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1486 - Primary and secondary legislation – assessing the impacts of rules for making rulesJonathan Cave & Stephen Gibson
Impact assessments (IAs) of government regulatory policy proposals set out their expected costs, benefits and risks and who is likely to face those impacts. In the UK, primary legislation can confer powers on Government ministers and other bodies to enact Statutory Instruments (SIs) and other secondary legislation. Because SIs have the same effect as Acts of Parliament, but face significantly less scrutiny, there has been a trend to increase the use of this mechanism and to use them for areas of policy or principle, rather than purely administrative procedures. However, the different timing and treatment of primary and secondary legislation has important implications for the assessment of the impacts of the proposed measures in IAs. This paper outlines the rationale for a compound (primary and secondary) approach to introducing legislation, identifies different types of subordination and considers the implications for estimating their expected impacts in an IA - particularly when the assessment of the secondary measure happens after some of the uncertainty related to the possible outcomes of the primary measure has been resolved and this can be taken into account in the secondary decision(s). It points out the limitations of the conventional NPV-based approach to assessing the impacts of compound measures and proposes the use of a real options approach to IAs to address this concern. In particular it suggests that the real options approach should be used in cases where there are; uncertain outcomes, different possible timings, irreversible policy decisions and distortions due to the use of standard discount rates. Primary legislation creates the opportunity but not the obligation to pursue secondary measures and should be assessed taking these future options into account.
1485 - Developmental Dictatorship and Middle Class-driven DemocratisationHyungmin Park
I investigate the motives behind economic growth under a dictatorship, exploring the tradeoff between pursuing higher future gains, which come with growing threats from the demand for democracy from the emerging middle class, and accepting lower gains for a relatively more stable regime. I propose a model where a dictator invests and acquires a rent, citizens educate their children for skilled jobs, and these children adopt democratic values through education. I find that a dictator invests in an underdeveloped economy for future gains. As the economy matures, investment decreases because more citizens get democratic values from higher education. Democracy follows an opposite investment trend: little investment is made when the economy is underdeveloped, but more investment is made as it develops. The analysis is generalised to cases where the dictator is legitimised by higher economic growth than in democracies, and where the dictator oppresses the middle class through high taxation.
1484 - Urban-Biased Structural ChangeNatalie Chen, Dennis Novy, Carlo Perroni, and Horng Chern Wong
Using firm-level data from France, we document that the shift of economic activity from manufacturing to services over the last few decades has been urban-biased : structural change has been more pronounced in areas with higher population density. This bias can be accounted for by the location choices of large services firms that sort into big cities and large manufacturing firms that increasingly locate in suburban and rural areas. Motivated by these findings, we estimate a structural model of city formation with heterogeneous firms and international trade. We find that agglomeration economies have strengthened for services but weakened for manufacturing. This divergence is a key driver of the urban bias but it dampens aggregate structural change. Rising manufacturing productivity and falling international trade costs further contribute to the growth of large services firms in the densest urban areas, boosting services productivity and services exports, but also land prices.
1483 - How Big is the Media Multiplier? Evidence from Dyadic News DataTimothy Besley, Thiemo Fetzer & Hannes Mueller
This paper estimates the size of the media multiplier, an easily generalizable model-based measure of how far media coverage magnifies the economic response to shocks. We combine monthly aggregated and anonymized credit card activity data from 114 card issuing countries in 5 destination countries with a large corpus of news coverage in issuing countries reporting on violent events in the destinations. To define and quantify the media multiplier we estimate a model in which latent beliefs, shaped by either events or news coverage, drive card activity. According to the model, media coverage can more than triple the economic impact of an event. We document, through our model, that this effect is highly heterogenous and depends on the broader media representation of countries in each others news. We speculate about the role of the media in driving international travel patterns an.
