Discussion Paper No. 521
January 15, 2025
Climbing the Ivory Tower: How Socio-Economic Background Shapes Academia
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Abstract:
We explore how socio-economic background shapes academia, collecting the largest dataset of U.S. academics’ backgrounds and research output. Individuals from poorer backgrounds have been severely underrepresented for seven decades, especially in humanities and elite universities. Father’s occupation predicts professors’ discipline choice and, thus, the direction of research. While we find no differences in the average number of publications, academics from poorer backgrounds are both more likely to not publish and to have outstanding publication records. Academics from poorer backgrounds introduce more novel scientific concepts, but are less likely to receive recognition, as measured by citations, Nobel Prize nominations, and awards.
Keywords:
academics; socio-economic background; science; u.s. census;
JEL-Classification:
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Discussion Paper No. 520
January 9, 2025
Gender Identity and Economic Decision Making
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Abstract:
Economic research on gender gaps has focused on variation based on the binary classification of “men” and “women”. We explore whether a self-reported continuous measure of gender identity (CGI) explains variation in economic decisions and outcomes beyond the relationship with binary gender. We analyze data from four diverse populations (N=8,018), including measures of economic preferences and educational and labor market outcomes. We find that CGI is significantly associated with economic outcomes, with stronger relationships for men than women. Our results indicate that incorporating measures of self-reported gender identity could enhance our understanding of gender gaps in economic behavior and outcomes.
Keywords:
gender identity; non-binary gender; economic preferences; economic outcomes;
JEL-Classification:
C91; J16; J2;
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Discussion Paper No. 519
December 30, 2024
Do Women Comply More Than Men? Experimental Evidence from a General Population Sample
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Abstract:
Women are often perceived as more compliant than men; however, the literature provides inconclusive evidence. Using a novel experimental design comprising two complementary experiments, we test this claim in online samples representative of the German adult population. The first experiment (N=1600) features a probabilistic social dilemma game (PDG) in which participants can increase their individual payoff at the expense of exposing themselves and their group to probabilistic losses. In two treatment conditions, they receive either a recommendation on socially optimal behavior or a recommendation and information on weakly non-compliant peer behavior. We find that the recommendation strongly affects behavior but more so for women than for men. However, information on the non-compliant behavior of others does not induce significantly different responses in men and women. In the second experiment (N=522), we elicit empirical and normative expectations about behavior in the PDG with a recommendation to study the role of norms in following it. While men and women are expected to hold similar normative beliefs, men are expected to follow the recommendation less often, suggesting that compliance is a female social norm.
Keywords:
gender; compliance; public good; social dilemma; risk-taking; social norms;
JEL-Classification:
J16; I12; D81; H41;
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Discussion Paper No. 518
December 12, 2024
Pareto-Improvements, Welfare Trade-Offs and the Taxation of Couples
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Abstract:
We develop a theory of tax reforms for a setting with multi-dimensional heterogeneity amongst taxpayers and multiple economic decisions that are all subject to fixed and variable costs. The theorems in this paper provide a complete characterization of the conditions under which Pareto- or welfare-improving tax reforms exist. We focus on one application, the taxation of couples, and present a detailed analysis of the behavioral responses to taxation in this setting. Squaring the theorems with this analysis yields sufficient statistics for the existence of Pareto- or welfare-improving tax reforms. In the empirical part, we apply them to US data. Our findings include the following: Tax rates on secondary earnings are inefficiently high when secondary earnings are close to primary earnings. Also, reducing the tax system’s degree of jointness is not Pareto-improving. Whether it raises welfare depends on a trade-off between poverty alleviation and gender balance.
Keywords:
taxation of couples; pareto efficiency; tax reforms; optimal taxation; non-linear income taxation;
JEL-Classification:
C72; D72; D82; H21;
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Discussion Paper No. 517
December 8, 2024
A Mean-Field Game of Market Entry
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Abstract:
We consider both N-player and mean-field games of optimal portfolio liquidation in which the players are not allowed to change the direction of trading. Players with an initially short position of stocks are only allowed to buy while players with an initially long position are only allowed to sell the stock. Under suitable conditions on the model parameters we show that the games are equivalent to games of timing where the players need to determine the optimal times of market entry and exit. We identify the equilibrium entry and exit times and prove that equilibrium mean-trading rates can be characterized in terms of the solutions to a highly non-linear higher-order integral equation with endogenous terminal condition. We prove the existence of a unique solution to the integral equation from which we obtain the existence of a unique equilibrium both in the mean-field and the N-player game.
