Impact Of Wealth Research Articles

What is the shareholder wealth impact of target CEO retention in private equity deals?

There is a widespread belief among observers that a lower premium is paid when the target CEO is retained by the acquirer in a private equity deal because conflicts of interest lead her to negotiate less aggressively on behalf of the target shareholders. Our empirical evidence is not consistent with this belief. We find that, when a private equity acquirer retains the target CEO, target shareholders receive an acquisition premium that is larger by as much as 18% of pre-acquisition firm value when accounting for the endogeneity of the retention decision. Our evidence is consistent with what we call the “valuable CEO hypothesis.” With this hypothesis, retention of the CEO can be valuable to private equity acquirers because, unlike public operating companies with managers in place, these acquirers have to find a CEO to run the post-acquisition company and the incumbent CEO may be the best choice to do so because she has valuable firm-specific human capital. When a private equity acquirer finds a target with a CEO who can manage the post-acquisition company better than other potential CEOs, we expect target shareholders to receive a larger premium because the post-acquisition value of the target is higher.

Fueling development? Assessing the impact of oil and soybean wealth on municipalities in Brazil

The commodity boom of the 2000s, which now came to an end, represented a windfall to resource-rich countries. However, the benefits − or potential curse − likely had heterogeneous effects at the local level, with the potential to increase regional or income inequalities within countries. This paper examines the impact of the international commodity boom during the first decade of the 2000s on different parts of Brazil. Using a range of quantitative techniques, it estimates the changes in development and inequality indicators between 2000 and 2010 among oil rich, soybean rich, and resource poor control municipalities. Our results indicate both that there is a “catch-up” effect benefitting less developed, resource poor municipalities, and that oil rich municipalities may be experiencing some of the dynamics associated with a resource curse. These findings are broadly in line with existing empirical research on the effect of oil wealth on local development in Brazil. We argue that national-level institutions and social programs that redistribute the windfall and constrain how local governments spend their resources likely constitute part of the reason for why regional inequalities have not been exacerbated as a result of the boom and local resources curses are at most incipient.

Parents or peers, wealth or warmth? The impact of social support, wealth, and a positive outlook on self-efficacy and happiness

PurposeThe purpose of this paper is to investigate the association between family wealth, positive outlook, and support from significant others, including parents and friends, on self-efficacy and happiness.Design/methodology/approachThe impact of family wealth, social support, and positive outlook on self-efficacy and one’s own happiness is analyzed through the partial least squared method.FindingsThere are five essential points that can be drawn from the statistical results. First, parents’ support tends to be more important than friends’ support for individuals’ happiness. Second, individuals that receive more support from parents tend to develop a higher level of self-efficacy. Third, individuals that are in a less wealthy family tend to develop a higher level of self-efficacy. Fourth, parents’ support plays a more important role in developing a higher level of self-efficacy for individuals that are in a less wealthy family than for individuals that are in a wealthier family. Finally, the positive link between happiness and self-efficacy was stronger for individuals in a wealthier family than for individuals in a less wealthy family.Research limitations/implicationsIn particular, although individuals in a wealthier family tend to exhibit a lower level of self-efficacy, and happiness alone had no significant impact on self-efficacy, happiness significantly promoted self-efficacy more for individuals in a wealthier family than for individuals in a less wealthy family.Social implicationsIn conclusion, the results from this research provide essential recommendations for individuals regarding the approach to happiness and self-efficacy. The results indicated how significant the role of parents’ support is in one’s happiness and that support from parents is more important for one’s self-efficacy and happiness than support from friends. Furthermore, individuals should be aware that money is not the ultimate answer for happiness and self-efficacy. Individuals in less wealthy families were able to enjoy a higher level of self-efficacy given that they were receiving sufficient support from their parents.Originality/valueThis study found that although individuals in a wealthier family tend to exhibit a lower level of self-efficacy, and happiness alone has no significant impact on self-efficacy, happiness significantly promote self-efficacy more for individuals in a wealthier family than for individuals in a less wealthy family. However, in the less-wealthier family, parents play more significant role and can generate high level of self-efficacy for their children.