1482 - Losing on the Home Front? Battlefield Casualties, Media, and Public Support for Foreign InterventionsThiemo Fetzer, Pedro CL Souza, Oliver Vanden Eynde, Austin L. Wright
How domestic constituents respond to signals of weakness in foreign wars remains an important question in international relations. In this paper, we study the impact of battlefield casualties and media coverage on public demand for war termination. To identify the effect of troop fatalities, we leverage the otherwise exogenous timing of survey collection across 26,776 respondents from nine members of the International Security Assistance Force (ISAF) in Afghanistan. Quasi-experimental evidence demonstrates that battlefield casualties increase coverage of the Afghan conflict and public demand for withdrawal, with heterogeneous effects consistent with an original theoretical argument. Evidence from a survey experiment replicates the main results. To shed light on the media mechanism, we leverage a news pressure design and find that major sporting matches occurring around the time of battlefield casualties drive down subsequent coverage, and significantly weaken the effect of casualties on support for war termination. These results highlight the crucial role that media play in shaping public support for foreign military interventions.
1481 - Platforms as arbitrageurs and facilitators of arbitrage- a simple analysisMichael Waterson
This paper analyses the consumer impacts of arbitrage focusing on the significant role of internet platforms as monopolistic arbitrageurs between essentially competitive sub-markets that have not been previously linked. As arbitrageurs, there is the potential for them to create consumer benefit, but for a series of reasons, we show that consumer welfare may not be enhanced and that particular sections of the community may be disadvantaged by their actions.
1480 - Catch me if you can : Gaps in the Register of Overseas EntitiesArun Advani, Cesar Poux, Anna Powell-Smith and Andy Summers
The Register of Overseas Entities (ROE) was introduced by the government in Spring 2022 with the commitment that it would require anonymous foreign owners of UK property to reveal their real identities. We use data released by Companies House and HM Land Registry to assess to what extent the ROE is currently delivering on this aim. We identify and quantify several major gaps in the scope and operation of the register and make recommendations for how the register could be improved.
1479 - The Monte Carlo Integral of a Continuum of Independent Random VariablesPeter J. Hammond
Consider a continuum of independent and identically distributed random variables corresponding to the points of the unit interval [0; 1]. Known technical diffculties are complemented by showing directly that the random sample path is almost surely not a Lebesgue measurable function. This refutes the common claim that, because of some version of the "law of large numbers", the integral of each sample path equals the common mean of each random variable. To obtain a valid and useful result, we apply to the continuum of random variables the Monte Carlo method of numerical integration based on limits as the sample size tends to infinity of empirical finite sample averages of the realized random values. The resulting "Monte Carlo integral" is almost surely a degenerate random variable concentrated on the mean. A suitably modified version works when the different indexed random variables are merely independent with cumulative distribution functions that are measurable w.r.t. the index. Further generalizations to Monte Carlo integrals of conditionally independent random variables result, under conditions discussed in Hammond and Sun (2008, 2021), in non-degenerate random integrals that are measurable w.r.t. the conditioning -algebra.
1478 - From the Death of God to the Rise of HitlerSascha O. Becker, Hans-Joachim Voth
Can weakened religiosity lead to the rise of totalitarianism? The Nazi Party set itself up as a political religion, emphasizing redemption, sacrifice, rituals, and communal spirit. This had a major impact on its success: Where the Christian Church only had shallow roots, the Nazis received higher electoral support and saw more party entry. shallow Christianity reflects the geography of medieval Christianization and the strength of pagan practices, which we use as sources of exogenous variation. We also find predictive power at the individual level : Within each municipality, the likelihood of joining the Nazi Party was higher for those with less Christian first names.
1477 - Railways and the European Fertility TransitionCarlo Ciccarelli, James Fenske, and Jordi Martí Henneberg
We show that the spread of the railway network slowed the decline of fertilityin Europe during the late nineteenth and early twentieth centuries. We construct novel data on market access across sub-national regions in Europe and use both a panel fixed effects approach and an instrumental variables strategy that leverages variation in market access stemming from access to distant markets. We find that greater market access predicts higher fertility, with a standardized magnitude of 0.14. Consistent with an interpretation that market access increased fertility by raising incomes relative to the returns to child quality and the opportunity cost of childbearing, we show that our results are driven by locations that achieved higher levels of income per capita despite lagging in human capital and female labor force participation.
