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Department of Economics

Research in a Nutshell

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… slavery helped the early rise of Europe? In Britain, areas with a higher proportion of slaves were less agricultural, had more cotton mills, introduced more steam engines, had higher per capita wealth and employed more people in industry.

Joachim Voth 
Slavery and the British Industrial Revolution
NBER Working Paper No. 30451

...  the German debt brake has played a major role in crowding out private investments? Regional savings banks are obliged to lend at relatively low interest rates to municipalities, which have had massive additional financing needs due to cuts at federal and state level. These shadow costs lead to higher interest rates for investment loans for small and medium-sized enterprises, which often have no other source of financing than the savings banks.

Mathias Hoffmann, Michael Stiefel, Iryna Stewen
Growing Like Germany: Local Public Debt, Local Banks, Low Private Investment 
UZH Working Paper ECON 380
 

…a quarter of the increase in wealth concentration of the wealthiest 0.1 per cent of Swiss taxpayers is due to reductions in wealth tax rates over the last 50 years?

Samira Marti, Florian Scheuer, Isabel Z. Martínez
Does A Progressive Wealth Tax Reduce Top Wealth Inequality? Evidence From Switzerland
CEPR Discussion Paper No. 17989
 

… there is a simple method to ensure that priority and equal treatment are met for rationed goods? Suppose there are half a million people living in cities A and B who should be vaccinated, but there are only a quarter of a million vaccine doses. There are 400,000 people living in A and 100,000 in B. In order for each city to vaccinate half of the highest priority people, 1/5 of the doses should be delivered to B and 4/5 of the doses should be delivered to A. 

Carlos Alós-Ferrer, Jaume García-Segarra, Miguel Ginés-Vilar
Ethical allocation of scarce vaccine doses: The Priority-Equality protocol
Frontiers in Public Health 10:986776
 

… by using simple statistical methods and publicly available data on flight times, it can be proven that the Earth's surface must be curved and that the Earth cannot be flat? The resulting estimate for the curvature is almost identical to the value /20 000 km, which is based on complicated physical measurements. 


Olivier Ledoit, Michael Wolf, David Bell
A Novel Estimator of Earth’s Curvature (Allowing for Inference As Well) 
UZH Working Paper ECON 431
 

... in developing countries many farmers are day laborers? This makes it difficult for them to put money aside for unexpected expenses. Many are willing to accept a wage reduction of up to 15% in exchange for being paid monthly.

Lorenzo Casaburi, Rocco Macchiavello
Demand and Supply of Infrequent Payments as a Commitment Device: Evidence from Kenya
American Economic Review, 2019
 

...politicians who advocate universalist ethical principles, i.e. who want to improve the welfare of all people equally, are considered more trustworthy than politicians who are willing to favor one group at the expense of another?

Jim Everett, Molly Crocket, Julien Senn, Michel Maréchal et al.
Moral dilemmas and trust in leaders during a global health crisis
Nature Human Behaviour, 2021
 

Prosociality_Pandemic

... that contrary to the often-held belief, the gender of older and younger siblings does not influence personality development? 

[paper]

Prosociality_Pandemic

... that structural changes affect the demand for different skills in the labor market and thereby increase income inequality? In one experiment, participants are more likely to accept inequality when it is caused by such random demand shocks for skills than when it is based on a coin toss. This contrasts with widespread meritocratic notions of fairness.

 

Simona Sartor, Jeffrey Yusof (Working Paper, 2022)

Prosociality_Pandemic

... that by reducing labor costs, the German Hartz reforms reduced innovation in automation technologies by firms selling equipment to Germany?

[paper]

Prosociality_Pandemic

... that the average height is a proxy for the biological standard of living? Over the centuries, living conditions have improved and people have grown taller.  But short-term economic cycles are also reflected in fluctuations in average body size, offering valuable insights into the quality of life of past societies.

[paper]

Prosociality_Pandemic

... that in most countries there is still room to increase top tax rates without de-incentivizing economic activity?

[paper]

Prosociality_Pandemic

... that people in democratic countries are happier — regardless of culture, income, language, or religion? This effect is stronger the more established the democracy in which they live.

[paper]

Prosociality_Pandemic

... that a one-time financial grant does not reduce socio-economic inequalities? Children who benefited from the "Baby Bonus" paid in 2007 in Spain did not show better results than others in terms of health and school test scores.

[paper]

Prosociality_Pandemic

... that even moderate alcohol consumption is associated with a smaller brain volume and a reduced mass of gray and white brain matter? The effects are exponential; giving up on the last beer is also a good idea from the point of view of brain aging.

[paper]

Prosociality_Pandemic

... that pesticide-free coffee cultivation contributes to the spread of coffee rust, a fungal disease that attacks coffee plants and causes widespread crop failure? The resulting crop and revenue losses, in turn, generate high social costs.

[paper]

Prosociality_Pandemic

... that a consistent renunciation of cheese and beef leads in total to a better CO2 balance than a purely vegetarian diet?

[paper]

Prosociality_Pandemic

... that developed countries would have an incentive to increase their carbon tax by up to 26% if the economic and social costs of climate refugees were integrated into growth models?