The impact of income inequality and national wealth on child and adolescent mortality in low and middle-income countries

BackgroundIncome inequality and national wealth are strong determinants for health, but few studies have systematically investigated their influence on mortality across the early life-course, particularly outside the high-income world.MethodsWe performed cross-sectional regression analyses of the relationship between income inequality (national Gini coefficient) and national wealth (Gross Domestic Product (GDP) averaged over previous decade), and all-cause and grouped cause national mortality rate amongst infants, 1–4, 5–9, 10–14, 15–19 and 20–24 year olds in low and middle-income countries (LMIC) in 2012. Gini models were adjusted for GDP.ResultsData were available for 103 (79%) countries. Gini was positively associated with increased all-cause and communicable disease mortality in both sexes across all age groups, after adjusting for national wealth. Gini was only positively associated with increased injury mortality amongst infants and 20–24 year olds, and increased non-communicable disease mortality amongst 20–24 year old females. The strength of these associations tended to increase during adolescence.Increasing GDP was negatively associated with all-cause, communicable and non-communicable disease mortality in males and females across all age groups. GDP was also associated with decreased injury mortality in all age groups except 15–19 year old females, and 15–24 year old males. GDP became a weaker predictor of mortality during adolescence.ConclusionPolicies to reduce income inequality, rather than prioritising economic growth at all costs, may be needed to improve adolescent mortality in low and middle-income countries, a key development priority.

Economic Status and Maternal Health: Analysis of the 2013-14 Zambia Demographic and Health Survey

With the current high maternal mortality rates prevailing in Zambia, it is imperative to analyze the effect that the economic status of women has on maternal health outcomes. It is hypothesized that wealth is positively linked to better health outcomes. As a result, maternal health outcomes will improve when the economic status of women improve. Using data for women from the 2013-14 Zambia Demographic and Health Survey, bivariate and multivariate analysis was used to ascertain the impact of wealth as a proxy for economic status and other variables based on five independent outcomes (Number of antenatal care visits, timing of first antenatal care visit, tetanus toxoid vaccination, iron tablet/syrup uptake, and place of delivery) and a composite measure of maternal health. The results revealed that women’s wealth and region were the only significant factor associated with all the five independent indicators and the composite measure of maternal health. However, for the composite measure, literacy and age of the mother were also found to be associated with maternal health. The study therefore concluded that economic status is an important factor in improving maternal health outcomes in Zambia. As a result, policy should be aimed at providing support to women within the lowest wealth quintiles so as to enable them access maternal health services.

Resource Wealth, Democracy and Mobilisation

The impact of resource wealth on society remains highly contested in the literature. Some perspectives suggest that resource wealth is associated with political apathy, while others indicate that resource wealth fosters violent civil conflicts. We leverage these seemingly contradictory impacts of natural resources on society by expanding the scope of inquiry to explore different types of resource wealth (oil and minerals) as well as other dimensions of political life (protest). Utilising a global dataset for the period 1950–2006, we test the impact of resource wealth on mobilisation. We find that while oil wealth demobilises citizens in all regime types, mineral wealth strongly correlates with higher levels of mobilisation in democracies, though not in autocracies. In addition, using survey data, we examine individual-level attitudes toward protest participation in two resource-rich states, Peru and Ecuador. The results indicate that an individual living in a mineral-rich country like Peru is more likely to participate in a protest compared to an individual living in an oil-rich country like Ecuador. Our findings highlight the contributions of the resource activism framework for understanding the connection between natural resources and mobilisation.

Asymmetric effects of housing wealth on college enrolment

ABSTRACTWe investigate the impact of housing wealth, credit availability and financial distress on college enrolment decisions. We find that housing wealth is negatively related to enrolment in public schools and positively related to enrolment in private schools. This evidence suggests that, on average, students substituted away from private schools towards public institutions during the recent financial crisis.

Does Oil Hinder Social Spending? Evidence from Dictatorships, 1972–2008

This paper examines the effects of natural resource abundance on social spending in dictatorships. Natural resources, particularly oil, provide authoritarian leaders with economic rents without widescale labor force participation. I argue that dependence on natural resource production thus reduces dictators’ incentive to invest in human capital, which is reflected in lower levels of social spending. Using a panel dataset of authoritarian regimes between 1972 and 2008, I find that oil abundance leads to significantly lower levels of social spending by authoritarian governments. The negative effects are especially prominent concerning expenditures for public education and health: when an authoritarian country earns ten more dollars per capita from oil production, per capita spending on education and health decreases by approximately 1%. Extended analysis shows that the negative impact of oil on social spending is peculiar to authoritarian regimes; no impact of oil wealth on social expenditures is found among democracies.

