Consumption smoothing and liquidity income redistribution

We show theoretically that income redistribution benefits borrowingconstrained individuals more than is implied by standard relative-income and uninsurable-risk considerations. Empirically, we find in international opinion-survey data that younger and lower-income individuals express stronger support for government redistribution in countries where consumer credit is less easily available. This evidence supports our theoretical perspective if such individuals are more strongly affected by tighter credit supply, in that expectations of higher incomes in the future increase their propensity to borrow. JEL Classification: E2

Hidden insurance in a moral hazard economy

We consider an economy where individuals privately choose effort and trade competitively priced securities that pay off with effort-determined probability. We show that if insurance against a negative shock is sufficiently incomplete, then standard functional form restrictions ensure that individual objective functions are optimized by an effort and insurance combination that is unique and satisfies first- and second-order conditions. Modeling insurance incompleteness in terms of costly production of private insurance services, we characterize the constrained inefficiency arising in general equilibrium from competitive pricing of nonexclusive financial contracts

Evidence for convergent nucleotide evolution and high allelic turnover rates at the complementary sex determiner (csd) gene of western and Asian honey bees

Our understanding of the impact of recombination, mutation, genetic drift and selection on the evolution of a single gene is still limited. Here we investigate the impact of all of these evolutionary forces at the complementary sex determiner (csd) gene which evolves under a balancing mode of selection. Females are heterozygous at the csd gene and males are hemizygous; diploid males are lethal and occur when csd is homozygous. Rare alleles thus have a selective advantage, are seldom lost by the effect of genetic drift and are maintained over extended periods of time when compared to neutral polymorphisms. Here, we report on the analysis of 17, 19 and 15 csd alleles of Apis cerana, Apis dorsata and Apis mellifera honey bees respectively. We observed great heterogeneity of synonymous (pi S) and nonsynonymous (pi N) polymorphisms across the gene, with a consistent peak in exon 6 and 7. We propose that exons 6 and 7 encode the potential specifying domain (csd-PSD) which has accumulated elevated nucleotide polymorphisms over time by balancing selection. We observed no direct evidence that balancing selection favors the accumulation of nonsynonymous changes at csd-PSD (pi N/pi S ratios are all < 1, ranging from 0.6 to 0.95). We observed an excess of shared nonsynonymous changes, which suggests that strong evolutionary constraints are operating at csd-PSD resulting in the independent accumulation of the same nonsynonymous changes in different alleles across species (convergent evolution). Analysis of a csd-PSD genealogy revealed relatively short average coalescence times (~6 million years), low average synonymous nucleotide diversity (pi S < 0.09) and a lack of trans-specific alleles which substantially contrasts with previously analyzed loci under strong balancing selection. We excluded the possibility of a burst of diversification after population bottlenecking and intragenic recombination as explanatory factors, leaving high turn-over rates as the explanation for this observation. By comparing observed allele richness and average coalescence times with a simplified model of csd-coalescence, we found that small long term population sizes (i.e. Ne <104), but not high mutation rates, can explain short maintenance times, implicating a strong impact of genetic drift on the molecular evolution of highly social honey bees

Consumption Smoothing and Liquidity Income Redistribution

We show theoretically that income redistribution benefits borrowingconstrained individuals more than is implied by standard relative-income and uninsurable-risk considerations. Empirically, we find in international opinion-survey data that younger and lower-income individuals express stronger support for government redistribution in countries where consumer credit is less easily available. This evidence supports our theoretical perspective if such individuals are more strongly affected by tighter credit supply, in that expectations of higher incomes in the future increase their propensity to borrow.Consumption, Smoothing

