Gambling Attitudes and Financial Misreporting. By Dane Christensen, Keith Jones & David Kenchington
Contemporary Accounting Research, http://onlinelibrary.wiley.com/doi/10.1111/1911-3846.12322/pdf
Abstract: We investigate whether attitudes toward gambling help explain the occurrence of intentional misreporting. Similar to gambling, some financial reporting choices involve taking deliberate, speculative risks. We predict that in places where gambling is more socially acceptable, managers will be more likely to take financial reporting risks that increase the likelihood the financial statements will need to be restated. To test this prediction, we exploit geographic variation in local gambling attitudes and find that restatements due to intentional misreporting are more common in areas where gambling is more socially acceptable. This association is even stronger in situations where management is under greater pressure to misreport, including when the firm is: close to meeting a performance benchmark, experiencing poor financial performance, or under investment-related pressure. Furthermore, these results are robust to numerous tests to address omitted variables and endogeneity. Collectively, these findings suggest gambling attitudes help explain the incidence of intentional misreporting.
Keywords: Gambling; Attitudes; Misreporting; Irregularities.
JEL Classification Codes: K42; M14; M41; M42; R10.
Monday, July 10, 2017
Selectively Distracted: Divided Attention and Memory for Important Information
Selectively Distracted: Divided Attention and Memory for Important Information. By Catherine Middlebrooks, Tyson Kerr & Alan Castel
Psychological Science, http://journals.sagepub.com/doi/abs/10.1177/0956797617702502
Abstract: Distractions and multitasking are generally detrimental to learning and memory. Nevertheless, people often study while listening to music, sitting in noisy coffee shops, or intermittently checking their e-mail. The current experiments examined how distractions and divided attention influence one’s ability to selectively remember valuable information. Participants studied lists of words that ranged in value from 1 to 10 points while completing a digit-detection task, while listening to music, or without distractions. Though participants recalled fewer words following digit detection than in the other conditions, there were no significant differences between conditions in terms of selectively remembering the most valuable words. Similar results were obtained across a variety of divided-attention tasks that stressed attention and working memory to different degrees, which suggests that people may compensate for divided-attention costs by selectively attending to the most valuable items and that factors that worsen memory do not necessarily impair the ability to selectively remember important information.
Psychological Science, http://journals.sagepub.com/doi/abs/10.1177/0956797617702502
Abstract: Distractions and multitasking are generally detrimental to learning and memory. Nevertheless, people often study while listening to music, sitting in noisy coffee shops, or intermittently checking their e-mail. The current experiments examined how distractions and divided attention influence one’s ability to selectively remember valuable information. Participants studied lists of words that ranged in value from 1 to 10 points while completing a digit-detection task, while listening to music, or without distractions. Though participants recalled fewer words following digit detection than in the other conditions, there were no significant differences between conditions in terms of selectively remembering the most valuable words. Similar results were obtained across a variety of divided-attention tasks that stressed attention and working memory to different degrees, which suggests that people may compensate for divided-attention costs by selectively attending to the most valuable items and that factors that worsen memory do not necessarily impair the ability to selectively remember important information.
Is China building too many airports?
Is China building too many airports? By Fran Wang. Caixin, Jun 23, 2017. http://www.caixinglobal.com/2017-06-23/101105028.html. Extract.
Over the next three years, local authorities in China are planning to build more than 900 airports for general aviation—the segment of the industry that includes crop dusting and tourism. The figure is nearly double the central government’s goal of “more than 500” over the period.
A news report has warned that’s just too many airports.
In May 2016, the State Council, China’s cabinet, announced that the country wanted to construct more than 500 general aviation airports to boost the size of the industry to over 1 trillion yuan (U.S.$146 billion).
General aviation covers flights on helicopters and light aircraft used in sectors such as tourism, agriculture, medical care, and disaster relief.
All provincial-level governments except Shanghai, Tibet, and the northeastern province of Jilin have since published their own plans for these airports, and their goal is far more ambitious than the central government’s. Together, they plan to build 934 general aviation airports, according to the 21st Century Business Herald.
