Citizenship and power in an agent-based model of tax compliance with public expenditure

In this paper we present a model of tax compliance with heterogeneous agents who maximize their individual utility based on income and the conjectured level of per capita public expenditure. We formally include psychological drivers in this model. These drivers affect individual behavior, such as risk aversion, together with appreciation of public expenditure, expectations about peers’ compliance and a natural inclination to comply, all of which we summarize in a quality termed “citizenship”. The enforcement system, based on random inspections, is standard and only partially known to agents.The agent-based model is simulated under a variety of settings, representing different “societies”. We use the artificial data produced by the model to estimate the effects of taxpayers’ traits on personal tax behavior and to build a compliance societal slippery slope. At the individual level, we find a positive dependence of compliance on all variables, with the significant exception of the tax rate, which has a negative impact. As far as societies are concerned, we show how aggregate tax compliance depends on composite indices of citizenship and power, and we find that the former is more important than the latter.     

Macroeconomic Conditions and Australian Financial Risk Attitudes, 2001–2010

This paper employed panel data from the 2001–2010 waves of the Household, Income, and Labor Dynamics in Australia (HILDA) survey to investigate the financial risk attitudes of 10,000 individuals across 6,839 households. Ordered logit models including individual and household random effects tested for changes in risk tolerance while focusing on the impact of transitory macroeconomic conditions and controlling for individual demographic and socioeconomic characteristics. We found Australians generally reduced their tolerance for risk over time, though higher levels of education, wealth, good health, and being self-employed indicated the increased likelihood of risk tolerance. We also found macroeconomic conditions were jointly significant in determining financial risk attitudes. However, the innate demographic and socioeconomic characteristics of individuals were more important at the margin.     

ESTIMATION AND IMPACT OF GENDER DIFFERENCES IN RISK TOLERANCE

This paper provides numerical estimates of the distributions of risk tolerance for men and women. A simple model of individual portfolio choice is calibrated to data on Individual Retirement Accounts from the Health and Retirement Study to obtain the estimates. Results show that women tend to be less risk-tolerant than men. The estimates are then used to measure the impact of risk tolerance on wealth accumulation. Simulations show that the difference in risk tolerance can account for around 10% of the gender difference in accumulated wealth. ( JEL J16, G11, D81)     

The Temporality of Emotion: Constructing Past Emotions

Symbolic interactionists have developed a rich literature on emotion that has advanced our understanding of the socially constructed nature of emotions and has provided a wealth of understanding about emotions and emotional life. Left unexplored, however, has been the temporal nature of emotion. Similarly, interactionists' renewed interest in time and temporality has not focused on emotion. In this article I describe the implicit leads in these two literatures that need to be pulled together to make the linkage clear. Drawing on the work defining emotions as social objects and on George Herbert Mead's theory of the past, I describe how emotional pasts are used as foundations for situated actions. I also explain how we use the emotional pasts in four areas: the individual level, individuals in interaction, collective behavior, and the social structural level. This linkage provides insights for understanding how we use emotional pasts when we construct and enact behavior. I argue that emotional pasts are important tools used in the interpretation and construction of present emotions, to situate selves and others, and to construct the social order.     

Gender differences in risk behavior and the link to household effects and individual wealth

This study examined the differences in risk behavior between men and women using a household survey that captured the risk preferences of two members in a household and recorded wealth at the individual level instead of the usual approach of representing wealth at the household level. After controlling for commonly used explanatory variables, such as gender, education, age, and wealth, household fixed effects explain about 15% of the variation in risk behavior. This highlights the magnitude of household effects in shaping one’s risk behavior. In general, females in the study area are more risk averse than males based on a risk game with real payout. The gender differences disappear when focusing on only the top land owners. However, even in those cases, females consider themselves more risk averse, supporting results from previous studies that link culture and societal norms to the gender differences in risk behavior.     

EVALUATING CHANGES IN THE DISTRIBUTION OF CAPITAL WEALTH

A small-scale general equilibrium model in which the distribution of capital wealth is a key parameter is employed to examine the potential economic consequences of greater capital wealth equality. Every performance indicator examined – aggregate income, consumption equality, social welfare in the sum-of-utilities sense, and aggregate saving –is improved by greater capital wealth equality. However, the bottom-line social welfare gain, relative to the present high-inequality situation – even from the maximum achievable level of complete equality in capital wealth distribution – would be numerically rather modest.     

