What Determines Attitude Improvements? Does Religiosity Help?

Transcription

1 Internatonal Journal of Busness and Socal Scence Vol. 4 No. 9; August 2013 What Determnes Atttude Improvements? Does Relgosty Help? Madhu S. Mohanty Calforna State Unversty-Los Angeles Los Angeles, 5151 State Unversty Drve, Los Angeles, CA Unted States of Amerca Abstract Followng earler theores and usng data from the Natonal Longtudnal Survey of Youth, a US longtudnal data set, the current study demonstrates that the atttude of an ndvdual can change over tme. The study then dentfes the factors that contrbute to mprovement n atttude. Our results ndcate that (1) any varable whch makes an ndvdual feel mportant mproves hs/her atttude, (2) determnants of atttude dffer to some extent between adults and young-adults, and (3) relgosty of an ndvdual does n fact affect hs/her atttude postvely. Based on these fndngs, the study recommends value educaton and behavoral tranng to accompany tradtonal schoolng to promote an ndvdual s atttude and thereby promote hs/her economc wellbeng. Key Words: Postve Atttude, Self-Esteem, Relgosty, Treatment Effect, Propensty Score JEL Classfcaton Code: A13, A14, J10, J19, Z1 I. Introducton Recently, economsts have joned psychologsts n examnng the role of atttude and other personalty trats n the determnaton of an ndvdual s dfferent aspects of lfe ncludng economc performance (Barrck and Mount, 1991; Nollen and Gaertner, 1991; Goldsmth et al., 1997, 2000; Bowles et al., 2001; Edwards et al., 2001; Groves, 2005; Nyhus and Pons, 2005; Gelssen and degraaf, 2006; Jackson, 2006; Mohanty, 2009a, 2009b, 2010, 2012). These studes suggest that postve atttude n general affects the ndvdual s economc performance postvely, and consequently, wth a vew to mprovng atttude, they recommend tranng n behavoral sklls to supplement tradtonal schoolng (Bowles et al, 2001; Groves, 2005; Sa Baba, 2007; Mohanty, 2009a, 2009b, 2010, 2012). In fact, Groves (2005, p. 829) concludes, If personalty varables are rewarded n the labor market, worker-tranng programs wll be more successful f they educate and prepare workers wth the behavoral and socal characterstcs that can mprove occupatonal success. Also, schools may ncrease students opportuntes for hgh wage jobs by concentratng on both cogntve and behavoral sklls. We can conclude from the above fndngs that f mprovements n atttude lead to better economc performance and f behavoral tranng s necessary for such atttude mprovements, then ths tranng program wll be more effectve n promotng the economc wellbeng of ts partcpants f t focuses prmarly on developng the characterstcs that affect atttude postvely. For the effectveness of polces desgned to mprove the ndvdual s atttude and economc performance therefore t s necessary to recognze the key determnants of postve atttude. The current study does exactly that. Followng dfferent econometrc technques and usng longtudnal data from the Unted States, t dentfes a number of varables that promote mprovements n atttude. Before examnng the determnants of postve atttude t s necessary to frst defne ths varable n more clear terms. Due to ts psychologcal nature, a precse defnton, however, s not possble, and consequently we defne ths varable n general terms as the qualty of percevng dfferent lfe events and reactng to them n a productve and optmstc manner. Mohanty (2009a, p.358) characterzes an ndvdual wth postve atttude n the followng lnes: 37

2 Center for Promotng Ideas, USA 38 A person wth a postve atttude always sees the brghter sde of every stuaton and thus concentrates on good aspects only. Such a person has the convcton that whatever s gong to happen wll work out well. Postve atttude thus brngs optmsm to lfe. Ths defnton suggests that postve atttude s an attrbute that nvarably s assocated wth optmstc perceptons of dfferent events n lfe. Economsts treat ths varable as a psychologcal captal varable that measures an ndvdual s behavoral skll smlar to dfferent human captal varables dscussed extensvely n labor economcs lterature that measure hs/her cogntve skll (Nollen and Gaertner, 1991; Goldsmth et al., 1997; Waddell, 2006; Mohanty, 2009a, 2009b, 2010). Postve atttude may thus be defned as a psychologcal skll that helps one see and react to events wth an optmstcally constructve outlook. It s mportant to note that postve atttude s a psychologcal skll and consequently t should not be treated as a personalty trat that s restrcted only to a specfc personalty dmenson characterzed by the Bg-Fve model extraverson, agreeableness, conscentousness, neurotcsm (or emotonal stablty) and autonomy (Rosenberg, 1965; Dgman, 1990; Nyhus and Pons, 2005). In fact, an ndvdual wth any personalty dmenson may develop postve atttude wth proper tranng and sustaned practce (Bowles et al, 2001; Groves, 2005; Mohanty, 2009a, 2012), just as an ndvdual, regardless of hs/her personalty factor, can enhance hs/her human captal endowments wth approprate schoolng. Ths varable should not therefore be confused wth a trat that belongs to one of the Bg-Fve personalty dmensons. 1 Note that postve atttude s an nner characterstc whch may easly be confused wth a genetcally nflexble trat. Followng the set-pont theory used extensvely n the happness lterature, one may even argue that atttude s bascally nnate to ndvduals and therefore s fxed n the long-run at hedonc neutralty. 2 In fact, McCrae and Costa (1999, p. 145) conclude that, Trats develop through chldhood and reach mature form n adulthood; thereafter they are stable n cogntvely ntact ndvduals. Ths statement clearly suggests that personalty trats ncludng atttude are lkely to reman more or less fxed after a certan age. The queston thus arses, Can atttude really change at any age? From the pont of vew of polcy effectveness, the answer to ths queston, whch s dscussed n the followng paragraph, s extremely mportant. Frst, as mentoned earler, the psychologcal captal characterstc atttude s a skll whch lke other human captal varables can be mproved through proper tranng. Second, the nature vs. nurture argument (Behrman and Taubman, 1989) provdes an approprate answer to the above queston. Followng the nature theory, we may argue that atttude s determned genetcally and therefore s unlkely to change unless the genetc composton of the ndvdual s changed. The nurture theory, however, presents a dfferent scenaro. It suggests that, although dffcult, atttude and other such psychologcal captal varables can be changed wth approprate nurture, sustaned efforts and changes n the socal envronment (Srvastava et al., 2003; Sa Baba, 2007; Borghans et al., 2008; Mohanty, 2012). In fact, Borghans et al. (2008, p.1020) n ther semnal work on economcs and psychology of personalty trats conclude, In summary, the answer to the queston of whether the change n personalty s possble must be a defnte yes, both n terms of mean-level and rank-order change. However, change may be more dffcult later n the lfe cycle, change may be more endurng for some (such as more emotonally stable ndvduals) than others, change may requre persstent and consstent envronmental pressure (as opposed to transent pressure from short-term nterventons), and there are powerful forces for stablty (such as genes and habt) whch make change dffcult. Ths statement clearly ndcates that, although dffcult, t s not mpossble to change the ndvdual s atttude through delberate efforts. Fnally, the current study uses self-reported data on atttude from a sample of respondents from the Unted States (Natonal Longtudnal Survey of Youth, 1979) observed at three dfferent perods of ther lves (as teen-agers, young-adults, and matured adults) and demonstrates that the atttude of an ndvdual does n fact change over tme. Ths motvates the current research that uses real-world data to frst examne the possblty of change n an ndvdual s atttude, and then dentfy the varables that facltate ths change n the postve drecton.

