Behavioral economics and the economics of Keynes

The aim of this paper is two-fold: it first evaluates some of the psychological insights offered by Keynes in his economic theories, and secondly it weighs up these insights in the light of recent research in behavioral and experimental economics. We found that many of the psychological ideas set forth by Keynes in his economic works, especially in The General Theory, have a defensible behavioral foundation and fit broadly the actual behavior of economic agents in the real world as suggested by recent empirical evidence. As a consequence, we argue that Keynesian economics can benefit from this interaction, especially for issues related to judgment under uncertainty and building solid microfoundations for macroeconomics.     

Technology Effects on Wages in Finnish Manufacturing

In this paper we study the effect of technology on establishment‐level wages using a classification of manufacturing industries based on four technology levels. The technology wage premiums are estimated separately for non‐manual and manual workers using wage equations with available control variables for plant and workforce characteristics (human capital) over the time period 1974–93. The results do not show a straightforward increasing relationship between a plant’s average wages and its technology at higher technology levels. However, establishments with the lowest technology level paid the lowest wages during the whole period. We also find that the relative non‐manual to manual wage ratio increased over the time period in the highest technology levels. These findings are consistent with technology wage premiums and skill‐biased technological change found in studies for other countries     

Small Theories and Large Risks—Is Risk Analysis Relevant for Epistemology?

Ought we to take seriously large risks predicted by “exotic” or improbable theories? We routinely assess risks on the basis or either common sense, or some developed theoretical framework based on the best available scientific explanations. Recently, there has been a substantial increase of interest in the low‐probability “failure modes” of well‐established theories, which can involve global catastrophic risks. However, here I wish to discuss a partially antithetical situation: alternative, low‐probability (“small”) scientific theories predicting catastrophic outcomes with large probability. I argue that there is an important methodological issue (determining what counts as the best available explanation in cases where the theories involved describe possibilities of extremely destructive global catastrophes), which has been neglected thus far. There is no simple answer to the correct method for dealing with high‐probability high‐stakes risks following from low‐probability theories that still cannot be rejected outright, and much further work is required in this area. I further argue that cases like these are more numerous than usually assumed, for reasons including cognitive biases, sociological issues in science and the media image of science. If that is indeed so, it might lead to a greater weight of these cases in areas such as moral deliberation and policy making.     

Editorial statement: Stress and work compensation

Shift work has been reported to predict health problems, and a possible explanation is that shift work may lead to poorer health habits, thereby increasing a person's vulnerability to illness. This study examined the association between shift work and health habits, as indicated by smoking, alcohol intake, physical activity and by being overweight. A questionnaire was sent to all 2795 female nurses working in the 10 hospitals of two Finnish health care districts. From the 2299 respondents, we selected those 506 shift workers who reported having always done shift work and those 183 day workers who had never done shift work. Shift workers were found to smoke more and to be overweight more often than day workers. These differences gradually increased in each successive age group, being 1.94 pack-years in smoking and 0.9 kg m^-2 in body mass index among nurses over 45 years of age. Shift work was not associated with alcohol intake or sedentary lifestyle. This evidence is compatible with the possibility that shift work in nurses increases smoking and being overweight to a degree that contributes to health problems, including coronary heart disease.     

On limiting distribution laws of statistics analogous to pearson's chi-square

Two test-statistics analogous to Pearson's chi-square test function - given in (1.6) and (1.7) - are investigated. These statistics utilize, apart from the number of sample elements lying in the respective intervals of the partition, their positions within the intervals too. It is shown that the test-statistics are asymptotically distributed - as the sample size N tends to infinity - according to the x ²distribution with parameter r, i.e. the number of intervals chosen. The limiting distribution of the test statistics under the null-hypothesis when N tends to the infinity and r =O(N ^α) (0<α<1), further the consistency of the tests based on these statistics is considered. Some remarks are made concerning the efficiency of the corresponding goodness of fit tests also; the authors intend to return to a more detailed treatment of the efficiency later.     

Attaining specified reliability in component design: a stochastic approximation approach

In the design, manufacture and maintenance of components, particular attention is paid to component reliability R, the probability that the strength X of a component will exceed a stress Y to which it will be subjected. The problem addressed here is the design (or redesign) of a compoFent to meet a specified reliability R*. While certain characteristics of the random variables X and Y are assumed (symmetry of X about a unique median for example) it is not assumed that the form of the distribution of (X,Y) is known, nor that X and Y are independent. A design is recomnended based on a variation of the stochastic approximation procedure due to Dupac and Kral (1972) which in general estimates recursively the root of a regression curve assuming both independent and dependent regression variables are subject to experimental error.     

Physical violence against children reported to the police: discrepancies between register-based data and child victim survey

This study examines the reporting and not reporting of child victimization to the police. The study focuses on comparing the police reports of child victimization to the Finnish Child Victim Survey (FCVS) to find out the kind of violence that is reported to the police and the kind that is not. A total number of 242 police reports of 12-year-old victims of physical violence were collected from the Finnish Police Information System. These reports were compared to the 12-year-old children's victimization experiences in the FCVS. Discrepancies between these two data can be found in the victim's gender, the relationship between the victim and the suspect, and the location of the assault. Physical violence against girls committed by mothers is not reported as often as physical violence against boys committed by men.     

Social Aspects of Sustainable Competitiveness in the Selected European Countries in the Period 2012–2015

Social Indicators Research - The paper examines the impact of the social dimension of sustainable competitiveness on the economic dimension, where the social dimension is represented by Indicators...     

An Empirical Bayes Inference for the von Mises Distribution

This paper develops an empirical Bayesian analysis for the von Mises distribution, which is the most useful distribution for statistical inference of angular data. A two-stage informative prior is proposed, in which the hyperparameter is obtained from the data in one of the stages. This empirical or approximate Bayes inference is justified on the basis of maximum entropy, and it eliminates the modified Bessel functions. An example with real data and a realistic prior distribution for the regression coefficients is considered via a Metropolis-within-Gibbs algorithm.