Growth Forecast Errors and Fiscal Multipliers

By Olivier J. Blanchard and Daniel Leigh

American Economic Review, May 2013

This paper investigates the relation between growth forecast errors and planned fiscal consolidation during the crisis. We find that, in advanced economies, stronger planned fiscal consolidation has been associated with lower growth than expected. The re...

From Exxon to BP: Has Some Number Become Better Than No Number?

[Symposium: Contingent Valuation]

By Catherine L. Kling, Daniel J. Phaneuf, and Jinhua Zhao

Journal of Economic Perspectives, Fall 2012

On March 23, 1989, the Exxon Valdez ran aground in Alaska's Prince William Sound and released over 250,000 barrels of crude oil, resulting in 1300 miles of oiled shoreline. The Exxon spill ignited a debate about the appropriate compensation for damages su...

Downward Nominal Wage Rigidity and the Case for Temporary Inflation in the Eurozone

[Symposium: The Euro]

By Stephanie Schmitt-Grohé and Martin Uribe

Journal of Economic Perspectives, Summer 2013

Since the onset of the Great Recession in peripheral Europe, nominal hourly wages have not fallen from the high levels they had reached during the boom years — this in spite of widespread increases in unemployment. This observation evokes a well-known...

Cognition and Incomplete Contracts

By Jean Tirole

American Economic Review, March 2009

Thinking about contingencies, designing covenants, and seeing through their implications is costly. Parties to a contract accordingly use heuristics and leave it incomplete. The paper develops a model of limited cognition and examines its consequences ...

Retirement and Home Production: A Regression Discontinuity Approach

By Elena Stancanelli and Arthur Van Soest

American Economic Review, May 2012

Existing studies show that individuals who retire replace some private consumption with home production, but do not consider joint behavior of couples. Here we analyze the causal effect of retirement of each partner on hours of home production for both pa...

Monetary Policy Rules Based on Real-Time Data

By Athanasios Orphanides

American Economic Review, September 2001

This paper examines the magnitude of informational problems associated with the implementation and interpretation of simple monetary policy rules. Using Taylor's rule as an example, I demonstrate that real-time policy recommendations differ considerably f...

Housing Market Spillovers: Evidence from an Estimated DSGE Model

By Matteo Iacoviello and Stefano Neri

American Economic Journal: Macroeconomics, April 2010

We study sources and consequences of fluctuations in the US housing market. Slow technological progress in the housing sector explains the upward trend in real housing prices of the last 40 years. Over the business cycle, housing demand and housing tec...

International Productivity Comparisons Built from the Firm Level

By Martin Neil Baily and Robert M. Solow

Journal of Economic Perspectives, Summer 2001

International productivity comparisons can be built up with micro and macro data. Studies of firms or groups of firms producing similar outputs reveal the deeper causes of differences in productivity across countries. The studies find that such difference...

Report of the Editor: American Economic Journal: Macroeconomics

By Richard Rogerson

American Economic Review, May 2016

Social Security

By Peter Diamond

American Economic Review, March 2004

The Impact of Temporary Protected Status on Immigrants' Labor Market Outcomes

By Pia M. Orrenius and Madeline Zavodny

American Economic Review, May 2015

The United States currently provides Temporary Protected Status (TPS) to more than 300,000 immigrants. TPS is typically granted if dangerous conditions prevail in migrants' home countries. Individuals with TPS are allowed to stay and work in the United St...

The Demand for Medical Male Circumcision

By Jobiba Chinkhumba, Susan Godlonton, and Rebecca Thornton

American Economic Journal: Applied Economics, April 2014

This paper measures the demand for adult medical male circumcision using an experiment that randomly offered varying-priced subsidies and comprehensive information to 1,600 uncircumcised men in urban Malawi. We find low demand for male circumcision: on...

Dynamic Implications of Subjective Expectations: Evidence from Adult Smokers

By Yang Wang

American Economic Journal: Applied Economics, January 2014

We set up a dynamic discrete choice model with subjective expectations data to explain adult smokers' find important differences between subjective survival probabilities and those estimated using observed mortality data. Subjectively, individuals att...

Behavioral Economics Comes of Age: A Review Essay on Advances in Behavioral Economics

By Wolfgang Pesendorfer

Journal of Economic Literature, September 2006

Advances in Behavioral Economics contains influential second-generation contributions to behavioral economics. Building on the seminal work by Kahnemann, Strotz, Thaler, Tversky, and others, these contributions have established behavioral economi...

Market Exposure and Endogenous Firm Volatility over the Business Cycle

By Ryan A. Decker, Pablo N. D'Erasmo, and Hernan Moscoso Boedo

American Economic Journal: Macroeconomics, January 2016

We propose a theory of endogenous firm-level risk over the business cycle based on endogenous market exposure. Firms that reach a larger number of markets diversify market-specific demand shocks at a cost. The model is driven only by total factor producti...

Offshoring and Volatility: Evidence from Mexico's Maquiladora Industry

By Paul R. Bergin, Robert C. Feenstra, and Gordon H. Hanson

American Economic Review, September 2009

This paper studies the second-moment properties of offshoring, the arrangement whereby firms carry out particular stages of production abroad. It documents a new empirical regularity: maquiladora industries in Mexico that are associated with US offshoring...

Restructuring Research: Communication Costs and the Democratization of University Innovation

By Ajay Agrawal and Avi Goldfarb

American Economic Review, September 2008

We report evidence that Bitnet adoption facilitated increased research collaboration between US universities. However, not all institutions benefited equally. Using panel data from seven top engineering journals, Bitnet connection records, and institution...

Sraffa, Wittgenstein, and Gramsci

By Amartya Sen

Journal of Economic Literature, December 2003

Two distinct but interrelated issues are investigated here. The first concerns Sraffa's critical role in contemporary philosophy through his pivotal influence on Wittgenstein. The intellectual origins of this profound influence can be traced to the philos...

Guilt in Games

By Pierpaolo Battigalli and Martin Dufwenberg

American Economic Review, May 2007

Deconstructing the Energy-Efficiency Gap: Conceptual Frameworks and Evidence

By Todd Gerarden, Richard G. Newell, and Robert N. Stavins

American Economic Review, May 2015

Energy-efficient technologies offer considerable promise for reducing the financial costs and environmental damages associated with energy use, but these technologies appear not to be adopted to the degree that appears justified, even on a purely private ...