POLITICAL IDEOLOGY AND ECONOMIC GROWTH: EVIDENCE FROM THE FRENCH DEMOCRACY

We provide a test of the impact of voters' political ideology on economic growth and of the role of preferences for government size as a transmission channel. We focus on France from the beginning of its stable democratic experience in 1871. A move of voters' ideology to the right increases economic growth over the total observation period. However, the growth effect of ideology is mediated by voters' preferences for government size only during the post‐World War II period. For reverse causality concerns, we use the political ideology of other historical democracies as an instrument variable for France's ideology. (JEL E6, O43, H11)     

INEQUALITY AND TRUST: NEW EVIDENCE FROM PANEL DATA

We estimate the causal link from income inequality to generalized trust by reconsidering the country‐level evidence on this issue. First, we exploit the panel dimension of the data, thus controlling for any country unobservable time‐invariant variables, and find a negative relationship between the two variables that holds only for developed countries. Second, we focus on these advanced economies and provide instrumental variable estimates using the predicted exposure to technological change as an exogenous driver of inequality. According to our findings, the negative causal effect of inequality on trust is even larger than that coming from ordinary least squares estimation. We also provide new insights on the effects of different dimensions of inequality, exploiting measures of both static inequality—such as the Gini index and top income shares—and dynamic inequality—proxied by intergenerational income mobility. (JEL D31, O15, Z13)     

LIES,DAMN LIES,AND RUMORS: AN ANALYSIS OF COLLECTIVE EFFICACY,RUMORS, AND FEAR IN THE WAKE OF KATRINA

In the days following Hurricane Katrina, many displaced residents from New Orleans evacuated to the Baton Rouge area. As a result, many Baton Rougians became increasingly concerned about crime in their community. This concern, coupled with a lack of official information, led to the widespread dissemination of rumors of criminal victimization. The purpose of this study is to examine the relations between collective efficacy, rumors, and fear during this trying time for Baton Rouge. The results are based on telephone interviews with Baton Rouge residents conducted two months after Katrina. As predicted, collective efficacy fosters the transmission of rumors. These rumors then lead to increased personal and altruistic fear of victimization; therefore, collective efficacy indirectly increases fear through its effect on rumors. The implications of these findings for public and emergency management policy are discussed as are concrete suggestions for future research.     

FISCAL STRUCTURES AND ECONOMIC GROWTH: INTERNATIONAL EVIDENCE

Our paper systematically examines the effects of fiscal structure on economic growth. We find that for developing countries, debt-financed increases in government expenditure retard growth and tax-financed increases stimulate growth, while for developed countries, debt-financed increases in government expenditure do not affect growth and tax-financed increases lower growth. We impose the government budget constraint on the regression equations so that the precise changes in fiscal policy can be identified (e.g., the effect of a debt-financed increase in health expenditure), employing a pooled cross-section, time-series sample and fixed- and random-effect methods. (JEL 04, E6)     

OCCUPATIONAL SEX SEGREGATION AND ECONOMIC INEQUALITY UNDER SOCIALISM:

An increase in scholarly attention to income differences between sex-typed occupations has generated a burgeoning literature. Typically-female occupations require preemployment education, not prolonged on-the-job training; receive less renumeration for work autonomy than male-typed occupations; and are concentrated in economically disadvantaged industrial sectors. However, these issues have received only preliminary consideration regarding noncapitalist societies and research has lacked an integrative, analytical focus. This study compares the earnings effects of education, type of work, and industrial sector between female- and male-dominated occupations in socialist Yugoslavia. As expected, average earnings are significantly higher in male than in female occupations. The results from the earnings regressions reveal a higher explained variance and larger economic returns to education among female- dominated occupations, especially in the managerial and professional strata. A decomposition of the earnings difference between sex-typed occupations suggests a variation in the source of inequality across skill strata. In the discussion, a comparison of capitalism and socialism reveals that while some aspects of the earnings attainment process may be unique to socialism, others are not.     

THEORIES OF COMMITMENT, ALTRUISM AND RECIPROCITY: EVIDENCE FROM LINEAR PUBLIC GOODS GAMES

Theories of commitment, altruism, and reciprocity have been invoked to explain and describe behavior in public goods and social dilemma situations. Commitment has been used to explain behaviors like water conservation and voting. Altruism has been applied to explain contributions to charities and intergenerational transfers and bequests. Reciprocity has been invoked to explain gift exchange and labor market decisions. This paper describes a set of experiments, which distinguish between these competing theories by testing their comparative statics predictions in a linear public goods setting. Results provide strong support for reciprocity theories over either theories of commitment or of altruism. ( JEL C9, D64, H41, C72)     