[paper]

Prosociality_Pandemic

... that interventions with environmental goals can have reinforcing side effects? A project to reduce hot water consumption led to a reduction in heating consumption as well.  

[paper]

Prosociality_Pandemic

... that young men with higher risk-taking and impatience are more likely to commit property crimes, while those with less self-control are more likely to commit violence, drug, and sexual offenses? For the first time, preferences such as risk-taking, impatience, altruism, and self-control could be used to predict delinquent behavior.

[paper]

Prosociality_Pandemic

... that variance in reaction times on a memory test is a better predictor of a child's school performance-one year after working memory training-than the accuracy of his or her responses on the memory test.

[paper]

Prosociality_Pandemic

... that prosociality is a little-known but superior predictor of individual behavior in the area of public health? Researchers show that a large majority of people are very reluctant to put others at risk for their personal benefit. The level of prosociality predicts health behaviors during the COVID-19 pandemic. Prosocial individuals are more likely to follow physical distancing guidelines, stay home when sick, and buy face masks.     [paper]

Snowboard

... that large redistributive measures can secure long-lasting political support and electoral gains? This is shown by a study of the Italian land reform of 1951, which split large estates and transferred land to small owners in some regions. Initiated by the incumbent Christian Democrat party, the reform led to electoral benefits for more than four decades. Reformed areas supported the candidates and the agenda of the incumbent party, and the party promoted the interests of these areas.                  [paper]

Social-Media

... that the more "likes" social media users receive for their posts, the more frequently they will post? This pattern closely matches the so-called learning theory: Behavior is not only reinforced by reward, but also adapts to reward frequency. The pursuit of virtual acclaim on Instagram exhibits similarities with animals that are beckoned by a food reward.       [paper]

Snowboard

... that there is a common genetic and neurobiological basis for risky behavior? The genetic disposition for risk-taking is mapped in several areas of the brain. The researchers examined the relationship between individual differences in brain anatomy of more than 25,000 people and their propensity to engage in risky behavior. They found both functional and anatomical differences.                  [paper]

sorbonne

... that programs to support students from disadvantaged groups have positive spill-over effects? When some French elite universities promoted applications from financially disadvantaged students, this led to the fact that students were also more likely to apply to other elite universities. One possible explanation is that talented students from disadvantaged backgrounds had wrong ideas about their chances at elite universities. The success of their colleagues may have encouraged them to apply as well.       [paper]

grillen

... that financial incentives affect our information gathering? An experiment in which participants were asked to eat insects showed that a higher financial compensation led to these participants selectively seeking information that emphasized the advantages of their decision. This insight is very helpful when it comes to limiting financial incentives in ethically problematic situations such as medical tests or organ donations.                     [paper]

healthy choice

... that efficient market equilibria are achieved in markets where participants assume that the other participants are trustworthy? Mistrust, on the other hand, leads to inefficient market equilibria.  [paper]

fonduegabel

... that cultural background plays an important role in entrepreneurship? A study looking at the French-speaking part of Switzerland shows that people with Swiss-german roots start 20 percent more companies compared to people with roots in the French-speaking part of Switzerland. Since the study examines the town of origin (‘Heimatort’) of the person, the effect persists for decades. [paper]

healthy choice

...that self-control doesn't always make you happier? People who make very rational decisions actually feel better when they resist a temptation, for example eating sweets. It is different for people who make their decisions "from the gut": they feel that self-control is inauthentic and tend to decide against it.                             [paper]

present

...that testosterone reduces generosity? A new study shows that the addition of testosterone reduces generosity, especially towards people who are considered socially more distant. In addition, testosterone increases the perceived social distance to other people.                                  [paper]

pay day

... that many day laborers would prefer to be paid at the end of the month, even if they earn less money by doing so? Farmers in Kenya said that a lack of self-control was getting in the way of them putting money aside for saving and that monthly wages would be a welcome solution.  [paper]

Wien

... that conflicts that happened centuries ago can have an influence on the attitudes of today's inhabitants if the memory of them is activated? The rhetoric of the Austrian FPÖ's anti-Islam campaigns since 2005 fell on particularly fertile ground in places that had experienced acts of violence in the 16th or 17th century in the context of the Turkish siege of Vienna.                          [paper]

... that status competition encourages risky behavior? The public recognition of the performance of fighter pilots during the Second World War fueled the efforts of their direct colleagues – with very unequal results. The best pilots continued to outperform, but average pilots took too many risks and crashed.                       [paper]

Gummibären

... that mothers in Germany earn 61% less ten years after the birth of their first child, than they did one year before the birth? In Austria it’s 51%. Women in Sweden (-27%) and Denmark (-21%) are much less affected.                               [paper]

... that economies with a high percentage of small and medium-sized businesses and a high dependency on domestic bank loans are more prone to risks from global bank shocks? This explains why Greece, Spain, Italy and Portugal were particularly affected by the 2008 crash.             [paper]

waage

... that morals come before money? At least on a neurobiological level. Our behavior is the result of a subconscious process of weighing up moral and monetary values. If the monetary incentive is strong enough, it will override moral preferences. If the process of this mental trade-off is inhibited within the brain, people act in more moral ways.                                    [paper]

