The Economics of Vocation or Why is a Badly Paid Nurse a Good Nurse?

Given the longstanding shortage of nurses in many jurisdictions, why couldn’t nursing wages be raised to attract more people into the profession? We tell a story in which the status of nursing as a ‘vocation’ implies that increasing wages reduces the average quality of applicants attracted. The underlying mechanism accords with the notion that increasing wages might attract the ‘wrong sort’ of people into the profession and highlights an (in)efficiency wage mechanism, particular to vocations, which makes wages sticky upwards. The analysis has implications for job design in vocation-based sectors such as nursing and teaching

Enforcement Missions: Targets vs Budgets

Enforcement of policy is typically delegated. What sort of mission should the head of an enforcement program be given? When there is more than one firm being regulated their compliance decisions - otherwise completely separate - become linked in a way that depends on that mission. Under some sorts of missions firms compete to avoid the attention of the enforcer by competitive reductions in the extent of their non-compliance. Under others the interaction pushes in the opposite direction. We develop a general model or enforcement spillovers that allows for the ordering of some typical classes of missions. We find that in plausible settings 'target-driven' missions (that set a hard emissions target and flexible budget) achieve the same outcome at lower cost than 'budget-driven' ones (that fix budget). Inspection of some fixed fraction of firms is never optimal

Understanding the organization of green activism: sociological and economic perspectives

Environmental activists are an important voice in public and private politics, urging governmental and corporate responses and solutions to ongoing environmental damage. Scholars have become increasingly interested in understanding environmental movements and the influence of environmental activist organizations. This article describes two literatures that have analyzed the dynamics and outcomes of activism, one based in a sociological examination of social movements and the other in economic analysis of activist nongovernmental organizations. Although the literatures sometimes use different language and methods, they have much in common. We highlight the consistent themes—in particular the shared respect for the rational actor model—the particular strengths of each tradition, and directions for future research where synergies between the disciplines could be more fully exploited

Private vs. Public Regulation: Political Economy of the International Environment

Minimum standards set by a ‘World Environmental Organisation’ (WEO) and NGO labelling are promoted as alternative approaches to international environmental protection. We explore the potential inter-play between these two approaches when the WEO is subject to pressure from producers. We find that if WEO and NGO schemes are mutually exclusive then the existence of an NGO ‘alternative’ increases industry resistance to WEO proposals and this may reduce welfare. If, however, the schemes are run in parallel, existence of the NGO lessens producer opposition to WEO activities. This allows the WEO to be ‘bolder’ in its proposals, which is good for welfare

A theory of social license when regulatory pressure is jointly produced by an EPA and an NGO

We develop a model in which social pressure on a firm to behave well is jointly produced by a state regulator (EPA) and an NGO. The EPA and NGO differ in how they trade-off business versus environmental interests and also have access to different instruments in pursuit of their objectives. EPA and NGO efforts may be strategic complements or substitutes, depending upon circumstances. We present a taxonomy of outcomes in the game between EPA and NGO in the spirit of Fudenberg and Tirole's (1984) classic taxonomy of business strategies. We also consider strategic delegation from NGO supporters to an NGO that has tastes over environmental and business interests different to their own

Alerts work! Air quality warnings and cycling

Alert programs are central to strategies to reduce pollution exposure and manage its impact. To be effective alerts have to change behavior, but evidence that they do that is sparse. Indeed the majority of published studies fail to find a significant impact of alerts on the outcome behavior that they study. Alerts particularly seek to influence energetic cardio-vascular outdoor pursuits. This study is the first to use administrative data to show that they are effective in reducing participation in such a pursuit (namely cycle use in Sydney, Australia), and to our knowledge the first to show that they are effective in changing any behavior in a non-US setting. We are careful to disentangle possible reactions to realised air quality from the ‘pure’, causal effect of the issuance of an alert. Our results suggest that when an air quality alert is issued, the amount of cycling is reduced by 14–35%, which is a substantial behavioral response. The results are robust to the inclusion of a battery of controls in various combinations, alternative estimation methods and non-linear specifications. We develop various sub-sample results, and also find evidence of alert fatigue

Pollution and Politicians: The Effect of PM on MPs

Applying methods of textual and stylometric analysis to all 119,225 speeches made in the Canadian House of Commons between 2006 and 2011, we establish that air pollution reduces the speech quality of Canadian Members of Parliament (MPs). Exposure to fine particulate matter concentrations exceeding 15 μg/m3 causes a 3.1 percent reduction in the quality of MPs speech (equivalent to a 3.6 months of education). For more difficult communication tasks the decrement in quality is equivalent to the loss of 6.5 months of schooling. Our design accounts for the potential endogeneity of exposure and controls for many potential confounders including individual fixed effects. Politicians are professional communicators and as such the analysis contributes to our evolving understanding of how pollution exposure impacts the execution of work-relevant skills. Though we are cautious in interpreting the effect as a clean metric for performance, the effect size is around half that established in recent research for workers engaged in physical work tasks. Insofar as the changed speech patterns reflect diminished mental acuity the results make plausible detrimental effects of air pollution on productivity in a wider set of communication-intensive work settings

Economics and the Environment: Save the Planet or Let It Burn?

Anthony Heyes presented Economics and the Environment: Save the Planet or Let It Burn? at an ISCR seminar in April 200

Economics and the Environment: Save the Planet or Let It Burn?

Anthony Heyes presented Economics and the Environment: Save the Planet or Let It Burn? at an ISCR seminar in April 200