ATTRIBUTION ERROR IN ECONOMIC VOTING: EVIDENCE FROM TRADE SHOCKS

This article exploits the international transmission of business cycles to examine the prevalence of attribution error in economic voting in a large panel of countries from 1990 to 2009. We find that voters, on average, exhibit a strong tendency to oust the incumbent governments during an economic downturn, regardless of whether the recession is home‐grown or merely imported from trading partners. However, we find important heterogeneity in the extent of attribution error. A split sample analysis shows that countries with more experienced voters, more educated voters, and possibly more informed voters—all conditions that have been shown to mitigate other voter agency problems—do better in distinguishing imported from domestic growth. (JEL E3, E6)     

TAXATION, AGGREGATE ACTIVITY AND ECONOMIC GROWTH: CROSS-COUNTRY EVIDENCE ON SOME SUPPLY-SIDE HYPOTHESES

Data from sixty-three countries are used to examine the impact of average and marginal tax rates on the level and growth of economic activity. Apparent negative effects of tax rates on growth disappear upon controlling for (1) potential endogeneity of average tax rates to per capita income and (2) the relation between economic growth and per capita income. However, controlling for average tax rates, increases in marginal tax rates have negative effects on the level of economic activity. This evidence supports the hypothesis that reductions in the "progressivity" of tax rates induce a parallel shift upward in the growth path.     

WORKERS, FIRMS, AND THE DOMINANT IDEOLOGY:

Theorists of work and class relations have argued that organizational processes within the monopoly 'core' induce employees to identify with the firm and consent to the social relations of production. The adequacy of this 'hegemony' thesis is evaluated using data from two Bell operating companies, whose workers hold relatively high-paying primary sector jobs and are exposed to a strong corporate culture. Although these factors should favor the thesis of managerial hegemony, the data provide only limited support. In fact, an oppositional consciousness is fairly common among the workers, but with marked variations between occupational groups. The data indicate that hegemony theory inflates the role of ideological mechanisms in the reproduction of managerial control and underestimates workers' capacity to form a critical consciousness of the employment relationship. Worker consent should be viewed as problematic—that is, as exceptional, occurring only under specific social and organizational conditions.     

TRUST,RECIPROCITY, AND RULES

Many economic interactions rely on trust and trust violations can have serious economic consequences. Simple minimum standard rules are attractive because they prevent egregious trust violations. However, they may undermine more trusting and reciprocal (trustworthy) behavior that otherwise would have occurred, leading to worse outcomes. In an experimental trust game, we test the efficacy of exogenously imposed minimum standard rules. Rules damage trust and reciprocity, reducing economic welfare. While sufficiently restrictive rules restore welfare, trust and reciprocity never return. Results indicate that participants are concerned about payoffs while also using the game to learn about trust and trustworthiness of others. (JEL C72, C90, D63, D64, L51)     

IDEOLOGY, FOUNDATIONALISM, AND SOCIOLOGICAL THEORY

The issue of foundationalism and the growing irrelvance of sociological metatheorizing to the understanding of contemporary society is considered from the perspective of postmodernism. Foundationalism is treated as a form of ideology. Changes in the analysis of ideology are discussed briefly and the postmodern approach to the critique of grand narratives, or logocentrism, is introduced. Two meta-narratives, neofunctionalism and conflict theory, are criticized as illustrative examples of logocentrism. The postmodern critique is then applied to the issue of foundationalism as recently articulated in the "Seidman controversy." which is exposed as containing hidden foundationalist implications of its own. The critique of foundationalism raises three issues that are discussed: the possibility of a deontological social theory, narrative as social inquiry, and the social role of academics as intellectuals.     

LEGISLATIVE TURNOVER,FISCAL POLICY,AND ECONOMIC GROWTH: EVIDENCE FROM U.S. STATE LEGISLATURES

Increased turnover among legislators can make them short‐sighted, affecting fiscal policy and economic growth. We exploit the exogenous variation in legislative turnover induced by term limit laws and by redistricting in the 50 U.S. states, finding that increased turnover increases capital spending by state governments, which may be designed to constrain future governments. The changes may cause long‐run distortions in the economy, reducing long‐term economic growth. (JEL H72, H73, H76)     

RACE AND TRUST IN GOVERNMENT: TESTING THE POLITICAL REALITY MODEL

Ever since the Institute for Social Research began measuringpolitical trust more than twenty years ago, racial differenceshave been noted. Since 1968 blacks have been notably less trustingthan whites. The explanation most commonly offered is the politicalreality model. This note directly tests the political realitymodel by comparing the relationship of race to trust in twosettings. One is the nation in 1984 and the second is a citywhere a black mayor and black administration had been in officefor eight years. If the political reality model is correct,the relationship of being black to trust should be positivein the local setting, precisely the opposite of the negativedirection in national samples. The political reality model performedwell under this direct comparison. As others have found, theCPS trust questions measure in large part one's evaluation ofincumbents. These incumbent evaluations are part of the politicalreality that blacks respond to in answering the trust questions.     

