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Description
This dissertation focuses on consequences of public policy on consumption responses.
Chapter 1 evaluates the effect of Thailand's car tax rebate scheme in 2012 on household consumption by examining aggregate and administrative data. Car sales doubled during the policy and dramatically declined afterwards while domestic household spending was sluggish following the policy, suggesting a substantial dampening effect of the policy on future household consumption.
Chapter 2 develops a formal model to evaluate Thai household consumption responses. A life-cycle model of consumption and saving is developed with features including uninsured income risks, liquidity constraints, durable goods with embedded adjustment costs and non-homothetic preference in durable goods. Adjustment costs and liquidity constraints are important frictions in the evaluation of the shorter-term responses to changes in relative prices, while non-homotheticity captures the income effect given that cars are luxury goods in the Thai economy context. Key parameters and the partial equilibrium responses, which are key inputs to inform the aggregate outcome of the policy, are estimated. The results show that the car-tax rebates had a sizable impact on slowing Thai household consumption following the policy due to high level of elasticity of intertemporal substitution among Thai households.
Chapter 3 examines the effect of public smoking bans in the EU countries. Using individual-level data, this chapter investigates whether nationwide smoke-free laws in Europe lead to higher smoking reduction and cessation rates among mature smokers. Exploiting the different timing in imposing smoking ban laws and using a difference-in-differences approach, I find that light smokers and heavy smokers were more likely to quit smoking after comprehensive bans were in place while there was no significant effect on average smokers. The results confirm that smoking bans, particularly when enforced more strictly and comprehensively, lead to higher smoking cessation rates even among mature smokers with well-established addiction.
Chapter 1 evaluates the effect of Thailand's car tax rebate scheme in 2012 on household consumption by examining aggregate and administrative data. Car sales doubled during the policy and dramatically declined afterwards while domestic household spending was sluggish following the policy, suggesting a substantial dampening effect of the policy on future household consumption.
Chapter 2 develops a formal model to evaluate Thai household consumption responses. A life-cycle model of consumption and saving is developed with features including uninsured income risks, liquidity constraints, durable goods with embedded adjustment costs and non-homothetic preference in durable goods. Adjustment costs and liquidity constraints are important frictions in the evaluation of the shorter-term responses to changes in relative prices, while non-homotheticity captures the income effect given that cars are luxury goods in the Thai economy context. Key parameters and the partial equilibrium responses, which are key inputs to inform the aggregate outcome of the policy, are estimated. The results show that the car-tax rebates had a sizable impact on slowing Thai household consumption following the policy due to high level of elasticity of intertemporal substitution among Thai households.
Chapter 3 examines the effect of public smoking bans in the EU countries. Using individual-level data, this chapter investigates whether nationwide smoke-free laws in Europe lead to higher smoking reduction and cessation rates among mature smokers. Exploiting the different timing in imposing smoking ban laws and using a difference-in-differences approach, I find that light smokers and heavy smokers were more likely to quit smoking after comprehensive bans were in place while there was no significant effect on average smokers. The results confirm that smoking bans, particularly when enforced more strictly and comprehensively, lead to higher smoking cessation rates even among mature smokers with well-established addiction.
ContributorsTawichsri, Tanisa (Author) / Silverman, Daniel (Thesis advisor) / Kuminoff, Nicolai (Committee member) / Ventura, Gustavo (Committee member) / Arizona State University (Publisher)
Created2018
Description
Agent Based modeling has been used in computer science to simulate complex phenomena. The introduction of Agent Based Models into the field of economics (Agent Based Computational Economics ACE) is not new, however work on making model environments simpler to design for individuals without a background in computer science or computer engineering is a constantly evolving topic. The issue is a trade off of how much is handled by the framework and how much control the modeler has, as well as what tools exist to allow the user to develop insights from the behavior of the model. The solutions looked at in this thesis are the construction of a simplified grammar for model construction, the design of an economic based library to assist in ACE modeling, and examples of how to construct interactive models.
ContributorsAnderson, Brandon David (Author) / Bazzi, Rida (Thesis director) / Kuminoff, Nicolai (Committee member) / Roberts, Nancy (Committee member) / Computer Science and Engineering Program (Contributor) / Economics Program in CLAS (Contributor) / Barrett, The Honors College (Contributor)
Created2016-05
Description
This dissertation consists of three essays on public good provision.
