Broader Empirical Literature Research Articles

THE RELATIONSHIP BETWEEN TAX REVENUES AND DEMOCRACY: AN APPLICATION ON EMERGING AND DEVELOPING COUNTRIES

States collect taxes as one-way revenues based on their sovereign power to provide public goods and services. However, over time, taxes have evolved from being based solely on the pure sovereign power of the states to an authority arising from the power of representation. In this context, the connection between taxation and democracy has become one of the critical discussion topics in the fiscal sociology literature. Since the 13th century, the expeditions guiding economic and political reform movements, coupled with rebellions against non-representative taxation, have played a fundamental role in shaping concepts such as representation and taxation in the evolution of the modern public financial structures. In parallel with the theoretical discussions, a broad empirical literature examining the connection between democracy and taxation has emerged due to attempts to measure the typology of political regimes in a country. Empirical findings indicate a positive relationship between democratization and taxation in advanced economies; however, this connection is ambiguous for emerging and developing countries. This study takes this gap in the literature into account and examines the effects of democratization, urbanization, and institutional quality indicators on tax revenues for 41 emerging and developing countries in the 2000-2018 period with dynamic panel data analysis techniques. Our findings indicate that democratization and the increasing share of urban population in total population have a positive impact on tax revenues in the context of emerging and developing countries.

Textual Indicators of Deliberative Dialogue: A Systematic Review of Methods for Studying the Quality of Online Dialogues

High-quality online dialogues help sustain democracy. Deliberative theory, which predates the internet, provides the primary model for assessing the quality of online dialogues. It conceptualizes high-quality online dialogue as civil, rational, constructive, equal, interactive, and for the common good. More recently, advances in computation have driven an upsurge of empirical studies using automated methods for operationalizing online dialogue and measuring its quality. While related in their aims, deliberative theory and the wider empirical literature generally operate independently. To bridge the gap between the two literatures, we introduce Textual Indicators of Deliberative Dialogue (TIDDs). TIDDs are defined as text-based measures of online dialogue quality under a deliberative model (e.g., disagreement, incivility, and justifications). In this study, we identified 123 TIDDs by systematically reviewing 67 empirical studies of online dialogue. We found them to have mid-low reliability, low criterion validity, and high construct validity for measuring two deliberative dimensions (civility and rationality). Our results highlight the limitations of deliberative theory for conceptualizing the variety of ways online dialogues can be operationalized. We report the most promising TIDDs for measuring the quality of online dialogue and suggest deliberative theory would benefit from altering its models in line with the broader empirical literature.

Firms, kinship networks, and economic growth in the Kyrgyz Republic

While kinship ties support private sector development, they can also lead to economic inefficiencies. The paper examines the impact of kinship networks on firm performance and growth based on our original survey of 1000 firm owners in the Central Asian Republic of Kyrgyzstan. We obtained detailed information on respondents’ business networks, resources they both receive from (in-networks) and provide to their kin and other contacts (out-networks) and their firm's performance. Our results indicate that in-networks raise profitability, out-networks reduce it, and these two forms of network usage are positively, but far from perfectly, correlated. We also show that kin-reliant firms grow slower than firms with access to non-kin assistance but faster than firms that do not have access to any business networks at all. We find evidence that one mechanism of slower growth is lower levels of reinvestment. We conclude that accounting for in- and out-networks helps to resolve the ambiguous message from the broader empirical literature regarding the effect of kin networks on firm performance: the two forms of network use are positively correlated, most likely due to generalized reciprocity within kin networks, yet have opposite effects.

Effective police investigative practices: an evidence-assessment of the research

PurposeDetective work is a mainstay of modern law enforcement, but its effectiveness has been much less evaluated than patrol work. To explore what is known about effective investigative practices and to identify evidence gaps, the authors assess the current state of empirical research on investigations.Design/methodology/approachThe authors assess the empirical research about the effectiveness of criminal investigations and detective work in resolving cases and improving clearance rates.FindingsThe authors’ analysis of the literature produced 80 studies that focus on seven categories of investigations research, which include the impact that case and situational factors, demographic and neighborhood dynamics, organizational policies and practices, investigative effort, technology, patrol officers and community members have on case resolution. The authors’ assessment shows that evaluation research examining the effectiveness of various investigative activities is rare. However, the broader empirical literature indicates that a combination of organizational policies, investigative effort and certain technologies can be promising in improving investigative outcomes even in cases deemed less solvable.Research limitations/implicationsFrom an evidence-based perspective, this review emphasizes the need for greater transparency, evaluation and accountability of investigative activities given the resources and importance afforded to criminal investigations.Originality/valueThis review is currently the most up-to-date review of the state of the research on what is known about effective investigative practices.

