Martin A. Leroch

Saving newspapers with public grants – The effects of press subsidies on the provision of journalistic quality

Many European governments subsidize their newspapers with the intention to guaranteeing high journalistic quality. Since journalistic quality is not defined by consumer preferences, increasing will not necessarily lead to benefits for all consumers. Based on this idea, the demand for a regional newspaper monopolist is modeled and the profit maximizing level of journalistic quality is analysed. We find that frequently used sales subsidies may be counter-productive as they can lead the newspaper to reduce journalistic quality.

IMPARTIAL SPECTATOR, MORAL COMMUNITY, AND SOME LEGAL CONSEQUENCES

Building on Adam Smith’s moral theory, this paper discusses effects of group size on moral standards. The key concepts of Smith’s theory, that of sympathy and the impartial spectator, provide a basis for this discussion because both presuppose a moral community, i.e. a group of people bound together via common experience and values. As this group increases in size, common experience becomes scarce and leads to a decrease in the habitual sympathy among its members. Consequently moral communities sharing related impartial spectators will be of limited size. In order to achieve coordination among the members of a polymorphic society, the law regulates which norms should be binding for it. Following Smith, common law seems to bear superior features compared to other legal systems in making use of juries, thereby resembling the internal, moral judgement process. Limits to the application of common law are discussed.

Intergroup Revenge: A Laboratory Experiment on the Causes

Field studies of conflict report cycles of mutual revenge between groups, often linked to perceptions of intergroup injustice. We test the hypothesis that people are predisposed to reciprocate against groups. In a laboratory experiment, subjects who were harmed by a partner’s uncooperative action reacted by harming other members of the partner’s group. This group reciprocity was only observed when one group was seen as unfairly advantaged. Our results support a behavioral mechanism leading from perceived injustice to intergroup conflict. We discuss the relevance of group reciprocity to economic and political phenomena including conflict, discrimination and team competition.

Culture at work: how culture affects workplace behaviors

Purpose - – The purpose of this paper is to give structure to the argument that “culture matters.” Further, the aim is to show how cultural differences shape the use of incentives within firms and point toward culturally affected degrees of efficiency. Design/methodology/approach - – The paper incorporates differences in the evaluation of the stimuli money, order, and monitoring into a simple efficiency wage model. Profit maximizing firms are assumed. Findings - – It is found that the use of incentives should respect the cultural surrounding. Data from a real-world analysis can partly be explained with this model, which was not done before. Research limitations/implications - – The major limitation lies in the abstract nature in which economic models deal with incentives. Practical implications - – The theoretical predictions are tested against the findings of Bloom and van Reenen (2007). Although the model may apparently contribute to the explanation of differences in the relative use of monitoring and pay, it fails in do so for directives. The reason for this shortcoming is identified in the impossibility to clearly compare the empirical notion of directives as found in Bloom and van Reenen (2007) to the theoretical notion of directives applied in the model. Originality/value - – The paper is one of the few approaches dealing with cultural differences on an individualistic basis. Most findings on the importance of intercultural variation offer econometric analysis, leaving open how exactly culture affects individual behavior such that the observed differences can be explained. The model presented offers exactly such a link.

Good Intentions, Bad Results: The Effects of Newspaper Subsidies on Journalistic Quality

News media play an irreplaceably important role in the successful working of democratic societies: they guarantee that citizens have access to information, are accurately informed, and actively take part in the political process. A crucial factor for the effective fulfillment of these democratic functions is an adequate level of journalistic quality.

Pointing Fingers: Why People Hold Corporations Responsible

Abstract Social incentives, e. g. holding others responsible, are a major but in economics rarely discussed element of norm enforcement. I argue they are intimately tied to sentiments towards the assumed causers of a specific outcome. If, in case of joint actions, individual causers are not identifiable, a group as a whole may be held responsible. Those collective entities serve as ‘scapegoat’ and thus relieve those involved from their empathetic distress. Consequently, the ascription of responsibility is easily flawed and not reliable. Policy recommendations calling on the responsibility of the actors should thus be dispensed with. Zusammenfassung Soziale Anreize wie die Zuweisung von Verantwortung sind ein wichtiges, aber in der Ökonomik wenig diskutiertes Element zur Durchsetzung gesellschaftlicher Normen. Es wird eine auf Emotionen aufbauende Verantwortungstheorie vorgestellt. Emotionen entstehen unmittelbar den für ein Ereignis kausalen Personen gegenüber. Können im Fall gemeinschaftlicher Handlungen die individuellen Beiträge nur schwer identifiziert werden, werden diese Emotionen sich auf eine gesamte Gruppe von Akteuren beziehen. Sie wird als Ganzes zur Verantwortung gezogen und dient leicht als ‚Sündenbock’. Dies macht die Zuweisung von Verantwortung leicht fehlbar und nicht verlässlich. Auf Forderungen, die sich ausschließlich auf die Verantwortung der Akteure beziehen, ist daher zu verzichten.