| 1. |
- Lind, Thérèse, 1989-
(author)
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Financial literacy, motivated reasoning, and gender : essays in behavioral economics
- 2019
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Doctoral thesis (other academic/artistic)abstract
- I wrote this thesis to create a better understanding of how individual characteristics influence our feelings, our behavior and our way of interpreting information. My focus is on financial behavior and financial information, however I also consider a political context. I investigate the (usually) enabling abilities of financial literacy and numeracy. I also consider impediments such as stereotype threat and motivated reasoning, which can prevent people from engaging in certain behaviors or from interpreting information objectively. Both processes stem from valued beliefs and psychological foundations, consequently peoples’ efforts, decisions, and evaluations are based on them.The first essay, “Competence, confidence, and gender: The role of perceived and actual financial literacy in household finance,” broadens our understanding of the benefits of financial competence. I contrast perceived and actual levels of financial literacy, and consider the role of numeracy and cognitive reflective ability. I conclude that perceived and actual levels of financial literacy positively affect behavior and wellbeing; however, perceived financial literacy more so than actual financial literacy. No such effect is observed for numeric ability and cognitive reflection. Furthermore, women are more anxious about financial matters even though they tend to engage more frequently in the considered financial behaviors.The second essay, “Threatening finance? Examining the gender gap in financial literacy,” continues my exploration of the relationship between gender and financial literacy. In a series of studies, I investigate whether the observed gender gap in financial literacy can be identified in nonnumerical contexts, if it can be associated with confidence in financial matters, and if it can be attributed to stereotype threat, which posits that inbuilt prejudices about gender and finance undermine women’s performance of tasks that involve finance. The results show that the observed gender gap in financial literacy is robust even in nonnumerical financial contexts and suggest that a stereotype threat for women in the financial domain might be present. The gender gap in financial literacy could not be attributed to a difference in (displayed) confidence.In the third essay, “Preferences for lump-sum over divided payment structures,” I investigate whether or not people display systematic preferences for lump–sum or divided payment structures and how these preferences differ in gain (benefit) and loss (payment) situations. I investigate what happens when payments belong to a single underlying event, such as when people can choose to pay immediately or in installments. I also examine whether or not individual differences in time preferences, risk preferences, numeracy, and financial literacy are associated with preferences for one payment structure or the other. The aggregate results show a tendency for people to prefer obtaining and paying money in lump sums. I find no systematic indication that the considered individual differences play a role in this type of decision.The fourth essay, “Motivated reasoning when assessing the effect of refugee intake,” inquires into differences in worldview ideology, whether people identify as nationally or globally oriented, hinder them from objectively interpreting information. I use an experiment to find out if people display motivated reasoning when interpreting numerical information about the effects of refugees on the crime rate. Our results show evidence of motivated reasoning along the lines of worldview ideology. However, individuals with higher numeric ability were less likely to engage in motivated reasoning, leading to the conclusion that motivated reasoning is more likely to be driven by feelings and emotional cues than by deliberate analytical processes.
