stations (ITS-Ss) are increasingly deployed worldwide at relevant traffic nodes. The resulting digital twins of the real environment are suitable for developing and validating connected and automated driving functions and for increasing the operational safety of intelligent vehicles by providing ITS-S real-time data. However, ITS-Ss are very costly to establish and operate. The choice of sensor technology also has an impact on the overall costs as well as on the data quality. So far, there is only insufficient knowledge about the concrete expenses that arise with the construction of different ITS-S setups. Within this work, multiple modular infrastructure sensor setups are investigated with the help of a life cycle cost analysis (LCCA). Their economic efficiency, different user requirements and sensor data qualities are considered. Based on the static cost model, a Monte Carlo simulation is performed, to generate a range of possible project costs and to quantify the financial risks of implementing ITS-S projects of different scales. Due to its modularity, the calculation model is suitable for diverse applications and outputs a distinctive evaluation of the underlying cost-benefit ratio of investigated setups.

2.Flexible heat pumps: must-have or nice to have in a power sector with renewables?

Authors:Alexander Roth, Dana Kirchem, Carlos Gaete-Morales, Wolf-Peter Schill

Abstract: Heat pumps are a key technology for reducing fossil fuel use in the heating sector. A transition to heat pumps implies an increase in electricity demand, especially in cold winter months. Using an open-source power sector model, we examine the power sector impacts of a massive expansion of decentralized heat pumps in Germany in 2030, combined with buffer heat storage of different sizes. Assuming that the additional electricity used by heat pumps has to be fully covered by renewable energies in a yearly balance, we quantify the required additional investments in renewable energy sources. If wind power expansion potentials are limited, the roll-out of heat pumps can also be accompanied by solar PV with little additional costs, making use of the European interconnection. The need for additional firm capacity and electricity storage generally remains limited even in the case of temporally inflexible heat pumps. We further find that relatively small heat storage capacities of 2 to 6 hours can substantially reduce the need for short- and long-duration electricity storage and other generation capacities, as well as power sector costs. We further show that 5.8 million additional heat pumps save around 120 TWh of natural gas and 24 million tonnes of CO$_2$ emissions per year.

1.A Robust Site Selection Model under uncertainty for Special Hospital Wards in Hong Kong

Authors:Mohammad Heydari, Yanan Fan, Kin Keung Lai

Abstract: This paper process two robust models for site selection problems for one of the major Hospitals in Hong Kong. Three parameters, namely, level of uncertainty, infeasibility tolerance as well as the level of reliability, are incorporated. Then, 2 kinds of uncertainty; that is, the symmetric and bounded uncertainties have been investigated. Therefore, the issue of scheduling under uncertainty has been considered wherein unknown problem factors could be illustrated via a given probability distribution function. In this regard, Lin, Janak, and Floudas (2004) introduced one of the newly developed strong optimisation protocols. Hence, computers as well as the chemical engineering [1069-1085] has been developed for considering uncertainty illustrated through a given probability distribution. Finally, our accurate optimisation protocol has been on the basis of a min-max framework and in a case of application to the (MILP) problems it produced a precise solution that has immunity to uncertain data.

2.ESG Reputation Risk Matters: An Event Study Based on Social Media Data

Authors:Maxime L. D. Nicolas, Adrien Desroziers, Fabio Caccioli, Tomaso Aste

Abstract: We investigate the response of shareholders to Environmental, Social, and Governance-related reputational risk (ESG-risk), focusing exclusively on the impact of social media. Using a dataset of 114 million tweets about firms listed on the S&P100 index between 2016 and 2022, we extract conversations discussing ESG matters. In an event study design, we define events as unusual spikes in message posting activity linked to ESG-risk, and we then examine the corresponding changes in the returns of related assets. By focusing on social media, we gain insight into public opinion and investor sentiment, an aspect not captured through ESG controversies news alone. To the best of our knowledge, our approach is the first to distinctly separate the reputational impact on social media from the physical costs associated with negative ESG controversy news. Our results show that the occurrence of an ESG-risk event leads to a statistically significant average reduction of 0.29% in abnormal returns. Furthermore, our study suggests this effect is predominantly driven by Social and Governance categories, along with the "Environmental Opportunities" subcategory. Our research highlights the considerable impact of social media on financial markets, particularly in shaping shareholders' perception of ESG reputation. We formulate several policy implications based on our findings.

1.Commitment and the Dynamics of Household Labor Supply

Authors:Alexandros Theloudis, Jorge Velilla, Pierre-André Chiappori, J. Ignacio Giménez-Nadal, José Alberto Molina

Abstract: The extent to which individuals commit to their partner for life has important implications. This paper develops a lifecycle collective model of the household, through which it characterizes behavior in three prominent alternative types of commitment: full, limited, and no commitment. We propose a test that distinguishes between all three types based on how contemporaneous and historical news affect household behavior. Our test permits heterogeneity in the degree of commitment across households. Using recent data from the Panel Study of Income Dynamics, we reject full and no commitment, while we find strong evidence for limited commitment.

2.Indicatori comuni del PNRR e framework SDGs: una proposta di indicatore composito

Authors:Fabio Bacchini, Lorenzo Di Biagio, Giampiero M. Gallo, Vincenzo Spinelli

Abstract: The main component of the NextGeneration EU (NGEU) program is the Recovery and Resilience Facility (RRF), spanning an implementation period between 2021 and 2026. The RRF also includes a monitoring system: every six months, each country is required to send an update on the progress of the plan against 14 common indicators, measured on specific quantitative scales. The aim of this paper is to present the first empirical evidence on this system, while, at the same time, emphasizing the potential of its integration with the sustainable development framework (SDGs). We propose to develop a first linkage between the 14 common indicators and the SDGs which allows us to produce a composite index (SDGs-RRF) for France, Germany, Italy, and Spain for the period 2014-2021. Over this time, widespread improvements in the composite index across the four countries led to a partial reduction of the divergence. The proposed approach represents a first step towards a wider use of the SDGs for the assessment of the RRF, in line with their use in the European Semester documents prepared by the European Commission.

1.COVID-19 Demand Shocks Revisited: Did Advertising Technology Help Mitigate Adverse Consequences for Small and Midsize Businesses?

Authors:Shun-Yang Lee, Julian Runge, Daniel Yoo, Yakov Bart, Anett Gyurak, J. W. Schneider

Abstract: Research has investigated the impact of the COVID-19 pandemic on business performance and survival, indicating particularly adverse effects for small and midsize businesses (SMBs). Yet only limited work has examined whether and how online advertising technology may have helped shape these outcomes, particularly for SMBs. The aim of this study is to address this gap. By constructing and analyzing a novel data set of more than 60,000 businesses in 49 countries, we examine the impact of government lockdowns on business survival. Using discrete-time survival models with instrumental variables and staggered difference-in-differences estimators, we find that government lockdowns increased the likelihood of SMB closure around the world but that use of online advertising technology attenuates this adverse effect. The findings show heterogeneity in country, industry, and business size, consistent with theoretical expectations.

2.Socio-spatial Inequalities in a Context of "Great Economic Wealth". Case study of neighbourhoods of Luxembourg City

Authors:Natalia Zdanowska

Abstract: In spite of being one of the smallest and wealthiest countries in the European Union in terms of GDP per capita, Luxembourg is facing socio-economic challenges due to recent rapid urban transformations. This article contributes by approaching this phenomenon at the most granular and rarely analysed geographical level - the neighbourhoods of the capital, Luxembourg City. Based on collected empirical data covering various socio-demographic dimensions for 2020-2021, an ascending hierarchical classification on principal components is set out to establish neighbourhoods' socio-spatial patterns. In addition, Chi2 tests are carried out to examine residents' socio-demographic characteristics and determine income inequalities in neighbourhoods. The results reveal a clear socio-spatial divide along a north-west south-east axis. Moreover, classical factors such as gender or citizenship differences are revealed to be poorly determinant of income inequalities compared with the proportion of social benefits recipients and single residents.

1.The Heterogeneous Earnings Impact of Job Loss Across Workers, Establishments, and Markets

Authors:Susan Athey, Lisa K. Simon, Oskar N. Skans, Johan Vikstrom, Yaroslav Yakymovych

Abstract: Using generalized random forests and rich Swedish administrative data, we show that the earnings effects of job displacement due to establishment closures are extremely heterogeneous across workers, establishments, and markets. The decile of workers with the largest predicted effects lose 50 percent of annual earnings the year after displacement and accumulated losses amount to 250 percent during a decade. In contrast, workers in the least affected decile experience only marginal losses of less than 6 percent in the year after displacement. Workers in the most affected decile tend to be lower paid workers on negative earnings trajectories. This implies that the economic value of (lost) jobs is greatest for workers with low earnings. The reason is that many of these workers fail to find new employment after displacement. Overall, the effects are heterogeneous both within and across establishments and combinations of important individual characteristics such as age and schooling. Adverse market conditions matter the most for already vulnerable workers. The most effective way to target workers with large effects, without using a complex model, is by focusing on older workers in routine-task intensive jobs

1.A Regional Analysis of Electric LDV Portfolio Choices by Vehicle Manufacturers

Authors:Aditya Ramji, Hanif Tayarani

Abstract: Global light duty electric vehicle (EV) sales exceeded 10.5 million units in 2022, with a year-on-year growth of 55%, but these trends differ regionally. Despite the robust growth, upfront purchase price remains a challenge for consumers in different regions, and thus, OEMs make technology choices to respond to market needs. This paper examines the electrification portfolio choices of three major automotive manufacturers (OEMs) in different regions of the world, including Europe, Americas, Asia Pacific, and Africa/Middle-East. The analysis focuses on trends in dominant segments for Battery Electric Vehicles (BEV) and Plug-in Hybrid Electric Vehicles (PHEV), as well as battery chemistry choices. Regional differences show a trend towards SUVs for both BEVs and PHEVs. Tesla's dominance in the BEV market influences battery chemistry choices. Average battery sizes for BEVs remain similar in Europe and Americas, but lower in Asia Pacific and Africa/Middle East.

1.A Simple Linear Algebraic Approach to Capture the Dynamics of the Circular Flow of Income

Authors:Aziz Guergachi, Javid Hakim

Abstract: This article has one single purpose: introduce a new and simple, yet highly insightful approach to capture, fully and quantitatively, the dynamics of the circular flow of income in economies. The proposed approach relies mostly on basic linear algebraic concepts and has deep implications for the disciplines of economics, physics and econophysics.

