Economics, sociobiology and behavioral psychology on preferences

Economists have become increasingly interested in hypotheses from sociobiology as a source of inspiration for filling gaps in the economic model of behavior. To avoid borrowing eclectically and arbitrarily from neighboring disciplines, this paper attempts to outline in a systematic way the similarities and differences between the approaches taken in economics and sociobiology. In doing so, special attention is given to an empirical theory of preferences that is lacking in economics. Here, inspiration from sociobiology would seem to be particularly useful. The considerations in the paper suggest that sociobiological arguments may indeed be helpful, albeit at a very elementary level only. A more comprehensive theory cannot ignore the influences of innate learning mechanisms in higher living beings. An elaborated theory of preferences in economics will have to acknowledge and incorporate insights from behavioral psychology.     

A critical note on the role of the capability approach for sustainability economics

Can sustainability economics profit from the fusion with Amartya Sen's capability approach, thereby gaining solid normative foundations and wider applicability? We argue that this fusion is mistaken to the extent that the capability approach is essentially a static normative framework while sustainability economics demands a systematic long-term view with focus on wide-ranging societal change. These demands are best realized by taking an evolutionary perspective that focuses on the evolution and development of societies.     

Phonological Specificity in 12‐ and 17‐Month‐Old French‐Speaking Infants

The literature reports some contradictory results on the degree of phonological specificity of infants’ early lexical representations in the Romance language, French, and Germanic languages. It is not clear whether these discrepancies are because of differences in method, in language characteristics, or in participants’ age. In this study, we examined whether 12‐ and 17‐month‐old French‐speaking infants are able to distinguish well‐pronounced from mispronounced words (one or two features of their initial consonant). To this end, 46 infants participated in a preferential looking experiment in which they were presented with pairs of pictures together with a spoken word well pronounced or mispronounced. The results show that both 12‐ and 17‐month‐old infants look longer at the pictures corresponding to well‐pronounced words than to mispronounced words, but show no difference between the two mispronunciation types. These results suggest that, as early as 12 months, French‐speaking infants, like those exposed to Germanic languages, already possess detailed phonological representations of familiar words.     

A hierarchical model for ordinal matrix factorization

This paper proposes a hierarchical probabilistic model for ordinal matrix factorization. Unlike previous approaches, we model the ordinal nature of the data and take a principled approach to incorporating priors for the hidden variables. Two algorithms are presented for inference, one based on Gibbs sampling and one based on variational Bayes. Importantly, these algorithms may be implemented in the factorization of very large matrices with missing entries.     

Contradictions and crises of neoliberal–imperial globalization and the political opportunity structures for the Global Justice Movements

The Global Justice Movements emerged in the context of the contradictions and crisis of neoliberal–imperial globalization and the critique of it. They therefore express and provide a basis for the politicization of the negative consequences of post-Fordism and its crisis. This article examines the structural changes of the last 30 years from a Gramscian perspective of neoliberal globalization as a “passive revolution” and as the deepening of a “imperial mode of living” at a global scale. It is argued that examining structural changes helps us to understand why protest and social movements re-emerged around the year 2000. The article discusses some central features of the Global Justice Movements by focusing on the international Attac movement and the recent Occupy movement.     

Income inequality and risk taking: the impact of social comparison information

Theory and Decision - In contrast to the assumptions of standard economic theory, recent experimental evidence shows that the income of peers has a systematic impact on observed degrees of risk...     

Allais for the poor: Relations to ability,information processing,and risk attitudes

This paper complements evidence on the Allais paradox from advanced countries and educated people by a novel investigation in a poor rural area. The share of Allais-type behavior is indeed high and related to indicators of “lacking ability,” such as poor education, unemployment, and little financial sophistication. Based on prospective reference theory, we extend these characteristics by biased processing of probabilistic information. Finally, we reveal that Allais-type behavior is linked to risk-related characteristics, such as risk tolerance and optimism. This indicates a potential problem as exactly the more dynamic among the poor tend to make inconsistent decisions under uncertainty.     

How to measure and proxy permanent income: evidence from Germany and the U.S.

Permanent income (PI) is an enduring concept in the social sciences and is highly relevant to the study of inequality. Nevertheless, there has been insufficient progress in measuring PI. We calculate a novel measure of PI with the German Socio-Economic Panel (SOEP) and U.S. Panel Study of Income Dynamics (PSID). Advancing beyond prior approaches, we define PI as the logged average of 20+ years of post-tax and post-transfer (“post-fisc”) real equivalized household income. We then assess how well various household- and individual-based measures of economic resources proxy PI. In both datasets, post-fisc household income is the best proxy. One random year of post-fisc household income explains about half of the variation in PI, and 2–5 years explain the vast majority of the variation. One year of post-fisc HH income even predicts PI better than 20+ years of individual labor market earnings or long-term net worth. By contrast, earnings, wealth, occupation, and class are weaker and less cross-nationally reliable proxies for PI. We also present strategies for proxying PI when HH post-fisc income data are unavailable, and show how post-fisc HH income proxies PI over the life cycle. In sum, we develop a novel approach to PI, systematically assess proxies for PI, and inform the measurement of economic resources more generally.