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Behavioral economics questions the basic underpinnings of economic theory, showing that people often do not act consistently in their own self-interest when making economic decisions. While these findings have important theoretical implications, they also provide a new lens for examining public policies, such as taxation, public spending, and the provision of adequate pensions. How can people be encouraged to save adequately for retirement when evidence shows that they tend to spend their money as soon as they can? Would closer monitoring of income tax returns lead to more honest taxpayers or a more distrustful, uncooperative citizenry? Behavioral Public Finance, edited by Edward McCaffery and Joel Slemrod, applies the principles of behavioral economics to government's role in constructing economic and social policies of these kinds and suggests that programs crafted with rational participants in mind may require redesign. Behavioral Public Finance looks at several facets of economic life and asks how behavioral research can increase public welfare. Deborah A. Small, George Loewenstein, and Jeff Strnad note that public support for a tax often depends not only on who bears its burdens, but also on how the tax is framed. For example, people tend to prefer corporate taxes over sales taxes, even though the cost of both is eventually extracted from the consumer. James J. Choi, David Laibson, Brigitte C. Madrian, and Andrew Metrick assess the impact of several different features of 401(k) plans on employee savings behavior. They find that when employees are automatically enrolled in a retirement savings plan, they overwhelmingly accept the status quo and continue participating, while employees without automatic enrollment typically take over a year to join the saving plan. Behavioral Public Finance also looks at taxpayer compliance. While the classic economic model suggests that the low rate of IRS audits means far fewer people should voluntarily pay their taxes than actually do, John Cullis, Philip Jones, and Alan Lewis present new research showing that many people do not underreport their incomes even when the probability of getting caught is a mere one percent. Human beings are not always rational, utility-maximizing economic agents. Behavioral economics has shown how human behavior departs from the assumptions made by generations of economists. Now, Behavioral Public Finance brings the insights of behavioral economics to analysis of policies that affect us all.
My Life in Texas Commerce
Serving as CEO of Texas Commerce Bancshares in the 1980s, during the collapse of the Texas banking industry, Ben Love had an inside view of the debacle. His story, told here in detail for the first time, provides an insightful perspective on the Texas banking industry’s evolution after World War II, its decline, and its subsequent recovery. It also offers a glimpse into of the kind of character that creates men of power. Love grew up with his family during the Great Depression. Their farm outside Paris, Texas, taught him hard lessons about opportunity and financial security lessons that would serve him well in the future. After America’s entry into war in 1941, Love flew 8th Air Force B-17 combat missions over Europe, and then settled in Houston with his business degree in the late 1940s. His entrance into the world of banking began as a member of the board of directors for River Oaks Bank & Trust. Houston was rapidly growing into a metropolis, and he accepted an offer to leave River Oaks to join Texas Commerce Bank in 1967. As president of Texas Commerce Bank (TCB) in 1969 and CEO in 197289, Love cultivated change from single banks to holding companies, garnering a national reputation for his banking organization. In 1984, Texas Commerce was the twenty-first-largest bank in the country. Under his competent management, TCB was the only Big Five Texas bank to survive the economic downturn. One reason for its continued success lies with Loves successful merger in 1987 with the Chemical Bank of New York, now J. P. Morgan Chase. Not only does Ben F. Love’s memoir reveal an inside look at the evolution of banking in Texas, but it will serve as an instructional guide to future business leaders and managers.
Marseille and the Early Modern Mediterranean
Between Crown and Commerce examines the relationship between French royal statecraft, mercantilism, and civic republicanism in the context of the globalizing economy of the early modern Mediterranean world. This is the story of how the French Crown and local institutions accommodated one another as they sought to forge acceptable political and commercial relationships with one another for the common goal of economic prosperity. Junko Thérèse Takeda tells this tale through the particular experience of Marseille, a port the monarchy saw as key to commercial expansion in the Mediterranean. At first, Marseille’s commercial and political elites were strongly opposed to the Crown’s encroaching influence. Rather than dismiss their concerns, the monarchy cleverly co-opted their civic traditions, practices, and institutions to convince the city’s elite of their important role in Levantine commerce. Chief among such traditions were local ideas of citizenship and civic virtue. As the city’s stature throughout the Mediterranean grew, however, so too did the dangers of commercial expansion as exemplified by the arrival of the bubonic plague. Marseille’s citizens reevaluated citizenship and merchant virtue during the epidemic, while the French monarchy's use of the crisis as an opportunity to further extend its power reanimated republican vocabulary. Between Crown and Commerce deftly combines a political and intellectual history of state-building, mercantilism, and republicanism with a cultural history of medical crisis. In doing so, the book highlights the conjoined history of broad transnational processes and local political change.