The Impact of Health, Wealth, and Attractiveness on Romantic Evaluation from Photographs of Faces.

A large literature suggests that men and women differ in their self-reported mate preferences such that men place greater weight on physical attractiveness than women do, whereas women value financial prospects more than men. Yet, little research has addressed how these differences generalize to other contexts, such as modern online dating in which mate selection may largely depend on visual cues. Distinct from the sex differences observed in previous studies relying on self-reports, we found that men and women both used perceptions of health and attractiveness to select hypothetical partners based on photographs of their faces. Importantly, although people reliably identified others' wealth from their photographs, these perceptions did not influence men's or women's partner selections. Thus, men and women may select romantic partners similarly based on limited visual information.

The Relative Influence of Wealth on Households Joint Decisions on Cooking Fuel, Drinking Water and Sanitation in Burkina Faso: A Semi-Parametric Trivariate Probit Modeling Approach

Evaluation of Millennium Development Goals (MDGs) outcomes shows as of 2015, a deficit in the targeted goals for energy, water, and sanitation in sub-Saharan Africa. Although much progress has been made in some sectors more than others since 2000, much still remain to be done as we move forward with the 2030 agenda for sustainable development (SGDs). As such, with the aim of moving SDG goals 5 and 6 forward for Burkina Faso, this study uses data derived from the 2014 Burkina Faso Malaria Indicator Survey (MIS 2014) to investigate the impact of households' wealth on their joint decisions on cooking fuel, water and sanitation in the country. To this end, we first specify and estimate standard univariate probit models for each decision process, then we move to a fully parametric trivariate probit specification to relax the independence assumption between the three decisions, followed by a semi-parametric trivariate probit specification to further relax the linearity assumption in each of the three equations. The results suggest that the semi-parametric trivariate probit specification is better at capturing the true effects of wealth on households joint decisions on cooking fuel, water and sanitation in Burkina Faso. Furthermore, the marginal effects of wealth show positives but non linear and varying effects of wealth on the three household decisions, suggesting that wealth do create positive health and environmental consciousness as wealthier households present greater likelihoods of making relatively healthier and environmentally friendlier choices, in terms of their needs for cooking fuel, drinking water and sanitation. Although sanitation seems to be the lowest priority at relatively lower levels of wealth, at higher wealth levels it becomes the highest priority for households in Burkina Faso.

The Wealth Effect of Adopting Anti-Takeover Defences: Evidence from a Meta Analysis

We use meta-analysis techniques to compile and analyze findings assessing the effect of the adoption of antitakeover defenses (ATDs) on existing shareholders’ wealth. 51 papers were examined to construct a sample of 89 observations, covering nearly 16,000 cases of ATD adoptions mostly in the United States. Meta-analysis revealed that it does not matter whether an ATD is adopted, but rather in what context. Neither managerial entrenchment nor shareholder interest theory can be supported unconditionally. However, a number of moderators impact the wealth impact of ATD adoptions such as the strength of a corporation’s corporate governance structure, whether or not the firm is subject to takeover threats at the time of adoption, and how the proposal is framed and implemented. The analysis of publication characteristics in the field does not suggest any serious biases.

The Impact of Income Inequality and National Wealth on Child and Adolescent Mortality in Low and Middle-Income Countries

Background Income inequality and national wealth are strong determinants for health, but few studies have systematically investigated their influence on mortality across the early life-course, particularly outside the high-income world.

Entrepreneurship Among Baby Boomers: Recent Evidence from the Health and Retirement Study

We study entrepreneurship among Baby Boomers using data from the US Health and Retirement Study (HRS). Using two different definitions of entrepreneurship (being self-employed and being a business owner), we compare entrepreneurs to non-entrepreneurs and entrepreneurs who were age 52–65 in the 2012 HRS to their counterparts (i.e., those age 52–65) in the 1998 HRS. We find that entrepreneurs are systematically different from the rest of the population; specifically, they are more highly educated, healthier, wealthier, and more likely to be white and male. When we compare the cohort of Baby Boomer entrepreneurs surveyed in 2012 to entrepreneurs in the same age range in 1998, we find that Baby Boomer entrepreneurs are older, are less likely to be white, have a higher level of education, have fewer children and grandchildren, and are in poorer physical health. Finally, using partial identification methods, we find some evidence for a positive causal impact of wealth on business ownership, but only for the highest levels of wealth.