The number put forward by each region ranges from seven to 200. The three places that intend to build the most general aviation airports are Guangxi in southern China, Heilongjiang in the northeast, and Xinjiang in the northwest—all remote and less developed areas, the newspaper said.
Despite the government excesses managing the public treasure*, corruption in civil engineering works†, etc.‡, the citizen is quite comfortable ¶ with these expenditures (while the costs are not recouped visibly from him). It seems that if we see more tower buildings, and are taller, we assume we are progressing, there is material advance, and that most are better for this. My hypothesis is that what feeds the population's approval are patriotism§ (very powerful in Han China) and redistributionism֍.
From Chris Buckley's China’s New Bridges: Rising High, but Buried in Debt, The New York Times, Jun 10, 2017. Available at https://www.nytimes.com/2017/06/10/world/asia/china-bridges-infrastructure.html (impressive imagery).
* “Infrastructure is a double-edged sword,” said Atif Ansar, a management professor at the University of Oxford who has studied China’s infrastructure spending. “It’s good for the economy, but too much of this is pernicious. ‘Build it and they will come’ is a dictum that doesn’t work, especially in China, where there’s so much built already.”
A study that Mr. Ansar helped write said fewer than a third of the 65 Chinese highway and rail projects he examined were “genuinely economically productive,” while the rest contributed more to debt than to transportation needs.
† In the past six years, anticorruption inquiries have toppled more than 27 Hunan transportation officials.
‡, § “The amount of high bridge construction in China is just insane,” said Eric Sakowski, an American bridge enthusiast who runs a website on the world’s highest bridges. “China’s opening, say, 50 high bridges a year, and the whole of the rest of the world combined might be opening 10.”
Of the world’s 100 highest bridges, 81 are in China, including some unfinished ones, according to Mr. Sakowski’s data. (The Chishi Bridge ranks 162nd.)
China also has the world’s longest bridge, the 102-mile Danyang-Kunshan Grand Bridge, a high-speed rail viaduct running parallel to the Yangtze River, and is nearing completion of the world’s longest sea bridge, a 14-mile cable-stay bridge skimming across the Pearl River Delta, part of a 22-mile bridge and tunnel crossing that connects Hong Kong and Macau with mainland China.
The country’s expressway growth has been compared to that of the United States in the 1950s, when the Interstate System of highways got underway, but China is building at a remarkable clip. In 2016 alone, China added 26,100 bridges on roads, including 363 “extra large” ones with an average length of about a mile, government figures show.
֍ “It’s very important to improve transport and other infrastructure so that impoverished regions can escape poverty and prosper,” President Xi Jinping said while visiting the spectacular, recently opened Aizhai Bridge in Hunan in 2013. “We must do more of this and keep supporting it.”
¶ Indeed, the new roads and railways have proved popular.
§ Who Will Fight? The All-Volunteer Army after 9/11. By Susan Payne Carter, Alexander Smith & Carl Wojtaszek. American Economic Review, May 2017, Pages 415-419, https://www.aeaweb.org/articles?id=10.1257/aer.p20171082.
Over the next three years, local authorities in China are planning to build more than 900 airports for general aviation—the segment of the industry that includes crop dusting and tourism. The figure is nearly double the central government’s goal of “more than 500” over the period.
A news report has warned that’s just too many airports.
In May 2016, the State Council, China’s cabinet, announced that the country wanted to construct more than 500 general aviation airports to boost the size of the industry to over 1 trillion yuan (U.S.$146 billion).
General aviation covers flights on helicopters and light aircraft used in sectors such as tourism, agriculture, medical care, and disaster relief.
All provincial-level governments except Shanghai, Tibet, and the northeastern province of Jilin have since published their own plans for these airports, and their goal is far more ambitious than the central government’s. Together, they plan to build 934 general aviation airports, according to the 21st Century Business Herald.
The number put forward by each region ranges from seven to 200. The three places that intend to build the most general aviation airports are Guangxi in southern China, Heilongjiang in the northeast, and Xinjiang in the northwest—all remote and less developed areas, the newspaper said.