3 Internatonal Journal of Busness and Socal Scence Vol. 4 No. 9; August 2013 The current study contrbutes to the lterature n several dfferent ways. Frst, t demonstrates emprcally that an ndvdual s atttude s not necessarly nflexble and can change over tme under sutable crcumstances. Note that ths clam s not completely new n the lterature because earler researchers have already used atttude as an endogenous varable n ther regressons (Mohanty, 2009a, 2009b) whch mplctly assumes that ths varable may change due to the changes n ts determnants. None of these studes, however, has explctly examned the magntudes of these changes. Usng longtudnal data, the current study for the frst tme n the lterature demonstrates that a large percentage of ndvduals, n fact, change from one atttude category to another as they grow older. Second, by usng dfferent varants of the atttude varable as the dependent varable and econometrc technques assocated wth such dependent varables, the study examnes the factors that determne the ndvdual s atttude, and thus presents fndngs that are robust aganst data specfcaton and econometrc procedures. Moreover, whle examnng the determnants of atttude, the current study further dentfes the varables that contrbute to ts mprovement, and thus ads polcy makers n formulatng approprate polces when dealng wth ths problem. Fnally, wth an ncreasng nterest among economsts n the economcs of relgon n recent years (Azz and Ehrenberg, 1975; Iannaccone, 1998), the study tests emprcally whether or not relgosty affects atttude. In the absence of a randomzed controlled experment, the study uses the propensty score matchng technque dscussed n the next secton to examne the causal effect of relgosty on the ndvdual s atttude. To the knowledge of ths author, no earler study has ever done ths. The current study tests ths mportant hypothess and thus flls a gap n the lterature. The study s organzed as follows. The next secton presents two two-perod longtudnal samples and from the Unted States, and demonstrates that atttudes of a large percentage of respondents n fact changed sgnfcantly durng these tme perods. Wth a vew to examnng the determnants of ths change, Secton 3 presents the relevant estmatng equatons, and outlnes approprate estmaton procedures under alternatve assumptons on the dependent varable. Secton 4 presents the data, and Secton 5 reports the crosssectonal results examnng the determnants of an ndvdual s atttude. To determne the factors that contrbute to the change n atttude, Secton 6 frst presents the random effect estmates of the atttude equaton, and then followng a frst-dfferenced regresson approach, t examnes the determnants of the mprovement n atttude. To verfy the clam that relgosty may mprove atttude, Secton 7 presents propensty score matchng results that help us measure the treatment effect of relgous attendance on atttude mprovement. The fnal secton summarzes our fndngs, and dscusses the polcy mplcatons and lmtatons of ths study. II. Evdence from the US Data To examne whether atttude can change over tme, we used data from the Natonal Longtudnal Survey of Youth 1979 (NLSY79), a US longtudnal survey that started n 1979 wth 12,686 ndvduals aged between 14 and 21 and was contnued annually untl 1992 and bennally thereafter. For the purpose of our study, the respondents n ths survey were observed at three dfferent tme perods: 1980, 1987 and These three years were chosen because they are the only surveys n the NLSY79 that contan nformaton on the ndvdual s atttude. Snce the respondents n ths survey were observed at three dfferent tme perods as teenagers, young-adults and matured adults, our fndngs are applcable to all ndvduals of dfferent age-groups. In the lght of the fact that younger people are more amenable to change than matured adults for whom the changes are less pronounced (Sa Baba, 2007; Borghans et al., 2008), our data set wth responses from dfferent age-groups s just perfect for the purpose of ths comparson. Informaton on the ndvdual s self-reported atttude avalable n all three surveys was obtaned from the response to the statement, I take a postve atttude toward myself. The four response-choces to ths statement are (1) strongly agree, (2) agree, (3) dsagree and (4) strongly dsagree, and for approprate econometrc analyss, they are recoded respectvely as 3, 2, 1, and 0. By elmnatng the mssng values of ths varable from both 1980 and 1987 surveys, we found a sample of 10,089 ndvduals wth vald responses to the above statement. Smlarly, the 1987 and 2006 surveys yelded 7,255 observatons wth nformaton on the atttude varable n both years. Table 1A and Table 1B respectvely report 4 4 cross-tabulatons of ndvduals and ther respectve percentages n dfferent and atttude categores. For example, the frst element of the 4 4 cross-tabulaton n Table 1A s 2,066 (20.48) whch suggests that 2,066 ndvduals who agreed strongly n 1980 to have a postve atttude also mantaned the same vew n 1987 and ther percentage n the sample s

4 Center for Promotng Ideas, USA It s mportant to note that the elements n the prncpal dagonals of these 4 4 tables denote the number of ndvduals who dd not change ther atttudes durng the tme perods under consderaton. In our sample of 10,089 ndvduals, 5,919 belong to ths category and they consttute percent of the sample. The remanng 4,170 ndvduals that consttute percent of the sample dd n fact change ther atttudes ether postvely or negatvely. The number of ndvduals whose atttude mproved durng ths perod s 2,608 (or percent) and 1562 ndvduals (or percent) changed for the worse. It s nterestng to note that a larger percentage of respondents, whose atttude changed durng ths perod, changed for the better. When we add ndvduals, who remaned at the hghest level of atttude (.e., havng responses 3 and 3 n both 1980 and 1987 surveys) wth no chance to mprove further, to the category of ndvduals who mproved n ther atttudes, the number n ths group rses to 4,674 (or percent). The scenaro n Table 1B that shows the change n atttude between 1987 and 2006 s very smlar. Out of 7,255 ndvduals who responded to the atttude queston, 4,202 (or percent) dd not change. Out of the remanng 3,053 (or percent) ndvduals, 1,514 (or percent) changed for the better and 1,539 (or percent) changed for the worse. The total number of people who mproved or stayed at the hghest level of atttude between 