Attention Oligopoly

By Andrea Prat and Tommaso Valletti

American Economic Journal: Microeconomics, August 2022

We model digital platforms as attention brokers that have proprietary information about their users' product preferences and sell targeted ad space to retail product industries. Retail producers—incumbents or entrants—compete for access to this attent...

Searching Forever After

By Yair Antler and Benjamin Bachi

American Economic Journal: Microeconomics, August 2022

We study a model of two-sided search in which agents' strategic reasoning is coarse. In equilibrium, the most desirable agents behave as if they were fully rational, while for all other agents, coarse reasoning results in overoptimism with regard to their...

Experience Goods and Consumer Search

By Yongmin Chen, Zhuozheng Li, and Tianle Zhang

American Economic Journal: Microeconomics, August 2022

We introduce a search model where products differ in horizontal attributes and unobserved quality ("experience goods"), and firms can establish quality reputation. We show that the inability of consumers to observe quality before purchase significantly ch...

Competitive Information Disclosure to an Auctioneer

By Stefan Terstiege and Cédric Wasser

American Economic Journal: Microeconomics, August 2022

We analyze how voluntary disclosure of information by bidders affects the outcome of optimally designed auctions. In a single-object auction environment, we assume that before the revenue-maximizing auctioneer designs the auction, bidders noncooperatively...

Dynamic Competition and Arbitrage in Electricity Markets: The Role of Financial Players

By Ignacia Mercadal

American Economic Journal: Microeconomics, August 2022

I study the effects of financial players who trade alongside physical buyers and sellers in electricity markets. Using detailed firm-level data, I examine physical and financial firms' responses to regulation that exogenously increased financial trading. ...

Production Clustering and Offshoring

By Vladimir Tyazhelnikov

American Economic Journal: Microeconomics, August 2022

I introduce a model of international production that allows the production chain to be of any length or number of sourcing countries and in which the production process does not have to be perfectly sequential. The presence of trade costs in this model ma...

Trade and Urbanization: Evidence from Hungary

By Dávid Krisztián Nagy

American Economic Journal: Microeconomics, August 2022

I study how trade affects urbanization and real income. To this end, I exploit large-scale exogenous changes in trade stemming from the redrawing of Hungary's borders after the First World War. I show that urbanization in counties near the new border decr...

Substitution Effects in Intertemporal Problems

By Davide Dragone and Paolo Vanin

American Economic Journal: Microeconomics, August 2022

We consider a broad class of intertemporal economic problems and characterize the short-run and long-run responses of the demand for a good to a permanent increase in its market price. Depending on the interplay between self-productivity and time discount...

Fairness through the Lens of Cooperative Game Theory: An Experimental Approach

By Geoffroy de Clippel and Kareen Rozen

American Economic Journal: Microeconomics, August 2022

We experimentally investigate how impartial observers allocate money to agents whose complementarity and substitutability determine the surplus that each group can achieve. Analyzing the data through the lens of axioms and solutions from cooperative game ...

Belief Elicitation When More than Money Matters: Controlling for "Control"

By Jean-Pierre Benoît, Juan Dubra, and Giorgia Romagnoli

American Economic Journal: Microeconomics, August 2022

Elicitation mechanisms typically presume only money enters utility functions. However, nonmonetary objectives are confounders. In particular, psychologists argue people favor bets where ability is involved over equivalent random bets—a preference for co...

What Is Wrong with Taylor Rules? Using Judgment in Monetary Policy through Targeting Rules

By Lars E. O. Svensson

Journal of Economic Literature, June 2003

It is argued that inflation targeting is best understood as a commitment to a targeting rule rather than an instrument rule, either a general targeting rule (explicit objectives for monetary policy) or a specific targeting rule (a criterion for the foreca...

Stability of Experimental Results: Forecasts and Evidence

By Stefano DellaVigna and Devin Pope

American Economic Journal: Microeconomics, August 2022

How robust are experimental results to changes in design? And can researchers anticipate which changes matter most? We consider a real-effort task with multiple behavioral treatments and examine the stability along six dimensions: (i) pure replication, (i...

Front Matter

American Economic Review, August 2022

Sentiment and Speculation in a Market with Heterogeneous Beliefs

By Ian W. R. Martin and Dimitris Papadimitriou

American Economic Review, August 2022

We present a model featuring risk-averse investors with heterogeneous beliefs. Individuals who are correct in hindsight—whether through luck or judgment—get rich, so sentiment is bullish following good news and bearish following bad news. Sentiment ma...

Market Access and Quality Upgrading: Evidence from Four Field Experiments

By Tessa Bold, Selene Ghisolfi, Frances Nsonzi, and Jakob Svensson

American Economic Review, August 2022

Smallholder farming in many developing countries is characterized by low productivity and low-quality output. Low quality limits the price farmers can command and their potential income. We conduct a series of experiments among maize farmers in Uganda to ...

The Impact of Childhood Social Skills and Self-Control Training on Economic and Noneconomic Outcomes: Evidence from a Randomized Experiment Using Administrative Data

By Yann Algan, Elizabeth Beasley, Sylvana Côté, Jungwee Park, Richard E. Tremblay, and Frank Vitaro

American Economic Review, August 2022

A childhood intervention to improve the social skills and self-control of at-risk kindergarten boys in the 1980s had positive impacts over the life course: higher trust and self-control as adolescents; increased social group membership, education, and red...

Community Colleges and Upward Mobility

By Jack Mountjoy

American Economic Review, August 2022

Two-year community colleges enroll nearly half of all first-time undergraduates in the United States, but to ambiguous effect: low persistence rates and the potential for diverting students from four-year institutions cast ambiguity over two-year colleges...

All Eyes on Them: A Field Experiment on Citizen Oversight and Electoral Integrity

By Natalia Garbiras-Díaz and Mateo Montenegro

American Economic Review, August 2022

Can information and communication technologies help citizens monitor their elections? We analyze a large-scale field experiment designed to answer this question in Colombia. We leveraged Facebook advertisements sent to over 4 million potential voters to e...

Capital Gains Taxes and Real Corporate Investment: Evidence from Korea

By Terry S. Moon

American Economic Review, August 2022

This paper assesses the effects of capital gains taxes on investment in the Republic of Korea (hereafter, Korea), where capital gains tax rates vary at the firm level by firm size. Following a reform in 2014, firms with a tax cut increased investment by 3...

Forecasting Volatility in Financial Markets: A Review

By Ser-Huang Poon and Clive W.J. Granger

Journal of Economic Literature, June 2003

Financial market volatility is an important input for investment, option pricing, and financial market regulation. The emphasis of this review article is on forecasting instead of modelling; it compares the volatility forecasting findings in 93 papers pub...