Public Goods and Private Wants: A Psychological Approach to Government Spending
... 27 First, investigating the generalizability of experimental survey evidence, Barabas and Jerit (2010) find that the information effects in their survey experiment are also found, to a somewhat smaller extent, in a natural experiment based on variation in the exposure to news that cover the same information. Relatedly, it has been argued that survey responses are a good proxy for actual voting behavior (Kemp, 2002). ...
In the political economy of education policy, interactions between policymakers and public opinion can create discrepancies between political awareness and action. While a large literature studies public opinion on different aspects of the welfare state, research has only recently started to investigate the public’s attitudes towards education policy. We survey this emerging literature with a particular focus on public preferences for education spending in different sociodemographic subgroups, policy trade-offs, support for specific education reforms, and the importance of information for public preferences. While the available evidence is multifaceted, there is some general indication that citizens place high priority on education policy, show substantial willingness to reform, and are responsive to information and adequate reform designs.
... The reliability of answers to questions about willingness to pay has, however, been criticized both by neoclassical economists who prefer to rely on preferences revealed by behaviour and by psychologists who believe that the answers merely reflect attitudes (e.g.,Kahneman et al 1993 andKemp 2002). ...
Sapere Research Group and the New Zealand Law Foundation.
Neoclassical economics, which assumes rationality and self-interest, has helped analyse many regulations. But a growing body of evidence about judgements, decisions, and preferences casts doubt on the applicability of these assumptions. Drawing on this evidence, behavioural economics can now supplement neoclassical economics in regulatory analysis.
Psychologists have been observing and interpreting economic behaviour for at least fifty years, and the last decade, in particular, has seen an escalated interest in the interface between psychology and economics. The Cambridge Handbook of Psychology and Economic Behaviour is a valuable reference resource dedicated to improving our understanding of the economic mind and economic behaviour. Employing empirical methods – including laboratory experiments, field experiments, observations, questionnaires and interviews – the Handbook covers aspects of theory and method, financial and consumer behaviour, the environment and biological perspectives. With contributions from distinguished scholars from a variety of countries and backgrounds, the Handbook is an important step forward in the improvement of communications between the disciplines of psychology and economics. It will appeal to academic researchers and graduates in economic psychology and behavioural economics.
This article presents an unknown aspect of Tocqueville’s thinking that positions him as a pioneer in the field of fiscal sociology. In Democracy in America, he puts forward the general trend by democratic societies to increase their public expenditure, which would later be known as Wagner’s law. His findings continue to be valid in an era of economic globalization, especially with the resilience of the Welfare State. In The Old Regime and the Revolution, the demonstration is mainly based on the financial changes in the public sector that contributed to destroying political freedom, accentuating class divisions, and delegitimizing public action while cognitive and ideological factors precipitated the movement. Tocqueville’s pioneering work is remarkable for its methodology (although this remains implicit rather than explicit) and for its results. Nevertheless it is not referred to by either the founders of financial sociology or by current researchers.
Purpose
The purpose of this research is to explore the economic and social arguments used in support of government assistance for cultural well‐being, and the accounting measures used to capture cultural well‐being at a regional level in New Zealand.
Design/methodology/approach
Accounting information reported in city council annual reports is used to examine expenditure on cultural well‐being. The research investigates possible relationships between regional economic growth and regional expenditure on arts, culture and heritage. It also investigates justifications for expenditure on activities classified under the category of arts, culture and heritage in the annual reports produced by New Zealand city councils.
Findings
In most regions, funding for cultural activities has increased over the past ten years. The findings of this research indicate there is no significant relationship between funding on cultural activities and regional economic growth. Instead, the research highlights the emphasis placed on social benefit arising from funding cultural activities.
Research limitations/implications
The research is limited by access to comparable data. Accordingly, not all New Zealand regions are included in the analysis, resulting in a small number of observations. Moreover, robust city‐based measures of economic growth are unavailable, resulting in the use of labour force participation as a proxy for economic growth, together with the elimination of some regions in part of the analysis.
