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Essays in Applied Microeconomics
Get PDFThis thesis comprises three chapters, each serving as an independent research paper. Collectively, they all revolve around exploring individual decision making, with particular emphasis on the role of expectations and perceptions in the decision making process.
The first chapter explores students' expectations about the returns to completing higher education and provides first evidence on perceived signaling and human capital effects. We elicit counterfactual labor market expectations for the hypothetical scenarios of leaving university with or without a degree certificate among a large and diverse sample of students at different stages of higher education. Our findings indicate substantial expected labor market returns from signaling. Over the expected course of career, we find lasting perceived education premia as well as evidence consistent with perceived employer learning.
The second chapter answers the question: Why do employers seek to attract individuals with more education? We experimentally vary rates of master degree completion on applicant résumés to shift employer beliefs about candidates' productive traits. Our results confirm that a master's degree raises candidate desirability. Moreover, we find that master graduates outperform bachelor degree holders in terms of employer perceived cognitive and non-cognitive traits as well as subject matter expertise. Conversely, master dropouts are associated with weaker non-cognitive traits. Notably, these perceived traits account for up to 75% of candidate attractiveness. This paper thus provides causal evidence on the origins of the education premium.
The third chapter investigates the attitudes towards paternalism in an incentivized laboratory experiment. We test if individuals are willing to give up money in order to remove a paternalistically motivated constraint that restricts their choice set in a decision under risk. We find that individuals are willing to give up money in almost half of their decisions in order to be able to make an unrestricted choice. Disentangling the intrinsic value from the instrumental value of freedom of choice, we observe positive intrinsic values of freedom of choice in about 30% of all decisions. Occurrence and magnitude of the intrinsic value of freedom of choice vary between individuals and across decision contexts, i.e., for different types of risks (gains versus losses, long shots versus 50-50), but merely by stake size
Essays in Applied Microeconomics
Get PDFWhat determines human behavior? This seemingly simple question is at the core of economics and the social sciences more generally. Yet, it is one of the most difficult questions to answer for at least two reasons: First, the presence and choices of others influence our own behavior and requires a systematic study of social aspects. Second, every decision relies on our subjective beliefs about unobserved states of the world, and these beliefs may reflect heterogeneous expectations about the consequences of different choices. By investigating the role of peers for behavior and by studying the systematic variation in beliefs, this thesis contributes to our understanding of human behavior and decision-making. It is widely accepted that peers influence consumption behavior, general well-being, and performance. Yet, we do not know much about how individuals choose these peers in the first place and about the consequences of peer self-selection. The first two chapters, Chapters 1 and 2, which are joint work with Jonas Radbruch and Sebastian Schaube, therefore aim at filling this gap. We first examine how allowing individuals to choose with whom to interact affects their performance relatively to exogenously assigned peers (Chapter 1), and second, whom they actually choose as peers (Chapter 2). In order to study this self-selection of peers, we conduct a field experiment in secondary schools and allow students in two treatment arms to select their peers themselves, while in another they are randomly assigned to a peer. Chapter 1 (Self-selection of Peers and Performance) analyzes the consequences of peer self-selection on performance. It documents that individuals, who can self-select their peers, improve their performance more than those with randomly assigned peers. In principle, these differences in performance may stem from two sources: First, individuals interact with different peers, who influence performance. Thus, accounting for differences in the peer composition may explain our findings. Second, the results could stem from a psychological effect of being able to self-select peers rather than having them assigned. Although a peer's characteristics such as his or her performance explain part of the variation in one's own performance, these peer effects cannot explain the treatment effects. Rather, our data indicate a positive effect on performance when having autonomy over peer assignments. Furthermore, the presence of peer effects in multiple dimensions has implications for the design of reassignment policies such as tracking regimes, which are based on, e.g., measures of students' ability. If policy-makers want to reassign students into classrooms or workers into teams based on peer effects in a single dimension only, they neglect the fact that reassigning