1987 and 2006 s 3,273 (or percent). It s mportant to note that the two survey years, 1987 and 2006, are apart from each other approxmately by two decades and consequently changes n atttudes between these two dstant tme-perods are expected to be very dfferent from those between 1980 and Interestngly, however, both Table 1A and Table 1B yeld very smlar percentages n most of the comparable categores whch n turn ndcate that changes n atttude do not necessarly depend on the changes n tme-perods. However, there s one dfference n these tables that deserves an explanaton. The percentage of ndvduals who mproved n the second perod over the frst perod s larger n the panel than n the panel. Although the reason s not fully clear, ths dfference may be attrbuted partly to the fact that () younger people n general are more flexble to changes than matured adults and () the tme-nterval between 1987 and 2006 s overly long whch may reflect other structural changes, such as changes n economc envronments, technologcal advances, mgratons, cultural changes etc., durng ths perod. Despte the above smlartes and dfferences between Table 1A and Table 1B, the number and percentage of people changng ther atttudes between the two tme-perods under consderaton clearly ndcate that atttude of an ndvdual can mprove under favorable crcumstances. 3 For better polcy effectveness therefore t s worth examnng the factors that contrbute to ths change. III. Estmatng Equatons and Test Strategy To dentfy the factors that may contrbute to mprovements n an ndvdual s atttude, t s necessary to estmate the postve atttude equaton and examne ts determnants. Dependng on the nature of the data on atttude (POSITIVE), ths equaton can be estmated by dfferent econometrc technques. Although the varable POSITIVE n our data set s reported as an ordered categorcal varable, t can be used to generate a bnary atttude varable as has been done n several earler studes (Mohanty, 2009a, 200b). Contnuous atttude varables may also be generated by combnng several related bnary or categorcal varables (Nollen and Gaertner, 1991; Goldsmth et al., 1997; Nyhus and Pons, 2005). For a general dscusson therefore we present n ths secton dfferent estmaton methods of the postve atttude equaton dependng on how ths varable s reported. If POSITIVE s reported as a contnuous varable (for example, havng a postve atttude between 0 percent and 100 percent), we can estmate the followng atttude equaton by OLS: (1) POSITIVE X, where X denotes the vector of all ndependent varables that determne atttude. If, on the other hand, POSITIVE s observed as a bnary varable (for example, postve and not postve), the followng equatons are estmated by probt: (2) POSITIVE = 1, f POSITIVE * > 0; & = 0, otherwse (3) POSITIVE * X, where POSITIVE * s the latent contnuous varable, and 40

5 Internatonal Journal of Busness and Socal Scence Vol. 4 No. 9; August 2013 (4) Pr ob( POSITIVE 1) ( X ). Fnally, f the dependent varable POSITIVE s reported as an ordered categorcal varable (assumng, for example, values 0, 1, 2 and 3, wth 3 representng the hghest category of postve atttude very strong and 0 ndcatng the lowest category very weak ), the atttude equaton (equaton 3) can be estmated by ordered probt from the followng specfcaton: (5) POSITIVE 0, f POSITIVE * 0, POSITIVE 1, f 0 POSITIVE * 1, POSITIVE 2, f 1 POSITIVE * 2, POSITIVE 3, f 2 POSITIVE *, where (6) Pr ob( POSITIVE 0 X ) ( X ), (7) Pr ob( POSITIVE 1 X ) ( 1 X ) ( X ), (8) Pr ob( POSITIVE 2 X ) ( 2 X ) ( 1 X ), (9) Pr ob( POSITIVE 3 X ) 1 ( 2 X ). Note that 1 and 2 are the cut-off ponts for dfferent categores of the latent contnuous varable POSITIVE* that generates the ordered categorcal varable POSITIVE defned n equatons (5). The estmatng equatons presented above are approprate for a cross-sectonal analyss. In the presence of unobserved ndvdual heterogenetes, however, t s more approprate to estmate these equatons by a fxed effect or random effect approach usng panel data. Snce our data set contans two dfferent two-perod panels, and , we can easly estmate these equatons by a panel data method to elmnate ndvdual specfc effects. Note that under fxed effect estmaton, several mportant determnants of atttude, such as gender and race, whch reman fxed over tme, have to be excluded from the set of explanatory varables. To avod ths, we obtan and report n ths study the random effect estmates only. 4 An alternatve method of elmnatng these unobserved heterogenetes s to estmate these equatons n ther frstdfferenced form usng approprate econometrc technques. Defne atttude change, ATTCHNG = POSITIVE = POSITIVE,new POSITIVE,old,. If POSITIVE s a contnuous varable, then ATTCHNG s contnuous. The followng equaton can then be estmated by OLS: (10) ATTCHNG ( X ) u, where = X new X old, and u, new, old. X Alternatvely, by denotng ATTCHNG * as the latent contnuous varable, we can defne a bnary varable ndcatng mproved atttude n the second perod (IMPROVED) that assumes the value 1 for all those ndvduals who mproved n the second perod or remaned at the hghest level of postve atttude n both perods wth no need or chance for further mprovement. Thus, (11) IMPROVED = 1, f ATTCHNG * > 0; = 0, otherwse. (12) ATTCHNG * > 0, f (ATTCHNG > 0) (ATTCHNG = 0 POSITIVE,old =3) (13) ATTCHNG* ( X ) v, (14) Pr ob( IMPROVED 1) (( X ) ). Note that the varable ATTCHNG * s dfferent from ATTCHNG because the former s postve even when the later s zero under the specal condton defned n equaton (12). Ths varable assumes a postve sgn for the group of ndvduals who mproved between perod 1 and perod 2 or mantaned the hghest level of atttude n both perods wth no chances for further mprovement. 41