1.Policy Expectation Counts? The Impact of China's Delayed Retirement Announcement on Urban Households Savings Rates

Authors:Shun Zhang

Abstract: This article examines the impact of China's delayed retirement announcement on households' savings behavior using data from China Family Panel Studies (CFPS). The article finds that treated households, on average, experience an 8% increase in savings rates as a result of the policy announcement. This estimation is both significant and robust. Different types of households exhibit varying degrees of responsiveness to the policy announcement, with higher-income households showing a greater impact. The increase in household savings can be attributed to negative perceptions about future pension income.

2.Statistical Physics Perspective on Economic Inequality

Authors:Victor M. Yakovenko

Abstract: This article is a supplement to my main contribution to the Routledge Handbook of Complexity Economics (2023). On the basis of three recent papers, it presents an unconventional perspective on economic inequality from a statistical physics point of view. One section demonstrates empirical evidence for the exponential distribution of income in 67 countries around the world. The exponential distribution was not familiar to mainstream economists until it was introduced by physicists by analogy with the Boltzmann-Gibbs distribution of energy and subsequently confirmed in empirical data for many countries. Another section reviews the two-class structure of income distribution in the USA. While the exponential law describes the majority of population (the lower class), the top tail of income distribution (the upper class) is characterized by the Pareto power law, and there is no clearly defined middle class in between. As a result, the whole distribution can be very well fitted by using only three parameters. Historical evolution of these parameters and inequality trends are analyzed from 1983 to 2018. Finally, global inequality in energy consumption and CO2 emissions per capita is studied using the empirical data from 1980 to 2017. Global inequality, as measured by the Gini coefficient G, has been decreasing until around 2010, but then saturated at the level G=0.5. The saturation at this level was theoretically predicted on the basis of the maximal entropy principle, well before the slowdown of the global inequality decrease became visible in the data. This effect is attributed to accelerated mixing of the world economy due to globalization, which brings it to the state of maximal entropy and thus results in global economic stagnation. This observation has profound consequences for social and geopolitical stability and the efforts to deal with the climate change.

1.Social media use among American Indians in South Dakota: Preferences and perceptions

Authors:Deepthi Kolady, Amrit Dumre, Weiwei Zhang, Kaiqun Fu, Marcia O'Leary, Laura Rose

Abstract: Social media use data is widely being used in health, psychology, and marketing research to analyze human behavior. However, we have very limited knowledge on social media use among American Indians. In this context, this study was designed to assess preferences and perceptions of social media use among American Indians during COVID-19. We collected data from American Indians in South Dakota using online survey. Results show that Facebook, YouTube, TikTok, Instagram and Snapchat are the most preferred social media platforms. Most of the participants reported that the use of social media increased tremendously during COVID-19 and had perceptions of more negative effects than positive effects. Hate/harassment/extremism, misinformation/made up news, and people getting one point of view were the top reasons for negative effects.

1.Endogenous Barriers to Learning

Authors:Olivier Compte

Abstract: Motivated by the idea that lack of experience is a source of errors but that experience should reduce them, we model agents' behavior using a stochastic choice model, leaving endogenous the accuracy of their choice. In some games, increased accuracy is conducive to unstable best-response dynamics. We define the barrier to learning as the minimum level of noise which keeps the best-response dynamic stable. Using logit Quantal Response, this defines a limitQR Equilibrium. We apply the concept to centipede, travelers' dilemma, and 11-20 money-request games and to first-price and all-pay auctions, and discuss the role of strategy restrictions in reducing or amplifying barriers to learning.

1.Does Environmental Attention by Governments Promote Carbon Reductions

Authors:Yichuan Tian

Abstract: The carbon-reducing effect of attention is scarcer than that of material resources, and when the government focuses its attention on the environment, resources will be allocated in a direction that is conducive to reducing carbon. Using panel data from 30 Chinese provinces from 2007 to 2019, this study revealed the impact of governments' environmental attention on carbon emissions and the synergistic mechanism between governments' environmental attention and informatization level. The findings suggested that (1)the environmental attention index of local governments in China showed an overall fluctuating upward trend; (2)governments' environmental atten-tion had the effect of reducing carbon emissions; (3)the emission-reducing effect of governments' environmental attention is more significant in the western region but not in the central and eastern regions; (4)informatization level plays a positive moderating role in the relationship between governments' environmental attention and carbon emissions; (5)there is a significant threshold effect on the carbon reduction effect of governments' environmental attention. Based on the findings, this study proposed policy implications from the perspectives of promoting the sustainable enhancement of environmental attention, bringing institutional functions into play, emphasizing the ecological benefits and strengthening the disclosure of information.

1.The Impact of Parenthood on Labour Market Outcomes of Women and Men in Poland

Authors:Radost Waszkiewicz, Honorata Bogusz

Abstract: Poland records one of the lowest gender wage gaps in Europe. At the same time, it is a socially conservative country where women's rights have been on the decline. We argue that, in the Polish context, the gender gap in income is a more appropriate measure of gendered labour market outcomes than the gap in the hourly wage. We analyse the gender gap in income in Poland in relation to the parenthood status, using the placebo event history method, adjusted to low resolution data, and the two waves of the Polish Generations and Gender Survey (2010, 2014). Contrary to similar studies conducted in Western Europe, our analysis uncovers a large degree of anticipatory behaviour in both women and men who expect to become parents. We show that mothers' income decreases by about 20% after birth, but converges to the income trajectory of non-mothers after 15 years. In contrast, the income of eventual fathers is higher than that of non-fathers both before and after birth, suggesting that the fatherhood child premium might be driven primarily by selection. We also demonstrate a permanent increase in hours worked for fathers, as opposed to non-fathers and a decrease in hours worked for mothers who converge to the trajectory of non-mothers after 15 years from the birth. Finally, we compare the gender gaps in income and wages of women and men in the sample with those of individuals in a counterfactual scenario where the entire population is childless. We find no statistically significant gender gaps in the counterfactual scenario, thereby concluding that the gender gaps in income and wages in Poland are driven by parenthood and most likely, by differences in labour market participation and hours worked.

2.Armed Conflict and Early Human Capital Accumulation: Evidence from Cameroon's Anglophone Conflict

Authors:Hector Galindo-Silva, Guy Tchuente

Abstract: This paper examines the impact of the Anglophone Conflict in Cameroon on human capital accumulation. Using high-quality individual-level data on test scores and information on conflict-related violent events, a difference-in-differences design is employed to estimate the conflict's causal effects. The results show that an increase in violent events and conflict-related deaths causes a significant decline in test scores in reading and mathematics. The conflict also leads to higher rates of teacher absenteeism and reduced access to electricity in schools. These findings highlight the adverse consequences of conflict-related violence on human capital accumulation, particularly within the Anglophone subsystem. The study emphasizes the disproportionate burden faced by Anglophone pupils due to language-rooted tensions and segregated educational systems.

1.The Impact of Customer Online Satisfaction on Stock Returns: Evidence from the E-commerce Reviews in China

Authors:Zhi Su, Danni Wu, Zhenkun Zhou, Junran Wu, Libo Yin

Abstract: This paper investigates the significance of consumer opinions in relation to value in China's A-share market. By analyzing a large dataset comprising over 18 million product reviews by customers on, we demonstrate that sentiments expressed in consumer reviews can influence stock returns, indicating that consumer opinions contain valuable information that can impact the stock market. Our findings show that Customer Negative Sentiment Tendency (CNST) and One-Star Tendency (OST) have a negative effect on expected stock returns, even after controlling for firm characteristics such as market risk, illiquidity, idiosyncratic volatility, and asset growth. Further analysis reveals that the predictive power of CNST is stronger in firms with high sentiment conditions, growth companies, and firms with lower accounting transparency. We also find that CNST negatively predicts revenue surprises, earnings surprises, and cash flow shocks. These results suggest that online satisfaction derived from big data analysis of customer reviews contains novel information about firms' fundamentals.

1.Uniform taxation of electricity: incentives for flexibility and cost redistribution among household categories

Authors:Philipp Andreas Gunkel Section for Energy Economics and Modelling, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark, Febin Kachirayil Chair of Energy Systems Analysis, Institute of Energy and Process Engineering, ETH Zuerich, 8092 Zuerich, Switzerland, Claire-Marie Bergaentzlé Section for Energy Economics and Modelling, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark, Russell McKenna Chair of Energy Systems Analysis, Institute of Energy and Process Engineering, ETH Zuerich, 8092 Zuerich, Switzerland Paul Scherrer Institute, Laboratory for Energy Systems Analysis, Forschungsstrasse 111, 5232 Villigen PSI, Switzerland, Dogan Keles Section for Energy Economics and Modelling, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark, Henrik Klinge Jacobsen Section for Energy Economics and Modelling, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark

Abstract: Recent years have shown a rapid adoption of residential solar PV with increased self-consumption and self-sufficiency levels in Europe. A major driver for their economic viability is the electricity tax exemption for the consumption of self-produced electricity. This leads to large residential PV capacities and partially overburdened distribution grids. Furthermore, the tax exemption that benefits wealthy households that can afford capital-intense investments in solar panels in particular has sparked discussions about energy equity and the appropriate taxation level for self-consumption. This study investigates the implementation of uniform electricity taxes on all consumption, irrespective of the origin of the production, by means of a case study of 155,000 hypothetical Danish prosumers. The results show that the new taxation policy redistributes costs progressively across household sizes. As more consumption is taxed, the tax level can be reduced by 38%, leading to 61% of all households seeing net savings of up to 23% off their yearly tax bill. High-occupancy houses save an average of 116 Euro per year at the expense of single households living in large dwellings who pay 55 Euro per year more. Implementing a uniform electricity tax in combination with a reduced overall tax level can (a) maintain overall tax revenues and (b) increase the interaction of batteries with the grid at the expense of behind-the-meter operations. In the end, the implicit cross-subsidy is removed by taxing self-consumption uniformly, leading to a cost redistribution supporting occupant-dense households and encouraging the flexible behavior of prosumers. This policy measure improves economic efficiency and greater use of technology with positive system-wide impacts.

1.Perceived university support and environment as a factor of entrepreneurial intention: Evidence from Western Transdanubia Region

Authors:Attila Lajos Makai, Tibor Dőry

Abstract: The exploration of entrepreneurship has become a priority for scientific research in recent years. Understanding this phenomenon is particularly important for the transformation of entrepreneurship into action, which is a key factor in early-stage entrepreneurial activity. This gains particular relevance in the university environment, where, in addition to the conventional teaching and research functions, the entrepreneurial university operation based on open innovation, as well as the enhancement of entrepreneurial attitudes of researchers and students, are receiving increased attention. This study is based on a survey conducted among students attending a Hungarian university of applied science in Western Transdanubia Region who have demonstrated their existing entrepreneurial commitment by joining a national startup training and incubation programme. The main research question of the study is to what extent student entrepreneurship intention is influenced by the environment of the entrepreneurial university ecosystem and the support services available at the university. A further question is whether these factors are able to mitigate the negative effects of internal cognitive and external barriers by enhancing entrepreneurial attitudes and perceived behavioural control. The relatively large number of students involved in the programme allows the data to be analysed using SEM modelling. The results indicate a strong covariance between the perceived university support and environment among students. Another observation is the distinct effect of these institutional factors on perceived behavioural control of students.