SOCIAL ATOMISM, HOLISM, AND TRUST

The metatheoretical difference between social atomism and social holism is clarified by analysis of the generic necessity of trust. A theoretical approach to trust can be traced from Durkheim, Simmel, Parsons, and the recent work of Luhmann and Barber. Trust functions as a deep assumption underwriting social order and is not reducible to individual characteristics. Changes in trust alter social relationships. The study of power, exchange, family, and politics illustrates how trust constitutes social reality as emergent and holistic. This helps us understand the formation of interpersonal relationships, the difference between economic and social exchange, and the discrepancy between attitudes toward society and toward particular institutional actors.     

COMMUNITY,COMMUNICATION, AND MEANING: THEORIES OF BUCHLER AND HABERMAS

The scope of Jürgen Habermas's “universal pragmatics” and communicative interaction theory are critically assessed in this article. Habermas's pragmatics are seen to reveal different assumptions than those of Peirce or Mead. This difference yields different assumptions about the research program embodied in Habermas's work. The ideas of Justis Buchler are presented in order to develop a comprehensive theory of meaning and community. This article provides the basis for an assessment of linguistic rationality, meaning, and human interests in daily life.     

MONEY AND SEX, THE ILLUSORY UNIVERSAL SEX DIFFERENCE: Comment on Kanazawa

Kanazawa tests the hypothesis, derived from Evolutionary Psychology, that men's income enhances their ability to engage in copulation with more partners and at a greater frequency. However, the results presented in Kanazawa's article fail to appropriately test for interaction effects and some of the analyses may suffer from sample-selection bias. I reestimate the equations appearing in Kanazawa's study and find (given the author's original methodological decisions) evidence in support of the evolutionary prediction in only two of the four original analyses. Had the same methodological decisions been consistently applied in the original study, then only one of the four analyses provides very weak evidence in favor of a sex difference in the returns to income. Furthermore, I conduct cross-national analyses with International Social Survey Program data from four other industrialized nations: Australia, Bulgaria, Ireland, and Poland. In only one of the nations (Ireland) and for only two of the four dependent variables is there any compelling evidence that men with higher incomes have more sex partners. Since the term "sex partner" may be ambiguous, I also use data from the National Health and Social Life Survey where detailed questions were asked that may better measure evolutionarily significant forms of copulation. The data are not consistent with the evolutionary psychological theory of sexual behavior.     

LAWYERS IN VENTURE CAPITAL CONTRACTING: THEORY AND EVIDENCE

Real‐world financial contracts are sometimes so complex that it can be difficult to understand their exact payoff consequences. We develop and test a theoretical model of a venture capitalist (VC) negotiating with an entrepreneur who may overweigh or underweigh the payoff consequences of contractual downside protection (DP). A lawyer with expertise in venture capital can inform the entrepreneur about these consequences, but less expert (but otherwise high quality) lawyers cannot. We determine how a VC's decision to include DP is affected by the expected quality of the entrepreneur's project, the entrepreneur's experience, and the VC expertise of his/her legal counsel. We show that the VC's incentive to include unnecessary DP declines in expected project quality. Indeed, for inexperienced entrepreneurs involved with high‐quality projects, VCs prefer that the entrepreneur's counsel has VC expertise. This implies that, when negotiating with inexperienced entrepreneurs, VCs who invest in high‐quality companies should be more likely to negotiate with entrepreneurs who employ lawyers with VC expertise. We document broad empirical support for the model, and provide evidence against competing explanations. (JEL L24, G24, K12, L14, L24)     

REPRESENTATIVE TRUST AND RECIPROCITY: PREVALENCE AND DETERMINANTS

This paper provides evidence about the determinants of trust and reciprocal inclinations, that is, a tendency for people to respond in kind to hostile or kind actions, in a representative setting. We investigate the prevalence of reciprocity in the population, the correlation between trust and positive and negative reciprocal inclinations within person, the individual determinants of reciprocity, and the relationship with psychological measures of personality. We find that most people state reciprocal inclinations, in particular in terms of positive reciprocity, as well as substantial heterogeneity in the degree of trust and reciprocity. Trust and positive reciprocity are only weakly correlated, while trust and negative reciprocity exhibit a negative correlation. In terms of determinants, being female and increasing age are associated with stronger positive and weaker negative reciprocal tendencies. Taller people are more positively reciprocal, but height has no impact on negative reciprocity. Psychological traits also affect trust and reciprocity. ( JEL D63, J3, J6)