What Makes a Rule Complex?

By Ryan Oprea

American Economic Review, December 2020

We study the complexity of rules by paying experimental subjects to implement a series of algorithms and then eliciting their willingness-to-pay to avoid implementing them again in the future. The design allows us to examine hypotheses from the theoretica...

Invisible Geniuses: Could the Knowledge Frontier Advance Faster?

By Ruchir Agarwal and Patrick Gaule

American Economic Review: Insights, December 2020

A better understanding of the determinants of idea/knowledge production remains critical for long-run growth. Toward this end, this paper establishes two results using data from the International Mathematical Olympiad (IMO). First, individuals who excelle...

Using Models to Persuade

By Joshua Schwartzstein and Adi Sunderam

American Economic Review, January 2021

We present a framework where "model persuaders" influence receivers' beliefs by proposing models that organize past data to make predictions. Receivers are assumed to find models more compelling when they better explain the data, fixing receivers' prior b...

Job Seekers' Perceptions and Employment Prospects: Heterogeneity, Duration Dependence, and Bias

By Andreas I. Mueller, Johannes Spinnewijn, and Giorgio Topa

American Economic Review, January 2021

This paper uses job seekers' elicited beliefs about job finding to disentangle the sources of the decline in job-finding rates by duration of unemployment. We document that beliefs have strong predictive power for job finding, but are not revised downward...

Are We Approaching an Economic Singularity? Information Technology and the Future of Economic Growth

By William D. Nordhaus

American Economic Journal: Macroeconomics, January 2021

What are the prospects for long-run economic growth? One prominent line of economic thinking is the trend toward stagnation. Stagnationism has a long history in economics, beginning prominently with Malthus and occasionally surfacing in different guises. ...

What Makes a Rule Complex? Erratum

By Ryan Oprea

American Economic Review, February 2021

Strategic Experimentation with Congestion

By Caroline D. Thomas

American Economic Journal: Microeconomics, February 2021

This paper considers a two-player game of strategic experimentation with competition. Each agent faces a two-armed bandit problem where she continually chooses between her private, risky arm and a common, safe arm. Each agent has exclusive access to her p...

Sequential Preference Revelation in Incomplete Information Settings

By James Schummer and Rodrigo A. Velez

American Economic Journal: Microeconomics, February 2021

Strategy-proof allocation rules incentivize truthfulness in simultaneous move games, but real world mechanisms sometimes elicit preferences sequentially. Surprisingly, even when the underlying rule is strategy-proof and nonbossy, sequential elicitation ca...

Dynamic Persuasion with Outside Information

By Jacopo Bizzotto, Jesper Rüdiger, and Adrien Vigier

American Economic Journal: Microeconomics, February 2021

A principal seeks to persuade an agent to accept an offer of uncertain value before a deadline expires. The principal can generate information, but exerts no control over exogenous outside information. The combined effect of the deadline and outside infor...

Prediction: The Long and the Short of It

By Antony Millner and Daniel Heyen

American Economic Journal: Microeconomics, February 2021

Commentators often lament forecasters' inability to provide precise predictions of the long-run behavior of complex economic and physical systems. Yet their concerns often conflate the presence of substantial long-run uncertainty with the need for long-ru...

Influence and Information in Team Decisions: Evidence from Medical Residency

By David C. Chan

American Economic Journal: Economic Policy, February 2021

I study team decisions among physician trainees. Exploiting a discontinuity in team roles across trainee tenure, I find evidence that teams alter decision-making, concentrating influence in the hands of senior trainees. I also demonstrate little convergen...

Information Design and Strategic Communication

By Daniel Krähmer

American Economic Review: Insights, March 2021

I study sender-receiver games where the receiver can disclose information to the sender by designing an information structure. I show that by secretly randomizing over information structures, the receiver can virtually attain her complete information payo...

Internal Deadlines, Drug Approvals, and Safety Problems

By Lauren Cohen, Umit G. Gurun, and Danielle Li

American Economic Review: Insights, March 2021

Absent explicit quotas, incentives, reporting, or fiscal year-end motives, drug approvals around the world surge in December, at month-ends, and before respective major national holidays. Drugs approved before these informal deadlines are associated with ...

Directed Search and Competitive Search Equilibrium: A Guided Tour

By Randall Wright, Philipp Kircher, Benoît Julien, and Veronica Guerrieri

Journal of Economic Literature, March 2021

This essay surveys the literature on directed search and competitive search equilibrium, covering theory and a variety of applications. These models share features with traditional search theory, but also differ in important ways. They share features with...

Consumer Confidence and Consumer Spending

[Symposium: Consumer Confidence]

By Sydney C. Ludvigson

Journal of Economic Perspectives, Spring 2004

Despite the widespread attention given to surveys of consumer confidence, the mechanisms by which household attitudes influence the real economy are less well understood. This paper begins with an overview of how consumer confidence is measured and report...

Myopia and Anchoring

By George-Marios Angeletos and Zhen Huo

American Economic Review, April 2021

We develop an equivalence between the equilibrium effects of incomplete information and those of two behavioral distortions: myopia, or extra discounting of the future; and anchoring of current behavior to past behavior, as in models with habit persistenc...

Making a Name: Women's Surnames at Marriage and Beyond

By Claudia Goldin and Maria Shim

Journal of Economic Perspectives, Spring 2004

This paper tracks the fraction of college graduate women who kept their surnames upon marriage and after childbirth and explores some of the correlates of surname retention. Data from the New York Times, Harvard College alumni books, and Massachusetts bir...

When Does Regulation Distort Costs? Lessons from Fuel Procurement in US Electricity Generation: Comment

By Jin Soo Han, Jean-François Houde, Arthur A. van Benthem, and Jose Miguel Abito

American Economic Review, April 2021

We revisit one of the results in Cicala (2015) and show that the previously estimated large and significant effects of US electricity restructuring on fuel procurement are not robust to the presence of outliers. Using methodologies from the robust statist...

Fees, Reputation, and Information Production in the Credit Rating Industry

By Jacopo Bizzotto and Adrien Vigier

American Economic Journal: Microeconomics, May 2021

We compare a credit rating agency's incentives to acquire costly information when it is only paid for giving favorable ratings to the corresponding incentives when the agency is paid up-front, i.e., irrespective of the ratings assigned. We show that, in t...

Exit, Tweets, and Loyalty

By Joshua S. Gans, Avi Goldfarb, and Mara Lederman

American Economic Journal: Microeconomics, May 2021

Hirschman's Exit, Voice, and Loyalty highlights the role of "voice" when individuals confront an unexpected deterioration in quality. Yet, voice has received little attention. To motivate our empirical analysis, we develop a simple model of voice...