6 Center for Promotng Ideas, USA Note that ths later group conssts of ndvduals wth best atttudes who clearly belong to the most mproved category. They should not therefore be excluded from the sample when the focus of the study, for polcy purposes, s to dentfy the determnants of atttude mprovement. 5 Moreover they consttute a large percentage of the sampled observatons. To avod unnecessary loss of valuable nformaton we retan them n our mproved category even though they dd not really change durng the perod under consderaton. The determnants of atttude mprovement can then be examned by estmatng equaton (13) along wth equaton (14) by smple bnary probt. The atttude mprovement (IMPRVAT) equaton can also be estmated alternatvely by ordered probt by orderng the contnuous ATTCHNG and latent ATTCHNG* varables n the followng manner: (15) IMPRVAT 0, f ATTCHNG 0, or ATTCHNG * 0, 42 IMPRVAT 1, f ( ATTCHNG 0 POSITIVE 2), or 0 ATTCHNG * 1, IMPRVAT 2, f ATTCHNG 0) ( ATTCHNG 0 POSITIVE 3), ( or ATTCHNG *, 1 where 1 s the cut-off pont for dfferent categores of the latent contnuous varable ATTCHNG*. The relevant probabltes for ordered probt estmaton are as follows: (16) Pr ob( IMPRVAT 0 X ) ( ( X ) ), (17) Pr ob( IMPRVAT 1 X ) ( 1 ( X ) ) ( ( X ) ), (18) Pr ob( IMPRVAT 2 X ) 1 ( 1 ( X ) ). To examne whether relgosty affects the changes n atttudes of ndvduals between two tme perods, we used the varable, frequency of relgous attendance avalable n the 1980 survey as the treatment varable because some respondents attended relgous servces durng ths perod (RELGS = 1) and some dd not (RELGS = 0). In a controlled experment n whch ndvduals are randomly assgned to attend relgous servces, there s no sample selecton problem, and consequently a dfference-n-dfference regresson approach can be used to measure the treatment (causal) effect of relgosty on postve atttude. In such a stuaton, we can pool the data from both tme perods and estmate the followng equaton by lnear probablty method: (19) POSITIVEt RELGS PERIOD2t ( RELGS PERIOD2t ) X t t. The estmate of 3 n equaton (19) s the dfference-n-dfference estmate whch measures the treatment effect of relgosty on the ndvdual s atttude. In the absence of a controlled randomzed experment, the estmate of 3 suffers from sample selecton bas, and consequently we follow n ths study an alternatve approach, known as propensty score matchng, to estmate the treatment effect of relgosty on postve atttude (Rosenbaum and Rubn, 1983; Greene, 2012). Under ths approach, the treatment varable (relgosty) s regressed on several ndvdual characterstcs to obtan propensty scores for all ndvduals n the sample durng the treatment perod. These scores are then used to match ndvduals from both treatment and control groups. The average of the dfferences n the outcome varable (atttude) n a later perod between the treatment and control groups provdes an estmate of the desred treatment effect. Let the W be the vector of ndvdual characterstcs n tme perod 1 before the treatment s admnstered. The treatment varable relgosty (R) then s defned as (20) R = 1, f the ndvdual attends relgous servces, = 0, f he/she never attends these servces. Wth ths bnary treatment varable, the propensty score for the th ndvdual s defned as (21) P W ) P( R 1W ) E( R W ). (

7 Internatonal Journal of Busness and Socal Scence Vol. 4 No. 9; August 2013 Snce t s not possble to match ndvduals from both treatment and control groups based on ther numerous ndvdual characterstcs (W ), they are matched by usng ther unque propensty scores P(W ) obtaned from those same characterstcs. We estmate propensty scores by probt, where (22) P( W ) ( W ). Indvduals wth smlar propensty scores P(W ) (wthn small ntervals) are expected to have smlar characterstcs (W ), and consequently we can easly fnd ndvduals wth matchng propensty scores from both treatment and control groups for comparson. Let the outcome varable n the second tme perod for the th ndvdual (postve atttude n 1987 or 2006) be denoted by A. Under ths procedure, for any treated ndvdual wth propensty score P(W ) n tme perod 1 and outcome A n tme perod 2, we locate an ndvdual n the control group wth smlar propensty score P(W c ) and outcome A c. The dfference (A A c ) measures the treatment effect of relgosty on atttude for that partcular ndvdual. The average treatment effect s estmated by obtanng the average over all the matchng pars of ndvduals n the sample. 6 Corrected standard error of ths statstc s then computed to obtan the t-rato whch verfes whether or not the treatment effect of relgosty on atttude s statstcally sgnfcant. It s mportant to note that the use of propensty score matchng technque mplctly assumes the presence of an outcome varable that s contnuous. The outcome varable atttude n our study, however, s ordered categorcal wth four values: 3, 2, 1 and 0. Imposton of contnuty on such a varable unnecessarly assumes constant margnal changes of atttude from one category to the next level. In the absence of a sutable contnuous outcome varable, however, we have no other choce but to treat ths ordered categorcal varable as a contnuous varable. The sze of the treatment effect under ths procedure should not therefore be confused wth the actual magntude of ths effect. Despte ths lmtaton on the sze, our estmates provde useful nformaton on the sgn of the treatment effect because the ordered nature of ths categorcal dependent varable guarantees larger numercal values to be assocated wth better atttude categores. Regardless of ts sze therefore a statstcally sgnfcant and postve average (A A c ) clearly confrms the presence of a postve treatment effect of relgosty on atttude. IV. Data To determne the causes of change n atttudes among US young adults and adults respectvely between 1980 and 1987, and between 1987 and 2006, two separate panels were drawn from these two survey perods of the NLSY79. The panel contans 5,723 ndvduals and the panel has 4,787 observatons. These sampled observatons have responses to all relevant varables n both tme perods under consderaton. Separatng these panels nto ndvdual cross-sectons, we can obtan cross-sectonal estmates of atttude equatons for three dfferent years 1980, 1987 and Before estmatng these equatons, we frst verfed f these new samples (5,723 n and 4,787 n ) obtaned after elmnatng mssng values of the relevant varables contaned the same percentages of observatons n dfferent atttude categores as they were n the orgnal samples (Table1A and Table 1B). Two new 4 4 cross-tables based on these samples are reported n Table 2A and Table 2B. A comparson of respectve percentages n dfferent categores between Table 1 and Table 2 shows that they are very close and consequently our new samples n Table 2 are expected to preserve the characterstcs of the orgnal samples n Table 1. We used two varants of postve atttude (POSITIVE) to estmate our atttude equaton. In the ordered probt estmaton, POSITIVE (= POSORDR) assumes values 3, 2, 1, and 0 wth 3 denotng the strongest response to the postve atttude queston. Although ordered probt s the most approprate method of estmaton for the dependent varable under consderaton, we used smple bnary probt as an alternatve prmarly to check the robustness of our fndngs to dfferent estmaton technques. In the bnary probt estmaton, ths varable (POSITIVE = POSBINR) assumes the value 1 when the respondent strongly agrees that he/she has a postve atttude, that s, when the self-reported ordered categorcal postve atttude varable assumes the value 3, and s zero, otherwse. Ths practce s qute common n the lterature because t mnmzes the possblty of bas n weaker responses generally assocated wth self-reported psychologcal varables. 7 To examne the determnants of postve atttude, we selected a number of human captal, famly related, and demographc varables followng varable specfcatons n several earler studes (Goldsmth et al., 1997; Grove, 2005; Mohanty, 2009a, 2009b). 43

