Calendrier du 23 novembre 2023
PEPES (Paris Empirical Political Economics) Working Group
Du 23/11/2023 de 12:30 à 14:00
R2.21
JHA Saumitra()
KOUDIJS Peter(University Rotterdam)
SALGADO Marcos()
Markets under Siege: How Political Beliefs Move Financial Markets
Can beliefs about politics, particularly the benefits of war and peace, move thick financial markets? During and after the Siege of Paris by the Prussian army (1870- 71) we document that the prices of the French 3% sovereign bond (rente) differed persistently between the Bourse in Paris and elsewhere, despite being the most actively traded financial asset in continental Europe. Further, these differences were large, equivalent to almost 1% of French GDP in overall value. We show these differences manifested themselves during the period of limited arbitrage induced by the Siege and persisted until the peace terms were revealed. We show that as long as French military resistance continued, the rente price remained higher in Paris than the outside markets. However, when the parties ceased fire and started negotiating peace terms, this pattern was reversed. Further, while the price in Paris responded more negatively (positively) to defeats (victories), the price responded more to peace events elsewhere. These specific patterns are difficult to reconcile with other potential mechanisms, including differential information sets, need for liquidity, or relative market thickness. Instead, we argue that these results are consistent with prices reflecting the updating of different prevailing political beliefs in Paris and elsewhere about the benefits of war versus peace.
TOM (Théorie, Organisation et Marchés) Lunch Seminar
Du 23/11/2023 de 12:30 à 13:30
R1-15
LIQUI LUNG Caroline (Cambridge University)
Intersectionality in Individual Choice Behavior: The Pitfalls and Opportunities
I show how intersectionality, the interconnections of social organizations that create interdependent systems of disadvantage, plays a role in individual choice behavior. I analyze the model in Liqui Lung (2022) with multi-dimensional social types and show how agents endogenously determine which dimensions of social identity affect belief formation as a function of their exogenously specified social type, their social context and their underlying ability. I discuss what the implications of this behavior are for both individual and aggregate choice behavior, and show how social constraints, such as stigmatization or stereotypes, and endogenizing the social type, affect these patterns. I then illustrate how these insights could help explain the pitfalls we encounter in the evaluation of one-dimensional policy measures, and discuss how we could harness intersectionality to develop more effective approaches.
Travail et économie publique externe
Du 23/11/2023 de 12:30 à 13:30
PSE- 48 boulevard Jourdan, 74014 Paris, salle R1-09
PROFETA Paola (Bocconi University)
Family Culture and Childcare: Individual Preferences and Politicians' Legislative Behavior
écrit avec Lorenzo de Masi and Francesca Carta
We analyze whether historical principles defining the internal organization of the family in the past (i.e., equal inheritance and cohabitation) drive contemporary individual preferences for public childcare of US citizens. Then, we further investigate whether the support of federal politicians for childcare policies reflects the prevailing preferences among their constituents, as shaped by the historical organization of the family in their country of origin, or whether it is more significantly influenced by their own family backgrounds. We find that US citizens whose ancestors' familiar relationships were characterized by equal inheritance rules, which in turn are associated with a traditional financial dependency on parents, are more prone to advocate for government intervention in childcare services; on the contrary, individuals whose forebears traditionally lived in large, cohabiting family units tend to rely less on the government as an external provider of public childcare. Likewise, US representatives elected in districts where equal inheritance rules (or cohabitation principles) are predominant in the population's ancestry tend to sponsor more (or less) childcare-related bills, respectively, regardless of their own family origins. Finally, the prevailing historical family principles also influence the composition of the House of Representatives, thereby increasing (decreasing) the likelihood that a district with an egalitarian (large cohabitation) family background will be represented by a Democratic or a female politician.
Behavior seminar
Du 23/11/2023 de 11:00 à 12:00
R2-21
HAMMOND Peter (University of Warwick)
An Arboretum of Decision Trees
Recent work on finite decision trees has characterized pre-rational preference relations over the space of Anscombe/Aumann consequence lotteries as those that are complete and transitive, as well as satisfying the independence axiom for behaviour under risk, and the sure-thing principle for behaviour under uncertainty. In case the preferences are continuous over Marschak triangles, these properties imply that pre-rational preferences have a subjective expected utility representation. This past work considered trees containing four kinds of node: (i) decision nodes; (ii) terminal nodes with consequences; (iii) chance nodes at which a roulette lottery is resolved; (iv) event nodes at which a horse lottery is resolved. This talk will recognize the relevance of three further kinds of node: (v) quantum nodes, which can be replaced by a combination of decision, event and chance nodes; (vi) timed consequence nodes, which need not be terminal nodes; (vii) enlivenment nodes, which can be initial nodes of an enlivened continuation subtree about which nothing can be predicted before at least one earlier decision has to be made. The main focus will be on trees with timed consequence nodes in which, in the absence of menu consequences that include non-trivial continuation subtrees, the previous results on pre-rational preferences apply for an extended domain of elongated consequences taking the form of intertemporal consequence streams. The last part of the talk will consider whether preferences without an expected utility representation, like those in the potential addict example or in the Allais and Ellsberg paradoxes, can be made pre-rational by extending them to give weight to menu consequences
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