CEU Electronic Theses and Dissertations, 2024
| Author | Fleck, Dávid Márton |
|---|---|
| Title | Essays in Applied Economics |
| Summary | The thesis consists of three chapters, one single-authored and two co-authored. All chapters are based on original, novel datasets that help answer policy-relevant questions in various fields of applied economics. The individual chapters are summarized below. Chapter 1: Favoritism under Multiple Sources of Social Pressure Joint work with Gábor Békés and Endre Borza (Forthcoming, Economic Inquiry) This chapter investigates potential mechanisms of social pressure leading to biased decisions. In particular, we are concerned with the context in which decision-makers such as judges and referees, despite being guided by strict rules, may regularly make biased and unfair decisions to preferentially treat one of the parties. We focus on cases when such favoritism is driven by social pressure – where influence is exerted by another person or group informally. This chapter extends a well-known exercise to decompose various sources of social pressure, looking at how football referees make biased decisions in setting the length of the stoppage time. According to a classic result, the pressure emanates from the supporting crowd, as referees internalize the preferences of the crowd in their decisions, by systematically favoring the home team. With substantially finer data, we confirm the existence of a referee bias towards favoring the home team in European football, but identify a different source of this bias than previously assumed. Our exercise, covering granular data from the five top leagues over ten seasons (2011/12 to 2020/21), shows that the bias exists and referees support the home team by allowing the game to last longer if they are losing. The point estimate of this bias is 13 seconds or 5% of the extra time. Our key contribution is understanding the source of social pressure pushing referees to make such decisions. Using empty stadiums owing to Covid-19 as source of external variation, we show that, unlike previously assumed, the bias is not due to crowds as the bias persists even in the absence of home fans. Instead, we show that the bias is attributed to the host team organisation, as the bias is exacerbated by the status of the hosting firm: influential teams benefit more than twice as much as the smaller ones (23 vs 11 seconds). Thus, we argue that influential host organizations emerge as the source of social pressure. This has an adverse effect on maintaining the ranking of influential teams and hindering the progress of smaller teams. Chapter 2: The Xerox Effect: Communication Technology and Political Actions in Autocracy Joint work with Arieda Muco This chapter investigates the role that new communication technologies play in the fall of autocratic regimes. For this, we use a unique setting: the distribution of photocopy machines (called the Xerox program under the umbrella of the Soros Foundation) in communist Hungary. The photocopy machines were seen as a transformative technology, similar to the expansion and impact of the Gutenberg press. We assess the extent to which this new technology helped to promote democratic values and contributed to the fall of the communist regime, resulting in a democratic regime change by 1989/90. We use newly collected and digitized data on the allocation of Xerox machines to public institutions in Hungary between 1985 and 1989. Using various empirical strategies such as propensity score matching and staggered difference-in-differences, we show that the Xerox program had both short-term and long-term effects: in geographic areas equipped with machines, people were more likely to support democratic values in the 1989 referendum, participate in the 1990 general elections, and finally, less likely to support the 2016 anti-Soros referendum of the Hungarian government. We also show that adjacent areas are also affected. Our results suggest that new communication technologies help overthrow autocracies by promoting democratic values even when political competition is limited and traditional media is censored. Chapter 3: The Causes and Consequences of International Student Migration and Mobility Improving the international mobility of higher education students has been a major policy priority agenda of the European Union. The overall figures suggest that the project can be considered successful, as the number of degree-mobile students has been in a constant rise over the last twenty years. In the economic literature, generally two broad theories are used to model student mobility, and these come to different predictions as to the motives and consequences of student migration. According to the human capital model, student migration takes place to acquire skills that are not available at one's come country. In this case, the student chooses destination based on education quality, and is likely to return to home country after graduation (or settle down elsewhere). The migration model, on the other hand, considers student migration as a tool for settling down permanently in the destination country. This model predicts that future employment prospects and general conditions of the destination country are more important than university quality. The aim of this chapter is to empirically assess the drivers and consequences of international student mobility. To give a comprehensive account, I investigate these at three levels. First, a country-level analysis sheds light on how macroeconomic and geographic factors of origin and destination countries affect student migration flows. Using a gravity model estimation framework built on dyadic country level panel data, I test the predictions of the two alternative economic models. The results suggest that the student flows are more consistent with the human capital model, which predicts a relatively higher return rate. As a second step, a university-level analysis is carried out based on the European Tertiary Education Register (ETER) project's comprehensive data collection of European Union universities between 2017 and 2020. These results shed light on how various university level factors such as tuition fees, student-to-faculty ratio, research quality, and university rankings affect the number of international students. These results broadly confirm the empirical validity of the human capital model as opposed to the migration model: students tend to focus more on university quality (proxied by ranking scores) than the destination countries' feature. Finally, I carry out an individual level analysis. As part of this chapter, a web-based survey was designed to uncover international students' motives and post-graduation plans. Based on the responses collected from 600 international CEU students, I assess whether the results of the country- and university-level analyses are in line with the individual responses. Furthermore, this data allows to focus on an aspect that is completely missing from the existing datasets and literature: the likelihood of the students' returning to their home country after graduation, along with the factors that affect their return decisions. The responses to this questionnaire give a more nuanced picture than the country- and university-level analyses, as a slight majority of the respondents claim that they are not planning to return to their home country in the near future. This result has important major policy implications, as higher education mobility, when combined with low return rates, arguably contributes to brain drain and thus may inhibit the convergence of less developed countries. |
| Supervisor | Mátyás, László |
| Department | Economics PhD |
| Full text | https://www.etd.ceu.edu/2024/fleck_marton.pdf |
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