rules simultaneously change other peer characteristics, giving rise to peer effects apart from the targeted dimension. These effects can counterbalance each other leading to ambiguous net effects. Chapter 2 (Determinants of Peer Selection) studies whom individuals choose as peers and links these choices to three potential determinants. Particularly, the chapter assesses the extent to which the selection of peers depends on (i) the relative performance of peers, (ii) personality differences, and (iii) the presence of friendship ties. By quantifying the relative contributions of performance and social aspects for peer choices, we find that friendship is the most important determinant, but individuals exhibit sizable homophily both in past performance and personality. These results help to explain why previous studies often find that different groups exert peer effects of different sizes. In particular, we suggest that selective peer choices may give rise to individual-specific peer groups that result in differential peer effects. Chapters1 and 2 document peer effects in performance and that individuals prefer peers who are similar to themselves. Although such peer choices and peer effects yield a correlated outcomes among peers, decisions often remain highly heterogeneous in general. One potential explanation for such heterogeneities are differences in beliefs that individuals hold. The aim of Chapters 3 and 4 is to systematically study the heterogeneity of subjective beliefs and expectations in two specific contexts. First, I investigate parents' beliefs about the returns to different parenting styles and neighborhoods (Chapter 3). Second, in joint work with Pia Pinger, Philipp Seegers, and Jan Bergerhoff, I characterize gender differences in students' wage expectations and discuss potential drivers thereof (Chapter 4). Parents are crucial for the development and success of children as they grow up. However, not much is known about how parents decide how to raise their children, and how parenting decisions depend on the environment in which a family lives. In order to answer these questions, Chapter 3 (Understanding Parental Decision-making: Beliefs about Returns to Parenting Styles and Neighborhoods) studies parents' beliefs about the returns to two factors affecting the development and long-term outcomes of children: (i) parenting styles defined by the extent of warmth and control parents employ in raising their children, and (ii) neighborhood quality. Based on a representative sample of over 2,000 parents in the United States, I show that parents hold well-formed beliefs: they expect large returns to the warmth dimension of parenting as well as to living in a good neighborhood. Regarding the relation of both factors, I find that parents perceive parenting as being able to compensate partly for adverse environments. Moreover, mothers expect larger returns than fathers, but there is no socioeconomic gradient in perceived returns. Parents' perceived returns are relevant for their actual decision-making in so far that they are predictive for actual parenting behavior. Hence, my results highlight that parental beliefs are an important determinant of parental decision-making, but cannot explain socioeconomic differences in parenting. Chapter 4 (Gender Differences in Wage Expectations: Sorting, Children, and Negotiation Styles) presents evidence from a large-scale study on gender differences in wage expectations based on a sample of over 15,000 students in Germany. Studying such wage expectations before labor market entry is important as they may determine further educational or labor market choices, affect within-household bargaining or negotiations with prospective employers, and may have consequences for financial decision-making, e.g., in terms of an optimal choice of retirement and savings plans. We document a large gender gap in expected wages that amounts to approximately 500,000 EUR over the life-cycle and resembles actual wage differences. In order to understand the underlying causes and determinants, we relate these expected wages to (i) differential sorting into majors, industries, and occupations, (ii) differences in child-rearing plans, and (iii) male-female differences in negotiation styles. We show that males and females sort themselves into different majors, industries, and occupations, and follow different negotiation strategies. While child-rearing plans are comparable across genders, females expect child-penalties for giving birth to children before the age of 30. In summary, this thesis focuses on human behavior and decision-making by investigating the role of peer influences and subjective expectations. Using data from field experiments and large-scale surveys, the four chapters provide a starting point for further analyses of social aspects and heterogeneous beliefs
Determinants of Human Capital Formation
Get PDFHuman capital is crucial for individuals’ economic prosperity. As such, differences in human capital are largely responsible for existing inequalities within society, making it essential to understand the determinants of individual human capital formation. This dissertation presents three empirical papers that explore various hypotheses related to both the investment and return dimension, of why there may be differences in individual human capital formation.
