Trust,regulation, and market efficiency

Building from the interest-group theory of regulation, we posit that trust alters the payoff from regulatory rent-seeking relative to profit-seeking. Trust reduces the costs of productive economic exchange by lowering transaction costs, thus raising the cost of rent-seeking behavior. In addition, trust increases political accountability, discouraging politicians from creating regulatory rents. We therefore hypothesize that trust reduces the extent of business regulation while simultaneously facilitating market efficiency. To test that hypothesis, we construct an overall business regulation index measuring procedures, time, and cost along eight dimensions of doing business in a country. The empirical results reveal that trust negatively relates to business regulation but positively relates to market efficiency. Interaction and split-sample results further indicate that trust and business regulation are substitutes. Collectively, the findings reported herein suggest that business regulation itself is not the root cause of market inefficiency, but rather lack of trust is the dominant factor.

     

Unconscious Bias Training: The ‘Silver Bullet’ for Gender Equity?

Western Governments concerned about the lack of gender equity in their workforces are increasingly seeking to address the negative effects of unconscious biases on employment decisions to counter the effects of hidden prejudices. Although unconscious bias has received limited attention in the human resource literature, social psychology literature has identified inadequacies with this practice, including that such training may entrench and normalise unconscious biases. We argue that the popularity of unconscious bias training invites agencies to view this practice as a ‘silver bullet’ to achieve gender equity, but that its effectiveness is likely to be limited unless accompanied by sustained interventions to address discrimination. Further, the impacts of unconscious bias training need to be rigorously evaluated to assess whether government resources are being effectively utilised. Consistent with international research, such an evaluation may reveal that unconscious bias training has unintended negative consequences, but that the training can be improved to reduce these consequences.     

Candidate ideology and electoral success in congressional elections

In examining the factors that contribute to electoral success in congressional elections, legislative scholars often consider the actions of elected representatives; however, other research suggests that one must consider what challengers are (or are not) doing as well. For instance, inexperience and poor funding can significantly inhibit challenger success. We expand this list of potential shortcomings by arguing that ideological congruence with a constituency may be another factor in explaining challenger defeat. Using ideology measures derived from campaign contributions, we find that unsuccessful challengers in the U.S. House are generally more extreme than those who win, but ideological extremity is not a disadvantage to those seeking to represent an extreme constituency. More importantly, our existing political institutions may actually serve to mitigate the already high levels of partisan polarization in Congress.