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School of Economics and Finance · Te Kura Ohaoha Pūtea: Working Paper Series

Permanent URI for this collectionhttps://ir.wgtn.ac.nz/handle/123456789/21216

The School of Economics and Finance has an active research environment with very strong links to business, government and financial institutions in Wellington and wider New Zealand.

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Browsing School of Economics and Finance · Te Kura Ohaoha Pūtea: Working Paper Series by Author "Altman, Morris"

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    Behavioural economics perspectives: Implications for policy and financial literacy
    (Te Herenga Waka—Victoria University of Wellington, 2012) Altman, Morris
    This paper summarizes and highlights different approaches to behavioural economics. It includes a discussion of the differences between the “old” behavioural economics school, led by scholars like Herbert Simon, and the “new” behavioural economics, which builds on the work of Daniel Kahneman and Amos Tversky and is best exemplified by Richard Thaler and Cass Sunstein’s recent book, Nudge. These important currents in behavioural economics are also contrasted with the conventional economic wisdom. The focus of this comparative analysis is to examine the implications of these different approaches in behavioural economics for financial literacy.
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    Cooperative organizations as an engine of equitable rural economic development
    (Te Herenga Waka—Victoria University of Wellington, 2014) Altman, Morris
    Cooperatives represent an alternative to large-scale corporate farms and plantations as well as to independent unaffiliated small private farms. This paper presents a comparative modeling narrative on cooperative organizational forms’ potential impact on equitable rural development. This speaks to issues of both increasing the size of the economic pie and how this income is distributed. The case is made the cooperatives can potentially generate higher rates of growth and more equitable growth, even in competitive economic environments. An important type of cooperative that is focused upon is one based on the linking of smaller farms into a cooperative. Economies economics of scale and scope as well in transaction costs can be captured by the cooperatives. Given cooperative governance, one would also expect higher levels of x-efficiency. Overall, cooperatives can generate relative high incomes to cooperative members, whilst remaining competitive with the traditional privately owned large farms. Critical to the success of the cooperative, is a set rules and regulation that place them on a level playing field with the privately owned farm. In addition, the implementation and practice of cooperative principles is key to the success of the cooperative farm and rural cooperatives, more generally speaking.
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    Insights from behavioral economics on how labor markets work
    (Te Herenga Waka—Victoria University of Wellington, 2014) Altman, Morris
    I discuss some key issues raised by behavioral economics for better understanding the working of the labor market. Amongst the key points in this paper are: (i) a revised modeling of the labor supply curve, with a specific focus on the target income approach (ii) elaborating on the importance of effort variability for understanding labor supply, including a narrative on efficiency wage and x-efficiency theory (includes the importance of fairness) (iii) building upon x-efficiency and efficiency wage theory to better understand the demand side of the labor market (iv) discussing some of the cognitive/informational/institutional factors affecting decision-making, including modeling the role of errors or biases in labor market decisions for both the supply and demand side of the labor market (v) insights of experimental economics for labor market behavior (vi) the importance behavioral economics for better understanding the stylizing facts of labor markets. This paper also compares conventional to behavioral theoretical approaches labor markets, their different underlying assumptions, and analytical predictions, with implications for public policy and institutional design. Also compared are the errors and biases and the bounded rationality approaches labor market analysis. They produce different analytical predictions as well as having different implications for public policy and institutional design.