8 Center for Promotng Ideas, USA The human captal varables that are lkely to affect the atttude postvely are years of schoolng (YRSCHL), work experence (EXP) and ntellgence measured by the Armed Force Qualfcaton Test (AFQT) scores. Age (AGE) and health lmtatons (HLTHPROB) may also affect atttude and therefore are ncluded n the set of explanatory varables. The famly-related characterstcs, such as marrage (MARRIED), famly ncome (FAMINC), famly sze (FAMSIZE), and number of chldren (CHLDNM), may affect atttude and therefore are ncluded n ths regresson. To see f current employment status (EMPLOY) and school enrollment status (ENROLL) affect atttude, we nclude these varables n the atttude equaton. 8 Other demographc varables, such as gender (MALE), race (WHITE) and locaton of resdence (URBAN), are ncluded n ths regresson to see f they nfluence atttude. Fnally to see whether relgosty affects atttude, we ncluded n the set of explanatory varables a dummy varable RELGS whch assumes the value 1 f the ndvdual attends some relgous servces, and s 0 f he/she never partcpates n any relgous servce. Ths varable s avalable n the 1980 survey and therefore s ncluded n the 1980 atttude equatons only. To estmate the atttude mprovement equaton, we defne the dependent varable n two dfferent ways. For the bnary probt, the dependent varable IMPROVED s defned as follows. When the varable ATTCHNG = POSITIVE s postve ndcatng mprovement n atttude between 1980 and 1987, and between 1987 and 2006, or when t s zero wth POSITIVE = 3 ndcatng no possblty for further mprovement, the varable IMPROVED assumes the value one and s zero, otherwse. Ths s defned n equatons (11), (12) and (13) whch along wth (14) s estmated by smple bnary probt. Fnally, by assgnng values 0, 1 and 2 to the varable ATTCHNG,, we generate a new ordered categorcal varable IMPRVAT defned n equaton (15) whch along wth (13) s estmated by ordered probt. The ndependent varables n the atttude mprovement equaton essentally are the same as those n the postve atttude equatons, except that they are dfferenced varables. For contnuous varables, they are smply X = X,new X,old. They nclude changes n famly ncome (INCMCHNG), years of schoolng (SCHLCHNG), work experence (EXPCHNG), famly sze (FMSZCHNG) and number of chldren (CHLDCHNG). 9 For dummy ndependent varables, whch reman the same between 1980 and 1987, the dfferences are zeros and therefore they are omtted from the regresson of dfferenced varables. For dummy varables that changed between 1980 and 1987, and between 1987 and 2006, these dfferences are not zero and they ranged between -1 and 1. We created several new dummy varables to control for these changes. For example, an ndvdual who s unemployed n 1980 (or 1987) may be employed n 1987 (or 2006). To capture ths change, we ncluded n the set of explanatory varable a dummy varable NEMP2EMP whch assumes the value 1 when the ndvdual moves from unemployment n 1980 (or 1987) to employment n 1987 (or 2006), and s zero, otherwse. To avod possble collnearty and to focus on the varables that lead to mprovements n atttude, we ncluded one dummy varable only to control for ths change n the employment status. 10 Other dummy varables ncluded n the regresson that control for changes n ndvdual characterstcs between two tme perods under consderaton are no-marrage to marrage (NMAR2MAR), sckness to good health (SCK2HLTH), rural resdence to urban resdence (RRL2URBN), urban resdence to rural resdence (URBN2RRL), and no school attendance to school attendance (NATD2ATD). All these varables are defned n Table 3 whch also reports ther means and standard devatons. V. Determnants of Atttude (Cross-sectonal Analyss) To examne the determnants of atttude, we estmated atttude equatons wth bnary and ordered categorcal dependent varables, respectvely by probt and ordered probt. These estmates from three cross-sectonal samples are presented n Table 4. The margnal effects of dfferent ndependent varables on the lkelhood of beng ncluded n the strongest category of atttude are also reported n ths table. 11 Despte the dfferences n survey years and average ages of respondents n these surveys, a lot of smlartes exst among a number of coeffcents n all sx equatons. For example, famly ncome, as expected, has a postve effect on the ndvdual s atttude regardless of whether the sample s drawn from 1980, 1987 or 2006, and the dependent varable used n the regresson s ordered categorcal or bnary. The human captal varable, years of schoolng, also has a smlar effect on atttude n all three survey years. Indvduals wth more years of schoolng are more lkely to have a postve atttude than those wth less schoolng. Males and non-whtes are more lkely to have postve atttudes than ther otherwse dentcal female and whte counterparts. Interestngly, atttude mproves wth the ncrease n the number of own chldren n all cross-sectonal samples