The Flag or the Pocketbook: To What are Immigrants a Threat

An increasing number of immigrants and rising unemployment rates are widely thought to contribute to the electoral success of extreme right parties in Western Europe. However, no study explicitly posits the causal mechanism that links the aggregate level factors of immigration and unemployment to the electoral success of extreme right parties, and systematically analyzes whether and how this mechanism works. Thus, the causal connection between immigration, unemployment and extreme right success remains at best ambiguous. I argue that the causal mechanism linking immigration and unemployment to extreme right electoral performance is the development of anti‐immigrant attitudes at the individual level. In this paper, I examine how unemployment and immigration affect individuals’ attitudes toward immigrants. This examination furthers our understanding of the actual dynamics of how unemployment and immigration influences the electoral success of extreme right parties. I find that greater unemployment rates increase the probability that an individual will have an anti‐immigrant attitude only when immigration is already at a high level. Similarly, increasing immigration alone does not always increase the probability that an individual will have an anti‐immigrant attitude.     

Gender differences in financial risk tolerance

The purpose of this research is to explore gender differences in financial risk tolerance using a large, nationally representative dataset, the Survey of Consumer Finances. The impact of the explanatory variables in the model is allowed to differ between men and women to decompose gender differences in financial risk tolerance. The results indicate that gender differences in financial risk tolerance are explained by gender differences in the individual determinants of financial risk tolerance, and that the disparity does not result from gender in and of itself. The individual variables that moderate the relationship between gender and high risk tolerance are income uncertainty and net worth, with income uncertainty moderating the relationship between gender and some risk tolerance. Financial fiduciaries should understand the differences in income uncertainty and net worth between men and women and how those differences relate to risk tolerance.     

Retirement plans, personal saving, and saving adequacy

This Issue Brief addresses three questions raised by recent trends in personal saving: How are national savings measured and what is the meaning of the trends in measured personal saving rates, given what is included and what is not included in those measures? What is the effect of retirement saving programs--in particular, 401(k) plans and individual retirement accounts (IRAs)--on personal saving levels? What are the implications of existing saving behavior for the retirement income security of today's workers? The National Income and Product Accounts (NIPA), the most commonly referenced gauge of personal saving, is a widely misunderstood measure. One could argue that a complete measure of saving would include increases in wealth through capital gains, but NIPA does not factor accrued and realized capital gains on stocks and other assets into the saving rate. By one measure, accounting for capital gains results in an aggregate personal saving rate of 33 percent--more than double the rate of four decades ago. A major policy question is the impact of tax-qualified retirement saving plans (i.e., IRAs and 401(k) plans) on personal saving rates. Empirical analysis of this issue is extremely challenging and findings have been contradictory. These programs now represent an enormous store of retirement-earmarked wealth in tax-deferred vehicles: Combined, such tax-deferred retirement accounts currently have assets of about $4 trillion. Ninety percent of IRA contributions are now the result of "rollovers" as employees leave employer plans, like 401(k) plans. While leakage from the system remains a challenge, the majority of the assets in the system can be expected to be available to fund workers' retirements. One could argue that, from a retirement income security perspective, workers in general are better off because IRA and 401(k) programs exist. Surely, many of the dollars in these programs would have been saved even without the programs; but they would not necessarily have been earmarked for retirement and been available to fund retirement expenses. As rollovers become larger, this "partnership" of employment-based qualified plans and IRAs will grow even more important. The evidence indicates that many groups of American workers appear unlikely to be able to afford a retirement that maintains their current lifestyle (at least not without working more years than currently planned). Consensus does not exist on how many workers are at risk or the typical magnitude of their retirement saving shortfall. There is a consensus, however, that a substantial number of individuals are at risk. This is not surprising--despite the fact that the 70 percent of workers are saving for retirement--since relatively few workers know how much it is that they need to accumulate to fund their retirement.     

Village Tolerance of Abuse,Women's Status,and the Ecology of Intimate Partner Violence in Rural Uttar Pradesh,India

We explore the multilevel determinants of intimate partner violence (IPV) against women in rural Uttar Pradesh, India. We focus on village tolerance of abuse and its ability to regulate the effects of individual and village‐level women's status and social capital. Using individual and village data from the 1998 to 1999 India National Family Health Survey, we find that village tolerance and women's status at individual and village levels help explain the risk of IPV. Village tolerance of abuse also moderates the ability of village‐level women's status and social capital to protect women from IPV. Results underscore the need to understand processes that sustain and/or challenge violence‐legitimating norms.     

