Contingency learning tracks with stimulus-response proportion no evidence of misprediction costs

We investigate the processes involved in human contingency learning using the color-word contingency learning paradigm. In this task, participants respond to the print color of neutral words. Each word is frequently presented in one color. Results show that participants respond faster and more accurately to words presented in their expected color. In Experiment 1, we observed better performance for high-relative to medium-frequency word-color pairs, and for medium-relative to low-frequency pairs. Within the medium-frequency condition, it did not matter whether the word was predictive of a currently-unpresented color, or the color was predictive of a currently-unpresented word. We conclude that a given word facilitates each potential response proportional to how often they co-occurred. In contrast, there was no evidence for costs associated with violations of high-frequency expectancies. Experiment 2 further introduced a novel word baseline condition, which also provided no evidence for competition between retrieved responses

The role of fiscal delegation in a monetary union: a survey of the political economy issues

Current proposals to address the European sovereign debt crisis envision some sort of fiscal union to complement the Economic and Monetary Union, backed by stronger sanctions against countries that deviate from budget balance. We argue that sanctions are an indirect approach to balancing budgets, and that member states, and Europe as a whole, could instead consider delegating effective fiscal instruments with a direct budgetary impact to an independent authority. Outside of a fiscal union, a solvent country could establish an independent fiscal authority at the national level, with a mandate to maintain long-term budget balance. Delegating a few powerful fiscal instruments to an institution of this type could cut off speculation about fiscal sustainability without ceding sovereignty to a supranational body. Inside a fiscal union, delegating one or more fiscal levers of each Eurozone member state to a national or European fiscal authority could eliminate moral hazard without relying on sanctions per se. Many fiscal instruments can serve to balance budgets, but in the context of a monetary union the chosen instrument should ideally be one that increases competitiveness when recession looms. The instrument should also be one that is quick and simple to adjust, with a large budgetary impact and minimal redistributional consequences. For consistency with these criteria, we argue that fiscal adjustments should operate on the spending side, rather than the revenue side, and that spending adjustments should affect the prices the government pays, instead of the quantities of goods and services it purchases. We discuss in detail how a system of this sort could be implemente