2.CSREU: A Novel Dataset about Corporate Social Responsibility and Performance Indicators

Authors:Erion Çano, Xhesilda Vogli

Abstract: Corporate Social Responsibility (CSR) has become an important topic that is gaining academic interest. This research paper presents CSREU, a new dataset with attributes of 115 European companies, which includes several performance indicators and the respective CSR disclosure scores computed using the Global Reporting Initiative (GRI) framework. We also examine the correlations between some of the financial indicators and the CSR disclosure scores of the companies. According to our results, these correlations are weak and deeper analysis is required to draw convincing conclusions about the potential impact of CSR disclosure on financial performance. We hope that the newly created data and our preliminary results will help and foster research in this field.

1.Auctioning Corporate Bonds: A Uniform-Price under Investment Mandates

Authors:Labrini Zarpala

Abstract: This paper examines how risk and budget limits on investment mandates affect the bidding strategy in a uniform-price auction for issuing corporate bonds. I prove the existence of symmetric Bayesian Nash equilibrium and explore how the risk limits imposed on the mandate may mitigate severe underpricing, as the symmetric equilibrium's yield positively relates to the risk limit. Investment mandates with low-risk acceptance inversely affect the equilibrium bid. The equilibrium bid provides insights into the optimal mechanism for pricing corporate bonds conveying information about the bond's valuation, market power, and the number of bidders. These findings contribute to auction theory and have implications for empirical research in the corporate bond market.

2.Candidate Incentive Distributions: How voting methods shape electoral incentives

Authors:Marcus Ogren

Abstract: We evaluate the tendency for different voting methods to promote political compromise and reduce tensions in a society by using computer simulations to determine which voters candidates are incentivized to appeal to. We find that Instant Runoff Voting incentivizes candidates to appeal to a wider range of voters than single-winner Plurality Voting, but that it still leaves candidates far more strongly incentivized to appeal to their base than to voters in opposing factions. In contrast, we find that other voting methods, including STAR (Score Then Automatic Runoff) Voting and Condorcet methods, incentivize candidates to appeal to currently-opposed voters as much to their base, and that these differences between voting methods become more pronounced the more candidates are in the race.

1.The far-reaching effects of bombing on fertility in mid-20th century Japan

Authors:Tatsuki Inoue amd Erika Igarashi

Abstract: Fertility changes after wars and conflicts have been observed worldwide. This study examines whether regional war damage affects postwar fertility even in areas that were not directly affected but were close to the damaged areas. In order to accomplish this, we exploit the air-raid experience in Japan during World War II. Using the municipality-level fertility data in the Kinki region in 1935 and 1947 and the data on damages from air raids in cities, we find the effects of bombing on postwar fertility in towns and villages within 15 kilometers, despite no direct damages. However, the direction of the indirect effects is mixed. The estimation results suggest that severe air raids in neighboring cities increased fertility, whereas minor air raids decreased it. Moreover, the results of the quasi-experimental approach indicate that intense fears of air raids increased the fertility rate in the postwar period. Our study contributes to the literature on fertility changes in the postwar period, providing new insights into the complex relationship between war damage and fertility.

2.Interbank Decisions and Margins of Stability: an Agent-Based Stock-Flow Consistent Approach

Authors:Jessica Reale

Abstract: This study investigates the functioning of modern payment systems through the lens of banks' maturity mismatch practices, and it examines the effects of banks' refusal to roll over short-term interbank liabilities on financial stability. Within an agent-based stock-flow consistent framework, banks can engage in two segments of the interbank market that differ in maturity, overnight and term. We compare two interbank matching scenarios to assess how bank-specific maturity targets, dependent on the dictates of the Net Stable Funding Ratio, impact the dynamics of the interbank market and the effectiveness of conventional monetary policies. The findings reveal that maturity misalignment between deficit and surplus banks compromises the interbank market's efficiency and increases reliance on the central bank's standing facilities. Monetary policy interest-rate steering practices also become less effective. The study also uncovers a dual stability-based configuration in the banking sector, resembling the segmented European interbank structure. This paper suggests that heterogeneous maturity mismatches between surplus and deficit banks may result in asymmetric funding frictions that might precede credit- and sovereign-risk explanations of interbank tensions. Also, a combined examination of macroprudential tools and rollover-based interbank dynamics can enhance our understanding of how regulatory changes impact the stability of heterogeneous banking sectors.

3.The Relationship Between Burnout Operators with the Functions of Family Tehran Banking Melli Iran Bank in 2015

Authors:Mohammad Heydari, Matineh Moghaddam, Habibollah Danai

Abstract: In this study, the relationship between burnout and family functions of the Melli Iran Bank staff will be studied. A number of employees within the organization using appropriate scientific methods as the samples were selected by detailed questionnaire and the appropriate data is collected burnout and family functions. The method used descriptive statistical population used for this study consisted of 314 bank loan officers in branches of Melli Iran Bank of Tehran province and all the officials at the bank for >5 years of service at Melli Iran Bank branches in Tehran. They are married and men constitute the study population. The Maslach Burnout Inventory in the end internal to 0/90 alpha emotional exhaustion, depersonalization and low personal accomplishment Cronbach alpha of 0/79 and inventory by 0/71 within the last family to solve the problem 0/70, emotional response 0/51, touch 0/70, 0/69 affective involvement, roles, 0/59, 0/68 behavior is controlled. The results indicate that the hypothesis that included the relationship between burnout and 6, the family functioning, problem solving, communication, roles, affective responsiveness, affective fusion there was a significant relationship between behavior and the correlation was negative. The burnout is high; the functions within the family will be in trouble.

4.An Empirical Analysis of the Effect of Ballot Truncation on Ranked-Choice Electoral Outcomes

Authors:Mallory Dickerson, Erin Martin, David McCune

Abstract: In ranked-choice elections voters cast preference ballots which provide a voter's ranking of the candidates. The method of ranked-choice voting (RCV) chooses a winner by using voter preferences to simulate a series of runoff elections. Some jurisdictions which use RCV limit the number of candidates that voters can rank on the ballot, imposing what we term a truncation level, which is the number of candidates that voters are allowed to rank. Given fixed voter preferences, the winner of the election can change if we impose different truncation levels. We use a database of 1171 real-world ranked-choice elections to empirically analyze the potential effects of imposing different truncation levels in ranked-choice elections. Our general finding is that if the truncation level is at least three then restricting the number of candidates which can be ranked on the ballot rarely affects the election winner.

1.Losing a Gold Mine?

Authors:Syed Abul Basher, Salim Rashid, Mohammad Riad Uddin

Abstract: Four rounds of surveys of slum dwellers in Dhaka city during the 2020-21 COVID-19 pandemic raise questions about whether the slum dwellers possess some form of immunity to the effects of COVID-19? If the working poor of Bangladesh are practically immune to COVID-19, why has this question not been more actively investigated? We shed light on some explanations for these pandemic questions and draw attention to the role of intellectual elites and public policy, suggesting modifications needed for pandemic research.

1.Dynamic Programming on a Quantum Annealer: Solving the RBC Model

Authors:Jesús Fernández-Villaverde, Isaiah Hull

Abstract: We introduce a novel approach to solving dynamic programming problems, such as those in many economic models, on a quantum annealer, a specialized device that performs combinatorial optimization. Quantum annealers attempt to solve an NP-hard problem by starting in a quantum superposition of all states and generating candidate global solutions in milliseconds, irrespective of problem size. Using existing quantum hardware, we achieve an order-of-magnitude speed-up in solving the real business cycle model over benchmarks in the literature. We also provide a detailed introduction to quantum annealing and discuss its potential use for more challenging economic problems.

2.International Spillovers of ECB Interest Rates: Monetary Policy & Information Effects

Authors:Santiago Camara

Abstract: This paper shows that disregarding the information effects around the European Central Bank monetary policy decision announcements biases its international spillovers. Using data from 23 economies, both Emerging and Advanced, I show that following an identification strategy that disentangles pure monetary policy shocks from information effects lead to international spillovers on industrial production, exchange rates and equity indexes which are between 2 to 3 times larger in magnitude than those arising from following the standard high frequency identification strategy. This bias is driven by pure monetary policy and information effects having intuitively opposite international spillovers. Results are present for a battery of robustness checks: for a sub-sample of ``close'' and ``further away'' countries, for both Emerging and Advanced economies, using local projection techniques and for alternative methods that control for ``information effects''. I argue that this biases may have led a previous literature to disregard or find little international spillovers of ECB rates.

1.Big Tech's Tightening Grip on Internet Speech

Authors:Gregory M. Dickinson

Abstract: Online platforms have completely transformed American social life. They have democratized publication, overthrown old gatekeepers, and given ordinary Americans a fresh voice in politics. But the system is beginning to falter. Control over online speech lies in the hands of a select few -- Facebook, Google, and Twitter -- who moderate content for the entire nation. It is an impossible task. Americans cannot even agree among themselves what speech should be permitted. And, more importantly, platforms have their own interests at stake: Fringe theories and ugly name-calling drive away users. Moderation is good for business. But platform beautification has consequences for society's unpopular members, whose unsightly voices are silenced in the process. With control over online speech so centralized, online outcasts are left with few avenues for expression. Concentrated private control over important resources is an old problem. Last century, for example, saw the rise of railroads and telephone networks. To ensure access, such entities are treated as common carriers and required to provide equal service to all comers. Perhaps the same should be true for social media. This Essay responds to recent calls from Congress, the Supreme Court, and academia arguing that, like common carriers, online platforms should be required to carry all lawful content. The Essay studies users' and platforms' competing expressive interests, analyzes problematic trends in platforms' censorship practices, and explores the costs of common-carrier regulation before ultimately proposing market expansion and segmentation as an alternate pathway to avoid the economic and social costs of common-carrier regulation.