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| 2. |
- Strömbäck, Camilla, 1989-
(author)
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Self-Control, Financial Well-Being, and Motivated Reasoning : Essays in Behavioral Finance
- 2020
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Doctoral thesis (other academic/artistic)abstract
- The objective of this thesis is to improve our understanding of how individual differences in intuitive and analytic decision making are associated with people’s behavior as well as their well-being. The first three essays investigate, in turn, how self-control—a typical System 2 driven ability—correlates with financial behavior, financial well-being, and affective forecasting ability. The fourth essay leverages an experimental design, in which a randomized treatment attempts to inhibit the use of System 2 processing by individuals by setting them under time pressure, while measuring how they interpret numerical information.The first essay, Does Self-Control Predict Financial Behavior and Financial Well-Being?, describes how variation in self-reported individual differences in self-control, optimism and deliberativeness predicts financial behavior and financial well-being. Data was collected by means of an online survey distributed to a representative, adult Swedish sample. Results indicate that individuals with better self-control were more likely to engage in sound financial behaviors, were less anxious about financial matters, and felt more secure in their current and future financial situation than individuals displaying lower levels of self-control.The second essay, Subjective Self-Control but Not Objective Measures of Executive Functions Predicts Financial Behavior and Well-Being, is a follow-up study of the first essay. Apart from using the same self-reported measures of self-control, optimism, and deliberativeness as essay one does, this analysis additionally includes an extensive test battery of objective performance measures of executive functions and intelligence. Findings suggest that, while self-reported self-control predicts both financial behavior and subjective financial well-being, neither of the executive functions, nor intelligence do so. This indicates that an ability to form good habits and avoid temptation is more important for sound financial behavior and financial well-being than actual inhibitory control.The third essay, Better Self-Control Does Not Imply Fewer Affective Forecasting Errors, explores whether individual-level differences in self-control can explain observed variation in affective forecasting ability. Moreover, it assesses whether participants with strong self-control are more likely to make “optimal choices” in an intertemporal choice task: i.e. choices that maximize their own expected happiness. To test this, the study leveraged a laboratory experiment with a student sample in Linköping and Stockholm. Study results uncover no evidence of self-control predicting affective forecasting ability. Equally, self-control seemingly had no effect on the probability of individuals’ choosing happiness maximizing options.The fourth essay, Motivated Reasoning, Fast and Slow, investigates whether prior beliefs may hinder individuals from interpreting information about immigration and gender quotas correctly: a process commonly referred to as motivated reasoning. In general terms, motivated reasoning can be conceptualized as an intuitive or analytic process. Testing the prevalence of this form of sense-making, we ran an online experiment where half the respondents were tasked to interpret numeric information under time constraints, and the rest without said constraints. Findings provide clear evidence of the existence of motivated reasoning with regards to issues of both immigration and gender quotas. Numeric ability seemingly reduced the probability of individuals to engage in motivated reasoning, while time pressure had no effect on said likelihood. Hence, results suggest that motivated reasoning is an intuitive, rather than an analytic process.
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| 3. |
- Toelstede, Björn
(author)
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Social Hierarchies between Democracy and Autocracy
- 2020
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Doctoral thesis (other academic/artistic)abstract
- Social hierarchies exist in democracies as well as in authoritarian societies. However, their nature is different. Democratic hierarchies are built bottom-up through election, while autocratic hierarchies are built top-down through coalition formation and domination. Both have power asymmetries between the weaker citizens and the stronger politicians, which are amplified the stronger the hierarchies are. This thesis introduces a model which combines pro-/anti-social behavior with different degrees of hierarchies which I unite in a model called the Structure-Behavior Diagram (Toelstede, 2020/1). This model has the power to categorize countries according to these criteria, and indicates when and how societies move between democracy and authoritarianism.The movements of societies in the political space of the Structure-Behavior Diagram are marked by certain patterns and dynamics. I use the path dependence theory (Toelstede, 2019/2) and examine how so-called path-creating mechanisms can emerge and influence societies to move from democracy to authoritarianism. I show that path dependency-induced dynamics can put democracies at risk and are more serious in hierarchical societies than in horizontal societies.Institutional punishment is widely seen as more stable then peer punishment. However, in political reality, institutional punishment – here in the form of policing – can be marked by over- and under-punishment as well as changes in sociality (Toelstede, 2019/1 and 2020/2). These findings show, together with hierarchy-sensitive characteristics of the path dependency, that institutional punishment and social hierarchies require more attention.Lastly, I show that most democratic societies are intuitively aware of the power asymmetries and long principal-agent chains between them and their political agents. Together, these features provide increasing benefits for an anti-social descent of the agents, although some societies are prepared to trade personal freedom for higher socio-economic welfare. They therefore strive for higher socio-economic efficiency by embracing strong governmental forms and high conformity levels. I call this efficient statism (Toelstede, 2019/2). In doing so, societies compliantly put their free and democratic order at risk.