1476 - Non-Meritocrats or Conformist Meritocrats? A Redistribution Experiment in China and FranceMargot Belguise, Yuchen Huang & Zhexun Mo
Recent empirical evidence contends that meritocratic ideals are mainly a Western phenomenon. Intriguingly, the Chinese people appear to not differentiate between merit- and luck-based inequalities, despite their rich historical legacy of meritocratic institutions. We propose that this phenomenon might be due to the Chinese public’s greater adherence towards the status quo. In order to test this hypothesis, we run an incentivized redistribution experiment with elite university students in China and France, by varying the initial split of payoffs between two real-life workers to redistribute from. We show that Chinese respondents consistently and significantly choose more non-redistribution (playing the status quo) across both highly unequal and relatively equal status quo scenarios than our French respondents. Additionally, we also show that the Chinese sample does differentiate between merit- and luck-based inequalities, and does not redistribute less than the French absent status quo conformity. Ultimately, we contend that such a phenomenon is indicative of low political agency rather than apathy, inattention, or libertarian beliefs among the Chinese. Notably, our findings show that Chinese individuals’ conformity to the status quo is particularly pronounced among those from families of working-class and farming backgrounds, while it is conspicuously absent among individuals whose families have closer ties to the private sector.
1475 - Innovation During Challenging Times∗Danilo Cascaldi-Garcia, Marija Vukotic & Sarah Zubairy
When is receiving positive news regarding future technological advancements most impactful on the economy: during recessions or economic booms? A recession might represent an opportune time for investing in relatively cheaper, productivity enhancing activities. However, tighter financial constraints during recessions might hinder the ability to secure funds for these activities. We explore this dichotomy by exploiting patent-based innovation shocks, which are constructed using changes in stock market valuations of firms that obtain patent grants. We find that aggregate patent-based innovation shocks have a greater impact on the economy during recessions, leading to a more significant increase in private investment. Additionally, our exploration of firm-level data uncovers supporting evidence that firms tend to boost their capital investment and R&D expenditures in response to these innovation shocks, particularly during recessions. The financial constraints of firms play a crucial role, with capital investments by firms with low default risk driving the larger impact observed during recessions
1474 - Religion and GrowthSascha O. Becker, Jared Rubin, and Ludger Woessmann
We use the elements of a macroeconomic production function—physical capital, human capital, labor, and technology—together with standard growth models to frame the role of religion in economic growth. Unifying a growing literature, we argue that religion can enhance or impinge upon economic growth through all four elements because it shapes individual preferences, societal norms, and institutions. Religion affects physical capital accumulation by influencing thrift and financial development. It affects human capital through both religious and secular education. It affects population and labor by influencing work effort, fertility, and the demographic transition. And it affects total factor productivity by constraining or unleashing technological change and through rituals, legal institutions, political economy, and conflict. Synthesizing a disjoint literature in this way opens many interesting directions for future research.
1473 - Efficient estimation of regression models with user-specified parametric model for heteroskedastictySaraswata Chaudhuri and Eric Renault
Several modern textbooks report that, thanks to the availability of heteroskedasticity robust standard errors, one observes the near-death of Weighted Least Squares (WLS) in cross-sectional applied work. We argue in this paper that it is actually possible to estimate regression parameters at least as precisely as Ordinary Least Squares (OLS) and WLS, even when using a misspecified parametric model for conditional heteroskedasticity. Our analysis is valid for a general regression framework (including Instrumental Variables and Nonlinear Regression) as long as the regression is de ned by a conditional expectation condition. The key is to acknowledge, as first pointed out by Cragg (1992) that, when the user-specific heteroskedasticity model is misspecified, WLS has to be modified depending on a choice of some univariate target for estimation. Moreover, targeted WLS can be improved by properly combining moment equations for OLS and WLS respectively. Efficient GMM must be regularized to take into account the possible multicollinearity of estimating equations when errors terms are actually nearly homoscedastic.
1472 - The Returns to Viral Media: The Case of US Campaign ContributionsJohannes Böken, Mirko Draca, Nicola Mastrorocco & Arianna Ornaghi
Social media has changed the structure of mass communication. In this paper we explore its role in influencing political donations. Using a daily dataset of campaign contributions and Twitter activity for US Members of Congress 2019-2020, we find that attention on Twitter (as measured by likes) is positively correlated with the amount of daily small donations received. However, this is not true for everybody: the impact on campaign donations is highly skewed, indicating very concentrated returns to attention that are in line with a ‘winner-takes-all’ market. Our results are confirmed in a geography-based causal design linking member’s donations across states.