2.Toward Textual Internet Immunity

Authors:Gregory M. Dickinson

Abstract: Internet immunity doctrine is broken. Under Section 230 of the Communications Decency Act of 1996, online entities are absolutely immune from lawsuits related to content authored by third parties. The law has been essential to the internet's development over the last twenty years, but it has not kept pace with the times and is now deeply flawed. Democrats demand accountability for online misinformation. Republicans decry politically motivated censorship. And Congress, President Biden, the Department of Justice, and the Federal Communications Commission all have their own plans for reform. Absent from the fray, however -- until now -- has been the Supreme Court, which has never issued a decision interpreting Section 230. That appears poised to change, however, following Justice Thomas's statement in Malwarebytes v. Enigma in which he urges the Court to prune back decades of lower-court precedent to craft a more limited immunity doctrine. This Essay discusses how courts' zealous enforcement of the early internet's free-information ethos gave birth to an expansive immunity doctrine, warns of potential pitfalls to reform, and explores what a narrower, text-focused doctrine might mean for the tech industry.

3.Rebooting Internet Immunity

Authors:Gregory M. Dickinson

Abstract: We do everything online. We shop, travel, invest, socialize, and even hold garage sales. Even though we may not care whether a company operates online or in the physical world, however, the question has dramatic consequences for the companies themselves. Online and offline entities are governed by different rules. Under Section 230 of the Communications Decency Act, online entities -- but not physical-world entities -- are immune from lawsuits related to content authored by their users or customers. As a result, online entities have been able to avoid claims for harms caused by their negligence and defective product designs simply because they operate online. The reason for the disparate treatment is the internet's dramatic evolution over the last two decades. The internet of 1996 served as an information repository and communications channel and was well governed by Section 230, which treats internet entities as another form of mass media: Because Facebook, Twitter and other online companies could not possibly review the mass of content that flows through their systems, Section 230 immunizes them from claims related to user content. But content distribution is not the internet's only function, and it is even less so now than it was in 1996. The internet also operates as a platform for the delivery of real-world goods and services and requires a correspondingly diverse immunity doctrine. This Article proposes refining online immunity by limiting it to claims that threaten to impose a content-moderation burden on internet defendants. Where a claim is preventable other than by content moderation -- for example, by redesigning an app or website -- a plaintiff could freely seek relief, just as in the physical world. This approach empowers courts to identify culpable actors in the virtual world and treat like conduct alike wherever it occurs.

1.Post-COVID Inflation & the Monetary Policy Dilemma: An Agent-Based Scenario Analysis

Authors:Max Sina Knicker, Karl Naumann-Woleske, Jean-Philippe Bouchaud, Francesco Zamponi

Abstract: The economic shocks that followed the COVID-19 pandemic have brought to light the difficulty, both for academics and policy makers, of describing and predicting the dynamics of inflation. This paper offers an alternative modelling approach. We study the 2020-2023 period within the well-studied Mark-0 Agent-Based Model, in which economic agents act and react according to plausible behavioural rules. We include in particular a mechanism through which trust of economic agents in the Central Bank can de-anchor. We investigate the influence of regulatory policies on inflationary dynamics resulting from three exogenous shocks, calibrated on those that followed the COVID-19 pandemic: a production/consumption shock due to COVID-related lockdowns, a supply-chain shock, and an energy price shock exacerbated by the Russian invasion of Ukraine. By exploring the impact of these shocks under different assumptions about monetary policy efficacy and transmission channels, we review various explanations for the resurgence of inflation in the United States, including demand-pull, cost-push, and profit-driven factors. Our main results are four-fold: (i)~without appropriate policy, the shocked economy can take years to recover, or even tip over into a deep recession; (ii)~the response to policy is non-monotonic, leading to a narrow window of ``optimal'' policy responses due to the trade-off between inflation and unemployment; (iii)~the success of monetary policy in curbing inflation is primarily due to expectation anchoring, rather than to direct impact of interest rate hikes; (iv)~the two most sensitive model parameters are those describing wage and price indexation. The results of our study have implications for Central Bank decision-making, and offers an easy-to-use tool that may help anticipate the consequences of different monetary and fiscal policies.

2.The shape of business cycles: a cross-country analysis of Friedman s plucking theory

Authors:Emanuel Kohlscheen, Richhild Moessner, Daniel Rees

Abstract: We test the international applicability of Friedman s famous plucking theory of the business cycle in 12 advanced economies between 1970 and 2021. We find that in countries where labour markets are flexible (Australia, Canada, United Kingdom and United States), unemployment rates typically return to pre-recession levels, in line with Friedman s theory. Elsewhere, unemployment rates are less cyclical. Output recoveries differ less across countries, but more across episodes: on average, half of the decline in GDP during a recession persists. In terms of sectors, declines in manufacturing are typically fully reversed. In contrast, construction-driven recessions, which are often associated with bursting property price bubbles, tend to be persistent.

1.Examination of Supernets to Facilitate International Trade for Indian Exports to Brazil

Authors:Evan Winter, Anupam Shah, Ujjwal Gupta, Anshul Kumar, Deepayan Mohanty, Juan Carlos Uribe, Aishwary Gupta, Mini P. Thomas

Abstract: The objective of this paper is to investigate a more efficient cross-border payment and document handling process for the export of Indian goods to Brazil. The paper is structured into two sections: first, to explain the problems unique to the India-Brazil international trade corridor by highlighting the obstacles of compliance, speed, and payments; and second, to propose a digital solution for India-brazil trade utilizing Supernets, focusing on the use case of Indian exports. The solution assumes that stakeholders will be onboarded as permissioned actors (i.e. nodes) on a Polygon Supernet. By engaging trade and banking stakeholders, we ensure that the digital solution results in export benefits for Indian exporters, and a lawful channel to receive hard currency payments. The involvement of Brazilian and Indian banks ensures that Letter of Credit (LC) processing time and document handling occur at the speed of blockchain technology. The ultimate goal is to achieve faster settlement and negotiation period while maintaining a regulatory-compliant outcome, so that the end result is faster and easier, yet otherwise identical to the real-world process in terms of export benefits and compliance.

2.Life after (Soft) Default

Authors:Giacomo De Giorgi, Costanza Naguib

Abstract: We analyze the impact of soft credit default (i.e. a delinquency of 90+ days) on individual trajectories. Using a proprietary dataset on about 2 million individuals for the years 2004 to 2020, we find that a soft default has substantial and long-lasting (i.e. up to ten years after the event) negative effects on credit score, total credit limit, home-ownership status, and income.

1.Paradoxical Oddities in Two Multiwinner Elections from Scotland

Authors:Adam Graham-Squire, David McCune

Abstract: Ranked-choice voting anomalies such as monotonicity paradoxes have been extensively studied through creating hypothetical examples and generating elections under various models of voter behavior. However, very few real-world examples of such voting paradoxes have been found and analyzed. We investigate two single-transferable vote elections from Scotland that demonstrate upward monotonicity, downward monotonicity, no-show, and committee size paradoxes. These paradoxes are rarely observed in real-world elections, and this article is the first case study of such paradoxes in multiwinner elections.

1.Playing the system: address manipulation and access to schools

Authors:Andreas Bjerre-Nielsen, Lykke Sterll Christensen, Mikkel Høst Gandil, Hans Henrik Sievertsen

Abstract: Strategic incentives may lead to inefficient and unequal provision of public services. A prominent example is school admissions. Existing research shows that applicants "play the system" by submitting school rankings strategically. We investigate whether applicants also play the system by manipulating their eligibility at schools. We analyze this applicant deception in a theoretical model and provide testable predictions for commonly-used admission procedures. We confirm these model predictions empirically by analyzing the implementation of two reforms. First, we find that the introduction of a residence-based school-admission criterion in Denmark caused address changes to increase by more than 100% before the high-school application deadline. This increase occurred only in areas where the incentive to manipulate is high-powered. Second, to assess whether this behavior reflects actual address changes, we study a second reform that required applicants to provide additional proof of place of residence to approve an address change. The second reform significantly reduced address changes around the school application deadline, suggesting that the observed increase in address changes mainly reflects manipulation. The manipulation is driven by applicants from more affluent households and their behavior affects non-manipulating applicants. Counter-factual simulations show that among students not enrolling in their first listed school, more than 25% would have been offered a place in the absence of address manipulation and their peer GPA is 0.2SD lower due to the manipulative behavior of other applicants. Our findings show that popular school choice systems give applicants the incentive to play the system with real implications for non-strategic applicants.

1.The Economics of Augmented and Virtual Reality

Authors:Joshua Gans, Abhishek Nagaraj

Abstract: This paper explores the economics of Augmented Reality (AR) and Virtual Reality (VR) technologies within decision-making contexts. Two metrics are proposed: Context Entropy, the informational complexity of an environment, and Context Immersivity, the value from full immersion. The analysis suggests that AR technologies assist in understanding complex contexts, while VR technologies provide access to distant, risky, or expensive environments. The paper provides a framework for assessing the value of AR and VR applications in various business sectors by evaluating the pre-existing context entropy and context immersivity. The goal is to identify areas where immersive technologies can significantly impact and distinguish those that may be overhyped.

1.Social Sustainability of Digital Transformation: Empirical Evidence from EU-27 Countries

Authors:Saeed Nosratabadi, Thabit Atobishi, Szilard HegedHus

Abstract: In the EU-27 countries, the importance of social sustainability of digital transformation (SOSDIT) is heightened by the need to balance economic growth with social cohesion. By prioritizing SOSDIT, the EU can ensure that its citizens are not left behind in the digital transformation process and that technology serves the needs of all Europeans. Therefore, the current study aimed firstly to evaluate the SOSDIT of EU-27 countries and then to model its importance in reaching sustainable development goals (SDGs). The current study, using structural equation modeling, provided quantitative empirical evidence that digital transformation in Finland, the Netherlands, and Denmark are respectively most socially sustainable. It is also found that SOSDIT leads the countries to have a higher performance in reaching SDGs. Finally, the study provided evidence implying the inverse relationship between the Gini coefficient and reaching SDGs. In other words, the higher the Gini coefficient of a country, the lower its performance in reaching SDGs. The findings of this study contribute to the literature of sustainability and digitalization. It also provides empirical evidence regarding the SOSDIT level of EU-27 countries that can be a foundation for the development of policies to improve the sustainability of digital transformation. According to the findings, this study provides practical recommendations for countries to ensure that their digital transformation is sustainable and has a positive impact on society.

2.Modeling the Impact of Mentoring on Women's Work-LifeBalance: A Grounded Theory Approach

Authors:Parvaneh Bahrami, Saeed Nosratabadi, Khodayar Palouzian, Szilard Hegedus

Abstract: The purpose of this study was to model the impact of mentoring on women's work-life balance. Indeed, this study considered mentoring as a solution to create a work-life balance of women. For this purpose, semi-structured interviews with both mentors and mentees of Tehran Municipality were conducted and the collected data were analyzed using constructivist grounded theory. Findings provided a model of how mentoring affects women's work-life balance. According to this model, role management is the key criterion for work-life balancing among women. In this model, antecedents of role management and the contextual factors affecting role management, the constraints of mentoring in the organization, as well as the consequences of effective mentoring in the organization are described. The findings of this research contribute to the mentoring literature as well as to the role management literature and provide recommendations for organizations and for future research.

