Kjetil Telle

The impact of social approval and framing on cooperation in public good situations

Several economists have maintained that social and internalized norms can enforce cooperation in public good situations. This experimental study investigates how two important channels for social and internalized norms, social approval and framing, affect cooperation among strangers in a public good game. The experiment has two treatment effects. Firstly, it reveals each person’s identity and his contribution to the public good. Secondly, it presents the public good game in a language that suggests associations to social and internalized norms for cooperation. The first treatment effect increases voluntary contributions significantly.

THE EFFECT OF PLANT DOWNSIZING ON DISABILITY PENSION UTILIZATION

We investigate the impact of plant downsizing on disability pension utilization in Norway. Plant downsizing substantially increases the disability entry rate of workers in affected plants. Workers originally employed in plants that downsized by more than 60% between 1995 and 2000 were 24% more likely to utilize disability pensions in 2001 than comparable workers in non-downsized plants. We also estimate significant effects of downsizing on future earnings and mortality, which suggest that the increase in disability participation could be driven by an adverse effect of downsizing on the economic opportunities or the health of affected workers. (JEL: H55, I12, I38, J63, J65) (c) 2009 by the European Economic Association.

Sick Leave Before, During and After Pregnancy

Using register data on every employed Norwegian woman giving birth to her first child in the period 1995–2008, we describe sick leave before, during and after pregnancy. Sick leave increases abruptly in the month of conception and continues to grow throughout the pregnancy. Compared to pre-pregnancy levels, sick leave of pregnant women has risen substantially since the mid-1990s. In line with hypotheses of women’s ‘double burden’, observed sick-leave rates increase in the years after birth. However, when sick leave during a succeeding pregnancy is excluded, the increase in women’s sick leave in the years after birth dissolves.

Unit Roots, Polynomial Transformations and the Environmental Kuznets Curve

Properties of estimators of long-run parameters in a polynomial regression with nonstationary, strongly exogenous regressors are considered in the context of the Environmental Kuznets Curve using Monte Carlo simulations. Standard inferential procedures seem to work well in this context.

Monitoring and Enforcement of Environmental Regulations: Lessons from a Natural Field Experiment in Norway

Relying on a small natural field experiment with random assignment of treatments, I estimate effects of three core elements of most monitoring and enforcement practices: self-reporting, audit frequency and specific deterrence. I find evidence of evasive reporting of violations in self-audits, as more violations are detected in on-site audits than in self-audits. Announcing the increased audit frequency has no effect on compliance, but an audit raises the firm’s subsequent compliance substantially.

Childhood residential mobility and long-term outcomes

To study relations between childhood residential mobility and early adult outcomes, we use detailed longitudinal data on complete cohorts born in Norway between 1965 and 1980 (N = 967 151) and information on all their relocations between municipalities. Results from models with and without sibling-fixed effects show that children with more residential moves are more likely to drop out of high school, to have a lower adult income and to experience early parenthood, although most of these associations are weaker in the sibling fixed effects models. We also find that age at moving matters: the outcomes are similar for children who move or remain in place prior to elementary school, whereas those who move in adolescence are worse off than those who do not.

Retirement and mortality in Norway – Is there a real connection?

The growth in life expectancy has lead to growing concerns about the need to raise the retirement age in order to stabilize the ratio between the economically active and the inactive, particularly in order to sustain the viability of social security systems (NOU, 2004; Palmer, 2003). Strong increases in the retirement age are needed to keep dependency ratios constant if the projected life expectancy growth will materialize (UN, 2007a; Eurostat, 2008). National Statistical Offices (including Statistics Norway), Eurostat and the United Nations assume that the life expectancy at birth will continue to increase by 1 to 2 years per decade (de Beer, 2006; UN, 2007; Eurostat, 2008; Alho et al., 2005). Statistics Norway (2009a, 2009b) assumes that the life expectancy at birth is going to continue to increase from 2008 to 2060, i.e. between 1.1 and 2.3 years per decade for men and between 0.8 and 2 years for women.

Are Closely Held Firms Tax Shelters

In 2004 Norwegian authorities announced a reform introducing dividend taxation for personal (but not corporate) owners to take effect starting in 2006. This change provided incentives to maximize dividends in 2004 and 2005, and to retain earnings in the following years. Using Norwegian registry data that cover the universe of nonpublicly traded firms, we find that dividend payments responded very strongly to the anticipated reform, but also that much of the response was compensated by reinjecting shareholder equity in the same firms. On the other hand, following the reform, firms began to retain earnings. While all categories of assets grow, the increase in durable assets categories that include equipment, machinery, company cars, planes, and boats is particularly striking. We find that personally owned firms and those that pursued aggressive dividend maximization policy in anticipation of the reform exhibit lower profits and economic activity in the aftermath, but retain earnings and accumulated assets at comparable or faster rates than others. The differential effect on assets is concentrated in financial (a potential substitute for private saving) and durable (a potential substitute for private consumption) asset categories. We interpret these results as indicating both the existence of real tax responses and supportive of the notion that in the presence of dividend taxation, closely held firms partially serve as tax shelters.

A Dissolving Paradox: Firms' Compliance to Environmental Regulation

It has often been claimed that firms’ compliance to environmental regulations is higher than predicted by standard theory, a result labeled the “Harrington paradox” in the literature. Enforcement data from Norway presented here appears, at first glance, to confirm this “stylized fact”: Firms are inspected less than once a year, detected violators are seldom fined, but still, serious violations seem relatively rare. However, at a closer look, the paradox dissolves: Enforcement of minor violations is lax, but such violations do flourish; serious violations are more uncommon, but such violations are subject to credible threats of harsh punishment. This seems quite consistent with predictions from standard theory. Although our finding may of course apply to Norway only, we argue that the empirical existence of the Harrington paradox is not well documented in the literature. Hence, the claim that firms’ compliance with environmental regulations is higher than predicted by standard theory should be viewed with skepticism.