Despite the government excesses managing the public treasure*, corruption in civil engineering works†, etc.‡, the citizen is quite comfortable ¶ with these expenditures (while the costs are not recouped visibly from him). It seems that if we see more tower buildings, and are taller, we assume we are progressing, there is material advance, and that most are better for this. My hypothesis is that what feeds the population's approval are patriotism§ (very powerful in Han China) and redistributionism֍.
From Chris Buckley's China’s New Bridges: Rising High, but Buried in Debt, The New York Times, Jun 10, 2017. Available at https://www.nytimes.com/2017/06/10/world/asia/china-bridges-infrastructure.html (impressive imagery).
* “Infrastructure is a double-edged sword,” said Atif Ansar, a management professor at the University of Oxford who has studied China’s infrastructure spending. “It’s good for the economy, but too much of this is pernicious. ‘Build it and they will come’ is a dictum that doesn’t work, especially in China, where there’s so much built already.”
A study that Mr. Ansar helped write said fewer than a third of the 65 Chinese highway and rail projects he examined were “genuinely economically productive,” while the rest contributed more to debt than to transportation needs.
† In the past six years, anticorruption inquiries have toppled more than 27 Hunan transportation officials.
‡, § “The amount of high bridge construction in China is just insane,” said Eric Sakowski, an American bridge enthusiast who runs a website on the world’s highest bridges. “China’s opening, say, 50 high bridges a year, and the whole of the rest of the world combined might be opening 10.”
Of the world’s 100 highest bridges, 81 are in China, including some unfinished ones, according to Mr. Sakowski’s data. (The Chishi Bridge ranks 162nd.)
China also has the world’s longest bridge, the 102-mile Danyang-Kunshan Grand Bridge, a high-speed rail viaduct running parallel to the Yangtze River, and is nearing completion of the world’s longest sea bridge, a 14-mile cable-stay bridge skimming across the Pearl River Delta, part of a 22-mile bridge and tunnel crossing that connects Hong Kong and Macau with mainland China.
The country’s expressway growth has been compared to that of the United States in the 1950s, when the Interstate System of highways got underway, but China is building at a remarkable clip. In 2016 alone, China added 26,100 bridges on roads, including 363 “extra large” ones with an average length of about a mile, government figures show.
֍ “It’s very important to improve transport and other infrastructure so that impoverished regions can escape poverty and prosper,” President Xi Jinping said while visiting the spectacular, recently opened Aizhai Bridge in Hunan in 2013. “We must do more of this and keep supporting it.”
¶ Indeed, the new roads and railways have proved popular.
§ Who Will Fight? The All-Volunteer Army after 9/11. By Susan Payne Carter, Alexander Smith & Carl Wojtaszek. American Economic Review, May 2017, Pages 415-419, https://www.aeaweb.org/articles?id=10.1257/aer.p20171082.
Candidate Choice Without Party Labels: New Insights from Conjoint Survey Experiments
Candidate Choice Without Party Labels: New Insights from Conjoint Survey Experiments. By Patricia Kirkland & Alexander Coppock
Political Behavior, https://link.springer.com/article/10.1007/s11109-017-9414-8
Abstract: In the absence of party labels, voters must use other information to determine whom to support. The institution of nonpartisan elections, therefore, may impact voter choice by increasing the weight that voters place on candidate dimensions other than partisanship. We hypothesize that in nonpartisan elections, voters will exhibit a stronger preference for candidates with greater career and political experience, as well as candidates who can successfully signal partisan or ideological affiliation without directly using labels. To test these hypotheses, we conducted conjoint survey experiments on both nationally representative and convenience samples that vary the presence or absence of partisan information. The primary result of these experiments indicates that when voters cannot rely on party labels, they give greater weight to candidate experience. We find that this process unfolds differently for respondents of different partisan affiliations: Republicans respond to the removal of partisan information by giving greater weight to job experience while Democrats respond by giving greater weight to political experience. Our results lend microfoundational support to the notion that partisan information can crowd out other kinds of candidate information.