1471 - Economic Warfare: Lessons from Two World WarsMark Harrison
Economic warfare was a product of the total wars of the twentieth century. Four lessons are discussed: (1) Modern economies are resilient under attack. (2) The action of economic warfare is slow. (3) Economic warfare is powerful—eventually. (4) The threat of economic warfare is also powerful—although not always as hoped. To conclude, economic warfare belongs to wars of attrition. In such wars, economic and military measures are complements, not substitutes.
1470 - On the promises and perils of Smithian growth – from pin factory to AIMarcus Miller
For path-breaking insights on how prices can guide the efficient allocation of resources and on how innovation and investment can spur economic growth, Adam Smith is justly renowned. He was, however, well aware of problems posed by market dominance – specifically in banking and, more generally, wherever getting to the scale that delivers increasing returns leads to monopolistic behaviour. For the historical record, we draw on the recent wide-ranging survey by Acemoglu and Johnson on how the benefits of innovation have been spread across society since the Industrial Revolution. We also consider these issues in the context of geo-political competition.
1469 - Trajectories of Early Childhood Skill Development and Maternal Mental HealthDilek Sevim, Victoria Baranov, Sonia Bhalotra, Joanna Maselko & Pietro Biroli
We investigate the impacts of a perinatal psychosocial intervention on trajectories of maternal mental health and child skills, from birth to age 3. We find improved maternal mental health and functioning (0.17 – 0.29 SD), modest but imprecisely estimated improvements in parental investments (0.07 to 0.11 SD), and transitory improvements in child socioemotional development (0.06 to 0.39 SD). We also find negligible influence of the intervention on physical health and cognitive development. Estimates of a skill production function reveal that the intervention is associated with reduced productivity of maternal mental health and narrowed depression gaps in mother and child outcomes.
1468 - (How) Do electoral surprises drive business cycles? Evidence from a new datasetThiemo Fetzer & Ivan Yotzov
This paper documents that surprise election outcomes – measured as deviations between realised vote shares and expected vote shares based on a newly constructed dataset of opinion polls and party and candidate vote shares close to election day – are causing non-negligible short-term contractions in economic activity. We find that, on average, a percentage point higher surprise is associated with a 0.37 percentage point lower year-on- year growth rate one year after the election. These effects are only present in countries with strong democracies and seem to operate mainly through increased economic policy uncertainty and lower investment growth over a window of up to eight quarters after an election. In addition, surprise performances of left-wing political parties and in elections with transitions to left-wing governments (pre-defined from the Parlgov Database) are associated with the largest effects on the economy.
1467 - Distributional and climate implications of policy responses to energy price shocksThiemo Fetzer, Ludovica Gazze & Menna Bishop
Which households are most affected by energy price shocks? What can we learn about the distributional implications of carbon taxes? How do interventions in energy markets affect these patterns? This paper introduces a measurement framework that leverages granular property-level data representing more than 50% of the English and Welsh housing stock. We use this ex-ante measurement framework to investigate these questions and set out an empirical evaluation framework to study the causal effects of the energy crisis more broadly. We find that the energy price shock has a more pronounced effect on relatively more affluent areas highlighting the likely progressive impact of carbon taxation. We document that commonly used untargeted interventions in energy markets significantly weaken market price signals for able-to-pay households. Alternative, more targeted policies are cheaper, easily implementable, and could better align energy saving incentives.
1466 - Synthetic Decomposition for Counterfactual PredictionsNathan Canen and Kyungchul Song
Counterfactual predictions are challenging when the policy variable goes beyond its pre-policy support. However, in many cases, information about the policy of interest is available from different (“source”) regions where a similar policy has already been implemented. In this paper, we propose a novel method of using such data from source regions to predict a new policy in a target region. Instead of relying on extrapolation of a structural relationship using a parametric specification, we formulate a transferability condition and construct a synthetic outcome-policy relationship such that it is as close as possible to meeting the condition. The synthetic relationship weighs both the similarity in distributions of observables and in structural relationships. We develop a general procedure to construct asymptotic confidence intervals for counterfactual predictions and prove its asymptotic validity. We then apply our proposal to predict average teenage employment in Texas following a counterfactual increase in the minimum wage.