Predicting financial distress in an emerging market: corporate actions, accounting ratios, or both

This paper investigates the utility of corporate actions in predicting financial distress in the context of an emerging country: Malaysia. Recognising the dominance of historical accounting ratios in distress prediction models, we set out to test if employing more current information in the form of corporate action fares better. To this end, we employ three logistic regression models on data from 54 firms and find that corporate actions, on a stand-alone basis, outperform pure accounting ratios and a pooled combination of both. The most significant corporate actions are frequency of capital issuance and shuffling of audit committees. These findings are novel for Malaysia and relatively scarce in broader empirical literature. Meanwhile, among the accounting ratios, working capital and sales volumes emerge as significant predictors of distress, both of which have extensive empirical precedents.

Should I Stay or Should I Go? Geographic Entrepreneurial Choices in Brazilian Franchising

In the broad empirical literature on franchising, performance outcomes of location decisions appear to be a largely forgotten issue. Yet franchising represents a rich context to study the impact of geographic entrepreneurial choices. Addressing this “blank spot” in the literature, we deal with the following question: Is it better for a chain to stay in the same geographic area, or to expand via distant franchised units? Our econometric estimations on new and unique Brazilian panel data show that spatial agglomeration of chain outlets leads to higher performance, suggesting that agglomeration gains outweigh cannibalization and spatial monopoly effects.

Inequality, Social Comparisons and Income Aspirations: Evidence from a Highly Unequal Country

We investigate the formation of minimum income aspirations in South Africa, a country characterised by high poverty rates and high and rising rates of inequality. Although a few empirical studies have explored income aspirations in South Africa, this is the first study that analyses nationally representative micro-data. We add to the broader empirical literature on income aspirations in two ways. First, we investigate whether there is evidence of aspirations failure among the poor and we test the relationship between aspirations and income inequality. Second, we explore whether aspirations have different associations when social comparisons are drawn with different reference groups. Our analysis of the minimum income question (MIQ) asked in a national household survey from 2008/2009 shows that although aspirations increase significantly with income, the poor are far more likely than the non-poor to report aspirations that exceed current income. The aspirations of both the poor and the non-poor also vary positively (and not negatively) with local levels of inequality, although aspirations respond significantly only to the relative success of others in the same race group.

Emotion fingerprints or emotion populations? A meta-analytic investigation of autonomic features of emotion categories.

The classical view of emotion hypothesizes that certain emotion categories have a specific autonomic nervous system (ANS) "fingerprint" that is distinct from other categories. Substantial ANS variation within a category is presumed to be epiphenomenal. The theory of constructed emotion hypothesizes that an emotion category is a population of context-specific, highly variable instances that need not share an ANS fingerprint. Instead, ANS variation within a category is a meaningful part of the nature of emotion. We present a meta-analysis of 202 studies measuring ANS reactivity during lab-based inductions of emotion in nonclinical samples of adults, using a random effects, multilevel meta-analysis and multivariate pattern classification analysis to test our hypotheses. We found increases in mean effect size for 59.4% of ANS variables across emotion categories, but the pattern of effect sizes did not clearly distinguish 1 emotion category from another. We also observed significant variation within emotion categories; heterogeneity accounted for a moderate to substantial percentage (i.e., I2 ≥ 30%) of variability in 54% of these effect sizes. Experimental moderators epiphenomenal to emotion, such as induction type (e.g., films vs. imagery), did not explain a large portion of the variability. Correction for publication bias reduced estimated effect sizes even further, increasing heterogeneity of effect sizes for certain emotion categories. These findings, when considered in the broader empirical literature, are more consistent with population thinking and other principles from evolutionary biology found within the theory of constructed emotion, and offer insights for developing new hypotheses to understand the nature of emotion. (PsycINFO Database Record