Chapter 2 is joint work with Laura Ehrmantraut and Pia Pinger, and explores students' expectations about the returns to completing higher education and provides first evidence on perceived signaling and human capital effects. We conducted a survey among a large and diverse sample of students at different stages of higher education to elicit counterfactual labor market expectations for the hypothetical scenarios of leaving university with or without a degree certificate. Our findings indicate substantial perceived returns to higher education. Moreover, using within-individual fixed effects models, we document substantial expected labor market returns from signaling, whereas perceived productivity-enhancing (human capital) returns seem to be less pronounced. Perceived graduation premia are enduring, leaving little scope for expected employer learning.
Chapter 3 presents causal evidence that a relatively mild event of family distress can have lasting negative consequences in a context with high-stakes standardized testing. I investigate how children's educational outcomes are affected by experiencing a common form of family distress - the death of a grandparent - shortly before taking a test that co-determines secondary school track placement. I employ administrative registers from the Netherlands that allow me to obtain causal estimates by exploiting the quasi-random timing of death with respect to the track placement test. The findings show that grandparental loss at an unfortunate time leads to reduced test performance, and consequently an increased likelihood of attending or graduating from the lowest track of secondary education. These negative effects on secondary school outcomes are further aggravated by the subjective teacher recommendation, as children who lost a grandparent receive a lower track recommendation. The possibility to participate in a makeup test and switch tracks later-on mitigates part of the negative effects, although it is not able to fully offset the initial setback.
Chapter 4 analyses how a family's economic environment influences parental investments in children's development. Worsening economic conditions can incentivize parental investments by raising the importance of human capital accumulation in ensuring later-life success. Using a large representative German survey, in a regional and time-fixed effects setting, I estimate the causal impact of the local unemployment rate on parental investment measures. I find that a rise in the unemployment rate increases measures of maternal support, academic interest and homework assistance. Furthermore, heterogeneity analysis suggests that the responsiveness of parenting behavior on economic incentives differs by parental and child background characteristics such as parental locus of control and secondary school track
Three Essays on Beliefs and Perceptions in Applied Microeconomics
Get PDFThe central theme of this thesis revolves around the examination of the role of beliefs and perceptions in labor and education economics. Understanding these aspects is crucial as they significantly influence various economic decisions. In the first chapter, my colleagues and I demonstrate that parental beliefs regarding the returns on education play a significant role in determining their decisions regarding their children's high school education. Furthermore, we highlight how disparities in beliefs across different socioeconomic groups contribute to variations in educational choices. In the second chapter, we document the strong association between social status and networks and students' perceptions of the school environment, focusing on socioeconomically disadvantaged schools. In the last chapter, I examine the influence of media on adolescents' aspirations and gender heterogeneity in this influence. Specifically, I investigate how media shapes perceptions of male adolescents regarding the role of income in their future utility.
In Chapter 1, we explore the link between parental beliefs about educational returns and the selection of secondary school tracks. Using innovative survey data from the Netherlands, we examine parental perceptions regarding (i) the likelihood of their children enrolling in and completing university, and (ii) the financial gains associated with a university degree. We find that parents with lower socioeconomic status perceive the returns to education as well as the likelihood of their children enrolling in and completing university to be substantially lower. Through the application of a choice model, we demonstrate that the perceived probability of completing a university degree and the expected financial advantages play a crucial role in shaping the preference for the academic track.
In Chapter 2, we investigate how adolescents' social status in their peers' eyes shapes the way they view their social climate in secondary schools. Utilizing novel data on over 10,000 students, we construct comprehensive measures of social status and perceived social climate for each student, including a sense of belonging, perceived behavioral norms, and bullying experience. We show that while central and well-connected students are positive about their social environment, less central and socially isolated students view it as hostile. Our results highlight the importance of improving the relational dynamics of adolescents in disadvantaged schools to create better learning environments for all.