Political Behavior, https://link.springer.com/article/10.1007/s11109-017-9414-8
Abstract: In the absence of party labels, voters must use other information to determine whom to support. The institution of nonpartisan elections, therefore, may impact voter choice by increasing the weight that voters place on candidate dimensions other than partisanship. We hypothesize that in nonpartisan elections, voters will exhibit a stronger preference for candidates with greater career and political experience, as well as candidates who can successfully signal partisan or ideological affiliation without directly using labels. To test these hypotheses, we conducted conjoint survey experiments on both nationally representative and convenience samples that vary the presence or absence of partisan information. The primary result of these experiments indicates that when voters cannot rely on party labels, they give greater weight to candidate experience. We find that this process unfolds differently for respondents of different partisan affiliations: Republicans respond to the removal of partisan information by giving greater weight to job experience while Democrats respond by giving greater weight to political experience. Our results lend microfoundational support to the notion that partisan information can crowd out other kinds of candidate information.
On Feeling Warm and Being Warm: Daily Perceptions of Physical Warmth Fluctuate With Interpersonal Warmth
On Feeling Warm and Being Warm: Daily Perceptions of Physical Warmth Fluctuate With Interpersonal Warmth. By Adam Fetterman, Benjamin Wilkowski & Michael Robinson
Social Psychological and Personality Science, http://journals.sagepub.com/doi/abs/10.1177/1948550617712032?journalCode=sppa
Abstract: Previous investigations have linked laboratory manipulations of physical warmth to momentary increases in interpersonal warmth. However, replication concerns have occurred in this area, and it is not known whether similar dynamics characterize daily functioning. Two daily diary studies (total N = 235) suggest an affirmative answer. On days in which participants felt physically warmer, they perceived themselves to be interpersonally warmer and more agreeable, irrespective of the outdoor temperature. These findings are consistent with frameworks proposing that people draw on concepts of physical warmth to represent feelings of interpersonal warmth and they highlight the value of using daily diary and within-subject designs to investigate embodied cognition as well as other priming effects.
Social Psychological and Personality Science, http://journals.sagepub.com/doi/abs/10.1177/1948550617712032?journalCode=sppa
Abstract: Previous investigations have linked laboratory manipulations of physical warmth to momentary increases in interpersonal warmth. However, replication concerns have occurred in this area, and it is not known whether similar dynamics characterize daily functioning. Two daily diary studies (total N = 235) suggest an affirmative answer. On days in which participants felt physically warmer, they perceived themselves to be interpersonally warmer and more agreeable, irrespective of the outdoor temperature. These findings are consistent with frameworks proposing that people draw on concepts of physical warmth to represent feelings of interpersonal warmth and they highlight the value of using daily diary and within-subject designs to investigate embodied cognition as well as other priming effects.
The Nature-Disorder Paradox: A Perceptual Study on How Nature Is Disorderly Yet Aesthetically Preferred
The Nature-Disorder Paradox: A Perceptual Study on How Nature Is Disorderly Yet Aesthetically Preferred. By Hiroki Kotabe, Omid Kardan & Marc Berman
Journal of Experimental Psychology: General, https://www.ncbi.nlm.nih.gov/pubmed/28557512
Abstract: Natural environments have powerful aesthetic appeal linked to their capacity for psychological restoration. In contrast, disorderly environments are aesthetically aversive, and have various detrimental psychological effects. But in our research, we have repeatedly found that natural environments are perceptually disorderly. What could explain this paradox? We present 3 competing hypotheses: the aesthetic preference for naturalness is more powerful than the aesthetic aversion to disorder (the nature-trumps-disorder hypothesis); disorder is trivial to aesthetic preference in natural contexts (the harmless-disorder hypothesis); and disorder is aesthetically preferred in natural contexts (the beneficial-disorder hypothesis). Utilizing novel methods of perceptual study and diverse stimuli, we rule in the nature-trumps-disorder hypothesis and rule out the harmless-disorder and beneficial-disorder hypotheses. In examining perceptual mechanisms, we find evidence that high-level scene semantics are both necessary and sufficient for the nature-trumps-disorder effect. Necessity is evidenced by the effect disappearing in experiments utilizing only low-level visual stimuli (i.e., where scene semantics have been removed) and experiments utilizing a rapid-scene-presentation procedure that obscures scene semantics. Sufficiency is evidenced by the effect reappearing in experiments utilizing noun stimuli which remove low-level visual features. Furthermore, we present evidence that the interaction of scene semantics with low-level visual features amplifies the nature-trumps-disorder effect — the effect is weaker both when statistically adjusting for quantified low-level visual features and when using noun stimuli which remove low-level visual features. These results have implications for psychological theories bearing on the joint influence of low- and high-level perceptual inputs on affect and cognition, as well as for aesthetic design.