Keywords:
portfolio liquidation; mean-field game; Nash equilibrium; trading constraint; non-linear integral equations;
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Discussion Paper No. 516
December 7, 2024
A Global Minimum Tax for Large Firms Only: Implications for Tax Competition
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The Global Minimum Tax (GMT) is applied only to firms above a certain size threshold, permitting countries to set differential tax rates for small and large firms. We analyze tax competition among multiple tax havens and a non-haven country for heterogeneous multinationals to evaluate the effects of this partial coverage of GMT. Upon the introduction of a moderately low GMT rate, the havens commit to the single uniform GMT rate for all multinationals. However, gradual increases in the GMT rate induce the havens, and subsequently the non-haven, to adopt discriminatory, lower tax rates for small multinationals. Our calibration exercise shows that the implementation of a 15% GMT rate results in a regime where only the havens adopt split tax rates. Upon GMT introduction, welfare and tax revenues fall in the tax havens but rise in the non-haven, yielding a positive net gain worldwide.
Keywords:
global minimum tax; profit shifting; multinational firms;
JEL-Classification:
F23; H25; H87;
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Discussion Paper No. 515
November 1, 2024
Just Cheap Talk? Investigating Fairness Preferences in Hypothetical Scenarios
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The measurement of preferences often relies on surveys in which individuals evaluate hypothetical scenarios. This paper proposes and validates a novel factorial survey tool to measure fairness preferences. We specifically examine whether a non-incentivized survey captures the same distributional preferences as an impartial spectator design, where choices may apply to a real person. In contrast to prior studies, our design involves high stakes, with respondents determining a real person’s monthly earnings, ranging from $500 to $5,700. We find that the non-incentivized survey module yields nearly identical results compared to the incentivized experiment and recovers fairness preferences that are stable over time. Furthermore, we show that most respondents adopt intermediate fairness positions, with fewer exhibiting strictly egalitarian or libertarian preferences. These findings suggest that high stake incentives do not significantly impact the measurement of fairness preferences and that non-incentivized survey questions covering realistic scenarios offer valuable insights into the nature of these preferences.
Keywords:
fairness preferences; survey experiment; vignette studies;
JEL-Classification:
C90; D63; I39;
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Discussion Paper No. 514
October 31, 2024
Skills and Earnings: A Multidimensional Perspective on Human Capital
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The multitude of tasks performed in the labor market requires skills in many dimensions. Traditionally, human capital has been proxied primarily by educational attainment. However, an expanding body of literature highlights the importance of various skill dimensions for success in the labor market. This paper examines the returns to cognitive, personality, and social skills as three important dimensions of basic skills. Recent advances in text analysis of online job postings and professional networking platforms offer novel methods for assessing a wider range of applied skill dimensions and their labor market relevance. A synthesis and integration of the evidence on the relationship between multidimensional skills and earnings, including the matching of skill supply and demand, will enhance our understanding of the role of human capital in the labor market.
Keywords:
skills; human capital; education; labor market; earnings; tasks; cognitive skills; personality; social skills; multidimensional skills;
JEL-Classification:
J24; I26;
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Discussion Paper No. 513
October 16, 2024
Predictive Power of Biological Sex and Gender Identity on Economic Behavior
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Behavioral differences by biological sex are still not fully understood, suggesting that studying gender differences in behavioral traits through the lenses of continuous identity might be a promising avenue to understand the remaining observed gender gaps. Using a large U.S. online sample (N=2017) and machine learning, we develop and validate a new continuous gender identity measure consisting of separate femininity and masculinity scores. In a first study, we identify ninety attributes from prior research and conduct an experiment to classify them as feminine and masculine. In a subsequent study, a different group of participants completes tasks designed to elicit behavioral traits that have been previously documented in the behavioral economics literature to exhibit binary gender differences. Data for the second study are collected in two waves; the first wave serves as a training sample, allowing us to identify key attributes predicting behavioral traits, create candidate identity measures, and select the most effective one, comprising sixteen attributes, based on predictive power. Finally, we use the second wave (test sample) to validate our gender identity measure, which outperforms existing ones in explaining gender differences in economic decision-making. We show that confidence, competition, and risk are associated with masculinity, while altruism, equality, and efficiency are with femininity, providing new possibilities for targeted policymaking.
Keywords:
biological sex; gender identity; machine learning; online experiment;
JEL-Classification:
D91; J16; J62; C91;
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Discussion Paper No. 512
October 9, 2024
Employee Performance and Mental Well-Being: The Mitigating Effects of Transformational Leadership During Crisis
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Abstract:
The positive role of transformational leadership for productivity and mental wellbeing has long been established. Transformational leadership behavior may be particularly suited to navigate times of crisis which are characterized by high levels of complexity and uncertainty. We exploit quasi-random assignment of employees to managers and study the role of frontline managers’ leadership styles on employees’ performance, work style, and mental well-being in times of crisis. Using longitudinal administrative data and panel survey data from before and during the Covid-19 pandemic, we find that the benefits of different leadership styles depend on the environment: Employees of more transactional managers outperform those of more transformational leaders before the onset of the pandemic. During the pandemic, however, more transformational managers lead employees to better performance and mental well-being. We discuss potential explanations and implications.
Keywords:
leadership; frontline managers; labor-management relations; organizational behavior; crisis;
JEL-Classification:
M54; M12; J53;