Call Home? Mobile Phones and Contacts With Mother in 24 Countries

This article explores how the diffusion of mobile phones is associated with communication between adult children and their mothers. The article analyzes 2001 International Social Survey Program data from 24 countries (N = 12,313) combined with the country‐level data on the prevalence of mobile phones. Net of individual‐level predictors and country wealth, adult children who resided in countries with high prevalence of mobile phones contacted their mothers more frequently. High prevalence of mobile phones was also associated with larger differences in maternal contact by gender and smaller differences by education. These findings suggest that any impact of new communication technology on intergenerational relations is complex.     

Consumer bankruptcy and default: The role of individual social capital

In this paper, we empirically assess the role of individual social capital on personal bankruptcy and default outcomes in the consumer credit market. After controlling for a borrower’s risk score, debt, income, wealth, and legal and economic environments, we find that default/bankruptcy risk rises and then falls over the lifecycle, while a borrower who owns a home or is married has a lower risk of default/bankruptcy. Moreover, a borrower who migrates 190 miles from his “state of birth” is 17% more likely to default and 15% more likely to file for bankruptcy, while a borrower who continues to live in his state of birth is 14% and 10% less likely to default and file for bankruptcy, respectively. A borrower who moves to a rural area is 9% and 7% less likely to default and declare bankruptcy, respectively. We also find that measures of social networks, norms, and cooperation and trust (i.e., aggregate social capital) are inversely related to consumer bankruptcy.     

Neighborhood structural disadvantage,collective efficacy,and self-rated physical health in an urban setting

Our analyses examine the role neighborhood structural characteristics--including concentrated disadvantage, residential instability, and immigrant concentration--as well as collective efficacy in promoting physical health among neighborhood residents. Using data from the 1990 census, the 1994 Project on Human Development in Chicago Neighborhoods Community Survey, and the 1991-2000 Metropolitan Chicago Information Center-Metro Survey, we model the effects of individual and neighborhood level factors on self-rated physical health employing hierarchical ordered logit models. First, we find that neighborhood socioeconomic disadvantage is not significantly related to self-rated physical health when individual level demographic and health background are controlled. Second, individuals residing in neighborhoods with higher levels of collective efficacy report better overall health. Finally, socioeconomic disadvantage and collective efficacy condition the positive effects of individual level education on physical health.     

Rethinking the ‘neoliberal thought collective’ thesis

ABSTRACT

Numerous scholars have identified the ‘neoliberal thought collective’ as the key driver of the neoliberal transformation. These accounts emphasize the building of neoliberal hegemony through the mobilization of this collective, and the New Right parties who aligned to these ideas. We argue that Australia's corporatist road to neoliberalism pushes against this thesis, as the movement found little sympathy among policy makers. Rather, the thought collective acted more like a ‘ginger group’, attempting to radicalize public debate and create space for new neoliberal arrangements. In Australia, successive centre-left Labor governments rolled out neoliberalism in a series of formal corporatist arrangements with the trade union movement. This paper sets out a reconsideration of the role of the thought collective, on the basis of the Australian experience, and argues this can move us beyond the ideational determinism that has come to characterize key accounts of how neoliberalism developed.     

The comparative statics of differential rents in two-sided matching markets

This paper studies how shifts in the distribution of quality on one side of the market affect earnings on the other side in a model of one-to-one matching. A more dispersed distribution of quality hurts the low ability agents on the other side because they are matched to inferior partners. Earnings being a differential rent in these markets, this pulls down the earnings of high quality agents as well. It is shown that a more dispersed ability distribution reduces total earnings on the opposite side of the market. Under some conditions, all agents on that side are hurt.      

Was Achtsamkeitstrainings bewirken und wie sie in Organisationen wirksamer werden

In this article in the journal Gruppe. Interaktion. Organisation (GIO) we discuss the impact of individual mindfulness trainings on organizations. Therefore, we combine research on high reliability organizations with aspects of the newer sociologist system theory. First we seek to define the construct of mindfulness and we distinguish between individual and collective mindfulness as two different qualities of mindfulness. Using an example from the banking sector we discuss the challenges developing mindfulness in organizations and what intervention strategies could work. We distinguish between the three system levels psyche, interaction and organization. Doing this it becomes clear that interventions have to consider the coupling of the three different levels: How interventions have to be designed to effect all three levels?     