1465 - Economic Impact of Significant New Deployment of Infrastructure: Historical examples and links to potential high impact outcomes for 5GJonathan Cave, Michael Waterson & Giuliana Battisti
This paper aims to examine quantitatively and qualitatively the impact of five key general purpose technologies in order to gain insights into what factors may arise in relation to 5G as a potential example. We first attempt a definition of what constitutes a general-purpose technology, providing a potential framework for analysis of impact mechanisms then take this to the five case studies. It is difficult to capture the impacts of such technologies because their scope is broad and commonly a suitable base case from which to measure impact is missing. In addition, there are in each case antecedents and complementary developments which influence their impact. However, our analysis points to a range of factors that must be considered in relation to potential new candidate technologies, including a range of potential governmental interventions.
1464 - Identification of Expectational Shocks in the Oil Market using OPEC AnnouncementsRiccardo Degasperi
Surprises in the price of oil futures computed on the day of OPEC announcements have been used as an exogenous measure of shifts in market beliefs about future oil supply to identify shocks to oil supply expectations. I show that these surprises capture not only revisions in market expectations about oil supply, but also revisions in expectations about oil demand. This conflation of supply and demand components invalidates the use of the surprises as an exogenous measure of shocks to oil supply expectations. I show that imposing an additional restriction on the sign of the co-movement between surprises in oil futures and changes in stock prices within the day of the OPEC announcement disentangles the two underlying shocks. Accordingly, I derive two robust instruments for the identification of shocks to oil supply and demand expectations that combine the surprises with this additional sign restriction, and I test them on a set of empirical specifications modelling the oil market and the global economy. A negative shock to oil supply expectations has deep and long-lasting stagflationary effects on global economic conditions that are stronger and more immediate than previously reported. These effects represent a challenge for monetary authorities that seek to stabilise both prices and output. I show that information effects are a prominent feature of the oil market and need to be accounted for when estimating the effects of shocks to oil supply expectations.
1463 - Ethnic conflict : the role of ethnic representationSonia Bhalotra, Irma Clots-Figueras and Lakshmi Iyer
We investigate the impact of the political representation of minority groups on the incidence of ethnic conflict in India. We code data on Hindu-Muslim violence and Muslim political representation in India and leverage quasi-random variation in legislator religion generated by the results of close elections. We find that the presence of Muslim legislators results in a large and significant decline in Hindu-Muslim conflict. The average result is driven by richer states and those with greater police strength. Our results suggest that the political empowerment of minority communities can contribute to curbing civil conflict.
1462 - If You Do Not Change Your Behavior: Preventive Repression in Lithuania under Soviet RuleEugenia Nazrullaeva & Mark Harrison
Who is targeted by preventive repression and why? In the Soviet Union, the KGB applied a form of low-intensity preventive policing, called profilaktika. Citizens found to be engaging in politically and socially disruptive misdemeanors were invited to discuss their behavior and to receive a warning. Using novel data from Lithuania, a former Soviet republic, in the late 1950s and the 1970s, we study the profile and behaviors of the citizens who became subjects of interest to the KGB. We use topic modeling to investigate the operational focuses of profilaktika. We find that profilaktika began as a way of managing specific threats or “known risks” that arose from the experience of postwar Sovietization. The proportion of “unknown risks” – people without risk factors in their background or personal records – increased by the 1970s. These people were targeted because of their anti-Soviet behaviour, which the KGB attributed to “contagious” foreign influences and the spread of harmful values.
1461 - Brexit and consumer food pricesJan David Bakker, Nikhil Datta, Richard Davies and Josh De Lyon
Brexit continues to affect the UK economy. The results in this report are updates to the original study of Bakker et al. (2022), showing that higher non-tariff barriers due to Brexit are affecting food price inflation and costing households in the UK. While the original paper used data up to January 2022, this report updates the dataset through to March 2023. The methodology is otherwise identical so for more details please consult the original paper (appended to this paper).
