Prediction Policy Problems

By Jon Kleinberg, Jens Ludwig, Sendhil Mullainathan, and Ziad Obermeyer

American Economic Review, May 2015

Most empirical policy work focuses on causal inference. We argue an important class of policy problems does not require causal inference but instead requires predictive inference. Solving these "prediction policy problems" requires more than simple regres...

When the Levee Breaks: Black Migration and Economic Development in the American South

By Richard Hornbeck and Suresh Naidu

American Economic Review, March 2014

In the American South, post-bellum economic development may have been restricted in part by white landowners' access to low-wage black labor. This paper examines the impact of the Great Mississippi Flood of 1927 on black out-migration and subsequent agr...

Estimating the Value of Political Connections

By Raymond Fisman

American Economic Review, September 2001

Dynamics and Stagnation in the Malthusian Epoch

By Quamrul Ashraf and Oded Galor

American Economic Review, August 2011

This paper examines the central hypothesis of the influential Malthusian theory, according to which improvements in the technological environment during the preindustrial era had generated only temporary gains in income per capita, eventually leading to a...

Wage Inequality and Firm Growth

By Holger M. Mueller, Paige P. Ouimet, and Elena Simintzi

American Economic Review, May 2017

We discuss firm-level evidence based on UK data showing that within-firm pay inequality--wage differentials between top- and bottom-level jobs--increases with firm size. Moreover, within-firm pay inequality rises as firms grow larger over time. Lastly, us...

Inherited Control and Firm Performance

By Francisco Pérez-González

American Economic Review, December 2006

I use data from chief executive officer (CEO) successions to examine the impact of inherited control on firms’ performance. I find that firms where incoming CEOs are related to the departing CEO, to a founder, or to a large shareholder by either blood ...

Confidence-Enhanced Performance

By Olivier Compte and Andrew Postlewaite

American Economic Review, December 2004

There is ample evidence that emotions affect performance. Positive emotions can improve performance, while negative ones can diminish it. For example, the fears induced by the possibility of failure or of negative evaluations have physiological consequenc...

Real-Time Search in the Laboratory and the Market

By Meta Brown, Christopher J. Flinn, and Andrew Schotter

American Economic Review, April 2011

While widely accepted labor market search models imply a constant reservation wage policy, empirical evidence strongly suggests that reservation wages decline in search duration. This paper reports the results of the first real-time-search laboratory expe...

Balanced Skills and Entrepreneurship

By Edward P. Lazear

American Economic Review, May 2004

State-Owned and Privately Owned Firms: An Empirical Analysis of Profitability, Leverage, and Labor Intensity

By Kathryn L. DeWenter and Paul H. Malatesta

American Economic Review, March 2001

The Rise of Europe: Atlantic Trade, Institutional Change, and Economic Growth

By Daron Acemoglu, Simon Johnson, and James Robinson

American Economic Review, June 2005

The rise of Western Europe after 1500 is due largely to growth in countries with access to the Atlantic Ocean and with substantial trade with the New World, Africa, and Asia via the Atlantic. This trade and the associated colonialism affected Europe not o...

Why Do Firms in Developing Countries Have Low Productivity?

By Nicholas Bloom, Aprajit Mahajan, David McKenzie, and John Roberts

American Economic Review, May 2010

Auctions with Resale Markets: An Application to U.S. Forest Service Timber Sales

By Philip A. Haile

American Economic Review, June 2001

When bidders anticipate an opportunity for resale trade, the value of winning an auction is determined in part by the option values of buying and selling in the secondary market. One implication is that a bidder's willingness to pay at an auction increase...

Learning and Forgetting: The Dynamics of Aircraft Production

By C. Lanier Benkard

American Economic Review, September 2000

Explaining Changes in Female Labor Supply in a Life-Cycle Model

By Orazio Attanasio, Hamish Low, and Virginia Sánchez-Marcos

American Economic Review, September 2008

This paper studies the life-cycle labor supply of three cohorts of American women, born in the 1930s, 1940s, and 1950s. We focus on the increase in labor supply of mothers between the 1940s and 1950s cohorts. We construct a lifecycle model of female pa...

Water Quality Violations and Avoidance Behavior: Evidence from Bottled Water Consumption

By Joshua Graff Zivin, Matthew Neidell, and Wolfram Schlenker

American Economic Review, May 2011

We examine the impact of poor water quality on avoidance behavior by estimating the change in bottled water purchases in response to drinking water violations. Using data from a national grocery chain matched with water quality violations, we find an incr...

Wage Shocks and North American Labor-Market Integration

By Raymond Robertson

American Economic Review, September 2000

This study uses household-level data from the United States and Mexico to examine labor-market integration. I consider how the effects of shocks and rates of convergence to an equilibrium differential are affected by borders, geography, and demographics. ...

Fair Shares: Accountability and Cognitive Dissonance in Allocation Decisions

By James Konow

American Economic Review, September 2000

House Prices, Home Equity-Based Borrowing, and the US Household Leverage Crisis

By Atif Mian and Amir Sufi

American Economic Review, August 2011

Borrowing against the increase in home equity by existing homeowners was responsible for a significant fraction of the rise in US household leverage from 2002 to 2006 and the increase in defaults from 2006 to 2008. Instrumental variables estimation shows ...

Mismatch Unemployment

By Ayşegül Şahin, Joseph Song, Giorgio Topa, and Giovanni L. Violante

American Economic Review, November 2014

We develop a framework where mismatch between vacancies and job seekers across sectors translates into higher unemployment by lowering the aggregate job-finding rate. We use this framework to measure the contribution of mismatch to the recent rise in U.S....