3.More than Words: Twitter Chatter and Financial Market Sentiment

Authors:Travis Adams, Andrea Ajello, Diego Silva, Francisco Vazquez-Grande

Abstract: We build a new measure of credit and financial market sentiment using Natural Language Processing on Twitter data. We find that the Twitter Financial Sentiment Index (TFSI) correlates highly with corporate bond spreads and other price- and survey-based measures of financial conditions. We document that overnight Twitter financial sentiment helps predict next day stock market returns. Most notably, we show that the index contains information that helps forecast changes in the U.S. monetary policy stance: a deterioration in Twitter financial sentiment the day ahead of an FOMC statement release predicts the size of restrictive monetary policy shocks. Finally, we document that sentiment worsens in response to an unexpected tightening of monetary policy.

4.Validating a dynamic input-output model for the propagation of supply and demand shocks during the COVID-19 pandemic in Belgium

Authors:Tijs W. Alleman, Koen Schoors, Jan M. Baetens

Abstract: This work validates a previously established dynamical input-output model to quantify the impact of economic shocks caused by COVID-19 in the UK using data from Belgium. To this end, we used four time series of economically relevant indicators for Belgium. We identified eight model parameters that could potentially impact the results and varied these parameters over broad ranges in a sensitivity analysis. In this way, we could identify the set of parameters that results in the best agreement to the empirical data and we could asses the sensitivity of our outcomes to changes in these parameters. We find that the model, characterized by relaxing the stringent Leontief production function, provides adequate projections of economically relevant variables during the COVID-19 pandemic in Belgium, both at the aggregated and sectoral levels. The obtained results are robust in light of changes in the input parameters and hence, the model could prove to be a valuable tool in predicting the impact of future shocks caused by armed conflicts, natural disasters, or pandemics.

1.The Emergence of Economic Rationality of GPT

Authors:Yiting Chen, Tracy Xiao Liu, You Shan, Songfa Zhong

Abstract: As large language models (LLMs) like GPT become increasingly prevalent, it is essential that we assess their capabilities beyond language processing. This paper examines the economic rationality of GPT by instructing it to make budgetary decisions in four domains: risk, time, social, and food preferences. We measure economic rationality by assessing the consistency of GPT decisions with utility maximization in classic revealed preference theory. We find that GPT decisions are largely rational in each domain and demonstrate higher rationality scores than those of humans reported in the literature. We also find that the rationality scores are robust to the degree of randomness and demographic settings such as age and gender, but are sensitive to contexts based on the language frames of the choice situations. These results suggest the potential of LLMs to make good decisions and the need to further understand their capabilities, limitations, and underlying mechanisms.

2.Ownership Chains in Multinational Enterprises

Authors:Stefania Miricola, Armando Rungi, Gianluca Santoni

Abstract: In this contribution, we investigate the role of ownership chains developed by multinational enterprises across different national borders. First, we document that parent companies control a majority (58%) of foreign subsidiaries through indirect control relationships involving at least two countries along an ownership chain. Therefore, we hypothesize that locations along ownership chains are driven by the existence of communication costs to transmit management decisions. In line with motivating evidence, we develop a theoretical model for competition on corporate control that considers the possibility that parent companies in the origin countries can delegate their monitoring activities in final subsidiaries to middlemen subsidiaries that are located in intermediate jurisdictions. Our model returns us a two-step empirical strategy with two gravity equations: i) a triangular gravity for establishing a middleman by the parent, conditional on final investments' locations; ii) a classical gravity for the location of final investments. First estimates confirm the predictions that ease of communication at the country level shapes the heterogeneous locations of subsidiaries along global ownership chains.

3.The Key to Organizational and construction Excellence: A Study of Total Quality Management

Authors:M. R. Ibrahim, D. U. Muhammad, B. Muhammad, J. O. Alaezi, J. Agidani

Abstract: This study examines the impact of Total Quality Management (TQM) practices on organizational outcomes. Results show a significant relationship between TQM practices such as top executive commitment, education and teaching, process control, and continuous progress, and how they can be leveraged to enhance performance outcomes.

4.The Missing Link: Exploring the Relationship Between Transformational Leadership and Change in team members in Construction

Authors:M. R. Ibrahim

Abstract: This study aimed to investigate how transformational leadership affects team processes, mediated by change in team members. A self-administered questionnaire was distributed to construction project team members in Abuja and Kaduna, and statistical analysis revealed a significant positive relationship between transformational leadership and team processes, transformational leadership and change in team members, changes in team members and team processes, and changes in team members mediating the relationship between transformational leadership and team processes. Future studies should consider cultural differences.

1.Artificial intelligence moral agent as Adam Smith's impartial spectator

Authors:Nikodem Tomczak

Abstract: Adam Smith developed a version of moral philosophy where better decisions are made by interrogating an impartial spectator within us. We discuss the possibility of using an external non-human-based substitute tool that would augment our internal mental processes and play the role of the impartial spectator. Such tool would have more knowledge about the world, be more impartial, and would provide a more encompassing perspective on moral assessment.

2.AI Regulation in the European Union: Examining Non-State Actor Preferences

Authors:Jonas Tallberg, Magnus Lundgren, Johannes Geith

Abstract: As the development and use of artificial intelligence (AI) continues to grow, policymakers are increasingly grappling with the question of how to regulate this technology. The most far-reaching international initiative is the European Union (EU) AI Act, which aims to establish the first comprehensive framework for regulating AI. In this article, we offer the first systematic analysis of non-state actor preferences toward international regulation of AI, focusing on the case of the EU AI Act. Theoretically, we develop an argument about the regulatory preferences of business actors and other non-state actors under varying conditions of AI sector competitiveness. Empirically, we test these expectations using data on non-state actor preferences from public consultations on European AI regulation. Our findings are threefold. First, all types of non-state actors express concerns about AI and support regulation in some form. Second, there are nonetheless significant differences across actor types, with business actors being less concerned about the downsides of AI and more in favor of lax regulation than other non-state actors. Third, these differences are more pronounced in countries with stronger commercial AI sectors than in countries with lesser developed AI sectors. Our findings shed new light on non-state actor preferences toward AI regulation and point to challenges for policymakers having to balance competing interests.

3.The Global Governance of Artificial Intelligence: Next Steps for Empirical and Normative Research

Authors:Jonas Tallberg, Eva Erman, Markus Furendal, Johannes Geith, Mark Klamberg, Magnus Lundgren

Abstract: Artificial intelligence (AI) represents a technological upheaval with the potential to change human society. Because of its transformative potential, AI is increasingly becoming subject to regulatory initiatives at the global level. Yet, so far, scholarship in political science and international relations has focused more on AI applications than on the emerging architecture of global AI regulation. The purpose of this article is to outline an agenda for research into the global governance of AI. The article distinguishes between two broad perspectives: an empirical approach, aimed at mapping and explaining global AI governance; and a normative approach, aimed at developing and applying standards for appropriate global AI governance. The two approaches offer questions, concepts, and theories that are helpful in gaining an understanding of the emerging global governance of AI. Conversely, exploring AI as a regulatory issue offers a critical opportunity to refine existing general approaches to the study of global governance.

1.Health Impacts of Public Pawnshops in Industrializing Tokyo

Authors:Tatsuki Inoue

Abstract: This study is the first to investigate whether financial institutions for low-income populations have contributed to the historical decline in mortality rates. Using ward-level panel data from prewar Tokyo City, we found that public pawn loans were associated with reductions in infant and fetal death rates, potentially through improved nutrition and hygiene measures. Simple calculations suggest that popularizing public pawnshops led to a 6% and 8% decrease in infant mortality and fetal death rates, respectively, from 1927 to 1935. Contrarily, private pawnshops showed no significant association with health improvements. Our findings enrich the expanding literature on demographics and financial histories.

2.Executive Voiced Laughter and Social Approval: An Explorative Machine Learning Study

Authors:Niklas Mueller, Steffen Klug, Andreas Koenig, Alexander Kathan, Lukas Christ, Bjoern Schuller, Shahin Amiriparian

Abstract: We study voiced laughter in executive communication and its effect on social approval. Integrating research on laughter, affect-as-information, and infomediaries' social evaluations of firms, we hypothesize that voiced laughter in executive communication positively affects social approval, defined as audience perceptions of affinity towards an organization. We surmise that the effect of laughter is especially strong for joint laughter, i.e., the number of instances in a given communication venue for which the focal executive and the audience laugh simultaneously. Finally, combining the notions of affect-as-information and negativity bias in human cognition, we hypothesize that the positive effect of laughter on social approval increases with bad organizational performance. We find partial support for our ideas when testing them on panel data comprising 902 German Bundesliga soccer press conferences and media tenor, applying state-of-the-art machine learning approaches for laughter detection as well as sentiment analysis. Our findings contribute to research at the nexus of executive communication, strategic leadership, and social evaluations, especially by introducing laughter as a highly consequential potential, but understudied social lubricant at the executive-infomediary interface. Our research is unique by focusing on reflexive microprocesses of social evaluations, rather than the infomediary-routines perspectives in infomediaries' evaluations. We also make methodological contributions.

1.Evaluating congestion pricing schemes using agent-based passenger and freight microsimulation

Authors:Peiyu Jing, Ravi Seshadri, Takanori Sakai, Ali Shamshiripour, Andre Romano Alho, Antonios Lentzakis, Moshe E. Ben-Akiva

Abstract: The distributional impacts of congestion pricing have been widely studied in the literature and the evidence on this is mixed. Some studies find that pricing is regressive whereas others suggest that it can be progressive or neutral depending on the specific spatial characteristics of the urban region, existing activity and travel patterns, and the design of the pricing scheme. Moreover, the welfare and distributional impacts of pricing have largely been studied in the context of passenger travel whereas freight has received relatively less attention. In this paper, we examine the impacts of several third-best congestion pricing schemes on both passenger transport and freight in an integrated manner using a large-scale microsimulator (SimMobility) that explicitly simulates the behavioral decisions of the entire population of individuals and business establishments, dynamic multimodal network performance, and their interactions. Through simulations of a prototypical North American city, we find that a distance-based pricing scheme yields the largest welfare gains, although the gains are a modest fraction of toll revenues (around 30\%). In the absence of revenue recycling or redistribution, distance-based and cordon-based schemes are found to be particularly regressive. On average, lower income individuals lose as a result of the scheme, whereas higher income individuals gain. A similar trend is observed in the context of shippers -- small establishments having lower shipment values lose on average whereas larger establishments with higher shipment values gain. We perform a detailed spatial analysis of distributional outcomes, and examine the impacts on network performance, activity generation, mode and departure time choices, and logistics operations.

