Long term effects of a mandatory multistage program:the new deal for young people in the UK

The New Deal For Young People is the major welfare-to-work program in the UK. It is amandatory multistage policy targeted at the 18-24 year old unemployed. This paper investi-gates the effectiveness of the program in terms of enhancing the (re)employment probabilityof participant males. I exploit the eligibility rule to identify a suitable counterfactual relyingupon a simple regression discontinuity design. By exploiting such a discontinuity I am ableto non parametrically identify (Hahn et al., 2001) a local average treatment effect (LATE).While relying upon the non parametric local linear regression method I am able to pushforward such a parameter to a \global" dimension, implicitly adding parametric structure.No evidence of possible general equilibrium as well as substitution effects is found by a cohort specific approach (before and after the program). The main result is that the programenhances employability by about 6-7%

Indirect effects of an aid program: how do liquidity injections affect non-eligibles' consumption?

Aid programs in developing countries are likely to affect both the treated and the non-treated households living in the targeted areas. Studies that focus on the treatment effecton the treated may fail to capture important spillover effects. We exploit the unique designof an aid program's experimental trial to identify its indirect effect on consumption for non-eligible households living in treated areas. We find that this effect is positive, and that itoccurs through changes in the insurance and credit markets: non-eligible households receivemore transfers, and borrow more when hit by a negative idiosyncratic shock, because of theprogram liquidity injection; thus they can reduce their precautionary savings. We also testfor general equilibrium effects in the local labor and goods markets; we find no significantchanges in labor income and prices, while there is a reduction in earnings from sales ofagricultural products, which are now consumed rather than sold. We show that this classof aid programs has important positive externalities; thus their overall effect is larger thanthe effect on the treated. Our results confirm that a key identifying assumption - that thetreatment has no effect on the non-treated - is likely to be violated in similar policy designs. Aid programs in developing countries are likely to affect both the treated and the non-treated households living in the targeted areas. Studies that focus on the treatment effecton the treated may fail to capture important spillover effects. We exploit the unique designof an aid program's experimental trial to identify its indirect effect on consumption for non-eligible households living in treated areas. We find that this effect is positive, and that itoccurs through changes in the insurance and credit markets: non-eligible households receivemore transfers, and borrow more when hit by a negative idiosyncratic shock, because of theprogram liquidity injection; thus they can reduce their precautionary savings. We also testfor general equilibrium effects in the local labor and goods markets; we find no significantchanges in labor income and prices, while there is a reduction in earnings from sales ofagricultural products, which are now consumed rather than sold. We show that this classof aid programs has important positive externalities; thus their overall effect is larger thanthe effect on the treated. Our results confirm that a key identifying assumption - that thetreatment has no effect on the non-treated - is likely to be violated in similar policy designs

Diversification Preferences in the Theory of Choice

Diversification represents the idea of choosing variety over uniformity. Within the theory of choice, desirability of diversification is axiomatized as preference for a convex combination of choices that are equivalently ranked. This corresponds to the notion of risk aversion when one assumes the von-Neumann-Morgenstern expected utility model, but the equivalence fails to hold in other models. This paper studies axiomatizations of the concept of diversification and their relationship to the related notions of risk aversion and convex preferences within different choice theoretic models. Implications of these notions on portfolio choice are discussed. We cover model-independent diversification preferences, preferences within models of choice under risk, including expected utility theory and the more general rank-dependent expected utility theory, as well as models of choice under uncertainty axiomatized via Choquet expected utility theory. Remarks on interpretations of diversification preferences within models of behavioral choice are given in the conclusion

Entanglement, BEC, and superfluid-like behavior of two-mode photon systems

A system of two interacting photon modes, without constraints on the photon number, in the presence of a Kerr nonlinearity, exhibits BEC if the transfer amplitude is greater than the mode frequency. A symmetry-breaking field (SBF) can be introduced by taking into account a classical electron current. The ground state, in the limit of small nonlinearity, becomes a squeezed state, and thus the modes become entangled. The smaller is the SBF, the greater is entanglement. Superfluid-like behavior is observed in the study of entanglement growth from an initial coherent state, since in the short-time range the growth does not depend on the SBF amplitude, and on the initial state amplitude. On the other hand, the latter is the only parameter which determines entanglement in the absence of the SBF

Teleportation on a quantum dot array

We present a model of quantum teleportation protocol based on a double quantum dot array. The unknown qubit is encoded using a pair of quantum dots, coupled by tunneling, with one excess electron. It is shown how to create maximally entangled states with this kind of qubits using an adiabatically increasing Coulomb repulsion between different pairs. This entangled states are exploited to perform teleportation again using an adiabatic coupling between them and the incoming unknown state. Finally, a sudden separation of Bob's qubit enables a time evolution of Alice's state providing a modified version of standard Bell measurement. Substituting the four quantum dots entangled state with a chain of coupled DQD's, a quantum channel with high fidelity arises from this scheme allowing the transmission over long distances.Comment: 4 pages, 2 figure

Density functional theory for strongly interacting electrons

We present an alternative to the Kohn-Sham formulation of density functional theory for the ground-state properties of strongly interacting electronic systems. The idea is to start from the limit of zero kinetic energy and systematically expand the universal energy functional of the density in powers of a "coupling constant" that controls the magnitude of the kinetic energy. The problem of minimizing the energy is reduced to the solution of a strictly correlated electron problem in the presence of an effective potential, which plays in our theory the same role that the Kohn-Sham potential plays in the traditional formulation. We discuss several schemes for approximating the energy functional, and report preliminary results for low-density quantum dots.Comment: Revised version, to appear in Phys. Rev. Let

Quantum synchronization as a local signature of super- and subradiance

We study the relationship between the collective phenomena of super and subradiance and spontaneous synchronization of quantum systems. To this aim we revisit the case of two detuned qubits interacting through a pure dissipative bosonic environment, which contains the minimal ingredients for our analysis. By using the Liouville formalism, we are able to find analytically the ultimate connection between these phenomena. We find that dynamical synchronization is due to the presence of long standing coherence between the ground state of the system and the subradiant state. We finally show that, under pure dissipation, the emergence of spontaneous synchronization and of subradiant emission occur on the same time scale. This reciprocity is broken in the presence of dephasing noise.Comment: 12 pages, 6 figure

Portfolio Selection with Narrow Framing: Probability Weighting Matters

This paper extends the model with narrow framing suggested by Barberis and Huang (2009) to also account for probability weighting and a convex-concave value function in the specification of cumulative prospect theory preferences on narrowly framed assets. We show that probability weighting is needed in order that investors reduce their holding of narrowly framed risky assets in the presence of negative skewness and high Sharpe ratios, which are typical characteristics of stock index returns. The model with framing and probability weighting can thus explain the stock participation puzzle under realistic assumptions on stock market returns. We also show that a convex-concave value function generates wealth effects that are consistent with empirical observations on stock market participation. Finally, we address the asset pricing implications of probability weighting in the model with narrow framing and show that in the case of negative skewness the equity premium of narrowly framed assets is much higher than when probability weighting is not taken into account.Narrow framing, cumulative prospect theory, probability weighting function,negative skewness, simulation methods