Federal Financial Aid and Family Formation: Examining the Social Security Student Benefit Program

A broad empirical literature asks if social policies designed to provide benefits to low-income families also affect family formation patterns. While most of the evidence suggests that family formation effects are small at best, and often nonexistent, recent research argues that policies that alter budget constraints considerably should have greater family formation impacts. We tested this hypothesis by investigating the Social Security Student Benefit Program (SSSBP), a program designed to provide large higher education subsidies for the children of disabled, retired, or deceased parents. Conditions for receipt of SSSBP created strong incentives to delay marriage. Utilizing data from the National Longitudinal Survey of Youth, 1979, and a difference-in-differences model, we found that women potentially qualifying for the SSSBP were much less likely to marry before age 22 and were older when they had children, while the program did not influence the probability of women ever marrying or having children. Impacts on men, however, were negligible.

Revisiting Event Study Designs

A broad empirical literature uses event study research designs for treatment effect estimation, a setting in which all units in the panel receive treatment but at random times. We make four novel points about identification and estimation of causal effects in this setting and show their practical relevance. First, we show that in the presence of unit and time fixed effects, it is impossible to identify the linear component of the path of pre-trends and dynamic treatment effects. Second, we propose graphical and statistical tests for pre-trends. Third, we consider commonly-used static regressions, with a treatment dummy instead of a full set of leads and lags around the treatment event, and we show that OLS does not recover a weighted average of the treatment effects: long-term effects are weighted negatively, and we introduce a different estimator that is robust to this issue. Fourth, we show that equivalent problems of under-identification and negative weighting arise in difference-in-differences settings when the control group is allowed to be on a different time trend or in the presence of unit-specific time trends. Finally, we show the practical relevance of these issues in a series of examples from the existing literature, with a focus on the estimation of the marginal propensity to consume out of tax rebates.

Shifts in Women’s Mate Preferences Across the Ovulatory Cycle: A Critique of Harris (2011) and Harris (2012)

Many studies have documented systematic shifts in women’s mate preferences and sexual motivations across the ovulatory cycle. Harris (2012) presents a nonreplication of one particular finding in this literature—namely, that women’s preference for masculinity in men’s faces shifts across the cycle. Harris critiques the empirical and theoretical literature on cycle shifts and concludes that the cycle shift hypothesis should be abandoned. Here, we situate Harris’s findings within the broader empirical literature and respond to several of the points in her critique. We conclude that the evidence for cycle shifts in women‘s mate preferences and sexual motivations is much stronger than Harris portrays and that she mischaracterizes the theoretical basis of this work.

Impact of Environmental Regulations on Trade in the Main EU Countries: Conflict or Synergy?

AbstractIn an increasingly integrated world with declining trade barriers, environmental regulations can have a decisive role in shaping countries’ comparative advantages. The conventional wisdom about environmental protection is that it comes at an additional cost on firms imposed by the government, which may erode their global competitiveness. However, this paradigm has been challenged by some analysts. In particular, Porter and van der Linde argue that pollution is often associated with a waste of resources and that more stringent environmental policies can stimulate innovations that may overcompensate for the costs of complying with these policies. This is known as the Porter hypothesis. While there is a broad empirical literature on the impact of trade on environment, the empirical literature on the impact of environmental regulations on trade flows is relatively scarce, very heterogeneous and presents mixed results. The innovative feature of this paper is its attempts to estimate, in a gravity setting, augmented with a proxi of environmental stringency, the impact of three major multilateral environmental agreements (MEAs) on 15 EU countries’ bilateral exports. According to our estimates, in the period 1988–2008, to be member of MEAs had a positive average impact on EU‐15 bilateral exports. This evidence can be partly explained by a possible trade diversion effect with respect to countries that did not sign MEAs and a corresponding trade creation effect among members of the environmental agreements. Furthermore, evidence coming from interaction effects estimates seems to show that for exporting countries, having signed the United Nations Framework Convention on Climate Change and the Montreal agreements partly mitigates (by the amount of the estimated coefficient) the negative impact of having a relatively more stringent environmental regulation on bilateral trade. This result could have important policy implications for the future international trade–environmental negotiations.