1460 - Rational DialoguesJohn Geanakoplos & Herakles Polemarchakis
Any finite conversation no matter how crazy it sounds can be given context in which it is a rational dialogue
1459 - Did the policy response to the energy crisis cause crime? Evidence from EnglandThiemo Fetzer
The invasion of Ukraine has led to an unprecedented increase in energy prices in much of Western Europe with policy makers actively intervening in energy markets to cushion the shock. The UK’s policy response stands out: the energy price guarantee (EPG) was entirely untargeted and is, in real terms, much less generous to those living in properties with low energy efficiency. Using granular data and following a documented research approach this paper documents that areas more exposed to the energy price shock saw a notable increase in burglaries and anti-social behaviour: the energy price shock is responsible for a 6 to 10 percent increase in burglaries and a 9 to 24 percent increase in police reported anti-social behaviour between October 2022 to March 2023 inclusive. A quantification of policy alternatives suggests that a more targeted energy support package and/or a more energy efficient housing stock could have resulted in a drastically less pronounced uptick in crime.
1458 - Unconditional Convergence in Manufacturing Productivity across U.S. States: What the Long-Run Data ShowAlexander Klein & Nicholas Crafts
This paper examines long-run unconditional convergence of labour productivity in manufacturing across 48 contiguous U.S. states. For that purpose, we construct a detailed panel data set of state industry pairs with over 120 industries covering the period 1880-2007. We find that unconditional - convergence in manufacturing productivity was pervasive and rapid – 7.6% per year in 1880-2007 – and that manufacturing accounts for most of the unconditional convergence contribution to overall productivity growth over the long run: 61% in 1880-1940 and 91% in 1958-2007. We also examined broad U.S. regions and found that in the South the contribution of unconditional -convergence in manufacturing to aggregate productivity growth before World War II was weak not because of a slower convergence rate but a much smaller manufacturing sector.
1456 - Emergency Care Centers, Hospital Performance and Population HealthSonia Bhalotra, Leticia Nunes & Rudi Rocha
Hospitals are under increasing pressure as they bear a growing burden of chronic disease while also dealing with emergency cases that do not all require hospital care. Many countries have responded by introducing alternative facilities that provide 24/7 care for basic and medium-complexity cases. Using administrative data, we investigate impacts of the opening of these intermediate facilities (UPA) in the state of Rio de Janeiro in Brazil. We find that an UPA opening in the catchment area of a hospital reduces hospital outpatient procedures and admissions and that this is associated with improved hospital performance. There is a decline in inpatient mortality, particularly mortality from the more complex conditions that hospitals are best equipped to deal with. There is no discernible change in the risk profile of cases going to hospital, and no concurrent policy changes that can account for these findings. In order to capture displacement effects, we investigate city-level population outcomes. We find that two-thirds of the decline in hospital mortality is offset by deaths in UPAs. Looking at individual death causes, we see a net decline in deaths from congestive heart failure.
1455 - Measuring maternal autonomy and its effect on child nutrition in rural IndiaWiji Arulampalam, Anjor Bhaskar and Nisha Srivastava
We examine the link between a mother’s autonomy - the freedom and ability to think, express, make decisions, and act, independently - and the nutritional status of her children. We design a novel statistical framework that accounts for the cultural and traditional environment to create a measure of maternal autonomy treating this as a latent characteristic that is fixed in the short term. Using data from India, we deal with two econometric challenges: (i) creation and measurement of the ‘autonomy’ index, and (ii) endogeneity caused by selection due to son preference. We find : (i) one standard deviation (SD) higher autonomy score is associated with a 0.16 SD higher Height-for-Age Z-scores (HAZ); and an (ii)10% lower prevalence of stunting (HAZ <-2 SD). The latter is equivalent to the prevention of approximately 300,000 children from stunting, indicating the important role of maternal autonomy.
1454 - Measuring top income shares in the UKArun Advani, Andy Summers & Hannah Tarrant
Information about the share of total income held by the richest 1%, or other top income groups, is increasingly used to discuss inequality levels and trends within and between nations. A top income share is the ratio of the total income held by the top income group divided by total personal income (the ‘income control total’). We compare two approaches to estimating income control totals: the ‘external’ approach used by the World Inequality Database, and an augmented ‘internal’ approach. We argue in favour of the latter, with reference to five desirable properties that a top share series would ideally possess. The choice matters: our augmented ‘internal’ approach yields estimates of the UK top 1% share that are around 2 percentage points higher than the ‘external’ approach.
