Markets maintain institutions to support property rights & trade not in the absence of government, but rather in response to active government interference (predatory officials)

The politics of order in informal markets: Evidence from Lagos. Shelby Grossman. June 18, 2019. Forthcoming at World Politics. https://drive.google.com/file/d/1rzH2g4MEch3D_ff_A3kA8WJl4wdTPi2P/view

Abstract: Property rights are important for economic exchange, but in much of the world they are not publicly guaranteed. Private market associations can fill this gap by providing an institutional structure to enforce agreements, but with this power comes the ability to extort from group members. Under what circumstances do private associations provide a stable environment for economic activity? Using survey data collected from 1,179 randomly sampled traders across 199 markets in Lagos, I find that markets maintain institutions to support trade not in the absence of government, but rather in response to active government interference. I argue that associations develop pro-trade institutions when threatened by politicians they perceive to be predatory, and when the organization can respond with threats of its own; the latter is easier when traders are not competing with each other. In order to maintain this balance of power, the association will not extort because it needs trader support to maintain the credibility of its threats to mobilize against predatory politicians.

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1 Introduction
Outside of agriculture, more than half of workers in low-income countries are informally employed (Jütting, de Laiglesia and Jütting, 2009): they work in enterprises that are less regulated than similar activities in the same environment. Indeed, the informal sector accounts for an estimated 41% of developing countries’ GDP (Schneider, 2005). Yet public institutions rarely serve the needs of informal workers. For instance, informal entrepreneurs do not rely on courts for protection. Courts are often seen as biased, inefficient, and ill equipped to regulate off-the-book transactions – i.e., not worth the effort. Thus informal traders have no recourse to formal institutions if they are cheated. For example, the legal system would be of little help to a trader who buys what she thought were new smartphones, only to discover that they were refurbished and must be sold at a loss. A large body of work argues that private associations can step in to fill this regulatory gap by enforcing contracts,1 but this is not always the case. Although informal trade all over the world is organized into associations (Cross, 1998; Hummel, 2017), not all such groups promote trade. Indeed, many association leaders extort from their own traders. Markets in Lagos, Nigeria provide examples of both types of associations.

Some market association leaders in Lagos are a model of good governance and support a wide variety of policies that promote trade. For example, they impartially investigate customer complaints and organize market-wide boycotts of suppliers who cheat traders. By contrast, other market leaders extort from their traders, pocketing fees that they say will be used for services like market security. These leaders rarely intervene if a supplier wrongs a trader.

The ability to recognise others’ emotions from nonverbal cues is correlated with intelligence types (crystallized, fluid, spatial, memory, information processing speed & efficiency); academic achievement measures were unrelated

A meta-analysis of the relationship between emotion recognition ability and intelligence. Katja Schlegel, Tristan Palese, Marianne Schmid Mast, Thomas H. Rammsayer ORCID Icon, Judith A. Hall & Nora A. Murphy. Cognition and Emotion, Jun 21 2019, https://doi.org/10.1080/02699931.2019.1632801

ABSTRACT: The ability to recognise others’ emotions from nonverbal cues (emotion recognition ability, ERA) is measured with performance-based tests and has many positive correlates. Although researchers have long proposed that ERA is related to general mental ability or intelligence, a comprehensive analysis of this relationship is lacking. For instance, it remains unknown whether the magnitude of the association varies by intelligence type, ERA test features, as well as demographic variables. The present meta-analysis examined the relationship between ERA and intelligence based on 471 effect sizes from 133 samples and found a significant mean effect size (controlled for nesting within samples) of r = .19. Different intelligence types (crystallized, fluid, spatial, memory, information processing speed and efficiency) yielded similar effect sizes, whereas academic achievement measures (e.g. SAT scores) were unrelated to ERA. Effect sizes were higher for ERA tests that simultaneously present facial, vocal, and bodily cues (as compared to tests using static pictures) and for tests with higher reliability and more emotions. Results were unaffected by most study and sample characteristics, but effect size increased with higher mean age of the sample. These findings establish ERA as sensory-cognitive ability that is distinct from, yet related to, intelligence.

KEYWORDS: Emotion recognition ability, intelligence, meta-analysis, emotional intelligence, interpersonal accuracy

When outgroup negativity trumps ingroup positivity: Fans of the Boston Red Sox and New York Yankees place greater value on rival losses than own-team gains; effect more strong when one’s own team was behind in the rivalry

When outgroup negativity trumps ingroup positivity: Fans of the Boston Red Sox and New York Yankees place greater value on rival losses than own-team gains. Steven A. Lehr, Meghan L. Ferreira, Mahzarin R. Banaji. Group Processes & Intergroup Relations, July 19, 2017. https://doi.org/10.1177/1368430217712834

Abstract: Much research suggests that ingroup positivity is more central than outgroup negativity. We argue that this conclusion is incomplete as a description of the totality of intergroup emotions. In 4 studies, we use a novel measure of willingness to pay for intergroup gains and losses to examine the intergroup emotions of fans of the Boston Red Sox and New York Yankees. Results indicate that pleasure from a powerful rival’s losses can outstrip that from gains of one’s own group (Studies 1–2), and these patterns extend into domains not immediately relevant to the competition (Studies 3–4). A reversal in the competitive position of the two teams in the 2012–2013 season allowed us to examine whether fluctuations in competitive status moderated this pattern (Studies 3–4). Indeed, fans of the rival teams frequently valued outgroup losses more than ingroup gains, and this effect was particularly strong when one’s own team was behind in the rivalry.

Keywords: attitudes, intergroup processes, outgroup hate, Schadenfreude, sports rivalry

Honesty in 355 cities, 40 countries: In virtually all countries citizens were more likely to return wallets that contained more money

Civic honesty around the globe. Alain Cohn et al. Science Jun 20 2019:eaau8712. DOI: 10.1126/science.aau8712

Abstract: Civic honesty is essential to social capital and economic development, but is often in conflict with material self-interest. We examine the trade-off between honesty and self-interest using field experiments in 355 cities spanning 40 countries around the globe. We turned in over 17,000 lost wallets with varying amounts of money at public and private institutions, and measured whether recipients contacted the owner to return the wallets. In virtually all countries citizens were more likely to return wallets that contained more money. Both non-experts and professional economists were unable to predict this result. Additional data suggest our main findings can be explained by a combination of altruistic concerns and an aversion to viewing oneself as a thief, which increase with the material benefits of dishonesty.