Contributions in Merlin

This paper explores the relationship between the duration of a vacancy and the starting wage of a new job, using unusually informative data comprising detailed information on vacancies, the establishments posting the vacancies, and the workers eventually filling the vacancies. We find that vacancy durations are negatively correlated with the starting wage and that this negative association is particularly strong with the establishment component of the starting wage. We also confirm previous findings that growing establishments fill their vacancies faster. To understand the relationship between establishment growth, vacancy filling and entry wages, we calibrate a model with directed search and ex-ante heterogeneous workers and firms. We find a strong tension between matching the sharp increase in vacancy filling for growing firms and the response of vacancy filling to firm-level wages. We discuss the implications of this finding as well as potential resolutions.

EMU was a major step towards deeper financial integration among member states. However, diversification of equity portfolios remained limited while banking integration surged. We argue that the nature of banking integration is of first-order importance for understanding the patterns and channels of risk sharing. While EMU was associated with the creation of an integrated interbank market, as witnessed by an explosion in cross-border interbank flows, “real” banking integration (in terms of cross-border bank-to-real sector flows or banking-consolidation) remained limited. But we find that real banking integration is associated with more risk sharing, while indirect integration via interbank flows is not. Further, indirect banking integration proved to be highly procyclical, which contributed to the freeze in risk sharing after 2008. Based on this evidence, and a stylized DSGE model that allows us to explain these patterns in the data, we discuss implications for banking union. Our results show that real banking integration and capital market union are complements and robust risk sharing in the EMU requires both.

Humans vary substantially in their willingness to take risks. In a combined sample of over one million individuals, we conducted genome-wide association studies (GWAS) of general risk tolerance, adventurousness, and risky behaviors in the driving, drinking, smoking, and sexual domains. We identified 611 approximately independent genetic loci associated with at least one of our phenotypes, including 124 with general risk tolerance. We report evidence of substantial shared genetic influences across general risk tolerance and risky behaviors: 72 of the 124 general risk tolerance loci contain a lead SNP for at least one of our other GWAS, and general risk tolerance is moderately to strongly genetically correlated (|rˆg| ~ 0.25 to 0.50) with a range of risky behaviors. Bioinformatics analyses imply that genes near general-risk-tolerance-associated SNPs are highly expressed in brain tissues and point to a role for glutamatergic and GABAergic neurotransmission. We find no evidence of enrichment for genes previously hypothesized to relate to risk tolerance.

We assess the role of anti-social personality traits in explaining heterogeneity in commonly observed social preferences. We identified a personality profile that clearly reflects anti-social personality characteristics, with high positive loadings on Machiavellianism and high negative loadings on empathy, trustworthiness and agreeableness. Anti-sociality predicts decision strategies in a manner that is consistent with its name: significantly lower levels of trust and decreased trustworthiness. To identify the strategic nature of anti-social behavior in changing environments, we assessed the moderating role of personality on investor trust and trustee reciprocity in the presence relative to the absence of the investor’s option to punish. Our results show that only the anti-social personality profile is associated with specific payoff maximizing strategy shifts induced by these environmental changes: when punishment was not available to investors, we observe significantly lower levels of investor trust and trustee reciprocity, while there is a significant increase in both behaviors when punishment was available. These effects were specific for anti-sociality, as no other personality factor was associated with such a strong adjustment of decision strategies in the presence of punishment. These results demonstrate that anti-social personality characteristics are associated with strategic behavioral shifts aimed at maximizing the extraction of resources from their counterparts. The reliability of the strategic effects of anti-social personality during trust, reciprocity and punishment strongly supports the notion that self-projection underlies anti-social decision-making.

We present a method to estimate and predict fixed effects in a panel probit model when N is large and T is small, and when there is a high proportion of individual units without variation in the binary response. Our approach builds on a bias-reduction method originally developed by Kosmidis and Firth (2009) for cross-section data. In contrast to other estimators, our approach ensures that predicted fixed effects are finite in all cases. Results from a simulation study document favorable properties in terms of bias and mean squared error. The estimator is applied to predict period-specific fixed effects for the extensive margin of health care utilization (any visit to a doctor during the previous three months), using German data for 2000-2014. We find a negative correlation between fixed effects and observed characteristics. Although there is some within-individual variation in fixed effects over sub-periods, the between-variation is four times as large.