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| 4. |
- Hedström, Axel, 1989-
(author)
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Empirical Studies on Economic and Financial Spillovers : Asymmetric Risk and Dependence Modeling
- 2023
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Doctoral thesis (other academic/artistic)abstract
- Financial assets are volatile, and volatility becomes more intense in terms of size and rate of recurrence when markets are uncertain and growing rapidly. The fact that the recurrence rate increased during crisis periods, such as the IT bubble in the early 2000 and the global financial crisis that started in 2007, is a key finding in the literature. Estimating these results requires modeling a time series that can consider volatility clustering. However, the prominent model in finance and economics estimates that the average volatility increases when uncertainty increases. This modeling process needs to consider the asymmetry that financial assets and economic outcomes, such as gross domestic product (GDP) exhibit, which tend to fall drastically in a short period and increase steadily over a long period. To model these different behaviors, one must consider the asymmetric nature of the return, for example, when a stock has extremely low or extremely high returns in a day. To model this behavior, I used several methods in settings that could better explain what happens during market periods when there is higher uncertainty. The general finding is that correlations are higher when returns are in the lower quantiles, called the left tails. Thus, financial assets are positively correlated, especially during periods of increased uncertainty. It is not only clustering that one would try to explain, but another issue is the prediction of one asset’s effect on another. The effect of one asset on another asset is called the spillover effect. We tried to distinguish between events that happen during the same time that affect all assets. These events are called systematic risk, and the effects that one asset has on another asset is called systemic risk. Explaining the systemic risk typically has higher priority from a policy perspective, as systemic risk can be a driver for risk transmission from one asset to another, creating a chain of risk or a spiral of risk. Hence, the approaches I used can model that chain of risk and predict risk transmission while controlling for external factors that increase uncertainty. The results of this research show the connection between energy assets and renewable energy stocks in Papers 1 and 2. For instance, we found that there is a possibility of adjusting the European carbon emission cap and that renewable energy stocks positively correlate with energy commodities in the tails. Thus, renewable energy stocks follow a macroeconomic cycle. The findings of Paper 3 show the systemic and systematic nature of cross-country spillovers between emerging and developed financial markets, and that the spillover is time-varying with increasing spillovers in crisis periods. Paper 4 examines the Nordic banking sector. The results show that banks’ spillover to their local markets is due to their systemic importance and the strength of the spillover is related to the bank’s characteristics. In the final Paper, I studied the upside and downside movement asymmetry of stocks and found that betting on upside volatility is better than a portfolio perspective but comes at the cost of increased pricing errors. The empirical findings of this thesis significantly contribute to policymakers and institutional investors in portfolio diversification and risk management.
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| 5. |
- Ahmed, Ali M., Professor, 1977-, et al.
(author)
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Are people fuzzy about who they work with? : An experimental test of Becker’s coworker discrimination hypothesis
- 2021
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In: The Social Science Journal. - Amsterdam : Taylor & Francis. - 0362-3319 .- 1873-5355. ; 58:4, s. 477-483
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Journal article (peer-reviewed)abstract
- We used an experiment to investigate whether people’s decisions over employment opportunities are affected by the ethnicity and sex of their potential future coworkers. University students (N = 1,406) were asked to state the lowest hourly wage rate at which they would be willing to accept a job on a campus food truck, where they would work alongside the food truck owner. The ethnicity and sex of the food truck owners were randomized across participants. Results showed no signs of coworker prejudice in terms of the probability of being interested in the job and reservation wage.
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| 6. |
- Ahmed, Ali M., Professor, 1977-, et al.
