In the aftermath of the 2008 financial crisis it became clear that regulators had allowed many financial services firms to become “too big to fail”. Yet this system-critical firm problem is not confined to financial services. In their paper “Can electricity companies be too big to fail?” Ann van Ackere, Erik R. Larsen and Sebastian Osorio explain how a similar challenge faces the electricity sector, and offer some suggestions to help regulators prevent the lights from going out.
There has long been an association between politics and violence. Factional disagreements can often lead to prolonged violence. At the same time, there is apparent evidence that the prospect or reality of power sharing can reduce violence – as with the Good Friday agreement and paramilitaries in Northern Ireland, for example. At a time when factional violence, within a country or region, is evident in numerous parts of the world, research that examines how to prevent that violence is particularly relevant.
Two researchers look at the controversial issue of whether Early Child Care for very young children (under the age of three) provides benefits over care at home. And if so, whether it benefits children to a different degree depending on their circumstances.
Research suggests that, perhaps instinctively, people tend to prefer stability and the status quo to transformation and new ideas, even when they are personally disadvantaged as a result. The tacit approval of inequality despite its proven negative impact on society is a good example. Patrick Haack, Assistant Professor at HEC Lausanne and Jost Sieweke, Assistant Professor at Vrije Universiteit Amsterdam investigate why we think and behave this way. In doing so they provide persuasive new insights on how to change prevailing attitudes and behavior.
Could capital taxes on personal wealth be part of the solution to tackling growing inequalities in society? Unfortunately, there is little research evidence to support arguments for or against the imposition of wealth taxes. However, new research shows that use of wealth taxes in the battle against global inequality is far from straightforward.
Vaccination programs have the potential to substantially reduce the health and economic burden of many common diseases. However, vaccine uptake is far from optimal. One suggested reason for this is a general fear and mistrust of vaccinations. In their paper ‘Learning to Trust Flu Shots’ Jürgen Maurer and Katherine Harris investigate how the consumer learning process can help build trust and improve influenza vaccination use.
A common criticism of economics is that economic theory often fails to predict real world events, spectacularly so in some cases. More recently, however, a more empirical approach to economics has emerged that combines economic theory, psychology, and laboratory experimentation, in order to better understand decision making in real life situations.
As President Franklin D Roosevelt famously once observed: “The only thing we have to fear is fear itself”. It is an aphorism that policymakers should take note of, given the findings of research by Philippe Bacchetta and Eric van Wincoop into the causes of the Great Recession.
Research shows that policies designed to encourage people into work have an impact beyond the individual, at a market level. These market effects may produce unanticipated, unintended and even undesired consequences.
When we think about the consequences of war we tend to think about the immediate casualties, the lost lives and the injured. Yet war also has many debilitating long term economic effects, including some that make the prospects of further conflict and misery much more likely.