Impact of Inheritance and Housing Wealth on Retirement Decision

This paper proposes to find how wealth shocks such as inheritances and housing wealth impact retirement behaviour using cross-sectional micro data from the Canadian Survey of Financial Security. Estimation of wealth impact on retirement decision is challenging since wealth and retirement decision may be endogenously determined. We found no evidence that housing wealth impacts retirement decision suggesting that individuals are correctly anticipating future housing wealth and adjusting their labour market behaviour accordingly. However, the data supports the hypothesis that receiving an inheritance significantly increases the retirement hazard, which may indicate the existence of some financial constraints.

Исследовaние проблемы счaстья в рaзличных нaпрaвлениях психологии

This paper analyze the happiness phenomenon in different areas of psychology. The author describes the peculiarities of happiness understanding, its sources and determinants of experiencing happiness. Happiness as a pleasure, determines the specificity of regulation of libido energy entity disclosed in the psychoanalytic direction. Happiness as a self-development, provided by a desire for excellence and a sense of community in the individual psychology. Happiness as the peak of experiences associated with spirituality and responsibility in humanistic psychology. Happiness as a general life satisfaction, as the social well-being in behavioral and cognitive psychology.These studies of happiness represent an important role in the aspects of their appliance. The dependence of happiness on personal traits such as extroversion, sense of control, self-esteem and optimism, the ability to cooperate, openness to new experience, a positive sense of humor, the ability to build a comfortable relationship with the other, and plan for the future consciously. There was revealed the impact of wealth and money to happiness, which allowed to establish their significance mainly in countries with a low level of material security. The gender aspect emphasize the preference to money over men rather women. Women are more concerned with interpersonal relationships. Happiness is closely connected with the work, activity that contributes into self-realization and enjoying the process. Activities related to the short time period, stimulates the feeling of unhappiness. There is also an evidence that the highest value of happiness (the results of a longitudinal study) is warm relationships (family, friends, and society), the quality and stability of them, which are sources of better physical and mental health, longevity and, in the end, the subjective well-being. Analyzing the differences, the author reveals the sources and factors that stimulate feelings of happiness and poses the problem of a more integrated approach to the understanding of happiness. In connection with this, a differentiated approach to the study of the phenomenon of happiness as a substantial component of human life requires study both the structure and the relationship with the instrumental parameters providing a measure of wellbeing experience. Key words: happiness, pleasure, self-development, excellence, community, spirituality, responsibility, satisfaction, social well-being, the peak-experience.

What is the Shareholder Wealth Impact of Target CEO Retention in Private Equity Deals?

There is a widespread belief among observers that a lower premium is paid when the target CEO is retained by the acquirer in a private equity deal because the CEO’s potential conflicts of interest leads her to negotiate less aggressively on behalf of the target shareholders. Our empirical evidence is not consistent with this belief. We find that, when a private equity acquirer retains the target CEO, target shareholders receive an acquisition premium that is larger by as much as 18% of pre-acquisition firm value when accounting for the endogeneity of the retention decision. Our evidence is consistent with what we call the “valuable CEO hypothesis.” With this hypothesis, retention of the CEO can be valuable to private equity acquirers because, unlike public operating companies with managers in place, these acquirers have to find a CEO to run the post-acquisition company and the incumbent CEO may be the best choice to do so because she has valuable firm-specific human capital. When a private equity acquirer finds a target with a CEO who can manage the post-acquisition company better than other potential CEOs, we expect target shareholders to receive a larger premium because the post-acquisition value of the target is higher.

The Relationship between Multiple Substance Use, Perceived Academic Achievements, and Selected Socio-Demographic Factors in a Polish Adolescent Sample.

