Modeling the Transition to a New Economy: Lessons from Two Technological Revolutions

By Andrew Atkeson and Patrick J. Kehoe

American Economic Review, March 2007

Many view the period after the Second Industrial Revolution as a paradigm of a transition to a new economy following a technological revolution, including the Information Technology Revolution. We build a quantitative model of diffusion and growth duri...

Oligopsony and Monopsonistic Competition in Labor Markets

By V. Bhaskar, Alan Manning, and Ted To

Journal of Economic Perspectives, Spring 2002

We argue that models of oligopsony or monopsonistic competition provide insights and explanation for many empirical phenomena in labor markets. Using a simple model with job differentiation and preference heterogeneity, we illustrate how such models can b...

Income and Substitution Effects of Estate Taxation

By James R. Hines Jr.

American Economic Review, May 2013

This paper evaluates the effect of estate taxes on labor supply. The analysis decomposes the effect of estate taxation into the substitution effect of relative price changes and the two income effects for which the estate tax is responsible. These two inc...

Saving and Growth with Habit Formation

By Christopher D. Carroll, Jody Overland, and David N. Weil

American Economic Review, June 2000

Saving and growth are strongly positively correlated across countries. Recent empirical evidence suggests that this correlation holds largely because high growth leads to high saving, not the other way around. This evidence is difficult to reconcile with ...

The Dynamic Free Rider Problem: A Laboratory Study

By Marco Battaglini, Salvatore Nunnari, and Thomas R. Palfrey

American Economic Journal: Microeconomics, November 2016

We report the results of an experiment that investigates free riding in the accumulation of durable public goods. We consider economies with reversibility, where contributions can be positive or negative; and economies with irreversibility, where contribu...

On the Possibility of Credit Rationing in the Stiglitz-Weiss Model

By Lutz G. Arnold and John G. Riley

American Economic Review, December 2009

Contrary to what is usually assumed, the expected revenue for lenders as a function of the loan rate cannot be globally hump-shaped in the Stiglitz-Weiss (1981) adverse selection model with a continuum of types. This has important implications. First, ...

The Economist's Lament: Public Assistance in America

[Symposium: Welfare and Workfare]

By Gary Burtless

Journal of Economic Perspectives, Winter 1990

This survey will provide a brief summary of the main features of the U.S. welfare system together with an assessment of some major criticisms of it. I will discuss major reforms proposed by economists and consider some recent evidence about the behavioral...

Saving Soviet Science: The Impact of Grants When Government R&D Funding Disappears

By Ina Ganguli

American Economic Journal: Applied Economics, April 2017

I estimate the impact of a historic grant program, funded by George Soros, that provided grants to over 28,000 Soviet scientists shortly after the end of the USSR. Exploiting a discontinuity in the grant eligibility formula, I show that the grants more th...

Shadowy Banks and Financial Contagion during the Great Depression: A Retrospective on Friedman and Schwartz

By Kris James Mitchener and Gary Richardson

American Economic Review, May 2013

This essay assesses whether network linkages within the banking system amplified the real effects of bank failures during the Great Contraction. In 1929, nearly all interbank deposits held by Federal Reserve member banks belonged to "shadowy" nonmember ba...

What Is Meant by "Replication" and Why Does It Encounter Resistance in Economics?

By Maren Duvendack, Richard Palmer-Jones, and W. Robert Reed

American Economic Review, May 2017

This paper discusses recent trends in the use of replications in economics. We include the results of recent replication studies that have attempted to identify replication rates within the discipline. These studies generally find that replication rates a...

Inequality in the Labor Market for Native American Women and the Great Recession

By Jeffrey D. Burnette

American Economic Review, May 2017

This research paper builds on previous literature and documents general changes in the labor market for Native American women that occurred during the Great Recession using extracts of data from the Current Population Survey Annual Earnings file, known as...

How Financial Literacy Affects Household Wealth Accumulation

By Jere R. Behrman, Olivia S. Mitchell, Cindy K. Soo, and David Bravo

American Economic Review, May 2012

This study isolates the causal effects of financial literacy and schooling on wealth accumulation using a new household dataset and an instrumental variables (IV) approach. Financial literacy and schooling attainment are both strongly positively associate...

Is It Whom You Know or What You Know? An Empirical Assessment of the Lobbying Process

By Marianne Bertrand, Matilde Bombardini, and Francesco Trebbi

American Economic Review, December 2014

Do lobbyists provide issue-specific information to members of Congress? Or do they provide special interests access to politicians? We present evidence to assess the role of issue expertise versus connections in the US Federal lobbying process and illus...

Trade Liberalization, Exports, and Technology Upgrading: Evidence on the Impact of MERCOSUR on Argentinian Firms

By Paula Bustos

American Economic Review, February 2011

This paper studies the impact of a regional free trade agreement, MERCOSUR, on technology upgrading by Argentinean firms. To guide empirical work, I introduce technology choice in a model of trade with heterogeneous firms. The joint treatment of the techn...

Equity Aversion: Social Norms and the Desire to Be Ahead

By Chaim Fershtman, Uri Gneezy, and John A. List

American Economic Journal: Microeconomics, November 2012

Inequity aversion models have dominated the behavioral economics landscape in the last decade. This study uses variants of dictator and trust games to provide empirical content to these models. We manipulate market features—such as competition over ...

Political Economy of Redistribution in the United States in the Aftermath of World War II--Evidence and Theory

By Roel Beetsma, Alex Cukierman, and Massimo Giuliodori

American Economic Journal: Economic Policy, November 2016

We present legislative, historical and statistical evidence of a substantial upward ratchet in transfers and taxes in the US due to World War II. This finding is explained within a political-economy framework with defense spending responding to a war thre...

Economies of Scale and Constant Returns to Capital: A Neglected Early Contribution to the Theory of Economic Growth

By Edmund S. Cannon

American Economic Review, March 2000

The Geographic Concentration of Industry: Does Natural Advantage Explain Agglomeration?

By Glenn Ellison and Edward L. Glaeser

American Economic Review, May 1999

The Behavioralist Goes to School: Leveraging Behavioral Economics to Improve Educational Performance

By Steven D. Levitt, John A. List, Susanne Neckermann, and Sally Sadoff

American Economic Journal: Economic Policy, November 2016

We explore the power of behavioral economics to influence the level of effort exerted by students in a low stakes testing environment. We find a substantial impact on test scores from incentives when the rewards are delivered immediately. There is suggest...

Resolving the Global Imbalance: The Dollar and the U.S. Saving Rate

[Symposium: U.S. Trade Deficit]

By Martin Feldstein

Journal of Economic Perspectives, Summer 2008

The massive deficit in the U.S. trade and current accounts is one of the most striking features of the current global economy and, to some observers, one of the most worrying. Although the current account deficit finally began to shrink in 2007, it remain...