Financial decision making in collective society—A field test on Israeli kibbutz members and city residents

This comparison of Israeli kibbutz members to city residents examines how of individualistic/collective society affects financial decision making. Findings revealed that kibbutz members are more risk averse and discount the future more than city residents, undermining the assumption that collective society accords a safety net. We claim that the collective financial management of the kibbutz reduces individuals’ financial knowledge and experience, causing them to be more risk averse in financial decisions, and thus overpowering the safety net offered by the collective society. In addition, we argue that despite privatization, individuals still operate according to collective ideas in handling their personal finances, but less than before the onset of the privatization process.     

Individual Wealth and Subjective Financial Well‐being in Marriage: Resource Integration or Separation?

Economic wealth is mostly assumed to be a household‐level resource that is pooled by spouses in married couples. Using comprehensive data on the individual wealth of both spouses in married couples from the German Socio‐Economic Panel Study (N = 13,623 individuals), the author tests this assumption. To this end, the associations between individuals' wealth and their spouses' wealth with individuals' subjective financial well‐being are examined. Results show that women's financial well‐being is equally associated with their own individual wealth and their spouses' wealth in older birth cohorts. In younger birth cohorts, women's financial well‐being is more strongly associated with their own individual wealth than with their spouses' wealth. For men from all birth cohorts, their own individual wealth is more strongly related to their financial well‐being than is their spouses' wealth. These findings suggest that wealth is not generally and fully pooled and that individual ownership matters within married couples in Germany.     

STATUS DIVISIONS AND WORKER MOBILIZATION

The relatively conservative trajectory of the American labor movement often has been attributed to enduring status divisions among workers such as race and ethnicity, occupation, and skill. Such divisions, it has been argued in the literature, fragment working-class organization and pose limits on solidarity. Recent analyses of labor and class-based mobilization, however, have begun to challenge this assumption, suggesting that the impact of pertinent worker divisions is quite varied. In this article I draw from and extend these literatures by examining how workplace stratification impacts individual strike participation. The analyses draw on unique individual level data from a recent strike by the Communication Workers of America. Findings speak to the complexities of worker action, and show that status divisions among workers, while meaningful for strike participation, do not preclude successful collective action. I conclude by discussing the implications for labor mobilization more generally.     

No time to lose: time constraints and physical activity in the production of health

Although individuals are all endowed with the same time budgets—1,440 minutes per day—time use patterns differ owing to heterogeneity in preferences and in other constraints. In today’s health policy arena there is considerable discussion, but little conclusive strategy, about how to improve health outcomes by increasing levels of physical activity. In this paper, we explore how individuals with different levels of human capital (educational attainment) allocate time to physically-demanding activities that we characterize as health-producing behaviors. Our hypothesis is that many individuals are confronted with significant constraints on their allocation of time to exercise, and that these constraints differ importantly by level of human capital (e.g., educational attainment). However, the prediction of how human capital influences time allocated to physical activity is ambiguous because there are both substitution and wealth effects at work: since the shadow price of non-labor time use is relatively greater for high-wage individuals, they may spend less time engaged in health-promoting activities (as has been documented for activities like sleep); yet individuals who have amassed high levels of human capital are both more able to afford health-producing behaviors and more likely to prefer greater levels of produced health. We explore a set of empirical questions suggested by this framework using data from the American Time Use Survey (ATUS), administered by the U.S. Bureau of Labor Statistics. We focus on respondents ages 25–64 using the combined 2005 and 2006 ATUS data. The ATUS data are based on daily time use diaries completed by individuals aged 15 and older, including information on a large number of detailed physical activity time uses. We compare time allocated to physical activity to time allocated to sleep, household and personal activities, care for others, work, and non-exercise leisure activities. Since the ATUS time use categories are mutually exclusive and exhaustive (i.e. “multitasking” is not accommodated) we employ econometric share equation techniques to enforce the adding-up requirement that time use is constrained to 1,440 minutes per day. Our findings largely bear out the hypothesis that different levels of human capital endowment (educational attainment) result in different manifestations of how time is used in ways that may produce different health outcomes. While more-educated individuals tend to sleep much less than less-educated individuals and to work more hours, they are more likely to allocate time to physical activity in their leisure time. Our application of economic share equation techniques allows us to extend the literature by demonstrating not only how educational status is associated with time allocated to physical activity, but also where the other minutes of the day are allocated to and from.