2.Building resilient organizations: The roles of top-down vs. bottom-up organizing

Authors:Stephan Leitner

Abstract: Organizations face numerous challenges posed by unexpected events such as energy price hikes, pandemic disruptions, terrorist attacks, and natural disasters, and the factors that contribute to organizational success in dealing with such disruptions often remain unclear. This paper analyzes the roles of top-down and bottom-up organizational structures in promoting organizational resilience. To do so, an agent-based model of stylized organizations is introduced that features learning, adaptation, different modes of organizing, and environmental disruptions. The results indicate that bottom-up designed organizations tend to have a higher ability to absorb the effects of environmental disruptions, and situations are identified in which either top-down or bottom-up designed organizations have an advantage in recovering from shocks.

3.The use of trade data in the analysis of global phosphate flows

Authors:Matthias Raddant, Martin Bertau, Gerald Steiner

Abstract: In this paper we present a new method to trace the flows of phosphate from the countries where it is mined to the counties where it is used in agricultural production. We achieve this by combining data on phosphate rock mining with data on fertilizer use and data on international trade of phosphate-related products. We show that by making certain adjustments to data on net exports we can derive the matrix of phosphate flows on the country level to a large degree and thus contribute to the accuracy of material flow analyses, a results that is important for improving environmental accounting, not only for phosphorus but for many other resources.

1.Cost-benefit of green infrastructures for water management: A sustainability assessment of full-scale constructed wetlands in Northern and Southern Italy

Authors:Laura Garcia-Herrero, Stevo Lavrnic, Valentina Guerrieri, Attilio Toscano, Mirco Milani, Giuseppe Luigi Cirelli, Matteo Vittuari

Abstract: Sustainable water management has become an urgent challenge due to irregular water availability patterns and water quality issues. The effect of climate change exacerbates this phenomenon in water-scarce areas, such as the Mediterranean region, stimulating the implementation of solutions aiming to mitigate or improve environmental, social, and economic conditions. A novel solution inspired by nature, technology-oriented, explored in the past years, is constructed wetlands. Commonly applied for different types of wastewater due to its low cost and simple maintenance, they are considered a promising solution to remove pollutants while creating an improved ecosystem by increasing biodiversity around them. This research aims to assess the sustainability of two typologies of constructed wetlands in two Italian areas: Sicily, with a vertical subsurface flow constructed wetland, and Emilia Romagna, with a surface flow constructed wetland. The assessment is performed by applying a cost-benefit analysis combining primary and secondary data sources. The analysis considered the market and non-market values in both proposed scenarios to establish the feasibility of the two options and identify the most convenient one. Results show that both constructed wetlands bring more benefits (benefits-cost ratio, BCR) than costs (BCR > 0). In the case of Sicily, the BCR is lower (1) in the constructed wetland scenario, while in its absence it is almost double. If other ecosystem services are included the constructed wetland scenario reach a BCR of 4 and a ROI of 5, showing a better performance from a costing perspective than the absence one. In Emilia Romagna, the constructed wetland scenario shows a high BCR (10) and ROI (9), while the scenario in absence has obtained a negative present value indicating that the cost do not cover the benefits expected.

1.GPT Agents in Game Theory Experiments

Authors:Fulin Guo

Abstract: This paper explores the potential of using Generative Pre-trained Transformer (GPT)-based agents as participants in strategic game experiments. Specifically, I focus on the finitely repeated ultimatum and prisoner's dilemma games, two well-studied games in economics. I develop prompts to enable GPT agents to understand the game rules and play the games. The results indicate that, given well-crafted prompts, GPT can generate realistic outcomes and exhibit behavior consistent with human behavior in certain important aspects, such as positive relationship between acceptance rates and offered amounts in the ultimatum game and positive cooperation rates in the prisoner's dilemma game. Some differences between the behavior of GPT and humans are observed in aspects like the evolution of choices over rounds. I also study two treatments in which the GPT agents are prompted to either have social preferences or not. The treatment effects are evident in both games. This preliminary exploration indicates that GPT agents can exhibit realistic performance in simple strategic games and shows the potential of using GPT as a valuable tool in social science research.

1.Well-being policy evaluation methodology based on WE pluralism

Authors:Takeshi Kato

Abstract: Methodologies for evaluating and selecting policies that contribute to the well-being of diverse populations need clarification. To bridge the gap between objective indicators and policies related to well-being, this study shifts from constitutive pluralism based on objective indicators to conceptual pluralism that emphasizes subjective context, develops from subject-object pluralism through individual-group pluralism to WE pluralism, and presents a new policy evaluation method that combines joint fact-finding based on policy plurality. First, to evaluate policies involving diverse stakeholders, I develop from individual subjectivity-objectivity to individual subjectivity and group intersubjectivity, and then move to a narrow-wide WE pluralism in the gradation of I-family-community-municipality-nation-world. Additionally, by referring to some functional forms of well-being, I formulate the dependence of well-being on narrow-wide WE. Finally, given that policies themselves have a plurality of social, ecological, and economic values, I define a set of policies for each of the narrow-wide WE and consider a mapping between the two to provide an evaluation basis. Furthermore, by combining well-being and joint fact-finding on the narrow-wide WE consensus, the policy evaluation method is formulated. The fact-value combined parameter system, combined policy-making approach, and combined impact evaluation are disclosed as examples of implementation. This paper contributes to the realization of a well-being society by bridging philosophical theory and policies based on WE pluralism and presenting a new method of policy evaluation based on subjective context and consensus building.

1.Rankings-Dependent Preferences: A Real Goods Matching Experiment

Authors:Andrew Kloosterman, Peter Troyan

Abstract: We investigate whether preferences for objects received via a matching mechanism are influenced by how highly agents rank them in their reported rank order list. We hypothesize that all else equal, agents receive greater utility for the same object when they rank it higher. The addition of rankings-dependent utility implies that it may not be a dominant strategy to submit truthful preferences to a strategyproof mechanism, and that non-strategyproof mechanisms that give more agents objects they report as higher ranked may increase market welfare. We test these hypotheses with a matching experiment in a strategyproof mechanism, the random serial dictatorship, and a non-strategyproof mechanism, the Boston mechanism. A novel feature of our experimental design is that the objects allocated in the matching markets are real goods, which allows us to directly measure rankings-dependence by eliciting values for goods both inside and outside of the mechanism. Our experimental results confirm that the elicited differences in values do decrease for lower-ranked goods. We find no differences between the two mechanisms for the rates of truth-telling and the final welfare.

1.Understand Waiting Time in Transaction Fee Mechanism: An Interdisciplinary Perspective

Authors:Luyao Zhang, Fan Zhang

Abstract: Blockchain enables peer-to-peer transactions in cyberspace without a trusted third party. The rapid growth of Ethereum and smart contract blockchains generally calls for well-designed Transaction Fee Mechanisms (TFMs) to allocate limited storage and computation resources. However, existing research on TFMs must consider the waiting time for transactions, which is essential for computer security and economic efficiency. Integrating data from the Ethereum blockchain and memory pool (mempool), we explore how two types of events affect transaction latency. First, we apply regression discontinuity design (RDD) to study the causal inference of the Merge, the most recent significant upgrade of Ethereum. Our results show that the Merge significantly reduces the long waiting time, network loads, and market congestion. In addition, we verify our results' robustness by inspecting other compounding factors, such as censorship and unobserved delays of transactions via private changes. Second, examining three major protocol changes during the merge, we identify block interval shortening as the most plausible cause for our empirical results. Furthermore, in a mathematical model, we show block interval as a unique mechanism design choice for EIP1559 TFM to achieve better security and efficiency, generally applicable to the market congestion caused by demand surges. Finally, we apply time series analysis to research the interaction of Non-Fungible token (NFT) drops and market congestion using Facebook Prophet, an open-source algorithm for generating time-series models. Our study identified NFT drops as a unique source of market congestion -- holiday effects -- beyond trend and season effects. Finally, we envision three future research directions of TFM.

2.Employer Reputation and the Labor Market: Evidence from and

Authors:Ke Amy, Ma, Sophie Yanying Sheng, Haitian Xie

Abstract: How does employer reputation affect the labor market? We investigate this question using a novel dataset combining reviews from and job applications data from Labor market institutions such as crowd-sources information about employers to alleviate information problems faced by workers when choosing an employer. Raw crowd-sourced employer ratings are rounded when displayed to job seekers. By exploiting the rounding threshold, we identify the causal impact of Glassdoor ratings using a regression discontinuity framework. We document the effects of such ratings on both the demand and supply sides of the labor market. We find that displayed employer reputation affects an employer's ability to attract workers, especially when the displayed rating is "sticky." Employers respond to having a rating above the rounding threshold by posting more new positions and re-activating more job postings. The effects are the strongest for private, smaller, and less established firms, suggesting that online reputation is a substitute for other types of reputation.

3.Surveying Generative AI's Economic Expectations

Authors:Leland Bybee

Abstract: I introduce a survey of economic expectations formed by querying a large language model (LLM)'s expectations of various financial and macroeconomic variables based on a sample of news articles from the Wall Street Journal between 1984 and 2021. I find the resulting expectations closely match existing surveys including the Survey of Professional Forecasters (SPF), the American Association of Individual Investors, and the Duke CFO Survey. Importantly, I document that LLM based expectations match many of the deviations from full-information rational expectations exhibited in these existing survey series. The LLM's macroeconomic expectations exhibit under-reaction commonly found in consensus SPF forecasts. Additionally, its return expectations are extrapolative, disconnected from objective measures of expected returns, and negatively correlated with future realized returns. Finally, using a sample of articles outside of the LLM's training period I find that the correlation with existing survey measures persists -- indicating these results do not reflect memorization but generalization on the part of the LLM. My results provide evidence for the potential of LLMs to help us better understand human beliefs and navigate possible models of nonrational expectations.

1.Black-box Optimizers vs Taste Shocks

Authors:Yasin Kürşat Önder

Abstract: We evaluate and extend the solution methods for models with binary and multiple continuous choice variables in dynamic programming, particularly in cases where a discrete state space solution method is not viable. Therefore, we approximate the solution using taste shocks or black-box optimizers that applied mathematicians use to benchmark their algorithms. We apply these methods to a default framework in which agents have to solve a portfolio problem with long-term debt. We show that the choice of solution method matters, as taste shocks fail to attain convergence in multidimensional problems. We compare the relative advantages of using four optimization algorithms: the Nelder-Mead downhill simplex algorithm, Powell's direction-set algorithm with LINMIN, the conjugate gradient method BOBYQA, and the quasi-Newton Davidon-Fletcher-Powell (DFPMIN) algorithm. All of these methods, except for the last one, are preferred when derivatives cannot be easily computed. Ultimately, we find that Powell's routine evaluated with B-splines, while slow, is the most viable option. BOBYQA came in second place, while the other two methods performed poorly.

