Facts and Challenges from the Great Recession for Forecasting and Macroeconomic Modeling

By Serena Ng and Jonathan H. Wright

Journal of Economic Literature, December 2013

This paper provides a survey of business cycle facts, updated to take account of recent data. Emphasis is given to the Great Recession, which was unlike most other postwar recessions in the United States in being driven by deleveraging and financial mar...

International Institutions for Reducing Global Financial Instability

[Symposium: Global Financial Instability]

By Kenneth Rogoff

Journal of Economic Perspectives, Fall 1999

This paper asks how recent developments in research on banking and sovereign lending can help inform the debate on choosing a new international financial architecture. A broad range of plans is considered, including a global lender of last resort facility...

Efficient Pollution Regulation: Getting the Prices Right: Reply

By Nicholas Z. Muller and Robert Mendelsohn

American Economic Review, February 2012

Fraas and Lutter raise two important points in their comment on Muller and Mendelsohn (2009): How to design policies for sources that yield negative marginal damages? How does statistical uncertainty in the marginal damages affect the trading ratios acros...

The Price of Political Opposition: Evidence from Venezuela's Maisanta

By Chang-Tai Hsieh, Edward Miguel, Daniel Ortega, and Francisco Rodriguez

American Economic Journal: Applied Economics, April 2011

In 2004, the Hugo Chávez regime in Venezuela distributed the list of several million voters who had attempted to remove him from office throughout the government bureaucracy, allegedly to identify and punish these voters. We match the list of pet...

Shopping While Female: Who Pays Higher Prices and Why?

By Anne Fitzpatrick

American Economic Review, May 2017

I estimate gender price discrimination in the Ugandan antimalarial drug market with an audit study. To determine whether results are consistent with statistical or taste-based discrimination, I contrast gender results with results by ethnicity (tribe). Ve...

Search, Liquidity, and the Dynamics of House Prices and Construction

By Allen Head, Huw Lloyd-Ellis, and Hongfei Sun

American Economic Review, April 2014

The dynamics of house prices, sales, construction, and population growth in response to city-specific income shocks are characterized for 106 US cities. A dynamic model of search in the housing market in which construction, the entry of buyers, house p...

The Growth of Low-Skill Service Jobs and the Polarization of the US Labor Market

By David H. Autor and David Dorn

American Economic Review, August 2013

We offer a unified analysis of the growth of low-skill service occupations between 1980 and 2005 and the concurrent polarization of US employment and wages. We hypothesize that polarization stems from the interaction between consumer preferences, which...

Two Perspectives on Preferences and Structural Transformation

By Berthold Herrendorf, Richard Rogerson, and Ákos Valentinyi

American Economic Review, December 2013

We assess the empirical importance of changes in income and relative prices for structural transformation in the postwar United States. We explain two natural approaches to the data: sectors may be categories of final expenditure or value added; e.g., ...

Ambiguity Aversion with Three or More Outcomes

By Mark J. Machina

American Economic Review, December 2014

Ambiguous choice problems which involve three or more outcome values can reveal aspects of ambiguity and ambiguity aversion which cannot be displayed in the classic two-outcome Ellsberg urn problems, and hence are not always captured by models designed...

Think Locally, Act Locally: Spillovers, Spillbacks, and Efficient Decentralized Policymaking

By Hikaru Ogawa and David E. Wildasin

American Economic Review, September 2009

We analyze models with interjurisdictional spillovers among heterogeneous jurisdictions, such as CO2 emissions that affect the global environment. Each jurisdiction's emissions depend upon the local stock of capital, which is interjurisdictionally mobi...

Storable Good Monopoly: The Role of Commitment

By Paolo Dudine, Igal Hendel, and Alessandro Lizzeri

American Economic Review, December 2006

We study dynamic monopoly pricing of storable goods in an environment where demand changes over time. The literature on durables has focused on incentives to delay purchases. Our analysis focuses on a different intertemporal demand incentive. The key f...

Are Government Spending Multipliers Greater during Periods of Slack? Evidence from Twentieth-Century Historical Data

By Michael T. Owyang, Valerie A. Ramey, and Sarah Zubairy

American Economic Review, May 2013

A key question that has arisen during recent debates is whether government spending multipliers are larger during times when resources are idle. This paper seeks to shed light on this question by analyzing new quarterly historical data covering multiple l...

Knowledge Is (Less) Power: Experimental Evidence from Residential Energy Use

By Katrina Jessoe and David Rapson

American Economic Review, April 2014

Imperfect information about product attributes inhibits efficiency in many choice settings, but can be overcome by providing simple, lowcost information. We use a randomized control trial to test the effect of high-frequency information about residentia...

Compulsory Licensing: Evidence from the Trading with the Enemy Act

By Petra Moser and Alessandra Voena

American Economic Review, February 2012

Compulsory licensing allows firms in developing countries to produce foreign-owned inventions without the consent of foreign patent owners. This paper uses an exogenous event of compulsory licensing after World War I under the Trading with the Enemy Act t...

Two-Class Voting: A Mechanism for Conflict Resolution

By Ernst Maug and Bilge Yilmaz

American Economic Review, December 2002

We discuss two-class voting procedures where voters are divided into classes and a separate majority is required in each class. Examples include Chapter 11 bankruptcy proceedings and some political mechanisms. We investigate how voting mechanisms aggregat...

Tenure, Experience, Human Capital, and Wages: A Tractable Equilibrium Search Model of Wage Dynamics

By Jesper Bagger, François Fontaine, Fabien Postel-Vinay, and Jean-Marc Robin

American Economic Review, June 2014

We develop and estimate an equilibrium job search model of worker careers, allowing for human capital accumulation, employer heterogeneity and individual-level shocks. Wage growth is decomposed into contributions of human capital and job search, within a...

What Do Bargainers' Preferences Look Like? Experiments with a Convex Ultimatum Game

By James Andreoni, Marco Castillo, and Ragan Petrie

American Economic Review, June 2003

The ultimatum game, by its all-or-nothing nature, makes it difficult to discern what kind of preferences may be generating choices. We explore a game that convexifies the decisions, allowing us a better look at the indifference curves of bargainers while ...

Learning from Experiments When Context Matters

By Lant Pritchett and Justin Sandefur

American Economic Review, May 2015

Suppose a policymaker is interested in the impact of an existing social program. Impact estimates using observational data suffer potential bias, while unbiased experimental estimates are often limited to other contexts. This creates a practical trade-off...

Industry Compensation under Relocation Risk: A Firm-Level Analysis of the EU Emissions Trading Scheme

By Ralf Martin, Mirabelle Muûls, Laure B. de Preux, and Ulrich J. Wagner

American Economic Review, August 2014

When regulated firms are offered compensation to prevent them from relocating, efficiency requires that payments be distributed across firms so as to equalize marginal relocation probabilities, weighted by the damage caused by relocation. We formalize thi...

On the Use of Holdout Samples for Model Selection

By Frank Schorfheide and Kenneth I. Wolpin

American Economic Review, May 2012

Researchers often hold out data from the estimation of econometric models to use for external validation. However, the use of holdout samples is suboptimal from a Bayesian perspective, which prescribes using the entire sample to form posterior model weigh...