Journal of Experimental Psychology: General, https://www.ncbi.nlm.nih.gov/pubmed/28557512
Abstract: Natural environments have powerful aesthetic appeal linked to their capacity for psychological restoration. In contrast, disorderly environments are aesthetically aversive, and have various detrimental psychological effects. But in our research, we have repeatedly found that natural environments are perceptually disorderly. What could explain this paradox? We present 3 competing hypotheses: the aesthetic preference for naturalness is more powerful than the aesthetic aversion to disorder (the nature-trumps-disorder hypothesis); disorder is trivial to aesthetic preference in natural contexts (the harmless-disorder hypothesis); and disorder is aesthetically preferred in natural contexts (the beneficial-disorder hypothesis). Utilizing novel methods of perceptual study and diverse stimuli, we rule in the nature-trumps-disorder hypothesis and rule out the harmless-disorder and beneficial-disorder hypotheses. In examining perceptual mechanisms, we find evidence that high-level scene semantics are both necessary and sufficient for the nature-trumps-disorder effect. Necessity is evidenced by the effect disappearing in experiments utilizing only low-level visual stimuli (i.e., where scene semantics have been removed) and experiments utilizing a rapid-scene-presentation procedure that obscures scene semantics. Sufficiency is evidenced by the effect reappearing in experiments utilizing noun stimuli which remove low-level visual features. Furthermore, we present evidence that the interaction of scene semantics with low-level visual features amplifies the nature-trumps-disorder effect — the effect is weaker both when statistically adjusting for quantified low-level visual features and when using noun stimuli which remove low-level visual features. These results have implications for psychological theories bearing on the joint influence of low- and high-level perceptual inputs on affect and cognition, as well as for aesthetic design.
Entertainment and the Opportunity Cost of Civic Participation: Monday Night Football Game Quality Suppresses Turnout in US Elections
Entertainment and the Opportunity Cost of Civic Participation: Monday Night Football Game Quality Suppresses Turnout in US Elections. By Matthew Potoski & R. Urbatsch
Journal of Politics, April 2017, Pages 424-438, http://www.journals.uchicago.edu/doi/abs/10.1086/688174
Abstract: Raising the opportunity cost of people’s time may reduce their commitment to social obligations such as voting. Notably, entertaining sporting events can be strong civic distractions, as commentators throughout history have lamented. To consider sporting events’ influence on political behavior, this paper examines the effect of Monday Night Football games the day before US general elections from 1970 to 2014. More attractive games, such as those that feature more prominent and competitive match-ups or that feature local or high-scoring teams, may entice people to consume more entertainment and thus have less time to devote to civic affairs. When preelection football game quality increases from its 25th to 75th percentile, voter turnout falls by between 2 and 8 percentage points. These effects are somewhat weaker among those more interested in politics and do not appear in placebo tests on other political behaviors occurring before the preelection game.
