The Historical Roots of Global Inequality

Luigi Pascali (UPF and BSE)

Why is it that, throughout human history, different societies developed very different levels of hierarchical complexity, going from egalitarian tribes, to chiefdoms, city-states and great civilizations? Although this research question marked the very beginning of modern social science, from Hobbes to Locke to Rousseau and, there is surprisingly little empirical that has been presented in a well-identified econometric framework. The aim of this grant is to close this gap in the literature using standard methodologies in economics with global datasets coming from paleoclimatology, archaeogenetics, archaeology, and anthropology.

The grant proposal is composed of three projects. The first two projects will focus on the origins of complex hierarchies. Specifically, the first one will focus on the shift from chiefdoms to states, while the second one from egalitarian tribes to chiefdoms. The third one will then study the diffusion of complex hierarchies through space and through time until nowadays.

Personality, Preferences and Reference Dependence

Antonio Penta (UPF and BSE)

In recent years, the study of personality (noncognitive skills) has significantly increased in economics. There has been an explosion of empirical work that shows the promise and relevance of incorporating such factors into the field. But we lack a definition of relevant personality traits in terms of primitive preferences, the way we do with risk and time preferences, for instance. Most studies rely on self-reported surveys, but this is only part of the issue: without a sharp, agreed-upon definition, it is difficult to build models, make predictions or elicit these measures in a way that unambiguously separates the primitives from the outcomes. Our aim is to provide these notions.

Part 1 focuses on attitudes towards success and failure, and the thresholds that separate one from the other. Such attitudes are not only present in the way we discuss personality (e.g. perseverance and tenacity), they also appear in seemingly distant strands of economics, notably through the widely used notion of gain-loss sensitivity, through notions of aspirations, and so forth. Within a standard decision theoretic setting, we define such attitudes as features of the primitive preferences over lotteries, we characterize the corresponding utility representations, and provide indices of the intensity of each attitude, in a manner analogous to the Arrow-Pratt coefficients for risk-aversion.

These notions have crucial implications on two main levels: first, they generate testable predictions for choice under risk, and novel insights about central notions within the established economics toolkit; second, they expand the domain of economics methodology to the study of personality, by providing choice-based measures grounded on preferences, thereby bridging the gap between insightful notions from psychology and the desiderata of rigorous economic analysis. These two aspects are the focus of Parts 2 and 3, respectively, which tackle the problem through a series of large-scale experiments.