The first chapter develops a model of charity’s choice of fundraising method under two dimensions of asymmetric information, quality and purpose. The main implication is a separating equilibrium where higher-quality charities choose to distinguish themselves by using a traditional fundraising method, while lower-quality ones exploit a low-stakes, take-it- or leave-it, ``checkout’’ method. An empirical application reinforced that charities of lower quality are more likely to adopt the checkout method. Despite this, consumers still choose to give in the equilibrium, due to the small requested amount of checkout donations, which disincentivizes serious thinking. Although exploited by lower-quality charities, the checkout method, along with purpose uncertainty, has the potential to alleviate the free-riding problem associated with public good provision and is, therefore, welfare improving.
The second chapter studies why corporations donate to charities and
how their donations affect social welfare. I propose that firms make donations out of an image reason. In a model where two firms compete with each other, charitable donation could attract consumers and also signal firm overall social responsibility. I show that there exists an equilibrium where the high responsibility firm overdonates,
resulting in a donation level closer to the socially optimal
one. This leads to higher consumer welfare due to higher private good
consumption as well as higher public good consumption when overdonation is prominent. Overall social welfare is enhanced. Empirical results support social image as an incentive for firms to donate.
The third chapter examines people's marginal willingness to pay for a change in local public good provision. We use a fixed effects hedonic model with MSA level data to study the effect of crime on local housing price. We explore the 1990s crime drop and use abortion data in 1970s and 1980s as an instrumental variable based on \citet*{donohue2001impact}. One result we find is that a decrease in murder of 100 cases per 10,000 people increases housing price by 70\%. We further translate this result into a value of a statistical case of homicide, which is around 0.4 million in 1999 dollars.
The first chapter develops a model of charity’s choice of fundraising method under two dimensions of asymmetric information, quality and purpose. The main implication is a separating equilibrium where higher-quality charities choose to distinguish themselves by using a traditional fundraising method, while lower-quality ones exploit a low-stakes, take-it- or leave-it, ``checkout’’ method. An empirical application reinforced that charities of lower quality are more likely to adopt the checkout method. Despite this, consumers still choose to give in the equilibrium, due to the small requested amount of checkout donations, which disincentivizes serious thinking. Although exploited by lower-quality charities, the checkout method, along with purpose uncertainty, has the potential to alleviate the free-riding problem associated with public good provision and is, therefore, welfare improving.
The second chapter studies why corporations donate to charities and
how their donations affect social welfare. I propose that firms make donations out of an image reason. In a model where two firms compete with each other, charitable donation could attract consumers and also signal firm overall social responsibility. I show that there exists an equilibrium where the high responsibility firm overdonates,
resulting in a donation level closer to the socially optimal
one. This leads to higher consumer welfare due to higher private good
consumption as well as higher public good consumption when overdonation is prominent. Overall social welfare is enhanced. Empirical results support social image as an incentive for firms to donate.
The third chapter examines people's marginal willingness to pay for a change in local public good provision. We use a fixed effects hedonic model with MSA level data to study the effect of crime on local housing price. We explore the 1990s crime drop and use abortion data in 1970s and 1980s as an instrumental variable based on \citet*{donohue2001impact}. One result we find is that a decrease in murder of 100 cases per 10,000 people increases housing price by 70\%. We further translate this result into a value of a statistical case of homicide, which is around 0.4 million in 1999 dollars.
ContributorsTao, Ran (Author) / Silverman, Daniel (Thesis advisor) / Bishop, Kelly (Committee member) / Kuminoff, Nicolai (Committee member) / Arizona State University (Publisher)
Created2017
Description
This dissertation consists of three chapters. Chapter one examines whether spending different amount of time outdoors on weekends and weekdays change the estimates of the impact of ground level ozone on the incidents of respiratory disease and asthma in California. This chapter contributes to the literature that focuses on the short term effect of air pollution on public health. Using the American Time Use Survey data, I find that on average people spend 50 minutes outdoors on weekends more than weekdays. Incorporating this difference in estimating the health impact of ozone changes the results significantly, especially for adults 20-64. The specification also allows me to find a precise estimate for each day of the week.