Career Paths for the Forgotten Half
In a society where everyone is supposed to go to college, the problems facing high school graduates who do not continue their education are often forgotten. Many cannot find jobs, and those who do are often stuck in low-wage, dead-end positions. Meanwhile employers complain that high school graduates lack the necessary skills for today's workplace. Beyond College for All focuses on this crisis in the American labor market. Around the world, author James E. Rosenbaum finds, employers view high school graduates as valuable workers. Why not here? Rosenbaum reports on new studies of the interaction between employers and high schools in the United States. He concludes that each fails to communicate its needs to the other, leading to a predictable array of problems for young people in the years after graduation. High schools caught up in the college-for-all myth, provide little job advice or preparation, leading students to make unrealistic plans and hampering both students who do not go to college and those who start college but do not finish. Employers say they care about academic skills, but then do not consider grades when deciding whom to hire. Faced with few incentives to achieve, many students lapse into precisely the kinds of habits employers deplore, doing as little as possible in high school and developing poor attitudes. Rosenbaum contrasts the situation in the United States with that of two other industrialized nations-Japan and Germany-which have formal systems for aiding young people who are looking for employment. Virtually all Japanese high school graduates obtain work, and in Germany, eighteen-year-olds routinely hold responsible jobs. While the American system lacks such formal linkages, Rosenbaum uncovers an encouraging hidden system that helps many high school graduates find work. He shows that some American teachers, particularly vocational teachers, create informal networks with employers to guide students into the labor market. Enterprising employers have figures out how to use these networks to meet their labor needs, while students themselves can take steps to increase their ability to land desirable jobs. Beyond College for All suggests new policies based on such practices. Rosenbaum presents a compelling case that the problems faced by American high school graduates and employers can be solved if young people, employers, and high schools build upon existing informal networks to create formal paths for students to enter the world of work.
Labor Rights, Human Rights, and Transnational Activism
As the world economy becomes increasingly integrated, companies can shift production to wherever wages are lowest and unions weakest. How can workers defend their rights in an era of mobile capital? With national governments forced to compete for foreign investment by rolling back legal protections for workers, fair trade advocates are enlisting consumers to put market pressure on companies to treat their workers fairly. In Beyond the Boycott, sociologist Gay Seidman asks whether this non-governmental approach can reverse the “race to the bottom” in global labor standards. Beyond the Boycott examines three campaigns in which activists successfully used the threat of a consumer boycott to pressure companies to accept voluntary codes of conduct and independent monitoring of work sites. The voluntary Sullivan Code required American corporations operating in apartheid-era South Africa to improve treatment of their workers; in India, the Rugmark inspection team provides ‘social labels’ for handknotted carpets made without child labor; and in Guatemala, COVERCO monitors conditions in factories producing clothing under contract for major American brands. Seidman compares these cases to explore the ingredients of successful campaigns, as well as the inherent limitations facing voluntary monitoring schemes. Despite activists’ emphasis on educating individual consumers to support ethical companies, Seidman finds that, in practice, they have been most successful when they mobilized institutions—such as universities, churches, and shareholder organizations. Moreover, although activists tend to dismiss states’ capabilities, all three cases involved governmental threats of trade sanctions against companies and countries with poor labor records. Finally, Seidman points to an intractable difficulty of independent workplace monitoring: since consumers rarely distinguish between monitoring schemes and labels, companies can hand pick monitoring organizations, selecting those with the lowest standards for working conditions and the least aggressive inspections. Transnational consumer movements can increase the bargaining power of the global workforce, Seidman argues, but they cannot replace national governments or local campaigns to expand the meaning of citizenship. As trade and capital move across borders in growing volume and with greater speed, civil society and human rights movements are also becoming more global. Highly original and thought-provoking, Beyond the Boycott vividly depicts the contemporary movement to humanize globalization—its present and its possible future.