In Chapter 3, I investigate how media images, particularly advertisements, shape audiences' aspirations. Utilizing the natural experiment in East Germany, I demonstrate that exposure to Western TV during the formative years of childhood and adolescence increases the income aspirations of males. Additionally, through an online experiment, I highlight that advertisements not only elevate income aspirations but also diminish the desire to have children among male adolescents. The latter particularly holds when the advertisements portray equal sharing of childcare responsibilities within couples. These findings underscore the pivotal role of media in perpetuating and reinforcing stereotypical gender roles
Going Beyond Counting First Authors in Author Co-citation Analysis
Get PDFThe present study examines one of the fundamental aspects of author co-citation analysis (ACA) - the way co-citation
counts are defined. Co-citation counting provides the data on which all subsequent statistical analyses and mappings
are based, and we compare ACA results based on two different types of co-citation counting - the traditional type that
only counts the first one among a cited work's authors on the one hand and a non-traditional type that takes into
account the first 5 authors of a cited work on the other hand. Results indicate that the picture produced through this non-traditional author co-citation counting contains more coherent author groups and is therefore considerably clearer. However, this picture represents fewer specialties in the research field being studied than that produced through the traditional first-author co-citation counting when the same number of top-ranked authors is selected and analyzed. Reasons for these effects are discussed
Variations on the Author
Get PDF“Variations on the Author” discusses two of Eduardo Coutinho’s recent films (Um Dia na Vida, from 2010, and Últimas Conversas, posthumously released in 2015) and their contribution to the general question of documentary authorship. The director’s filmography is characterized by a consistent yet self-effacing form of authorial self-inscription: Coutinho often features as an interviewer that rather than express opinions propels discourses; an interviewer that is good at listening. This mode of self-inscription characterizes him as an author who is not expressive but who is nonetheless markedly present on the screen. In Um Dia na Vida, however, Coutinho is completely absent form the image, while Últimas Conversas, on the contrary, includes a confessional prologue that moves the director from the margins to the center of his films. This article examines the ways in which these works stand out in the filmography of a director who offers new insights into the notion of cinematic authorship
Appropriate Similarity Measures for Author Cocitation Analysis
Get PDFWe provide a number of new insights into the methodological discussion about author cocitation analysis. We first argue that the use of the Pearson correlation for measuring the similarity between authors’ cocitation profiles is not very satisfactory. We then discuss what kind of similarity measures may be used as an alternative to the Pearson correlation. We consider three similarity measures in particular. One is the well-known cosine. The other two similarity measures have not been used before in the bibliometric literature. Finally, we show by means of an example that our findings have a high practical relevance.information science;Pearson correlation;cosine;similarity measure;author cocitation analysis
The Transition from University to the Labor Market with a Focus on Gender
No full textKumulative Dissertation, Otto-Friedrich-Universität Bamberg, 2024The transition from university to the labor market is an important stage for university graduates, with long-lasting effects on their careers (e.g., Gerhart, 1990; Oyer, 2006; Kahn, 2010; Oreopoulos et al., 2012). This dissertation examines critical factors influencing this transition, with a particular focus on gender differences and the impact of information on labor market outcomes. The findings of this dissertation are key to understanding the gender gap at the beginning of a career and identifying factors that are crucial for a successful transition into the labor market. In addition, it highlights the role of information frictions during this period and how reducing them can affect labor market outcomes. This understanding can help inform policies and practices aimed at smoothing the transition of graduates from university to the labor market and at reducing the gender gaps in the early stages of careers
Dispelling the Myths Behind First-author Citation Counts
Get PDFWe conducted a full-scale evaluative citation analysis study of scholars in the XML research field to explore just how different from each other author rankings resulting from different citation counting methods actually are, and to demonstrate the capability of emerging data and tools on the Web in supporting more realistic citation counting methods. Our results contest some common arguments for the continued
use of first-author citation counts in the evaluation of scholars, such as high correlations between author rankings by first-author citation counts and other citation
counting methods, and high costs of using more realistic citation counting methods that are not well-supported by the ISI databases. It is argued that increasingly available digital full text research papers make it possible for citation analysis studies to go beyond what the ISI databases have directly supported and to employ more
sophisticated methods
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