In chapter two I estimate the effect of exposure to ozone on skills of children aged 3 to 15 years. I use the Letter-Word (LW) test scores from the Panel Study of Income Dynamics (PSID) as a measure of children's skills. Due to omitted variable bias, OLS estimate of ozone effect on children's skill is positive and imprecisely estimated. To mitigate the omitted variable bias I use the instrumental variables approach. This method accounts for endogeneity of pollution. The effect of ozone on children's skills becomes negative but only marginally significant.
In chapter three, I estimate a production function of skill formation for children 3 to 15 years old and simultaneously account for their childhood exposure to ozone. I find that a one standard deviation increase in ozone leads to a 0.07 standard deviation reduction in the LW test scores on average. The LW test score of 3 year olds drops by 0.10 standard deviation in response to one standard deviation increase in pollution levels, while for the 14 year olds this effect is only half as much, 0.04 standard deviation. I also find that households exhibit compensatory behavior and mitigate the negative effect of pollution by investing more on their children. I quantitatively demonstrate that certain policies, such as a reduction in pollution levels or income transfers to families, can remediate the negative impact of childhood exposure to pollution on adult outcomes.
In chapter two I estimate the effect of exposure to ozone on skills of children aged 3 to 15 years. I use the Letter-Word (LW) test scores from the Panel Study of Income Dynamics (PSID) as a measure of children's skills. Due to omitted variable bias, OLS estimate of ozone effect on children's skill is positive and imprecisely estimated. To mitigate the omitted variable bias I use the instrumental variables approach. This method accounts for endogeneity of pollution. The effect of ozone on children's skills becomes negative but only marginally significant.
In chapter three, I estimate a production function of skill formation for children 3 to 15 years old and simultaneously account for their childhood exposure to ozone. I find that a one standard deviation increase in ozone leads to a 0.07 standard deviation reduction in the LW test scores on average. The LW test score of 3 year olds drops by 0.10 standard deviation in response to one standard deviation increase in pollution levels, while for the 14 year olds this effect is only half as much, 0.04 standard deviation. I also find that households exhibit compensatory behavior and mitigate the negative effect of pollution by investing more on their children. I quantitatively demonstrate that certain policies, such as a reduction in pollution levels or income transfers to families, can remediate the negative impact of childhood exposure to pollution on adult outcomes.
ContributorsVahedi, Sajad (Author) / Silverman, Daniel (Thesis advisor) / Wiswall, Matthew (Committee member) / Kuminoff, Nicolai (Committee member) / Arizona State University (Publisher)
Created2017
Description
This study estimates the effect of district wealth on Arizona Empowerment Scholarship Account program participation using data from the Arizona Department of Education. We find that students from poor districts are not more likely to participate as school performance decreases.Conversely, those from wealthy districts do increase participation as school performance decreases. We briefly try to explain the observed heterogeneity through survey results and commenting on the program design.
ContributorsAngel, Joseph Michael (Author) / Kostol, Andreas (Thesis director) / Kuminoff, Nicolai (Committee member) / Economics Program in CLAS (Contributor) / School of Mathematical and Statistical Sciences (Contributor) / Barrett, The Honors College (Contributor)
Created2021-05
Description
Amid the fast-growing market of plant-based alternatives to conventional meat, there still lies uncertainty about consumers’ preferences for these new products. Through an online survey using a Becker-DeGroot-Marschak mechanism, I test the effect that environmental information provision has on consumers’ immediate and long-term willingness- to-pay for the Whopper and Impossible Whopper from Burger King. Respondents were randomly assigned to either a control group or a treatment group, and both received information on taste in an attempt to isolate the effect of environmental information. Results show that certain groups respond to the information differently. Specifically, consumers who care about climate change are affected greatly by environmental in- formation suggesting these “climate advocates” are not fully informed despite the efforts of Impossible Foods. Vegetarians and highly educated individuals have relatively stronger preferences for the plant-based burger, in line with previous studies. Results also show a lasting effect of information on WTP, suggesting little need for repeated interventions.
ContributorsStreff, Adam (Author) / Silverman, Daniel (Thesis director) / Kuminoff, Nicolai (Committee member) / Department of Economics (Contributor) / Barrett, The Honors College (Contributor)
Created2021-05
Description
This survey takes information on a participant’s beliefs on privacy security, the general digital knowledge, demographics, and willingness-to-pay points on if they would delete information on their social media, to see how an information treatment affects those payment points. This information treatment is meant to make half of the participants think about the deeper ramifications of the information they reveal. The initial hypothesis is that this information will make people want to pay more to remove their information from the web, but the results find a surprising negative correlation with the treatment.