1453 - Can Pollution Markets Work in Developing Countries? Experimental Evidence from IndiaMichael Greenstone, Rohini Pande, Anant Sudarshan and Nicholas Ryan
Market-based environmental regulations are seldom used in developing countries, where pollution is the highest but state capacity is often low. We experimentally evaluate a new particulate matter emissions the first in the world, covering industrial plants in a large Indian city. There are three main findings. First, the market functioned well: permit trade was active and plants obtained permits to meet their compliance obligations almost perfectly. Second, treatment plants, randomly assigned to the emissions market, reduced pollution emissions by 20% to 30%, relative to control plants. Third, the market, holding emissions constant, reduces abatement costs by 11% to 14%. These cost estimates are based on a model that estimates heterogeneous plant marginal abatement costs from plant bids for emissions permits. More broadly, we find that emissions can be reduced at small increases in abatement costs. The pollution market therefore has health benefits that exceed costs by at least twenty-five times.
1352 - Obesity Stigma : Causes, Consequences, and Potential SolutionsThijs van Rens, Petra Hanson, Oyinlola Oyebode, Lukasz Walasek, Thomas M Barber and Lena Al-Khudairy
This review aims to examine (i) the aetiology of obesity ; (ii) how and why a perception of personal responsibility for obesity so dominantly frames this condition and how this mindset leads to stigma ; (iii) the consequences of obesity stigma for people living with obesity, and for the public support for interventions to prevent and manage this condition ; and (iv) potential strategies to diminish our focus on personal responsibility for the development of obesity, to enable a reduction of obesity stigma, and to move towards effective interventions to prevent and manage obesity within the population. Recent Findings We summarise literature which shows that obesity stems from a complex interplay of genetic and environment factors most of which are outside an individual’s control. Despite this, evidence of obesity stigmatisation remains abundant throughout areas of media, entertainment, social media and the internet, advertising, news outlets, and the political and public health landscape. This has damaging consequences including psychological, physical, and socioeconomic harm. Summary Obesity stigma does not prevent obesity. A combined, concerted, and sustained effort from multiple stakeholders and key decision-makers within society is required to dispel myths around personal responsibility for body weight, and to foster more empathy for people living in larger bodies. This also sets the scene for more effective policies and interventions, targeting the social and environmental drivers of health, to ultimately improve population health.
1351 - Regulatory barriers to climate action: Evidence from Conservation Areas in EnglandThiemo Fetzer
Preserving heritage is an important part of maintaining collective identity for future generations. Yet, in the context of the climate crisis, it is imperative to understand to what extent there is a tangible trade-off between conserving character vis-a-vis averting the worst of climate change – a much more existential threat to those future generations. Studying data for more than half of the English housing stock, I show that conservation area status – a special area based designation to preserve the unique character of a neighborhood – not to be confused with preservation of historic buildings – in England may be responsible for up to 3.2 million tons of avoidable CO2 emissions annually. Using a suite of micro-econometric methods I show that properties in conservation areas have a notable worse energy efficiency; experience lower investment in retrofitting and consume notably higher levels of energy owing to poor energy efficiency. Effect sizes are very consistent comparing engineering based energy consumption estimates with actual consumption data. Effects can be directly attributed to planning requirements for otherwise permitted development that only apply to properties by virtue of them being located inside a conservation area.
1450 - Affective interdependence and welfareAviad Heifetz, Enrico Minelli & Herakles Polemarchakis
Purely affective interaction allows the welfare of an individual to depend on her own actions and on the profile of welfare levels of others. Under an assumption on the structure of mutual affection that we interpret as nonexplosive mutual affection, we show that equilibria of simultaneous-move affective interaction are Pareto optimal independently of whether or not an induced standard game exists. Moreover, if purely affective interaction induces a standard game, then an equilibrium profile of actions is a Nash equilibrium of the game, and this Nash equilibrium and Pareto optimal profile of strategies is locally dominan.