Debt Portfolios

We provide a model with endogenous portfolios of secured and unsecured household debt. Secured debt is collateralized by durables whereas unsecured debt can be discharged in bankruptcy procedures. We show that the model matches the main quantitative characteristics of observed wealth and debt portfolios in the US and some of the observed changes over time. Furthermore, we establish two quantitative results. Firstly, modest levels of risk aversion are necessary to match observed debt portfolios. Secondly, durables do not improve consumers' access to unsecured credit, and plausible variations of durable exemptions in bankruptcy procedures have very small effects on the equilibrium.Household debt portfolios, Durables, Collateral, Income risk, Bankruptcy

Debt Portfolios

We provide a model with endogenous portfolios of secured and unsecured household debt. Secured debt is collateralized by owner-occupied housing whereas unsecured debt can be discharged according to bankruptcy regulations. We show that the calibrated model matches important quantitative characteristics of observed wealth and debt portfolios for prime-age consumers in the U.S. We then establish the quantitative result that home equity does not serve as informal collateral for unsecured debt since, as in the data, unsecured debtors hold small amounts of home equity in equilibrium. Thus, observed variations in homestead exemptions, which are an important part of U.S. bankruptcy regulation, have a small effect on the quantity and price of unsecured debt.household debt portfolios, housing, collateral, bankruptcy, commitment, income risk

Public and Private Insurance with Costly Transactions

We characterize how public insurance schemes are constrained by hidden financial transactions. When non-exclusive private insurance entails increasing unit transaction costs, public transfers are only partly offset by hidden private transactions, and can influence consumption allocation. We show that efficient transfer schemes should take into account the impact of insurance on unobservable effort and saving choices as well as the relative cost of public and private insurance technologies. We provide suggestive evidence for the empirical relevance of these results by inspecting the cross-country relationship between available indicators of insurance transaction costs and variation in public and private insurance.public transfers, private insurance, moral hazard, transaction costs

Dealer Pricing of Consumer Credit

Interest rates on consumer lending are lower when funds are tied to purchase of a durable good than when they are made available on an unconditional basis. Further, dealers often choose to bear the financial cost of their customers' credit purchases. This paper interprets this phenomenon in terms of monopolistic price discrimination. We characterize consumers' intertemporal consumption decisions and the dealer's pricing incentives when the consumers' unconditional lending and borrowing rate as well as the internal rate of return of the durable purchase differ. Our empirical analysis offers considerable support for the assumptions and implications of our theoretical perspective.

Bridged: An Autoethnography Exploring How an Alternative School for At Risk Middle and High School Youth Overcame the Achievement Gap

The purpose of this autoethnographic study was to discover how an alternative school for at-risk students, bridged the achievement gap. It used autoethnographic approaches to examine the factors that have led to the successes of an urban school. In this study, 19 graduates of Eastend School (all participant and institutional names are replaced with pseudonyms), three parents and six current and former staff members participated in unstructured, individual interviews and shared their experiences. Autoethnographic field notes were composed. Documents and artifacts relating to Eastend School were collected and studied. The collected data were generally coded and specifically coded until themes emerged. The following research questions were addressed: What are the core values that provide the foundation of the culture at Eastend School, and how do students, teachers, administrators, and parents perceive their role and each other in that culture? What expectations do participants have for each role (student, teacher, administrator, and parent) within the school? How do the relationships between students and teachers, parents and teachers, and students and administrators impact student learning? What did Eastend do to create the culture of success at the school? How did the S.A.M.E. model, teaching the whole child and the providing the basic needs of students impact academic performance and contribute to school culture? This study found that Eastend School’s culture is based on surrogate familial relationships that allow educators to emotionally support students while having high expectations for academic performance and behavior. Parents accept the school as a part of their extended family. These relationships resulted in the creation of a safe environment that provides for the basic needs of the students. Eastend staff members accepted their position as role models who provide a positive example for the student body. The school is a safe environment that provides students with social, academic and moral education that provides them the foundation they need to be successful students. Suggested areas of future research include a study of what happened to the culture of Eastend since the study, how fundraisers for alternative inner-city schools impact students, how year-round school schedules impact student – teacher relationships, and why many successful educators leave the field