Journal of Politics, April 2017, Pages 424-438, http://www.journals.uchicago.edu/doi/abs/10.1086/688174
Abstract: Raising the opportunity cost of people’s time may reduce their commitment to social obligations such as voting. Notably, entertaining sporting events can be strong civic distractions, as commentators throughout history have lamented. To consider sporting events’ influence on political behavior, this paper examines the effect of Monday Night Football games the day before US general elections from 1970 to 2014. More attractive games, such as those that feature more prominent and competitive match-ups or that feature local or high-scoring teams, may entice people to consume more entertainment and thus have less time to devote to civic affairs. When preelection football game quality increases from its 25th to 75th percentile, voter turnout falls by between 2 and 8 percentage points. These effects are somewhat weaker among those more interested in politics and do not appear in placebo tests on other political behaviors occurring before the preelection game.
Young children discover how to deceive in 10 days: a microgenetic study
Ding XP, Heyman GD, Fu G, Zhu B, Lee K. Young children discover how to deceive in 10 days: a microgenetic study. Dev Sci. 2017;00:. https://doi.org/10.1111/desc.12566
Abstract: We investigated how the ability to deceive emerges in early childhood among a sample of young preschoolers (Mean age = 34.7 months). We did this via a 10-session microgenetic method that took place over a 10-day period. In each session, children played a zero-sum game against an adult to win treats. In the game, children hid the treats and had opportunities (10 trials) to win them by providing deceptive information about their whereabouts to the adult. Although children initially showed little or no ability to deceive, most spontaneously discovered deception and systematically used it to win the game by the tenth day. Both theory of mind and executive function skills were predictive of relatively faster patterns of discovery. These results are the first to provide evidence for the importance of cognitive skills and social experience in the discovery of deception over time in early childhood.
Abstract: We investigated how the ability to deceive emerges in early childhood among a sample of young preschoolers (Mean age = 34.7 months). We did this via a 10-session microgenetic method that took place over a 10-day period. In each session, children played a zero-sum game against an adult to win treats. In the game, children hid the treats and had opportunities (10 trials) to win them by providing deceptive information about their whereabouts to the adult. Although children initially showed little or no ability to deceive, most spontaneously discovered deception and systematically used it to win the game by the tenth day. Both theory of mind and executive function skills were predictive of relatively faster patterns of discovery. These results are the first to provide evidence for the importance of cognitive skills and social experience in the discovery of deception over time in early childhood.
Panhandling in Downtown Manhattan: A Preliminary Analysis
Panhandling in Downtown Manhattan: A Preliminary Analysis. By Gwendolyn Dordick & Brendan O’Flaherty
https://www.gc.cuny.edu/CUNY_GC/media/CUNY-Graduate-Center/PDF/Programs/Economics/Course%20Schedules/Seminar%20Sp.2013/panhandlingpaper100813.pdf
Abstract: Panhandling is a very visible industry, yet mysterious to outsiders. How does it work? How do
panhandlers allocate locations? Is there a market? Do they fight? Is there a mafia? How do
panhandlers get donors to give, when many potential donors think most panhandlers are frauds?
What are good policies toward panhandling? Should it be banned? Should generosity diversion
programs be set up to divert donations to formal charities? Should it be encouraged? Our tentative
answers are that there are more good locations than willing panhandlers, and so location is not
contentious or a big source of efficiency losses. On information, a pooling equilibrium is far from
first-best, and policy might concentrate on improving credibility.
... while panhandlers in general have low credibility, their livelihoods depend on having high
credibility...
https://www.gc.cuny.edu/CUNY_GC/media/CUNY-Graduate-Center/PDF/Programs/Economics/Course%20Schedules/Seminar%20Sp.2013/panhandlingpaper100813.pdf
Abstract: Panhandling is a very visible industry, yet mysterious to outsiders. How does it work? How do
panhandlers allocate locations? Is there a market? Do they fight? Is there a mafia? How do
panhandlers get donors to give, when many potential donors think most panhandlers are frauds?
What are good policies toward panhandling? Should it be banned? Should generosity diversion
programs be set up to divert donations to formal charities? Should it be encouraged? Our tentative
answers are that there are more good locations than willing panhandlers, and so location is not
contentious or a big source of efficiency losses. On information, a pooling equilibrium is far from
first-best, and policy might concentrate on improving credibility.
... while panhandlers in general have low credibility, their livelihoods depend on having high
credibility...
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