1449 - Shadow LobbyistsRocco d’Este, Mirko Draca & Christian Fons-Rosen
Special interest influence via lobbying is increasingly controversial and legislative efforts to deal with this issue have centred on the principle of transparency. In this paper we evaluate the effectiveness of the current regulatory framework provided by the US Lobbying Disclosure Act (LDA). Specifically, we study the role of ex-Congressional officials who join US lobbying firms in positions that could be related to lobbying activity but without officially registering as lobbyists themselves. We find that firm lobbying revenues increase significantly when these potential ‘shadow lobbyists’ join, with effects in the range of 10-20%. This shadow lobbyist revenue effect is comparable to the effect of a registered lobbyist at the median of the industry skill distribution. As such, it is challenging to reconcile the measured shadow lobbyist effect with the 20% working time threshold for registering as a lobbyist. Based on our estimates, the unaccounted for contributions of unregistered lobbyists can be valued at $149 million USD in revenue terms and this effect is concentrated within the industry’s largest and most active firms.
1448 - Electoral Accountability and Local Support for National PoliciesEleonora Alabrese, Federica Liberini, Francesco Porcelli, Michela Redoano & Antonio Russo
We study the provision of information by local governments that supports individual compliance with nationwide regulation, and how this provision relates to the electoral process. We use information about individual mobility (compliance with the lockdown) and Facebook posts by Italian local governments during the Covid 19 pandemic. We show that in municipalities where mayors were up for reelection, local governments provided significantly more covid-related information. This information caused a significant decrease in mobility and excess mortality. However, these effects seem to arise only in the northern regions of the country, where the impact of the pandemic was more severe.
1447 - Exploring European Regional TradeMarta Santamaría, Jaume Ventura and Uğur Yeşilbayraktar
We use the new dataset of trade flows across 269 European regions in 24 countries constructed in Santamaría et al. (2020) to systematically explore for the first time trade patterns within and across country borders. We focus on the differences between home trade, country trade and foreign trade. We document the following facts: (i) European regional trade has a strong home and country bias, (ii) geographic distance and national borders are important determinants of regional trade, but cannot explain the strong regional home bias and (iii) the home bias is heterogeneous across regions and seems to be driven by political regional borders.
1446 - Healthy diets, lifestyle changes and well-being during and after lockdown: longitudinal evidence from the West MidlandsThijs van Rens, Petra Hanson, Oyinlola Oyebode, Lukasz Walasek, Thomas M Barber and Lena Al-Khudairy
Lockdowns’ to control the spread of COVID-19 in the UK affected many aspects of life and may have adversely affected diets. We aimed to examine (1) the effect of lockdowns on fruit and vegetable consumption, as a proxy for healthy diets more generally, and on weight and well-being, (2) whether any subgroup was particularly affected and (3) the barriers and facilitators to a healthy diet in lockdown. We find no evidence for decreased fruit and vegetable consumption during lockdown compared with afterwards. If anything, consumption increased by half a portion daily among women, particularly among those who normally have a long commute. This finding, combined with a significant increase in physical activity, suggests that behaviours were healthier during lockdown, consistent with higher self-reported health. However, well-being deteriorated markedly, and participants reported being heavier during the lockdown as well. Our qualitative data suggest that an abundance of resources (more time) supported higher fruit and vegetable consumption during lockdown, despite increased access issues. Our results may assuage concerns that lockdowns adversely affected diets. They may point to the impact of commuting on diet, particularly for women. We add longitudinal evidence to a growing body of literature on the adverse effect of lockdown on mental health.
1445 - Demand for Electricity on the Global Electrification FrontierRobin Burgess, Michael Greenstone, Nicholas Ryan and Anant Sudarshan
Falling off-grid solar prices and an expanding grid are revolutionizing choices for nearly a billion people without electricity. Using experimental price variation, we estimate demand for all electricity sources in Bihar, India, during a four-year period when electrification leapt from 27% to 64%. We find that: (i) household surplus from electrification increased five-fold; (ii) both solar and the grid boost electrification but households gain more surplus from the grid; (iii) grid investments and subsidies strongly reduce demand for off-grid solar. When we extend the model to eight African countries where grid infrastructure is weaker and subsidies lower we find that off-grid solar often provides higher surplus than the grid.