Research

The slow diffusion of new technology in the agricultural sector of developing countries has long puzzled development economists. While most of the current empirical research on technology adoption focuses on credit constraints and learning spillovers, this paper examines the role of individual risk attitudes in the decision to adopt a new form of agricultural biotechnology in China. I conducted a survey and a field experiment to elicit the risk preferences of 320 Chinese farmers, who faced the decision of whether to adopt genetically modified Bt cotton a decade ago. Bt cotton is more effective in pest prevention and thus requires less pesticides than traditional cotton. In my analysis, I expand the measurement of risk preferences beyond expected utility theory to incorporate prospect theory parameters such as loss aversion and nonlinear probability weighting. Using the parameters elicited from the experiment, I find that farmers who are more risk averse or more loss averse adopt Bt cotton later. Farmers who overweight small probabilities adopt Bt cotton earlier.

Apologies made by physicians for adverse medical events have been identified as a mitigating factor in whether patients decide to litigate. However, doctors are socialized to avoid apologies because apologies admit guilt and invite lawsuits. An "Apology Law," which specifies that a physician's apology is inadmissible in court, is written to encourage patient-physician communication. Building on a simple model, we examine whether apology laws at the state-level have an impact on malpractice lawsuits and settlements. Using a difference-in-differences estimation, we find that state-level apology laws could expedite the settlement process and increase the number of settlements by 15% within 3 to 5 years of adopting the laws. Using individual level data, we also find that apology laws have the greatest reduction in average payment size and the settlement time on cases with more severe patient outcomes.

Previous studies have shown that Chinese cotton farmers continue to use excessive amount of pesticide beyond the optimal amount even after adopting the pest-resistance Bt cotton. Using the results from the survey data and a new field experiment design which elicit individual risk preferences beyond expected utility to incorporate prospect theory parameter, we find that the more risk-averse Bt cotton farmers use more pesticides, while the more loss-averse Bt cotton famers use less pesticide. Education also plays an important role in determining the level of pesticide use. Bt cotton farmers who have graduated from elementary school use 16 percent less pesticides compared to Bt cotton farmers with no education. Education also predicts whether a farmer attends a Bt training session, which itself dramatically reduces pesticide use by 21 percent., Although these results potentially suffer from omitted variable bias, they reinforce the notion that farmers with more education may find it easier to decipher the information about Bt cotton that could make their farming practices more efficient.

Many studies have found that the returns to education in China from the 1980s to early 1990s were astonishingly low. The estimates of the returns to education also vary considerably across studies. This paper perform a meta-analysis to investigate how changes over time, model specifications, differences in data sets, and variable definitions could contribute to the differences in the estimates. The results show that approximately 15 percent of the variation can be explained by changes over time, and the typical positive relationship between wages and education did not prevail at the onset of the market reform. However, since the reform, returns to education have increased approximately 0.3 percentage point a year, and this strong increasing trend shows no sign of abating. The increasing reward for human capital accumulation is a positive sign that suggests China has been successful at moving the labor market toward a market economy.

This article examines an estimate of wage differentials for ethnic minorities in China from 1989 to 2006. Interviews with minority actors and observations with various enterprises are included to provide a representation of the ethnic minority labor market experience. While wage differentials show little evidence for minority disadvantages, qualitative evidence looking at the process of minority labor acquisition and retention suggests looking at wages alone provides an incomplete demonstration of minority inequalities. The article subsequently assesses potential factors for minority disadvantages in China’s labor market such as discrimination, social network capital and working culture.

Average Chinese Farmers have σ = 0.52 (change of notation, it's 1-σ); λ = 3.47; α=0.69