Predictors of high-risk patterns of substance use are often analysed in relation to demographic and school-related factors. The interaction between these factors and the additional impact of family wealth are still new areas of research. The aim of this study was to find determinants of the most common patterns of psychoactive substance use in mid-adolescence, compared to non-users. A sample of 1202 Polish students (46.1% boys, mean age of 15.6 years) was surveyed in 2013/2014. Four patterns of psychoactive substance use were defined using cluster analysis: non-users—71.9%, mainly tobacco and alcohol users—13.7%, high alcohol and cannabis users—7.2%, poly-users—7.2%. The final model contained the main effects of gender and age, and one three-way (perceived academic achievement × gender × family affluence) interaction. Girls with poor perception of school performance (as compared to girls with better achievements) were at significantly higher risk of being poly-users, in both less and more affluent families (adjusted odds ratio (OR) = 5.55 and OR = 3.60, respectively). The impact of family affluence was revealed only in interaction with other factors. Patterns of substance use in mid-adolescence are strongly related to perceived academic achievements, and these interact with selected socio-demographic factors.

The impact of household wealth on child survival in Ghana.

BackgroundImproving child health is one of the major policy agendas for most of the governments, especially in the developing countries. These governments have been implementing various strategies such as improving healthcare financing, improving access to health, increasing educational level, and income level of the household to improve child health. Despite all these efforts, under-five and infant mortality rates remain high in many developing nations. Some previous studies examined how economic development or household’s economic condition contributes to child survival in developing countries. In Ghana, the question as to what extent does economic circumstances of households reduces infant and child mortality still remain largely unanswered. Thus, the purpose of this study is to investigate the extent to which wealth affects the survival of under-five children, using data from the Demographic and Health Survey (DHS) of Ghana.MethodsIn this study, we use four waves of data from Demographic and Health Surveys (DHS) of Ghana from 1993 to 2008. The DHS is a detailed data set that provides comprehensive information on households and their demographic characteristics in Ghana. Data was obtained by distributing questionnaires to women (from 6000 households) of reproductive age between 15 and 49 years, which asked, among other things, their birth history information. The Weibull hazard model with gamma frailty was used to estimate wealth effect, as well as the trend of wealth effect on child’s survival probability.ResultsWe find that household wealth status has a significant effect on the child survival in Ghana. A child is more likely to survive when he/she is from a household with high wealth status. Among other factors, birth spacing and parental education were found to be highly significant to increase a child’s survival probability.ConclusionsOur findings offer plausible mechanisms for the association of household wealth and child survival. We therefore suggest that the Government of Ghana strengthens and sustains improved livelihood programs, which reduce poverty. They should also take further initiatives that will increase adult education and improve health knowledge. To the best of our knowledge, this is the first study in Ghana that combines four cross sectional data sets from DHS to study a policy-relevant question. We extend Standard Weibull hazard model into Weibull hazard model with gamma frailty, which gives us a more accurate estimation. Finally, the findings of this study are of interest not only because they provide insights into the determinants of child health in Ghana and other developing countries, but they also suggest policies beyond the scope of health.

Political repression in autocratic regimes

Theoretical models on autocracies have long grappled with how to characterize and analyze state sponsorship of repression. Moreover, much of the existing formal literature sees dictators’ behavior as determined by one type of opposition actor alone and disregards the potential role played by other types of actors. We develop a contest model of political survival with a ruler, the elite and the opposition, and show how the ruler needs to respond to revolutionary pressures while securing the allegiance of his own supportive coalition. We find that the ruler’s reliance on vertical and horizontal repression is antithetically affected by the country’s wealth and the optimal bundle of vertical and horizontal repression has important consequences for the regime’s political vulnerability. Our hypothesis about the impact of wealth on repression is strongly borne out by the empirical results, which are robust to endogeneity concerns.

Do Wealth Shocks Affect Health? New Evidence from the Housing Boom

We exploit large exogenous changes in housing wealth to examine the impact of wealth gains and losses on individual health. In UK household, panel data house price increases, which endow owners with greater wealth, lower the likelihood of home owners exhibiting a range of non‐chronic health conditions and improve their self‐assessed health with no effect on their psychological health. These effects are not transitory and persist over a 10‐year period. Using a range of fixed effects models, we provide robust evidence that these results are not biased by reverse causality or omitted factors. For owners' wealth gains affect labour supply and leisure choices indicating that house price increases allow individuals to reduce intensity of work with commensurate health benefits. © 2016 The Authors. Health Economics Published by John Wiley & Sons, Ltd.