... that strangers can relieve pain better? If you get help from a person from a different social group, you will perceive the pain relief to be significantly higher than if that person is socially closer to you. This effect can be seen in the subjective pain evaluation as well as in the neural activity in the brain.                                              [paper]

Gummibären

... that one’s own educational achievement is influenced by one’s peer group? Students with medium or high abilities benefit from being around achieving fellow students and get higher grades. On the downside, however, it also influences their choice of specialization: although these students usually have better grades, they then choose easier courses.                                [paper]

... what it takes to be successful on the stock exchange? Good analytical qualities alone will not suffice to become a top trader. The ability to anticipate the behavior of other participants is just as important. Study results show that the average profit of a sophisticated trader (someone with both traits) is up to four times higher than that of a trader relying solely on their analytical skills.                     [paper]

... that social exclusion is not always a conscious disciplinary measure, but can often be an unintended side effect? People who have had positive experiences as a group in previous situations tend to rejoin to repeat that positive experience. In doing so, others can be excluded. This mechanism can also be used to prevent exclusion - a finding that is especially important for teachers and others who organize groups and influence group dynamics.                  [paper]

... that about a quarter of global GDP (and almost half of Swiss GDP) is ascribed to trade gains? The costs of a global trade war would be high, and would reduce global trade gains by about 25%. Overall, global economic performance could decline by about 6%.                                       [paper]

Prosociality_Pandemic

... that school closures in Brazil, some lasting more than 20 months, resulted in female students achieving only 20% (mathematics) and 40% (Portuguese) of learning goals on standardized tests compared to cohorts with face-to-face instruction.  

[paper]

Brazil_school

... that reopening schools during the Covid-19 pandemic in Brazil had no influence on the course or mortality of the pandemic. Not even in regions with more poverty, poorer infrastructure or more elderly people.                 [video]

MINT

... that many women in Saudi Arabia do not work outside the home because their husbands perceive the social norms in this regard to be more conservative than they actually are. Once the men realize that majority is in favor of women being able to work outside the home, they support their partners, and the number of working women increases.           [paper]

Paternalism

... that when we make decisions for others, we assume that they have the same preferences as we do. And if they do not, we will impose our preferences on them. This assumption and paternalistic interventions based on ideals lead to suboptimal results.  [paper]

MINT

... that the negative impact of poverty on our decision-making behavior is mostly based on income insecurity? Even more than the very low income per se, the uncertainty about when and where the next money will come from distorts our thought processes and decisions and thus keeps us trapped in poverty.                                 [paper]

MINT

... that when it comes to restructuring pension systems, increasing the retirement age is less efficient than reducing pensions? A study examines the welfare effects of various pension reforms in Austria. An increase in the retirement age leads primarily to longer unemployment, whereas a reduction in pensions means that people who can work longer work longer.         [paper]

MINT

... that young women whose peer group consists mainly of other women are less likely to study STEM subjects (science, technology, engineering and mathematics) or work in STEM professions? Among young men, a higher proportion of women in the group means that they are more likely to pursue a career in a STEM field. [paper]

pay day

... that people who are aware of their own weaknesses are particularly willing (and successfully able) to commit themselves to future behavior? For example, parents with limited resources may decide to give their children a greater share of the common resources in the future than they do today. Once the future is here, this preference disappears. However, they seem to be aware of this danger and therefore take the opportunity to commit themselves now for a situation in the future. [paper]

lotto

... that lottery winners are happier after all? Rainer Winkelmann refutes a much-cited study which showed that the increase in general life satisfaction after winning the lottery is only short-lived.                                      [paper]

...that frequent job changes aggravate the job search? A person with fewer job changes is significantly more likely to be invited to job interviews. Job-hopping seems to signal undesirable non-cognitive features of an applicant. [paper]

...that the effectiveness of nudging has yet to be proven? Whether the success of a nudge can be measured or not depends on the behavioral model that we base human decision-making on. Only once we have understood how a person makes decisions we can say whether a nudge actually improves their choices.                            [paper]

...that negative emotions make people more suspicious of others? Even when the negative feelings have nothing to do with the current situation or person.                                                    [paper]

...that Children who are taught in mixed-age classes at an early age show better school performance in adolescence? Especially children from educationally disadvantaged families benefit from sharing the classroom with older children.                            [paper]

...that even small gifts can influence purchasing behavior? Even more so if the gift is given to the boss. However, do not get ahead of yourself and hand the present over at the first meeting, but only after a good business relationship has already been established.                                [paper]

... that certain people prefer following rather than leading? Contrary to previous assumptions, character traits such as willingness to take risks or a pronounced need for control play a subordinate role when it comes to Leadership potential. Rather, the need for certainty is the decisive factor: If you need more certainty when taking a decision affecting others than just yourself, then you will probably prefer to defer the decision to the group. If you are equally happy to take decisions for yourself and others based on the same level of information, then you are a born leader.                            [paper]