2.A Mediation Analysis of the Relationship Between Land Use Regulation Stringency and Employment Dynamics

Authors:Uche Oluku, Shaoming Cheng

Abstract: The paper examines the effects of stringent land use regulations, measured using the Wharton Residential Land Use Regulatory Index (WRLURI), on employment growth during the period 2010-2020 in the Retail, Professional, and Information sectors across 878 local jurisdictions in the United States. All the local jurisdictions exist in both (2006 and 2018) waves of the WRLURI surveys and hence constitute a unique panel data. We apply a mediation analytical framework to decompose the direct and indirect effects of land use regulation stringency on sectoral employment growth and specialization. Our analysis suggests a fully mediated pattern in the relationship between excessive land use regulations and employment growth, with housing cost burden as the mediator. Specifically, a one standard deviation increase in the WRLURI index is associated with an approximate increase of 0.8 percentage point in the proportion of cost burdened renters. Relatedly, higher prevalence of cost-burdened renters has moderate adverse effects on employment growth in two sectors. A one percentage point increase in the proportion of cost burdened renters is associated with 0.04 and 0.017 percentage point decreases in the Professional and Information sectors, respectively.

3.Macroeconomic factors and Stock exchange return: A Statistical Analysis

Authors:Md. Fazlul Huq Khan, Md. Masum Billah

Abstract: The purpose of this research is to examine the relationship between the Dhaka Stock exchange index return and macroeconomic variables such as exchange rate, inflation, money supply etc. The long-term relationship between macroeconomic variables and stock market returns has been analyzed by using the Johnson Cointegration test, Augmented Dicky Fuller (ADF) and Phillip Perron (PP) tests. The results revealed the existence of cointegrating relationship between stock prices and the macroeconomic variables in the Dhaka stock exchange. The consumer price index, money supply, and exchange rates proved to be strongly associated with stock returns, while market capitalization was found to be negatively associated with stock returns. The findings suggest that in the long run, the Dhaka stock exchange is reactive to macroeconomic indicators.

1.Cooperation and Cognition in Social Networks

Authors:Edoardo Gallo, Joseph Lee, Yohanes Eko Riyanto, Erwin Wong

Abstract: Social networks can sustain cooperation by amplifying the consequences of a single defection through a cascade of relationship losses. Building on Jackson et al. (2012), we introduce a novel robustness notion to characterize low cognitive complexity (LCC) networks - a subset of equilibrium networks that imposes a minimal cognitive burden to calculate and comprehend the consequences of defection. We test our theory in a laboratory experiment and find that cooperation is higher in equilibrium than in non-equilibrium networks. Within equilibrium networks, LCC networks exhibit higher levels of cooperation than non-LCC networks. Learning is essential for the emergence of equilibrium play.

1.Disturbance Effects on Financial Timberland Returns in Austria

Authors:Petri P. Karenlampi

Abstract: Probability theory is applied for the effect of severe disturbances on the return rate on capital within multiannual stands growing crops. Two management regimes are discussed, rotations of even-aged plants on the one hand, and uneven-aged semi-stationary state on the other. The effect of any disturbance appears two-fold, contributing to both earnings and capitalization. Results are illustrated using data from a recently published study, regarding spruce (Picea abies) forests in Austria. The economic results differ from those of the paper where the data is presented, here indicating continuous-cover forestry is financially inferior to rotation forestry. Any severe disturbance may induce a regime shift from continuous-cover to even-aged forestry. If such a regime shift is not accepted, the disturbance losses reduce profits but do not affect capitalization, making continuous-cover forestry financially more sensitive to disturbances. Revenue from carbon rent favors the management regime with higher carbon stock. The methods introduced in this paper can be applied to any dataset, regardless of location and tree species.

1.Greening our Laws: Revising Land Acquisition Law for Coal Mining in India

Authors:Sugandha Srivastav, Tanmay Singh

Abstract: Laws that govern land acquisition can lock in old paradigms. We study one such case, the Coal Bearing Areas Act of 1957 (CBAA) which provides minimal social and environmental safegaurds, and deviates in important ways from the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act 2013 (LARR). The lack of due diligence protocol in the CBAA confers an undue comparative advantage to coal development, which is inconsistent with India's stance to phase down coal use, reduce air pollution, and advance modern sources of energy. We argue that the premise under which the CBAA was historically justified is no longer valid due to a significant change in the local context. Namely, the environmental and social costs of coal energy are far more salient and the market has cleaner energy alternatives that are cost competitive. We recommend updating land acquisition laws to bring coal under the general purview of LARR or, at minimum, amending the CBAA to ensure adequate environmental and social safeguards are in place, both in letter and practice.

2.Political Strategies to Overcome Climate Policy Obstructionism

Authors:Sugandha Srivastav, Ryan Rafaty

Abstract: Great socio-economic transitions see the demise of certain industries and the rise of others. The losers of the transition tend to deploy a variety of tactics to obstruct change. We develop a political-economy model of interest group competition and garner evidence of tactics deployed in the global climate movement. From this we deduce a set of strategies for how the climate movement competes against entrenched hydrocarbon interests. Five strategies for overcoming obstructionism emerge: (1) Appeasement, which involves compensating the losers; (2) Co-optation, which seeks to instigate change by working with incumbents; (3) Institutionalism, which involves changes to public institutions to support decarbonization; (4) Antagonism, which creates reputational or litigation costs to inaction; and (5) Countervailance, which makes low-carbon alternatives more competitive. We argue that each strategy addresses the problem of obstructionism through a different lens, reflecting a diversity of actors and theories of change within the climate movement. The choice of which strategy to pursue depends on the institutional context.

1.Racial and income-based affirmative action in higher education admissions: lessons from the Brazilian experience

Authors:Rodrigo Zeidan, Silvio Luiz de Almeida, Inácio Bó, Neil Lewis Jr

Abstract: This survey article provides insights regarding the future of affirmative action by analyzing the implementation methods and the empirical evidence on the use of placement quotas in the Brazilian higher education system. All federal universities have required income and racial-based quotas in Brazil since 2012. Affirmative action in federal universities is uniformly applied across the country, which makes evaluating its effects particularly valuable. Affirmative action improves the outcomes of targeted students. Specifically, race-based quotas raise the share of black students in federal universities, an effect not observed with income-based quotas alone. Affirmative action has downstream positive consequences for labor market outcomes. The results suggest that income and race-based quotas beneficiaries experience substantial long-term welfare benefits. There is no evidence of mismatching or negative consequences for targeted students' peers.

1.Selecting Sustainable Optimal Stock by Using Multi-Criteria Fuzzy Decision-Making Approaches Based on the Development of the Gordon Model: A case study of the Toronto Stock Exchange

Authors:Mohsen Mortazavi

Abstract: Choosing the right stock portfolio with the highest efficiencies has always concerned accurate and legal investors. Investors have always been concerned about the accuracy and legitimacy of choosing the right stock portfolio with high efficiency. Therefore, this paper aims to determine the criteria for selecting an optimal stock portfolio with a high-efficiency ratio in the Toronto Stock Exchange using the integrated evaluation and decision-making trial laboratory (DEMATEL) model and Multi-Criteria Fuzzy decision-making approaches regarding the development of the Gordon model. In the current study, results obtained using combined multi-criteria fuzzy decision-making approaches, the practical factors, the relative weight of dividends, discount rate, and dividend growth rate have been comprehensively illustrated using combined multi-criteria fuzzy decision-making approaches. A group of 10 experts with at least a ten-year of experience in the stock exchange field was formed to review the different and new aspects of the subject (portfolio selection) to decide the interaction between the group members and the exchange of attitudes and ideas regarding the criteria. The sequence of influence and effectiveness of the main criteria with DEMATEL has shown that the profitability criterion interacts most with other criteria. The criteria of managing methods and operations (MPO), market, risk, and growth criteria are ranked next in terms of interaction with other criteria. This study concludes that regarding the model's appropriate and reliable validity in choosing the optimal stock portfolio, it is recommended that portfolio managers in companies, investment funds, and capital owners use the model to select stocks in the Toronto Stock Exchange optimally.

1.On suspicious tracks: machine-learning based approaches to detect cartels in railway-infrastructure procurement

Authors:Hannes Wallimann, Silvio Sticher

Abstract: In railway infrastructure, construction and maintenance is typically procured using competitive procedures such as auctions. However, these procedures only fulfill their purpose - using (taxpayers') money efficiently - if bidders do not collude. Employing a unique dataset of the Swiss Federal Railways, we present two methods in order to detect potential collusion: First, we apply machine learning to screen tender databases for suspicious patterns. Second, we establish a novel category-managers' tool, which allows for sequential and decentralized screening. To the best of our knowledge, we pioneer illustrating the adaption and application of machine-learning based price screens to a railway-infrastructure market.

2.From Misalignment to Synergy: Analysis of Patents from Indian Universities & Research Institutions

Authors:Shoyeb Khan, Satyendra Kumar Sharma, Arnab Kumar Laha

Abstract: Indian Universities and Research Institutions have been the cornerstone of human resource development in the country, nurturing bright minds and shaping the leaders of tomorrow. Their unwavering commitment to excellence in education and research has not only empowered individuals but has also made significant contributions to the overall growth and progress of the nation. Despite the significant strides made by Indian universities and research institutions, the country still lags behind many developed nations in terms of the number of patents filed as well as in the commercialization of the granted patents. With 34 percent1 of students choosing STEM fields in India, and over 750 Universities and nearly 40,000 colleges, the concentration of patent applications in only a few top 10 institutions raises concerns. Innovation and technological advancement have become key drivers of economic growth and development in modern times. Therefore, our study aims to unravel the patent landscape of Indian Universities and Research Institutions, examining it through the lens of supply and demand for innovations and ideas. Delving into the dynamics of patent filing and innovation trends, this study seeks to shed light on the current state of intellectual property generation in the country's academic and research ecosystem.

