Yossef Tobol

Clever enough to tell the truth

We conduct a field experiment on 427 Israeli soldiers who each rolled a six-sided die in private and reported the outcome. For every point reported, the soldier received an additional half-hour early release from the army base on Thursday afternoon. We find that the higher a soldier’s military entrance score, the more honest he is on average. We replicate this finding on a sample of 156 civilians paid in cash for their die reports. Furthermore, the civilian experiments reveal that two measures of cognitive ability predict honesty, whereas general self-report honesty questions and a consistency check among them are of no value. We provide a rationale for the relationship between cognitive ability and honesty and discuss its generalizability.

The Correlation among Immigrant Homeownership, Objective and Subjective Characteristics, and Civic Participation: New Evidence from the Israeli Experience

The correlation between immigrant objective and subjective characteristics and the likelihood of achieving homeownership is tested empirically. Also, the article examines whether homeownership promotes civic participation and community involvement among immigrants. Observing a sample of immigrants who arrived in Israel between the years 1989 and 2004, it is found that a longer stay in the receiving country, living in proximity to other immigrants, being over 35 years old, holding a full-time job, earning above average income and being a single or divorced woman associate with greater likelihood of attaining homeownership. Moreover, it is found that the subjective notion of both respect for the receiving culture and proficiency in the language positively correlate with homeownership. Finally, it is found that the previous empirical findings, according to which native homeownership is tied to civic participation, extend to the immigrant population. Research findings may serve decision-makers in setting policies that advance homeownership among immigrant populations.

Whistle-blowers as a Deterrent to Tax Evasion

The economic literature on audit design has almost entirely ignored tax agencies’ practical reliance on whistle-blowers for the successful conduct of tax investigations. The authors compare the tax agency’s performance under a one-round blind-audit policy and a two-round whistle-blowing-intensive policy that invites whistle-blowers to blow the whistle on tax evaders who have escaped auditing in the first round. The authors show that if providing incentives for tax evasion is desirable under the one-round blind-audit scheme, the tax agency might be better off running a second, whistle-blowing-triggered, round, threatening to audit a sufficiently high fraction of the denounced evaders that will deter them from evading taxes. Hence, there will actually be no denouncing by honest whistle-blowers, who will find themselves serving as a deterrent to tax evasion without actually satisfying their desire for revenge or collecting a monetary reward. Committed to its threat, the tax agency will only be auditing falsely denounced non-evaders.

Social involvement, level of income and employment among immigrants : The Israeli experience

Purpose - – Previous studies of immigrant populations suggest that ceteris paribus an immigrants level of income is strongly and positively correlated with his proficiency in the local language. The purpose of this paper is to extend this literature using data from a telephone survey carried out in 2005 among a representative sample of Former Soviet Union (FSU) immigrants. Unlike previous surveys, the data includes responses to detailed subjective questions on degree of social involvement, in addition to the number of years since migration and level of proficiency in the local language. The authors are able to demonstrate that a higher degree of assimilation is associated with a significantly higher likelihood of finding full-time employment. Moreover, the estimation results for the wage equation reveal that the effect on income previously attributed solely to language proficiency is in fact also the result of more successful assimilation in the receiving culture. The findings thus stress the importance of assimilation in determining success in job search and in explaining variations in income among immigrants who are already employed in full-time jobs. Finally, the results obtained when differentiating according to gender show that male immigrants have better prospects of finding a job than female immigrants and higher incomes once they find one, which is consistent with the existing literature. Design/methodology/approach - – In order to compare the relative importance of the language proficiency variable ( Findings - –The authors are able to demonstrate that a higher degree of assimilation is associated with a significantly higher likelihood of finding full-time employment. Moreover, the estimation results for the wage equation reveal that the effect on income previously attributed solely to language proficiency is in fact also the result of more successful assimilation in the receiving culture. The findings thus stress the importance of assimilation in determining success in job search and in explaining variations in income among immigrants who are already employed in full-time jobs. Finally, the results obtained when differentiating according to gender show that male immigrants have better prospects of finding a job than female immigrants and higher incomes once they find one, which is consistent with the existing literature. Research limitations/implications - – The limitation is, like all of the existing literature and in particular the few studies that deal with social networking, that the database is exclusively based on either interviews or surveys consisting of self-assessment questions (such as, Dustman, 1996; Lazear, 1999; Amuedo-Dorantes and Mundra, 2007). Consequently, the implicit assumption is that the respondents self-perceived level of assimilation constitutes a good proxy for the true level. Practical implications - – The implications are the following: the findings are thus consistent with those of Lazear (1999), who anticipates a negative correlation between the relative size of a minority group and the level of proficiency in the local language. In the case of Israel, which received a massive wave of 1.5 million immigrants from the FSU, the findings indeed suggest that the chances of an immigrant job seeker finding a job are far more dependent on his degree of assimilation than his level of language proficiency. Moreover, the effect of the degree of assimilation, which has not previously been included in estimations, was mistakenly attributed to language proficiency. The findings of this research thus reveal the importance of the degree of assimilation in finding a job and can explain income differences among those who have already found full-time employment. Originality/value - – Previous studies of immigrant populations suggest that ceteris paribus the level of income is strongly and positively correlated with proficiency in the local language. The current study extends this literature using data from a telephone survey carried out in 2005 among a representative sample of FSU immigrants. Unlike previous surveys, the data includes responses to detailed subjective questions on degree of social involvement, in addition to the number of years since migration and level of proficiency in the local language. The authors are able to demonstrate that a higher degree of assimilation is associated with a significantly higher likelihood of finding full-time employment. Moreover, the estimation results for the wage equation reveal that the effect on income previously attributed to language proficiency is in fact the result of more successful assimilation in the receiving culture. The results are robust to gender differences. The findings thus stress the importance of assimilation in determining success in job search and in explaining variations in income among immigrants who are already employed in full-time jobs.

Futile and effective ways to combat wage discrimination

Using Beckers ‘taste for discrimination’ model, the chapter analyzes the current legislation against wage discrimination and finds it counterproductive. Using a costly apparatus of auditing, detecting and fining violators does not deliver results. If a fine is levied on discriminators and reimbursed to the disadvantaged workers in order to undo the discrimination, it affects equally the demand for and the supply of those workers, because their expected wage includes the fine, and has no real effect. If the fine is collected and kept by the government, it shifts employment away from the workers it seeks to help, to others, depressing the total employment. In contrast, levying a tax on the favored workers effectively curbs discrimination in the labor market. A quota is a possible substitute for a tax with questionable side effects. Affirmative action is in essence a sort of tax on employing favored workers, only administered in an indirect, clumsy and costly way. Yet, the chapter explains its humble impact in the right direction. An explicit and direct tax would do much more and with a negative cost. Alternatively, subsidizing the disfavored workers is a costly but as effective policy that, in addition, boosts total employment.

Should military uniforms carry the union label

It is widely believed that the unionization of military labor leads to reduced discipline and lower combat capability. Case studies of the performance of existing military unions, however, generally suggest that unionization has a benign impact on the performance of the armed forces. In this paper, we offer a theoretical economic analysis of the likely impact of military unionization on volunteer militaries. Our analysis suggests that military unionization will unambiguously lead to larger, but less disciplined, armed forces, leaving the overall impact of unionization on defense capability ambiguous. Military unionization, however, will clearly enhance social welfare.