9 Internatonal Journal of Busness and Socal Scence Vol. 4 No. 9; August 2013 Indvdual s age and work experence seem to have opposte effects on atttude. Although these varables are not statstcally sgnfcant n all equatons of Table 4, they assume dentcal sgns n all of them wth t-ratos hgher than 1, especally n 1980 and 1987 cross-sectonal samples. Note that age has a negatve effect on atttude whereas work experence affects t postvely. Although the reasons are not clear, the later may be attrbuted partly to a feelng of mportance (or hgher self-esteem) resultng from growng responsbltes assocated wth more work experence. Ths s evdent more clearly n the 2006 sample n whch the respondents have the most work experence and the coeffcent of ths varable s hghly sgnfcant. A negatve sgn of the age coeffcent n the 1987 sample, on the other hand, may result from matured young-adults enterng nto dfferent complcated relatonshps as they grow older, such as marrage, chld brth, job search, new jobs etc., that affect ther atttudes adversely. Ths s supported partly by the coeffcent of AGE losng sgnfcance completely n the 2006 sample n whch the respondents are aged between 41 and 48, and therefore are less lkely to enter such relatonshps as they grow older. A negatve and statstcally sgnfcant coeffcent of the famly sze varable n the 1987 sample, but not n 1980 and 2006 samples, partly supports the argument just mentoned n the above paragraph. Matured young adults of the 1987 sample are more lkely to be nvolved n martal relatonshps and chld brth than teenagers and younger young-adults of the 1980 sample and the matured adults of the 2006 sample. Consequently they are more lkely to ncrease ther famly szes compared to those n 1980 and 2006 samples. Negatve sgns and sgnfcant coeffcents of age and famly sze varables n the 1987 sample may therefore be attrbuted partly to hgher lkelhoods of marrage related events assocated wth ths partcular age-group. It s nterestng to note that ncrease n the number of chldren leads to an mprovement n the atttude, whereas a larger famly sze affects t negatvely. An ncrease n the number of chldren by demandng ncreasng responsblty may help the ndvdual develop a better atttude, but ncrease n the sze of the famly beyond a certan pont may be economcally burdensome and hence may affect atttude negatvely. Interestngly, employment, lke work experence, has a postve effect on atttude n the 1987 sample only. For adults of 2006, who may have been employed already for a long tme and may also have workng spouses, and for the teenagers and younger young-adults of 1980, who may not have been ready yet to partcpate fully n the labor market, lack of employment, although not desrable, may not be so devastatng. For the matured young-adults of the 1987 sample, on the other hand, lack of employment may ndcate lack of self-respect because they may already have completed ther schoolng to enter the job market, and consequently falure to fnd jobs may have devastatng effects on ther atttudes. Ths further supports our earler argument that any varable whch augments ones feelng of mportance (or self-esteem) s lkely to mprove hs/her atttude. There are several other varables whose coeffcents dffer n sgns and sgnfcance levels between the samples. Interestngly, the ndvdual s ntellgence (AFQT) affects hs/her atttude postvely when he/she s young (1980 and 1987 samples) and has no effect when he/she s older (2006 sample). Although the reason s not clear, t may be attrbuted partly to the possblty of greater accomplshments, an ndcator of self-esteem, resultng from hgher ntellgence when the ndvdual s young. For a matured adult, who may have already reached a hgher rung of hs/her job ladder, the chances of addng further accomplshments through hgher ntellgence s qute slm and consequently the coeffcent of AFQT does not assume a desred level of sgnfcance. Ths argument s clearly supported by larger margnal effects of ths varable n 1980 and 1987 samples compared to those n the 2006 sample. The above accomplshment argument s supported further by the varable ENROLL assumng a postve and sgnfcant coeffcent n the 2006 sample only. Acqurng addtonal schoolng after leavng schools for a long tme may be one of the most effectve ways by whch matured adults can enhance ther future accomplshments and self esteem, and hence school attendance, and not merely ntellgence, mproves ther atttude. For matured young adults of 1987, on the other hand, school attendance may not necessarly add to ther self esteem because they may just have completed ther desred levels of schoolng to enter the job market. For the teenagers and younger young adults of the 1980 sample, who may stll be contnung wth ther normal schoolng, attendng school s not a real accomplshment and consequently the coeffcent of ths varable, although postve, does not assume a desred level of statstcal sgnfcance. 45

10 Center for Promotng Ideas, USA Note that lvng n an urban area mproves the ndvdual s atttude n 1980 and 1987 samples whch may partly be attrbuted to better opportuntes for advancement, employment, entertanment etc. avalable n urban locatons than n rural areas. Ths varable, however, s not sgnfcant n the 2006 sample. Ths s not surprsng because after beng acclmatzed to ther respectve locatons of resdence for a relatvely longer tme perod, regardless of whether they belong to urban areas or rural areas, these matured adults may not have a stronger urge to relocate, and hence locaton of resdence s not as mportant for them as t s for young-adults who may stll be lookng for jobs and deal neghborhoods for resdence. As expected, presence of health problems adversely affects the atttudes of matured adults and not of the youngadults. Relatvely older people n the 2006 sample are more susceptble to physcal alments than the young-adults of 1980 and 1987 samples, and consequently health problems do not have a sgnfcant effect on the atttudes of the younger group. Ths s evdent from lower percentages of respondents havng some health lmtatons n the 1980 and 1987 samples than n the 2006 sample (Table 3). Moreover, young-adults, due to ther younger ages, may be able to overcome health lmtatons wth less dffculty than matured adults, and consequently ths varable does not affect ther atttudes sgnfcantly. Surprsngly, the varable MARRIED does not attan a desred level of statstcal sgnfcance n any sample. Note that marrage may be assocated wth ncreasng happness (Mohanty, 2009b), but t may also brng along wth t other constrants on ndependent decson makng whch n turn may have adverse effects on ones atttude. Fnally, relgosty as expected has a postve effect on atttude n the 1980 sample, the only sample n whch t s avalable, but s not statstcally sgnfcant at a desred level. 