(author)
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Asymmetric dynamics between uncertainty and unemployment flows in the United States
- 2020
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Reports (other academic/artistic)abstract
- This paper examines how different uncertainty measures affect the unemployment level, inflow, and outflow in the U.S. across all states of the business cycle. We employ linear and nonlinear causality-in-quantile tests to capture a complete picture of the effect of uncertainty on U.S. unemployment. To verify whether there are any common effects across different uncertainty measures, we use monthly data on four uncertainty measures and on U.S. unemployment from January 1997 to August 2018. Our results corroborate the general predictions from a search and matching framework of how uncertainty affects unemployment and its flows. Fluctuations in uncertainty generate increases (upper-quantile changes) in the unemployment level and in the inflow. Conversely, shocks to uncertainty have a negative impact on U.S. unemployment outflow. Therefore, the effect of uncertainty is asymmetric depending on the states (quantiles) of U.S. unemployment and on the adopted unemployment measure. Our findings suggest statecontingent policies to stabilize the unemployment level when large uncertainty shocks occur.
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| 7. |
- Ahmed, Ali M., Professor, 1977-, et al.
(author)
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Asymmetric dynamics between uncertainty and unemployment flows in the United States
- 2022
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In: Studies in Nonlinear Dynamics and Econometrics. - Berlin, Germany : Walter de Gruyter. - 1081-1826 .- 1558-3708. ; 26:1, s. 155-172
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Journal article (peer-reviewed)abstract
- This paper examines how different uncertainty measures affect the unemployment level, inflow, and outflow in the U.S. across all states of the business cycle. We employ linear and nonlinear causality-in-quantile tests to capture a complete picture of the effect of uncertainty on U.S. unemployment. To verify whether there are any common effects across different uncertainty measures, we use monthly data on four uncertainty measures and on U.S. unemployment from January 1997 to August 2018. Our results corroborate the general predictions from a search and matching framework of how uncertainty affects unemployment and its flows. Fluctuations in uncertainty generate increases (upper-quantile changes) in the unemployment level and in the inflow. Conversely, shocks to uncertainty have a negative impact on U.S. unemployment outflow. Therefore, the effect of uncertainty is asymmetric depending on the states (quantiles) of U.S. unemployment and on the adopted unemployment measure. Our findings suggest state-contingent policies to stabilize the unemployment level when large uncertainty shocks occur.
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| 8. |
- Ahmed, Ali M., Professor, 1977-, et al.
(author)
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Customer discrimination in the fast food market : a web-based experiment on a Swedish university campus
- 2020
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In: Migration Letters. - London, United Kingdom : Transnational Press London. - 1741-8984 .- 1741-8992. ; 17:6, s. 813-824
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Journal article (peer-reviewed)abstract
- This paper presents the results of a study that examined customer discrimination against fictitious male and female food truck owners with Arabic-sounding names on a Swedish university campus. In a web-based experiment, students (N = 1,406) were asked, in a market survey setting, whether they thought it was a good idea that a food truck was establishing on their campus and of their willingness to pay for a typical food truck meal. Four names—male and female Swedish-sounding names and male and female Arabic-sounding names—were randomly assigned to food trucks. We found no evidence of customer discrimination against food truck owners with Arabic-sounding names. Participants were slightly more positive to a food truck establishment run by a male with an Arabic-sounding name than a male with a Swedish-sounding name.
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| 9. |
- Ahmed, Ali M., Professor, 1977-, et al.
(author)
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Diskriminerar kunder utrikes födda företagare? Resultat från ett webb-baserat experiment
- 2018
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In: Ekonomisk Debatt. - Stockholm, Sweden : Research Institute of Industrial Economics. - 0345-2646. ; 46:7, s. 25-32
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Journal article (other academic/artistic)abstract
- Vi presenterar resultat från ett experiment utfört på ett universitetscampus.Deltagarna fick se bilder av olika food-trucks och svara på om de tyckte det varen god idé att en food-truck etablerade sig på campusområdet samt ange sinbetalningsvilja för olika varor. Deltagarna i experimentet var mer positivatill en etablering av en food-truck ägd av en man med arabiskt namn än till enetablering av en food-truck ägd av en man med svenskt namn. Resultaten är avintresse för integrationspolitiken, då de visar att egenföretagare med ursprung iMellanöstern inte diskrimineras i en bransch där de ofta är verksamma.
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| 10. |
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