Numbing the China shock

[Research Highlight]

March 06, 2020

Is there a link between free trade and deaths of despair?

The Long-Term Effects of Management and Technology Transfers

By Michela Giorcelli

American Economic Review, January 2019

This paper examines the long-run causal effects of management on firm performance. Under the Productivity Program (1952–1958), the US organized management-training trips for Italian managers to U.S. firms and granted technologically advanced machines to...

Economic Shocks and Crime: Evidence from the Brazilian Trade Liberalization

By Rafael Dix-Carneiro, Rodrigo R. Soares, and Gabriel Ulyssea

American Economic Journal: Applied Economics, October 2018

This paper studies the effect of changes in economic conditions on crime. We exploit the 1990s trade liberalization in Brazil as a natural experiment generating exogenous shocks to local economies. We document that regions exposed to larger tariff reducti...

Revisiting the Relationship between Competition and Price Discrimination

By Ambarish Chandra and Mara Lederman

American Economic Journal: Microeconomics, May 2018

We revisit the relationship between competition and price discrimination. Theoretically, we show that if consumers differ in terms of both their underlying willingness-to-pay and their brand loyalty, competition may increase price differences between some...

Academic Peer Effects with Different Group Assignment Policies: Residential Tracking versus Random Assignment

By Robert Garlick

American Economic Journal: Applied Economics, July 2018

I study the relative academic performance of students tracked or randomly assigned to South African university dormitories. Tracking reduces low-scoring students' GPAs and has little effect on high-scoring students, leading to lower and more dispersed GPA...

Cheating and Incentives: Learning from a Policy Experiment

By César Martinelli, Susan W. Parker, Ana Cristina Pérez-Gea, and Rodimiro Rodrigo

American Economic Journal: Economic Policy, February 2018

We use a database generated by a policy intervention that incentivized learning as measured by standardized exams to investigate empirically the relationship between cheating by students and cash incentives to students and teachers. We adapt methods from ...

Optimal Trend Inflation

By Klaus Adam and Henning Weber

American Economic Review, February 2019

Sticky price models featuring heterogeneous firms and systematic firm-level productivity trends deliver radically different predictions for the optimal inflation rate than their popular homogenous-firm counterparts: (i) the optimal steady-state inflation ...

Front Matter

American Economic Journal: Applied Economics, January 2019

Defensive Medicine: Evidence from Military Immunity

By Michael Frakes and Jonathan Gruber

American Economic Journal: Economic Policy, August 2019

We estimate the extent of defensive medicine by physicians, embracing the no-liability counterfactual made possible by the structure of liability rules in the Military Health System. Active-duty patients seeking treatment from military facilities cannot s...

Trucks without Bailouts: Equilibrium Product Characteristics for Commercial Vehicles

By Thomas G. Wollmann

American Economic Review, June 2018

The entry and exit of products, rather than firms, serve as the main equilibrating force in many markets, so accurately predicting changes from a merger or bankruptcy should incorporate this behavior. This paper estimates a structural model of the US comm...

Monetary Policy According to HANK

By Greg Kaplan, Benjamin Moll, and Giovanni L. Violante

American Economic Review, March 2018

We revisit the transmission mechanism from monetary policy to household consumption in a Heterogeneous Agent New Keynesian (HANK) model. The model yields empirically realistic distributions of wealth and marginal propensities to consume because of two fea...

Front Matter

American Economic Review, January 2019

Front Matter

American Economic Journal: Economic Policy, November 2019

Barriers to Reallocation and Economic Growth: The Effects of Firing Costs

By Toshihiko Mukoyama and Sophie Osotimehin

American Economic Journal: Macroeconomics, October 2019

We study how factors that hinder the reallocation of inputs across firms influence aggregate productivity growth. We extend Hopenhayn and Rogerson's (1993) firm-dynamics model to allow for endogenous innovation. We evaluate the effects of firing taxes on ...

Aggregate Recruiting Intensity

By Alessandro Gavazza, Simon Mongey, and Giovanni L. Violante

American Economic Review, August 2018

We develop an equilibrium model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort by spending resources to fill vacancies faster. Consistent with microevidence, fast-growing firms invest more in recruiting ...

Estimating the Production Function for Human Capital: Results from a Randomized Controlled Trial in Colombia

By Orazio Attanasio, Sarah Cattan, Emla Fitzsimons, Costas Meghir, and Marta Rubio-Codina

American Economic Review, January 2020

We examine the channels through which a randomized early childhood intervention in Colombia led to significant gains in cognitive and socio-emotional skills among a sample of disadvantaged children aged 12 to 24 months at baseline. We estimate the determi...

Reducing Medical Spending of the Publicly Insured: The Case for a Cash-out Option

By Svetlana Pashchenko and Ponpoje Porapakkarm

American Economic Journal: Economic Policy, August 2019

Individuals' medical spending has both necessary and discretionary components, which are not, however, separately observable. This paper studies ways to improve upon existing public health insurance policies by using a framework where both the discretiona...

Discounting Disentangled

By Moritz A. Drupp, Mark C. Freeman, Ben Groom, and Frikk Nesje

American Economic Journal: Economic Policy, November 2018

The economic values of investing in long-term public projects are highly sensitive to the social discount rate (SDR). We surveyed over 200 experts to disentangle disagreement on the risk-free SDR into its component parts, including pure time preference, t...

A Model of Endogenous Loan Quality and the Collapse of the Shadow Banking System

By Francesco Ferrante

American Economic Journal: Macroeconomics, October 2018

I develop a macroeconomic model in which banks can affect loan quality by exerting costly screening effort. Informational frictions limit the amount of external funds that banks can raise. In this framework I consider two types of financial intermediation...

Book Reviews

Journal of Economic Literature, June 2018