13 The cross-sectonal fndngs dscussed n ths secton lead to three mportant conclusons. Frst, any varable that makes an ndvdual feel mportant mproves hs/her atttude regardless of whether he/she s an adult or a youngadult. Ths may be the reason why the varables, such as hgher famly ncome, more years of schoolng, greater work experence, current employment, havng more chldren (prde of parenthood) and beng a male, whch are expected to augment ones self-esteem, have postve effects on atttude. Second, the determnants of atttude for matured adults are somewhat dfferent from those of young-adults. In other words, atttude depends to some extent on the ndvdual s age. Fnally, the bnary probt estmates of varable coeffcents are very smlar to the ordered probt estmates of these coeffcents n terms of ther sgns and sgnfcance levels. Ths clearly ndcates that the bnary postve atttude varable whch s generated by usng the strongest response to the postve atttude queston does n fact contan a large percentage of vald nformaton on the ndvdual s true atttude. Ths may be the reason why numerous past researchers examnng determnants of dfferent psychologcal captal varables used approprate bnary varables as ther dependent varables. The smple probt estmates thus provde an deal alternatve to the ordered probt results and mprove the robustness of our fndngs. In the remander of ths study therefore we present both sets of estmates for dfferent equatons under consderaton. VI. Determnants of Atttude Improvement (Panel Data Analyss) To examne the factors that determne changes n atttude over tme, we consder two panels and ntroduced earler and estmate relevant atttude mprovement equatons (equaton 13) from both perods separately. Before estmatng these equatons, however, we estmate frst the atttude equatons ntroduced n the last secton from these two panels by random effect method. These estmates are known to control for the ndvdual-specfc unobserved heterogenetes and thus are more meanngful than the cross-sectonal estmates. For comparson purposes, we obtan two sets of estmates ordered probt and smple probt from each panel under consderaton, and they are reported n Table 5. Lke the cross-sectonal estmates n Table 4, the random effect estmates n Table 5 suggest that hgher famly ncome, more years of schoolng, and longer work experence mprove the ndvdual s atttude, whereas ncreases n famly sze and age have negatve effects on ths varable. Males and non-whtes are more lkely to have postve atttudes than females and whtes. Unlke cross-sectonal estmates, however, random effect coeffcent estmates of ntellgence (AFQT), employment status and urban resdence emerge sgnfcant n all equatons and have postve sgns. Interestngly, marrage mproves the ndvdual s atttude n the panel and not n the panel. Note that several wdely known determnants of atttude, such as ntellgence, employment and marrage, whch are not statstcally sgnfcant n all equatons of Table 4, assume desred levels of sgnfcance n Table 5, ndcatng superorty of random effect approach over cross-sectonal estmates. Interestngly, these random effect results provde strong support to our earler concluson that any varable whch enhances an ndvdual s self-esteem (or the feelng of mportance) s lkely to mprove hs/her atttude

11 Internatonal Journal of Busness and Socal Scence Vol. 4 No. 9; August 2013 To examne the factors responsble for mprovement n atttude n the second perod compared to the frst perod, we estmated the frst-dfferenced atttude mprovement equatons (equaton 13) by probt usng the specfcaton n equaton (11) and by ordered probt usng the specfcaton n equaton (15). 15 These results are reported n Table 6 whch also shows the margnal effects of all the ndependent varables. Note that the margnal effect n ths case measures the change n the probablty of mprovng or remanng at the hghest level of atttude (POSITIVE = 3) when the change n a dfferenced ndependent varable rses by a unt. The margnal effects of dummy ndependent varables on the dependent varable are nterpreted accordngly. It s nterestng to note that both bnary probt and ordered probt yeld very smlar estmates n the same panel. However, these estmates dffer sgnfcantly between the two panels. For example, an ncrease n the famly ncome has a sgnfcant postve effect on atttude n both panels, but ts margnal effects are sgnfcantly dfferent. A ten thousand dollar rse n famly ncome s lkely to ncrease the atttude mprovement probablty by 1.2 percentage ponts (ordered probt) or 1.4 percentage ponts (smple probt) n the sample, whereas t ncreases ths probablty merely by 0.2 percentage ponts (ordered probt) or 0.3 percentage ponts (smple probt) n the sample. Snce famly ncome s a sgnfcant determnant of postve atttude and snce average ncome ncreased between 1980 and 1987, and between 1987 and 2006 by sgnfcant amounts, the mprovement n atttude durng these perods may be attrbuted largely to changes n ncome. The dfferences n margnal effects of ths varable between the two panels, however, s not surprsng because a gven ncrease n ncome between 1980 and 1987, when the respondent s famly ncome s low, clearly has greater utlty than an equal ncrease n ncome between 1987 and 2006, when hs/her ncome s much hgher. 16 Another factor that contrbuted to the mprovement n atttude between 1980 and 1987, but not between 1987 and 2006, s the ncrease n the years of schoolng. Note that the average schoolng of respondents ncreased by approxmately 1.75 years between 1980 and Snce schoolng, as demonstrated earler n the last secton, has a sgnfcant postve effect on atttude, ncreased schoolng n 1987 led to a sgnfcant rse n the atttude mprovement probablty. In fact, the margnal effects reported n Table 6 suggest that an ncrease n schoolng by a year enhances the probablty of atttude mprovement by 1.59 percentage ponts (ordered probt) or 2.23 percentage ponts (probt) durng ths perod. Between 1987 and 2006, on the other hand, the average years of schoolng rose by 0.6 years only, whch s too small a change to produce any sgnfcant effect on atttude. Note that more schoolng endows an ndvdual wth a larger stock of human captal whch enhances hs/her selfesteem, leadng to better atttude. The role of educaton n the mprovement of ndvdual s atttude therefore can hardly be gnored. Other two mportant varables, partly related to each other, that have sgnfcant postve effects on the atttude mprovement probablty are the ncrease n work experence n both panels and movement from an unemployment status n the frst perod to an employment status n the second perod n the panel only. Note that experence and employment status, as demonstrated