Towards a Pro-Poor and Inclusive Development Strategy for Zimbabwe
Beyond the Enclave sets out to unravel the contradiction of a country, Zimbabwe, where a rich, diverse resource base co-exists with endemic poverty. One reason lies in the colonial economy, which was predicated on an ideology of white supremacy, creating an enclave formal economy employing one-fifth of the labour force. Yet over three decades after independence, the non-formal segment has become even more entrenched. This book assesses Zimbabweís economy through three main phases: 1980-90 when a strong social policy framework proved difficult to sustain due to erratic growth, and 1991-96, when ëstructural adjustmentí demanded a market-driven approach to development. The third phase is characterized by crisis-management leading to policy inconsistencies and reversals. Not surprisingly, such incoherence saw the economy descend into hyperinflation and paralysis in 2007-2008, leading to the signing of the Global Political Agreement in September 2008. In the absence of formal dollarization, economic recovery after the adoption of the multi-currency regime has remained fragile, leaving an estimated 70 per cent of the population outside the banking system. This has further entrenched uneven (enclave) growth as the economy remains locked in a low-income poverty trap. There is a need to facilitate transition towards formality to promote decent jobs. Furthermore, a strategic, developmental role for the state in the economy is now widely recognized as vital for development. Beyond the Enclave argues for a new approach to development in Zimbabwe based on pro-poor and inclusive strategies, which will contribute to the well-being of all of its citizens and wise stewardship of its resources. It offers suggestions on policy formulation, implementation, monitoring and evaluation in all sectors, designed to promote inclusive growth and humane development.
This lively and erudite essay, now available in paperback, addresses a broad, central question: How can we improve our understanding of the large-scale social and political changes that transformed the world of the nineteenth century and are transforming our world today? "In this short, brilliant book Tilly suggests a way to think about theories of historical social change....This book should find attentive readers both in undergraduate courses and in graduate seminars. It should also find appreciative readers, for Tilly is a writer as well as a scholar." —Choice
Social scientists have repeatedly uncovered a disturbing feature of economic inequality: people with larger incomes and better education tend to lead longer, healthier lives. This pattern holds across all ages and for virtually all measures of health, apparently indicating a biological dimension of inequality. But scholars have only begun to understand the complex mechanisms that drive this disparity. How exactly do financial well-being and human physiology interact? The Biological Consequences of Socioeconomic Inequalities incorporates insights from the social and biological sciences to quantify the biology of disadvantage and to assess how poverty gets under the skin to impact health. Drawing from unusually rich datasets of biomarkers, brain scans and socioeconomic measures, Biological Consequences of Socioeconomic Inequalities illustrates exciting new paths to understanding social inequalities in health. Barbara Wolfe, William Evans and Nancy Adler begin the volume with a critical evaluation of the literature on income and health, providing a lucid review of the difficulties of establishing clear causal pathways between the two variables. Arun S. Karlamangla, Tara L. Gruenewald, and Teresa E. Seeman outline the potential of biomarkers—such as cholesterol, heart pressure and C-reactive protein—to assess and indicate the factors underlying health. Edith Chen, Hanna M. C. Schreier, and Meanne Chan reveal the empirical power of biomarkers by examining asthma, a condition steeply correlated with socioeconomic status. Their analysis shows how stress at the individual, family, and neighborhood levels can increase the incidence of asthma. The volume then turns to cognitive neuroscience, using biomarkers in a new way to examine the impact of poverty on brain development. Jamie Hanson, Nicole Hair, Amitabh Chandra, Ed Moss, Jay Bhattacharya, Seth Pollack, and Barbara Wolfe use a longitudinal Magnetic Resonance Imaging (MRI) study of children between the ages of four and eighteen to study the link between poverty and limited cognition among children. Michelle C. Carlson, Christopher L. Seplaki, and Teresa E. Seeman also focus on brain development to examine the role of socioeconomic status in cognitive decline among older adults. The authors report promising results from programs designed to improve cognitive function among the elderly poor by increasing physical activity and social engagement. Featuring insights from the biological and social sciences, Biological Consequences of Socioeconomic Inequalities will be an essential resource for scholars interested in socioeconomic disparities and the biological imprint that material deprivation leaves on the human body.
A Comparative Study
Throughout the fourteenth century AD/eighth century H, waves of plague swept out of Central Asia and decimated populations from China to Iceland. So devastating was the Black Death across the Old World that some historians have compared its effects to those of a nuclear holocaust. As countries began to recover from the plague during the following century, sharp contrasts arose between the East, where societies slumped into long-term economic and social decline, and the West, where technological and social innovation set the stage for Europe’s dominance into the twentieth century. Why were there such opposite outcomes from the same catastrophic event? In contrast to previous studies that have looked to differences between Islam and Christianity for the solution to the puzzle, this pioneering work proposes that a country’s system of landholding primarily determined how successfully it recovered from the calamity of the Black Death. Stuart Borsch compares the specific cases of Egypt and England, countries whose economies were based in agriculture and whose pre-plague levels of total and agrarian gross domestic product were roughly equivalent. Undertaking a thorough analysis of medieval economic data, he cogently explains why Egypt’s centralized and urban landholding system was unable to adapt to massive depopulation, while England’s localized and rural landholding system had fully recovered by the year 1500.