Rewards usually have multiple attributes that are relevant for behavior. For instance, even apparently simple choices between liquid or food rewards involve comparisons of at least two attributes, flavor and amount. Thus, in order to make the best choice, an organism will need to take multiple attributes into account. Theories and models of decision making usually focus on how strongly different attributes are weighted in choice, e.g., as a function of their importance or salience to the decision-maker. However, when different attributes impact on the decision process is a question that has received far less attention. Although one may intuitively assume a systematic relationship between the weighting strength and the timing with which different attributes impact on the final choice, this relationship is untested. Here, we investigate whether attribute timing has a unique influence on decision making using a time-varying sequential sampling model (tSSM) and data from four separate experiments. Contrary to expectations, we find only a modest correlation between how strongly and how quickly reward attributes impact on choice. Experimental manipulations of attention and neural activity demonstrate that we can dissociate at the cognitive and neural levels the processes that determine the relative weighting strength and timing of attribute consideration. Our findings demonstrate that processes determining either the weighting strengths or the timing of attributes in decision making can adapt independently to changes in the environment or goals. Moreover, they show that a tSSM incorporating separable influences of these two sets of processes on choice improves understanding and predictions of individual differences in basic decision behavior and self-control.

Arousal-related fluctuations of cortical activity are ubiquitous in the mammalian brain and vary spontaneously with neuromodulatory catecholamine levels. How such endogenous changes in brain state impact on behaviour is incompletely understood. Here, we investigate the neural mechanisms by which arousal-related brain state fluctuations, indexed by pre-stimulus pupil dilation, impact on perceptual and value-based choices in humans. We find that during elevated arousal, both types of choices are faster and more accurate. Computational modelling indicates that these arousal-dependent behavioural enhancements reflect increased precision in the representation of task-relevant evidence. Functional imaging demonstrates that changes in evidence representation predicted by behavioural modelling correspond to neural gain increases in regions that represent the choice-relevant decision variables. Moreover, the neural gain increases in these two regions correlated with participants’ reward rates on the corresponding tasks. Thus, our data show that arousal optimizes decision making by enhancing choice-relevant evidence representation in the human brain.

We document a new finding regarding changes in labor market outcomes for high-skilled men and women in the US. Since 1980, conditional on being a college-educated man, the probability of working in a cognitive/high-wage occupation has fallen. This contrasts starkly with the experience for college-educated women: their probability of working in these occupations rose, despite a much larger increase in the supply of educated women relative to men. We show that one key channel capable of rationalizing these findings is a greater increase in the demand for female-oriented skills in cognitive/high-wage occupations relative to other occupations. Using occupation-level data, we find evidence that this relative increase in the demand for female skills is due to an increasing importance of social skills within such occupations. Evidence from both male and female wages is also indicative of an increase in the demand for social skills. Finally, we document how these patterns change across the early and latter portions of the period.

Background: Bipolar disorder I (BD-I) is defined by episodes of mania, depression, and euthymic states. These episodes are among other symptoms characterized by altered reward processing and negative symptoms (NS), in particular apathy. However, the neural correlates of these deficits are not well understood. Methods: We first assessed the severity of negative symptoms in 25 euthymic BD-I patients compared to 25 healthy controls (HC) and 27 patients with schizophrenia (SZ). Then, we investigated ventral and dorsal striatal activation during reward anticipation in a Monetary Incentive Delayed Task and its association with NS. Results: In BD-I patients NS were clearly present and the severity of apathy was comparable to SZ patients. Apathy scores in the BD-I group but not in the SZ group correlated with sub-syndromal depression scores. At the neural level, we found significant ventral and dorsal striatal activation in BD-I patients and no group differences with HC or SZ patients. In contrast to patients with SZ, apathy did not correlate with striatal activation during reward anticipation. Explorative whole brain analyses revealed reduced extra-striatal activation in BD-I patients compared to HC and an association between reduced activation of the inferior frontal gyrus and apathy. Conclusion: This study found that in BD-I patients apathy is present to an extent comparable to schizophrenia, but is more strongly related to sub-syndromal depressive symptoms. The findings support the view of different pathophysiological mechanisms underlying apathy in the two disorders and suggest that extra-striatal dysfunction may contribute to impaired reward processing and apathy in BD-I.

Through the custom of guardianship, husbands typically have the final word on their wives’ labor supply decisions in Saudi Arabia, a country with very low female labor force participation (FLFP). We provide incentivized evidence (both from an experimental sample in Riyadh and from a national sample) that the vast majority of young married men in Saudi Arabia privately support FLFP outside of home from a normative perspective, while they substantially underestimate the level of support for FLFP by other similar men – even men from their same social setting, such as their neighbors. We then show that randomly correcting these beliefs about others increases married men’s willingness to let their wives join the labor force (as measured by their costly sign-up for a job-matching service for their wives). Finally, we find that this decision maps onto real outcomes: four months after the main intervention, the wives of men in our original sample whose beliefs about acceptability of FLFP were corrected are more likely to have applied and interviewed for a job outside of home. Together, our evidence indicates a potentially important source of labor market frictions, where job search is underprovided due to misperceived social norms.