ContributorsDeitrick, Noah Sumner (Author) / Silverman, Daniel (Thesis director) / Kuminoff, Nicolai (Committee member) / School of Mathematical and Statistical Sciences (Contributor) / Economics Program in CLAS (Contributor) / Barrett, The Honors College (Contributor)
Created2021-05
Description
Health and Wealthness is a podcast where your hosts, Emily Weigel and Hanaa Khan discuss pressing and trending topics about health and wealth that everyone should know about. Our first four episodes focus on the opioid crisis. Both the science and healthcare sides. We then go on to talk about burnout and mental health in a conversational episode.
ContributorsKhan, Hanaa S (Co-author) / Weigel, Emily (Co-author) / Olive, Foster (Thesis director) / Bonfiglio, Thomas (Committee member) / Department of Psychology (Contributor) / School of Life Sciences (Contributor) / Barrett, The Honors College (Contributor)
Created2021-05
Description
In this dissertation, I study two different sides of inequality. In the first part of this dissertation, I show what the role of unwanted childbirth is on women’s wages and education. I document that on average, mothers whose first childbirth was unwanted have lower levels of education, lower wages, and have their first childbirth at younger ages compared to the rest of the mothers. In the second part of this dissertation, I show how the introduction of a carbon tax affects individuals with different educational attainment. In particular, I show how the carbon tax affects their consumption, but also how the tax reduces air pollution and consequently affects individual mortality. I find that introducing this mortality channel reduces the aggregate welfare cost of a carbon tax by about half. In terms of the distributional effect of the policy, the mortality channel deepens the regressivity of the tax, since the benefits in terms of mortality reductions are similar for all individuals, the valuation of this benefit is higher for more educated individuals.
ContributorsOdriozola, Juan (Author) / Bick, Alexander (Thesis advisor) / Vereshchagina, Galina (Thesis advisor) / Kuminoff, Nicolai (Committee member) / Fried, Stephie (Committee member) / Arizona State University (Publisher)
Created2022
Description
The welfare consequences of price versus quantity-based regulation are known to differ when information about marginal benefits or costs of abatement is imperfect. Does uncertainty about demand for the polluting good also matter for welfare of these two approaches to regulation? In chapter 1, I use plant-level survey data and high frequency variation in power consumption to assess the dynamic implications of uncertainty about future demand for the relative welfare consequences of carbon taxes and cap-and-trade regulation. I address this question in the context of the electricity sector where demand risk is particularly salient. I show that the choice between policy instruments depends on how firms and consumers balance unpredictable output volatility (higher with carbon taxes) vs. price volatility (higher with cap-and-trade regulation). Over a wide range of policy-relevant abatement targets, I find carbon taxes outperform cap-and-trade in terms of welfare. Financial incentives like the Production Tax Credit are central initiatives behind wind power as the leading renewable energy source in the U.S. But do institutional design features of energy markets matter for cost-effectiveness of subsidies to wind investments? In chapter 2, I answer this question by investigating how the design of procurement contracts that are typically used by wind developers affects their investment incentives. Using unit-level data from wind farm production and installed capacity, I find that structuring subsidies based on key features of the type of procurement contracts associated to wind projects leads to major reductions in public expenditures in terms of subsidy payments to wind developers without undermining their investment incentives. The U.S. federal government is known to have a history of heavily subsidizing the wind power industry. Subsidies either to output (Production Tax Credit) or investment goods (Investment Tax Credit) have been critical to replace emissions-intensive technologies with wind power. Which type of subsidy is best to incentivize wind investments at the least cost? In chapter 3, I use plant-level data of wind facilities from the Texas electricity market to develop and estimate a model of investment decisions that accounts for productivity shocks at the wind farm level and prudent behavior of developers. I find that subsidizing production can increase average yearly investment rates in wind capacity up to 2.5 percentage points over mean investment rates under alternative subsidies to capital. This is driven by precautionary savings that developers accumulate to smooth out potential future shocks to investment income when adverse weather conditions lead to low subsidy payments.
ContributorsGómez Trejos, Felipe Alberto (Author) / Silverman, Daniel (Thesis advisor) / Fried, Stephie (Committee member) / Ventura, Gustavo (Committee member) / Kuminoff, Nicolai (Committee member) / Arizona State University (Publisher)
Created2023