DO LAB EXPERIMENTS MISREPRESENT SOCIAL PREFERENCES? THE CASE OF SELF‐SELECTED STUDENT SAMPLES

Social preference research has received considerable attention among economists in recent years. However, the empirical foundation of social preferences is largely based on laboratory experiments with self‐selected students as participants. This is potentially problematic as students participating in experiments may behave systematically different than nonparticipating students or nonstudents. In this paper we empirically investigate whether laboratory experiments with student samples misrepresent the importance of social preferences. Our first study shows that students who exhibit stronger prosocial inclinations in an unrelated field donation are not more likely to participate in experiments. This suggests that self‐selection of more prosocial students into experiments is not a major issue. Our second study compares the behavior of students and participants recruited from the general population in a trust experiment. In general, we find very similar behavioral patterns for the two groups, but nonstudents make significantly more generous repayments suggesting that results from student samples might be seen as a lower bound for the importance of prosocial behavior.     

Sustainable Development and Capabilities for the Polar Region

The paper develops a sustainable development framework for individual and collective capabilities in mixed subsistence and wage-based economies. We apply this framework to such regions of the Arctic and evaluate interactions and conflicts between two sectors of the mixed economy and between current and future generations of Arctic inhabitants. A recent Arctic Social Indicators Report published by the Arctic Human Development Report (AHDR) Task Force recognizes the importance of the mixed economy in the Arctic and aims to integrate collective assets, as well as individual assets in order to understand the human development in the Arctic. Yet due to its concerns of comparability of social development and data availability across the whole Arctic region (of which some parts do not have the similar population structure), its proposed indicators are not capable of covering the social development of predominantly indigenous regions of the North. We emphasize the importance of tracking collective capabilities, as well as individual capabilities to sustain community development. In addition we suggest that environmental sustainability, which is ignored by the AHDR Task Force, has to be integrated with social development as environmental deterioration significantly influences the social well-being and cultural stability of traditional inhabitants of the Arctic. We critically review the proposed indicators of the AHDR Task Force and make supplementary and alternative suggestions.     

A Note on Job Tenure and Collective Contracts

Abstract. This paper analyses the relationship between individual tenure and the application of collective contracts at the firm level under the specific institutional settings in Germany. The empirical approach is based on a multilevel model and a linked employer–employee data set for the years 1990, 1995, and 2001. The main result is that elapsed tenure is longer in firms applying collective contracts than in companies with individual wage setting: workers in firms with collective contracts benefit not only from higher wages, but also from higher job stability. Furthermore, we find no significant changes in mean tenure during the 1990s as well as stable differences across wage‐setting regimes.     

Regularized Gaussian belief propagation

Belief propagation (BP) has been applied in a variety of inference problems as an approximation tool. BP does not necessarily converge in loopy graphs, and even if it does, is not guaranteed to provide exact inference. Even so, BP is useful in many applications due to its computational tractability. In this article, we investigate a regularized BP scheme by focusing on loopy Markov graphs (MGs) induced by a multivariate Gaussian distribution in canonical form. There is a rich literature surrounding BP on Gaussian MGs (labelled Gaussian belief propagation or GaBP), and this is known to experience the same problems as general BP on graphs. GaBP is known to provide the correct marginal means if it converges (this is not guaranteed), but it does not provide the exact marginal precisions. We show that our adjusted BP will always converge, with sufficient tuning, while maintaining the exact marginal means. As a further contribution we show, in an empirical study, that our GaBP variant can accelerate GaBP and compares well with other GaBP-type competitors in terms of convergence speed and accuracy of approximate marginal precisions. These improvements suggest that the principle of regularized BP should be investigated in other inference problems. The selection of the degree of regularization is addressed through the use of two heuristics. A by-product of GaBP is that it can be used to solve linear systems of equations; the same is true for our variant and we make an empirical comparison with the conjugate gradient method.     

Risky investment decisions: How are individuals influenced by their groups?

We investigate the effect of group versus individual decision-making in the context of risky investment decisions in which all subjects are fully informed of the probabilities and payoffs. Although there is full information, the lottery choices pose cognitive challenges so that people may not be sure of their expected utility-maximizing choice. Making such decisions in a group context provides real-time information in which group members can observe others’ choices and revise their own decisions. Our experimental results show that simply observing what others in the group do has a significant impact on behavior. Coupling real-time information with group decisions based on the median value, i.e., majority rule, makes the median investment choice focal, leading people with low values to increase investments and those with high values to decrease investments. Group decisions based on the minimum investment amount produce more asymmetric effects.     

Prenatal risk and physical aggression during the first years of life: The gender‐specific role of inhibitory control

Prenatal risk and a lack of inhibitory control have consistently been related to the development of physical aggression in older children. This study examined whether inhibitory control mediated the relation between prenatal risk and aggression in infants and toddlers. The role of gender in this mediation model was also examined. The sample consisted of 161 mother–child dyads (83 boys). A prenatal cumulative risk score was created from a number of well‐established risk factors including maternal psychopathology, substance use, and social and socioeconomic disadvantages. At 12 months, children performed an inhibitory control task. Physical aggression was assessed through maternal reports at 12 and 20 months of age. Results showed that higher prenatal risk was associated with more physical aggression. Inhibitory control mediated this association at both 12 and 20 months: higher prenatal risk was related to lower inhibitory control, which in turn led to higher aggression. At 20 months, gender moderated the mediation effect: the mediating role of inhibitory control was only found for girls. These results suggest that even before 2 years of age, inhibitory control is an important construct involved in the relation between prenatal risk and physical aggression.     

Variation in Associations Between Family Dinners and Adolescent Well‐Being

Empirical evidence and conventional wisdom suggest that family dinners are associated with positive outcomes for youth. Recent research using fixed‐effects models as a more stringent test of causality suggests a more limited role of family meals in protecting children from risk. Estimates of average effects, however, may mask important variation in the link between family meals and well‐being; in particular, family meals may be more or less helpful based on the quality of family relationships. Using 2 waves of the National Longitudinal Study of Adolescent Health (N = 17,977), this study extended recent work to find that family dinners have little benefit when parent–child relationships are weak but contribute to fewer depressive symptoms and less delinquency among adolescents when family relationships are strong. The findings highlight the importance of attending to variation when assessing what helps and what hurts in families.