Impact of Environmental Regulations on Trade in the Main EU Countries: Conflict or Synergy?

In an increasingly integrated world with declining trade barriers, environmental regulations can have a decisive role in shaping countries’ comparative advantages. The conventional wisdom about environmental protection is that it comes at an additional cost on firms imposed by the government, which may erode their global competitiveness. However, this paradigm has been challenged by some analysts. In particular, Porter and van der Linde argue that pollution is often associated with a waste of resources and that more stringent environmental policies can stimulate innovations that may overcompensate for the costs of complying with these policies. This is known as the Porter hypothesis. While there is a broad empirical literature on the impact of trade on environment, the empirical literature on the impact of environmental regulations on trade flows is relatively scarce, very heterogeneous and presents mixed results. The innovative feature of this paper is its attempts to estimate, in a gravity setting, augmented with a proxi of environmental stringency, the impact of three major multilateral environmental agreements (MEAs) on 15 EU countries’ bilateral exports. According to our estimates, in the period 1988–2008, to be member of MEAs had a positive average impact on EU‐15 bilateral exports. This evidence can be partly explained by a possible trade diversion effect with respect to countries that did not sign MEAs and a corresponding trade creation effect among members of the environmental agreements. Furthermore, evidence coming from interaction effects estimates seems to show that for exporting countries, having signed the United Nations Framework Convention on Climate Change and the Montreal agreements partly mitigates (by the amount of the estimated coefficient) the negative impact of having a relatively more stringent environmental regulation on bilateral trade. This result could have important policy implications for the future international trade–environmental negotiations.

Economic Perspectives on Addiction: Hyperbolic Discounting and Internalities

This paper provides an introduction, with critical interpretations, to the use of hyperbolic discounting as a model of behavior for the consumption of addictive goods. The exponential and hyperbolic discounting models are carefully reviewed, with particular emphasis on the implications for time consistency. We then present a simple explanation of the logic of market failure resulting from internalities and the economic inefficiency that can result when time inconsistent choices have inter-temporal impacts. We then briefly review, with commentary, key work, from the experimental and broader empirical literature, that can be used to assess and critique the hyperbolic discounting model.

Consumption and Wealth in Australia

This paper examines the relationship between consumption and wealth in Australia. We find a steady‐state relationship between non‐durables consumption, labour income and aggregate household wealth for the period 1988–1999. We also find that changes in both non‐financial and financial assets have significant but different short‐run and long‐run effects in dynamic consumption models. Finally, we place our results within the broader empirical literature and examine whether they are consistent with standard theories of consumption.

Electoral Systems and the Representation of Minority Interests in Legislatures

The rules and institutions used to translate preferences into electoral outcomes have a profound impact on the nature of representation provided in a political system. This is especially true when it comes to representing divergent racial and ethnic group interests. This essay examines the range of alternatives that nations have used to address this fundamental problem, with a focus on the representation of minority interests within U.S. legislatures. After a brief review of related issues, I examine the following questions: how should representation be provided to minorities within a majority rule system (the normative literature); how can representation be provided (the legal literature); and, how are minority interests represented (the partisan implications of racial redistricting and the broader empirical literature on representation).

Primary error detection and minimization (PEDMIN) strategies in social cognition: a reinterpretation of confirmation bias phenomena.

A broad empirical literature demonstrates what has been termed a confirmation bias or positive test strategy heuristic in reasoning (Klayman & Ha, 1987), a potentially maladaptive pattern of data preferences that coexists with more normative preferences for highly diagnostic information (Skov & Sherman, 1986). A model is developed to account for these variations in test strategies, beginning with the premise that cognitive processes are adapted to reducing particularly costly errors rather than to detecting "truth" (Cosmides & Tooby, 1992). By specifying the information required to minimize various errors of primary concern, the model clarifies the adaptiveness of certain confirmatory preferences, identifies conditions under which such preferences should diminish, and outlines how error minimization goals might produce data preferences coincidentally consistent with normative prescriptions.