Appliance Ownership and Aspirations among Electric Grid and Home Solar Households in Rural Kenya

By Kenneth Lee, Edward Miguel, and Catherine Wolfram

American Economic Review, May 2016

In Sub-Saharan Africa, there are active debates about whether increases in energy access should be driven by investments in electric grid infrastructure or small-scale "home solar" systems (e.g., solar lanterns and solar home systems). We summarize the re...

Popular Attitudes toward Markets and Democracy: Russia and United States Compared 25 Years Later

By Maxim Boycko and Robert J. Shiller

American Economic Review, May 2016

We repeat a survey we did in the waning days of the Soviet Union (Shiller, Boycko and Korobov, AER 1991) comparing attitudes towards free markets between Moscow and New York. Additional survey questions, from Gibson Duch and Tedin (J. Politics 1992) are a...

Measuring and Understanding Behavior, Welfare, and Poverty

By Angus Deaton

American Economic Review, June 2016

The Demand for Energy-Using Assets among the World's Rising Middle Classes

By Paul J. Gertler, Orie Shelef, Catherine D. Wolfram, and Alan Fuchs

American Economic Review, June 2016

We study household decisions to acquire energy-using assets in the presence of rising incomes. We develop a theoretical framework to characterize the effect of income growth on asset purchases when consumers face credit constraints. We use large and plaus...

Measuring Discounting without Measuring Utility

By Arthur E. Attema, Han Bleichrodt, Yu Gao, Zhenxing Huang, and Peter P. Wakker

American Economic Review, June 2016

We introduce a new method to measure the temporal discounting of money. Unlike preceding methods, our method requires neither knowledge nor measurement of utility. It is easier to implement, clearer to subjects, and requires fewer measurements than existi...

Marijuana on Main Street? Estimating Demand in Markets with Limited Access

By Liana Jacobi and Michelle Sovinsky

American Economic Review, August 2016

Marijuana is the most common illicit drug with vocal advocates for legalization. Among other things, legalization would increase access and remove the stigma of illegality. Our model disentangles the role of access from preferences and shows that selectio...

Capital Taxation under Political Constraints

By Florian Scheuer and Alexander Wolitzky

American Economic Review, August 2016

This paper studies optimal dynamic tax policy under the threat of political reform. A policy will be reformed ex post if a large enough coalition of citizens supports reform; thus, sustainable policies are those that will continue to attract enough politi...

The Mechanics of Motivated Reasoning

[Symposium: Motivated Beliefs]

By Nicholas Epley and Thomas Gilovich

Journal of Economic Perspectives, Summer 2016

Whenever we see voters explain away their preferred candidate's weaknesses, dieters assert that a couple scoops of ice cream won't really hurt their weight loss goals, or parents maintain that their children are unusually gifted, we are reminded that peop...

Mindful Economics: The Production, Consumption, and Value of Beliefs

[Symposium: Motivated Beliefs]

By Roland Bénabou and Jean Tirole

Journal of Economic Perspectives, Summer 2016

In this paper, we provide a perspective into the main ideas and findings emerging from the growing literature on motivated beliefs and reasoning. This perspective emphasizes that beliefs often fulfill important psychological and functional needs of the in...

The Preference for Belief Consonance

[Symposium: Motivated Beliefs]

By Russell Golman, George Loewenstein, Karl Ove Moene, and Luca Zarri

Journal of Economic Perspectives, Summer 2016

We consider the determinants and consequences of a source of utility that has received limited attention from economists: people's desire for the beliefs of other people to align with their own. We relate this 'preference for belief consonance' to a varie...

Motivated Bayesians: Feeling Moral While Acting Egoistically

[Symposium: Motivated Beliefs]

By Francesca Gino, Michael I. Norton, and Roberto A. Weber

Journal of Economic Perspectives, Summer 2016

Research yields ample evidence that individual's behavior often reflects an apparent concern for moral considerations. A natural way to interpret evidence of such motives using an economic framework is to add an argument to the utility function such that ...

Long-Run Risk Is the Worst-Case Scenario

By Rhys Bidder and Ian Dew-Becker

American Economic Review, September 2016

We study an investor who is unsure of the dynamics of the economy. Not only are parameters unknown, but the investor does not even know what order model to estimate. She estimates her consumption process nonparametrically--allowing potentially infinite-or...

Free to Choose? Reform, Choice, and Consideration Sets in the English National Health Service

By Martin Gaynor, Carol Propper, and Stephan Seiler

American Economic Review, November 2016

Choice in public services is controversial. We exploit a reform in the English National Health Service to assess the effect of removing constraints on patient choice. We estimate a demand model that explicitly captures the removal of the choice constraint...

Do Consumers Exploit Commitment Opportunities? Evidence from Natural Experiments Involving Liquor Consumption

By B. Douglas Bernheim, Jonathan Meer, and Neva K. Novarro

American Economic Journal: Economic Policy, November 2016

This paper provides evidence concerning the extent to which consumers of liquor employ commitment devices. One widely recommended commitment strategy is to regulate alcohol consumption by deliberately manipulating availability. The paper assesses the prev...

The Effects of Tobacco Control Policies on Tobacco Products, Tar, and Nicotine Purchases among Adults: Evidence from Household Panel Data

By Chad Cotti, Erik Nesson, and Nathan Tefft

American Economic Journal: Economic Policy, November 2016

We analyze the Nielsen Household Consumer Panel to estimate the effects of tobacco policies on tobacco-related purchases using within-household variation. We also match purchases to cigarette contents from NHANES. Higher cigarette taxes reduce cigarette p...

Workers' Spending Response to the 2011 Payroll Tax Cuts

By Grant Graziani, Wilbert van der Klaauw, and Basit Zafar

American Economic Journal: Economic Policy, November 2016

This paper investigates workers' spending response to the 2011 payroll tax cuts. Respondents were surveyed at the beginning and end of 2011, which allows the comparison of ex ante and ex post reported use of the extra income. While workers on average inte...