The Welfare Cost of Perceived Policy Uncertainty: Evidence from Social Security

By Erzo F. P. Luttmer and Andrew A. Samwick

American Economic Review, February 2018

Policy uncertainty reduces individual welfare when individuals have limited opportunities to mitigate or insure against the resulting consumption fluctuations. We field an original survey to measure the degree of perceived policy uncertainty in Social Sec...

The Economic Consequences of Hospital Admissions

By Carlos Dobkin, Amy Finkelstein, Raymond Kluender, and Matthew J. Notowidigdo

American Economic Review, February 2018

We use an event study approach to examine the economic consequences of hospital admissions for adults in two datasets: survey data from the Health and Retirement Study, and hospitalization data linked to credit reports. For non-elderly adults with health ...

The Economic Implications of Housing Supply

[Symposium: Housing]

By Edward Glaeser and Joseph Gyourko

Journal of Economic Perspectives, Winter 2018

In this essay, we review the basic economics of housing supply and the functioning of US housing markets to better understand the distribution of home prices, household wealth, and the spatial distribution of people across markets. We employ a cost-base...

Homeownership and the American Dream

[Symposium: Housing]

By Laurie S. Goodman and Christopher Mayer

Journal of Economic Perspectives, Winter 2018

For decades, it was taken as a given that an increased homeownership rate was a desirable goal. But after the financial crises and Great Recession, in which roughly eight million homes were foreclosed on and about $7 trillion in home equity was erased, ...

Do Physicians Respond to the Costs and Cost-Sensitivity of Their Patients?

By Mariana Carrera, Dana P. Goldman, Geoffrey Joyce, and Neeraj Sood

American Economic Journal: Economic Policy, February 2018

We use individual level data on purchases of cholesterol-lowering drugs to study the responses of physicians and patients to variation in the cost of drugs. In a sample of first-time statin prescriptions to employees from 12 Fortune 500 firms, we find tha...

How Does Household Income Affect Child Personality Traits and Behaviors?

By Randall Akee, William Copeland, E. Jane Costello, and Emilia Simeonova

American Economic Review, March 2018

We examine the effects of a quasi-experimental unconditional household income transfer on child emotional and behavioral health and personality traits. Using longitudinal data, we find that there are large beneficial effects on children's emotional and be...

Borrowing Trouble? Human Capital Investment with Opt-In Costs and Implications for the Effectiveness of Grant Aid

By Benjamin M. Marx and Lesley J. Turner

American Economic Journal: Applied Economics, April 2018

We estimate the effect of grant aid on City University of New York (CUNY) students' borrowing and attainment using a regression discontinuity/kink design based on the federal Pell Grant formula. Each dollar of grant aid reduces loans by $1.80 among borrow...

The Economic Impact of Hurricane Katrina on Its Victims: Evidence from Individual Tax Returns

By Tatyana Deryugina, Laura Kawano, and Steven Levitt

American Economic Journal: Applied Economics, April 2018

Hurricane Katrina destroyed over 200,000 homes and led to massive economic and physical dislocation. Using a panel of tax return data, we provide one of the first comprehensive analyses of the hurricane's long-term economic impact on its victims. Hurrican...

Banking the Unbanked? Evidence from Three Countries

By Pascaline Dupas, Dean Karlan, Jonathan Robinson, and Diego Ubfal

American Economic Journal: Applied Economics, April 2018

We experimentally test the impact of expanding access to basic bank accounts in Uganda, Malawi, and Chile. Over two years, 17, 10, and 3 percent of treatment individuals made five or more deposits, respectively. Average monthly deposits in treatment accou...

Labor Market Uncertainty and Portfolio Choice Puzzles

By Yongsung Chang, Jay H. Hong, and Marios Karabarbounis

American Economic Journal: Macroeconomics, April 2018

The standard life-cycle models of household portfolio choice have difficulty generating a realistic age profile of risky share. These models not only imply a high risky share on average but also a steeply decreasing age profile, whereas the risky share is...

Cash-on-Hand and College Enrollment: Evidence from Population Tax Data and the Earned Income Tax Credit

By Day Manoli and Nicholas Turner

American Economic Journal: Economic Policy, May 2018

We estimate causal effects of cash-on-hand on college enrollment decisions of students from low-income families. Using population-level, administrative data from US income tax returns, we exploit variation in tax refunds received in the spring of the high...

Estimating Economic Characteristics with Phone Data

By Joshua E. Blumenstock

AEA Papers and Proceedings, May 2018

Historically, economists have relied heavily on survey-based data collection to measure social and economic well-being. Here, we investigate the extent to which the "digital footprints" of an individual can be used to infer his or her socioeconomic charac...

Can Information Change Personal Retirement Savings? Evidence from Social Security Benefits Statement Mailings

By Susan Payne Carter and William Skimmyhorn

AEA Papers and Proceedings, May 2018

Despite concern about the viability of public retirement programs and potential undersaving for retirement, we still know little about the impact of government provided information on individual behavior. We exploit plausibly exogenous variation in exposu...

When Nudges Are Forever: Inertia in the Swedish Premium Pension Plan

By Henrik Cronqvist, Richard H. Thaler, and Frank Yu

AEA Papers and Proceedings, May 2018

To inform economists and policymakers about whether the effects of nudges are persistent in one specific context, we study the choice architecture of the Swedish Premium Pension Plan. The data we study consist of all initial choices and subsequent rebalan...

Cross-Country Differences in Household Stock Market Participation: The Role of Gender Norms

By Da Ke

AEA Papers and Proceedings, May 2018

What explains substantial variation across countries in household stock market participation? Building on Ke (2018), I hypothesize that the prevailing gender norm in a country is an important cultural factor. In a cross-country analysis, I find that house...

Time and Money: Social Security Benefits and Intergenerational Transfers

By Anita Mukherjee

AEA Papers and Proceedings, May 2018

I examine the relationship between Social Security benefits, a major component of income in older age, and intergenerational transfers of financial help and caregiving. I find that the net pass-through rate of Social Security benefits from parents to chil...

In Debt and Approaching Retirement: Claim Social Security or Work Longer?

By Barbara A. Butrica and Nadia S. Karamcheva

AEA Papers and Proceedings, May 2018

Over the past couple of decades, older Americans have become considerably more leveraged. This paper considers whether household debt affects the timing of retirement and Social Security benefit claiming. Using data from the Health and Retirement Study, w...

The Changing Face of Debt and Financial Fragility at Older Ages

By Annamaria Lusardi, Olivia S. Mitchell, and Noemi Oggero

AEA Papers and Proceedings, May 2018

We investigate changes in older individuals' financial fragility as they stand on the verge of retirement. Using data from the Health and Retirement Study (HRS), we compare how debt has changed for successive cohorts of people age 56–61. Our analysis sh...

Salary Delays and Overdrafts in Rural Ghana

By Niklas Buehren, Virginia Ceretti, Ervin Dervisevic, Markus Goldstein, Leora Klapper, Tricia Koroknay-Palicz, and Simone Schaner

AEA Papers and Proceedings, May 2018

Checking overdrafts are an expensive yet common way for bank account holders to obtain short-term credit when faced with unexpected shocks. In developing countries, one common shock that many salaried workers face is late or erratic payment from their emp...

Wealth Redistribution after Exchange Rate Devaluations

By Andres Drenik, Gustavo Pereira, and Diego J. Perez

AEA Papers and Proceedings, May 2018

We document that the likelihood of having assets in foreign currency is increasing in households' income within many emerging economies. This pattern leads to heterogeneous exposures of wealth to exchange rate movements. We analyze the redistribution of l...