n the last secton, have postve effects on atttude, and consequently an ncrease n work experence and a movement from unemployment to employment are lkely to nfluence the atttude mprovement probablty postvely. Interestngly, however, changes n experence affect mprovements n atttudes of both young-adults and matured adults, whereas change n employment status affects the atttude of young adults only. Ths s not surprsng because ncrease n experence, whch may also be assocated wth promoton and ndependent decson-makng, endows a worker wth more autonomy and hgher self-esteem regardless of whether he/she s younger or older. Consequently, t mproves ther atttudes n both panels. Transton from non-employment to employment, although mportant for everyone s self-esteem, s more urgent for the young-adults of 1987 because they not only are ready to partcpate fully n the labor market after the completon of ther desred levels of schoolng, but also have the most pressng need to support themselves fnancally. Consequently ths varable assumes a desred level of sgnfcance n the panel only. In fact, the transton from unemployment n 1980 to employment n 1987 enhances the atttude mprovement probablty by approxmately 4 percentage ponts n the ordered probt estmaton n whch t s statstcally sgnfcant. Postve sgns for coeffcents of both these varables support our earler argument that any varable that enhances the ndvdual s feelng of mportance (or self-esteem) s lkely to augment hs/her atttude mprovement probablty. 47

12 Center for Promotng Ideas, USA Another varable that assumes a negatve coeffcent and s sgnfcant n most of the equatons s the change n famly szes. Ths s n lne wth our fndng n the last secton whch suggests that ncrease n the famly sze by reducng the physcal amentes per capta may have an adverse effect on an ndvdual s atttude. Ths argument s supported ndrectly by the evdence that hgher famly ncome mproves atttude. Two other varables that are sgnfcant only n the panel and not n the panel have nterestng mplcatons. Frst, movement from urban resdence n 1987 to rural resdence n 2006 has a negatve effect on atttude whch may partly be attrbuted to lack of opportuntes for employment, entertanment, professonal growth etc. n rural areas compared to those n urban locatons. Second, gong back to school n 2006 as matured adults after leavng school before 1987 clearly ndcates that these adults are serous about schoolng whch may be for the purpose of ganng promoton n ther current jobs or may be due to a sncere desre to learn. In ether case, t shows a hgher level of motvaton to do somethng worthwhle and thus t mproves ther atttudes. For respondents n 1987, who are almost ready to leave school for enterng the job market, gong back to school may partly be due to lack of productve employment opportuntes n the market, and consequently t does not have a sgnfcant effect on ther atttudes. All these longtudnal results support our cross-sectonal fndng from the last secton that the determnants of atttude dffer to some extent between matured adults and young-adults. However, there are some common determnants that affect both young-adults and matured adults alke. Our results n ths secton further confrm that any varable whch makes an ndvdual feel more mportant s lkely to mprove hs/her atttude. Hgher ncome, more schoolng, greater work experence and employment are such varables and therefore they help n mprovng the worker s atttude. Clearly, these varables changed for the better for a large percentage of respondents between the frst and second perods n both panels, and consequently ther atttudes mproved. These fndngs have mportant polcy mplcatons. They suggest that any polcy desgned to augment an ndvdual s years of schoolng, work experence, ncome and employment probablty s lkely to boost up hs/her self-esteem leadng to mprovement n atttude. Snce mproved atttude has already been shown to be assocated wth better economc performance (Goldsmth et al., 1997; Groves, 2005; Waddell, 2006; Mohanty, 2009a, 2012), polces to augment workers human captal endowments have the potental to mprove ther economc well-beng not only drectly, but also ndrectly through mprovements n ther atttudes. For polcy purposes therefore we recommend ncreased nvestment n human captal n the form of more schoolng and approprate workplace tranng to promote the ndvdual s atttude and economc performance. VII. Effects of Relgosty on Atttude It s nterestng to note from the last secton that tradtonal educaton measured by the years of schoolng has sgnfcant postve effect on the ndvdual s atttude. Recently, several studes, as ponted out earler, have recommended supplementng ths tradtonal schoolng wth tranng n behavoral sklls to mprove the atttude and other personalty trats of the worker (Groves, 2005; Borghans et al, 2008; Mohanty, 2009a, 2010). Snce relgosty of an ndvdual s tradtonally beleved to have a postve educatonal effect on hs/her personalty, t s qute temptng to dentfy relgous attendance wth some sort of behavoral tranng, and test whether or not relgosty affects atttude. Wth the growng popularty of economcs of relgon n the recent years after the semnal work of Azz and Ehrenberg (1975), such an nqury seems reasonable (Iannaccone, 1998). Snce our data set contans a varable, frequency of relgous attendance (RELGS), n ts 1980 survey, measurement of the treatment effect of relgosty on atttude n a future year (1987 or 2006) s qute straght forward. Note that the coeffcents of RELGS n both 1980 equatons of Table 4 are postve wth t-statstcs larger than 1, and consequently t s worth conductng ths experment to fnd out whether or not relgosty has a causal effect on atttude. We follow the propensty score matchng technque outlned n Secton 3 to examne the presence of ths effect. To estmate the propensty score P( W ) P( R 1W ) ( W ) defned n equatons (21) and (22), we estmated frst the relgous attendance equaton n the frst perod by probt. These results for , and samples are reported n Table The explanatory varables n the relgosty equaton used to obtan propensty scores for all observatons n the sample are the ndvdual s age (AGE, AGESQ), years of schoolng (YRSCHL), nnate abltes (AFQT), school enrollment status (ENROLL), famly ncome (FAMINC), famly sze (FAMSIZE), gender (MALE), race (WHITE), martal status (MARRIED), employment status (EMPLOY) and locaton of resdence (URBAN). 48