Does parental employment affect children's educational attainment?

This paper analyzes whether there exists a causal relationship between parental employment and children's educational attainment. We address potential endogeneity problems due to (i) selection of parents in the labor market by estimating a model on sibling differences and (ii) reverse causality by focusing on parents' employment when children are aged 0-3. We use data from the German Socioeconomic Panel. Overall, we find little support that parental employment affects children's educational attainment. We can rule out that having a mother who works one hour more per week lowers the probability of high secondary track attendance by more than 0.1%.sibling differences; educational attainment; child care

Is the veil of ignorance only a concept about risk? An experiment

We implement the Rawlsian thought experiment of a veil of ignorance in the laboratory which introduces risk and possibly social preferences. We find that both men and women react to the risk introduced by the veil of ignorance. Only the women additionally exhibit social preferences that reflect an increased concern for equality. Our results for women imply that maximin preferences can also be derived from a combination of some, not necessarily infinite risk aversion and social preferences. This result contrasts the Utilitarians' claim that maximin preferences necessarily represent preferences with infinite risk aversion.veil of ignorance; social preferences; equality; efficiency; experiment

An experimental test of the deterrence hypothesis

Crime has to be punished, but does punishment reduce crime? We conduct a neutrally framed laboratory experiment to test the deterrence hypothesis, namely that crime is weakly decreasing in deterrent incentives, i.e. severity and probability of punishment. In our experiment, subjects can steal from another participant's payoff. Deterrent incentives vary across and within sessions. The across subject analysis clearly rejects the deterrence hypothesis: except for very high levels of incentives, subjects steal more the stronger the incentives. We observe two types of subjects: selfish subjects who act according to the deterrence hypothesis and fair-minded subjects for whom deterrent incentives backfire.deterrence; law and economics; incentives; crowding out; experiment