Originality/value
Extant literature indicates that government expenditure on artistic and cultural activities is undertaken for reasons that include: possible economic benefit or generation of externalities, mitigation of market failure, educational purposes or improved national identity. In New Zealand, the “merit good” argument prevails with the objective of spending on artistic and cultural activity by local government expected to generate social rather than economic benefit.
L’impôt est un processus central des sociétés, ce qui justifie un traitement sociologique des faits fiscaux. La sociologie de l’impôt dont Marc Leroy, professeur à l’Université de Reims, est le spécialiste en France, cherche à comprendre les rapports entre la fiscalité, l’État et la société. Elle s’intéresse à la construction et à l’évolution des institutions publiques autour de l’impôt, questionne la légitimité de l’État fiscal pour le citoyen, propose enfin une réflexion sur la justice fiscale et sur la démocratie financière. Cet article énumère d'abord les problématiques de la sociologie fiscale, en les reliant à celles de la sociologie générale. Comment analyser sociologiquement les formes de fraude et de révolte, modéliser les décisions du contribuable, étudier les réformes fiscales ? Il présente ensuite une approche fonctionnelle renouvelée de la politique fiscale, en élargissant l'approche économique traditionnelle de Musgrave : l'impôt a aussi une fonction sociale, une fonction politique et une fonction territoriale. Comment la prise en compte de cette complexité permet-elle de nuancer et d'enrichir l'analyse strictement économique ? Il s’achève enfin par quelques observations sur la relation du citoyen à l’impôt, notamment sur une prétendue aversion générale à l'impôt inhérente à la "nature humaine", que les faits invalident. Quel est donc l'Etat légitime pour les contribuables ?
Children's distributional justice was investigated in two experiments. In Experiment 1, pairs of children played a game in which they guessed which card the experimenter would turn up next. We investigated the effect of age (5-, 7-, and 9-year-olds), gender, country (Indonesia or New Zealand), and instructional set on how the children distributed the sweets at the conclusion of the game. Children usually distributed equally, but five-year-olds often distributed according to neither equity nor equality. All the 7- and 9-year-olds applied the same distribution principle over two rounds of the game. In Experiment 2, many of the same children made an allocation preference in response to a hypothetical scenario. Older children, in particular, often showed differences between their allocation in this experiment and their behaviour in Experiment 1. Overall, Damon's (1975) account of children's ideas of distributional justice held up well as a description of the children's actual behaviour in our experiments.
Preferences for changes to public expenditures were evaluated using a choice experiment. Results indicate potential efficiency gains from reallocation of expenditures to items with higher marginal welfare. In particular, respondents were found to prefer more spending on health, education and the environment, with health spending providing the highest marginal benefits. The public preferred less expenditure on income support. The choice experiment also identified the impacts of demographic factors. The approach is offered as a complement to prior approaches that research public preferences for budget allocation, with prospects for revelation of richer information for informing social decisions.
New Zealand student and general public samples reported their perception of changes in spending and quality in eight areas of government spending between 2002 and 2007. The actual considerable shift in spending towards education, health and cultural goods was not perceived. They perceived some improvement in quality of areas that had received increased spending. Respondents who had recently used health services reported both a greater increase in spending and a greater quality increase in health services than non-users. Overall, the results suggest but by no means prove that the increased spending has produced little noticeable public benefit.
This paper begins by exploring four different possible forms of relationship between economics and psychology, which have
different connotations in terms of the relative status of the two disciplines. It then focuses on the future for one of these,
psychological economics. After setting out the hardcore axioms and positive and negative heuristics of a research programme
in psychological economics, it explores institutional and psychological barriers to the success of such a research programme
in the context of both research and teaching.
This paper examines whether electoral motives and government ideology influence short-term economic performance. I employ data on annual GDP growth in 21 OECD countries over the 1951-2006 period and provide a battery of empirical tests. In countries with two-party systems GDP growth is boosted before elections and, under leftwing governments, in the first two years of a legislative period. These findings indicate that political cycles are more prevalent in two-party systems because voters can clearly punish or reward political parties for governmental performance. My findings imply that we need more elaborate theories of how government ideology and electoral motives influence short-term economic performance.
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