1.How 'one-size-fits-all' public works contract does it better? An assessment of infrastructure provision in Italy

Authors:Massimo Finocchiaro Castroa, Calogero Guccio, Ilde Rizzo

Abstract: Public infrastructure procurement is crucial as a prerequisite for public and private investments and for economic and social capital growth. However, low performance in execution severely hinders infrastructure provision and benefits delivery. One of the most sensitive phases in public infrastructure procurement is the design because of the strategic relationship that it potentially creates between procurers and contractors in the execution stage, affecting the costs and the duration of the contract. In this paper, using recent developments in non-parametric frontiers and propensity score matching, we evaluate the performance in the execution of public works in Italy. The analysis provides robust evidence of significant improvement of performance where procurers opt for a design and build contracts, which lead to lower transaction costs, allowing contractors to better accommodate the project in the execution. Our findings bear considerable policy implications.

1.Robust Market Potential Assessment: Designing optimal policies for low-carbon technology adoption in an increasingly uncertain world

Authors:Tom Savage, Antonio del Rio Chanona, Gbemi Oluleye

Abstract: Increasing the adoption of alternative technologies is vital to ensure a successful transition to net-zero emissions in the manufacturing sector. Yet there is no model to analyse technology adoption and the impact of policy interventions in generating sufficient demand to reduce cost. Such a model is vital for assessing policy-instruments for the implementation of future energy scenarios. The design of successful policies for technology uptake becomes increasingly difficult when associated market forces/factors are uncertain, such as energy prices or technology efficiencies. In this paper we formulate a novel robust market potential assessment problem under uncertainty, resulting in policies that are immune to uncertain factors. We demonstrate two case studies: the potential use of carbon capture and storage for iron and steel production across the EU, and the transition to hydrogen from natural gas in steam boilers across the chemicals industry in the UK. Each robust optimisation problem is solved using an iterative cutting planes algorithm which enables existing models to be solved under uncertainty. By taking advantage of parallelisation we are able to solve the nonlinear robust market assessment problem for technology adoption in times within the same order of magnitude as the nominal problem. Policy makers often wish to trade-off certainty with effectiveness of a solution. Therefore, we apply an approximation to chance constraints, varying the amount of uncertainty to locate less certain but more effective solutions. Our results demonstrate the possibility of locating robust policies for the implementation of low-carbon technologies, as well as providing direct insights for policy-makers into the decrease in policy effectiveness resulting from increasing robustness. The approach we present is extensible to a large number of policy design and alternative technology adoption problems.

1.Climate uncertainty impacts on optimal mitigation pathways and social cost of carbon

Authors:Christopher J. Smith, Alaa Al Khourdajie, Pu Yang, Doris Folini

Abstract: Emissions pathways used in climate policy analysis are often derived from integrated assessment models (IAMs). However, such emissions pathways do not typically include climate feedbacks on socioeconomic systems and by extension do not consider climate uncertainty in their construction. Here we show that climate uncertainty alone significantly changes the cost-benefit optimal CO$_2$ emissions, varying from -14 to +12 GtCO$_2$ yr$^{-1}$ in 2050 (5-95% range) for an ensemble of scenarios that limit warming to 1.5{\deg}C with low overshoot. Climate uncertainty is also responsible for a factor of five range in the social cost of carbon (SCC) in this scenario ensemble. Equilibrium climate sensitivity (ECS) and the strength of present-day aerosol radiative forcing are strong determinants of SCC and optimal mid-century CO$_2$ emissions. This confirms that reducing climate uncertainty can refine cost-optimal emissions projections, and points to a missing feedback between climate and emissions in scenario construction.

1.Democratic Policy Decisions with Decentralized Promises Contingent on Vote Outcome

Authors:Ali Lazrak, Jianfeng Zhang

Abstract: We study how decentralized utility transfer promises affect collective decision-making by voting. Committee members with varying levels of support and opposition for an efficient reform can make enforceable promises before voting. An equilibrium requires stability and minimal promises. Equilibrium promises exist and are indeterminate, but do share several key characteristics. Equilibria require transfer promises from high to low intensity members and result in enacting the reform. When reform supporters lack sufficient voting power, promises must reach across the aisle. Even if the coalition of reform supporters is decisive, promises must preclude the least enthusiastic supporters of the reform from being enticed to overturn the decision. In that case, equilibrium promises do not need to reach across the aisle. We also discuss a finite sequence of promises that achieve an equilibrium.

2.Economic consequences of the spatial and temporal variability of climate change

Authors:Francisco Estrada, Richard S. J. Tol, Wouter Botzen

Abstract: Damage functions in integrated assessment models (IAMs) map changes in climate to economic impacts and form the basis for most of estimates of the social cost of carbon. Implicit in these functions lies an unwarranted assumption that restricts the spatial variation (Svar) and temporal variability (Tvar) of changes in climate to be null. This could bias damage estimates and the climate policy advice from IAMs. While the effects of Tvar have been studied in the literature, those of Svar and their interactions with Tvar have not. Here we present estimates of the economic costs of climate change that account for both Tvar and Svar, as well as for the seasonality of damages across sectors. Contrary to the results of recent studies which show little effect that of Tvar on expected losses, we reveal that ignoring Svar produces large downward biases, as warming is highly heterogeneous over space. Using a conservative calibration for the damage function, we show that previous estimates are biased downwards by about 23-36%, which represents additional losses of about US$1,400-US$2,300 billion by 2050 and US$17-US$28 trillion by the end of the century, under a high emissions scenario. The present value of losses during the period 2020-2100 would be larger than reported in previous studies by $47-$66 trillion or about 1/2 to 3/4 of annual global GDP in 2020. Our results imply that using global mean temperature change in IAMs as a summary measure of warming is not adequate for estimating the costs of climate change. Instead, IAMs should include a more complete description of climate conditions.

1.Low-carbon Lithium Extraction Makes Deep Geothermal Plants Cost-competitive in Energy Systems

Authors:Jann Michael Weinand, Ganga Vandenberg, Stanley Risch, Johannes Behrens, Noah Pflugradt, Jochen Linßen, Detlef Stolten

Abstract: Lithium is a critical material for the energy transition, but conventional procurement methods have significant environmental impacts. In this study, we utilize regional energy system optimizations to investigate the techno-economic potential of the low-carbon alternative of direct lithium extraction in deep geothermal plants. We show that geothermal plants will become cost-competitive in conjunction with lithium extraction, even under unfavorable conditions and partially displace photovoltaics, wind power, and storage from energy systems. Our analysis indicates that if 10% of municipalities in the Upper Rhine Graben area in Germany constructed deep geothermal plants, they could provide enough lithium to produce about 1.2 million electric vehicle battery packs per year, equivalent to 70% of today`s annual electric vehicle registrations in the European Union. This approach could offer significant environmental benefits and has high potential for mass application also in other countries, such as the United States, United Kingdom, France, and Italy, highlighting the importance of further research and development of this technology.

1.Visibility graph analysis of the grains and oilseeds indices

Authors:Hao-Ran Liu, Wei-Xing Zhou

Abstract: The Grains and Oilseeds Index (GOI) and its sub-indices of wheat, maize, soyabeans, rice, and barley are daily price indexes reflect the price changes of the global spot markets of staple agro-food crops. In this paper, we carry out a visibility graph (VG) analysis of the GOI and its five sub-indices. Maximum likelihood estimation shows that the degree distributions of the VGs display power-law tails, except for rice. The average clustering coefficients of the six VGs are quite large (>0.5) and exhibit a nice power-law relation with respect to the average degrees of the VGs. For each VG, the clustering coefficients of nodes are inversely proportional to their degrees for large degrees and are correlated to their degrees as a power law for small degrees. All the six VGs exhibit small-world characteristics to some extent. The degree-degree correlation coefficients shows that the VGs for maize and soyabeans indices exhibit weak assortative mixing patterns, while the other four VGs are weakly disassortative. The average nearest neighbor degree functions have similar patterns, and each function shows a more complex mixing pattern which decreases for small degrees, increases for mediate degrees, and decreases again for large degrees.

1.Five guidelines to improve context-aware process selection: an Australian banking perspective

Authors:Nigel Adams, Adriano Augusto, Michael Davern, Marcello La Rosa

Abstract: As the first phase in the Business Process Management (BPM) lifecycle, process identification addresses the problem of identifying which processes to prioritize for improvement. Process selection plays a critical role in this phase, but it is a step with known pitfalls. Decision makers rely frequently on subjective criteria, and their knowledge of the alternative processes put forward for selection is often inconsistent. This leads to poor quality decision-making and wastes resources. In recent years, a rejection of a one-size-fits-all approach to BPM in favor of a more context-aware approach has gained significant academic attention. In this study, the role of context in the process selection step is considered. The context is qualitative, subjective, sensitive to decision-making bias and politically charged. We applied a design-science approach and engaged industry decision makers through a combination of research methods to assess how different configurations of process inputs influence and ultimately improve the quality of the process selection step. The study highlights the impact of framing effects on context and provides five guidelines to improve effectiveness.

2.Mapping job complexity and skills into wages

Authors:Sabrina Aufiero, Giordano De Marzo, Angelica Sbardella, Andrea Zaccaria

Abstract: We use algorithmic and network-based tools to build and analyze the bipartite network connecting jobs with the skills they require. We quantify and represent the relatedness between jobs and skills by using statistically validated networks. Using the fitness and complexity algorithm, we compute a skill-based complexity of jobs. This quantity is positively correlated with the average salary, abstraction, and non-routinarity level of jobs. Furthermore, coherent jobs - defined as the ones requiring closely related skills - have, on average, lower wages. We find that salaries may not always reflect the intrinsic value of a job, but rather other wage-setting dynamics that may not be directly related to its skill composition. Our results provide valuable information for policymakers, employers, and individuals to better understand the dynamics of the labor market and make informed decisions about their careers.

3.Adapting to Disruptions: Flexibility as a Pillar of Supply Chain Resilience

Authors:Ambra Amico, Luca Verginer, Giona Casiraghi, Giacomo Vaccario, Frank Schweitzer

Abstract: Supply chain disruptions cause shortages of raw material and products. To increase resilience, i.e., the ability to cope with shocks, substituting goods in established supply chains can become an effective alternative to creating new distribution links. We demonstrate its impact on supply deficits through a detailed analysis of the US opioid distribution system. Reconstructing 40 billion empirical distribution paths, our data-driven model allows a unique inspection of policies that increase the substitution flexibility. Our approach enables policymakers to quantify the trade-off between increasing flexibility, i.e., reduced supply deficits, and increasing complexity of the supply chain, which could make it more expensive to operate.

1.On the state-space model of unawareness

Authors:Alex A. T. Rathke

Abstract: We show that the knowledge of an agent carrying non-trivial unawareness violates the standard property of 'necessitation', therefore necessitation cannot be used to refute the standard state-space model. A revised version of necessitation preserves non-trivial unawareness and solves the classical Dekel-Lipman-Rustichini result. We propose a generalised knowledge operator consistent with the standard state-space model of unawareness, including the model of infinite state-space.