Contracts as Reference Points—Experimental Evidence

By Ernst Fehr, Oliver Hart, and Christian Zehnder

American Economic Review, April 2011

Hart and John Moore (2008) introduce new behavioral assumptions that can explain long-term contracts and the employment relation. We examine experimentally their idea that contracts serve as reference points. The evidence confirms the prediction that ther...

Contract Form, Wage Flexibility, and Employment

By Thomas Lemieux, W. Bentley MacLeod, and Daniel Parent

American Economic Review, May 2012

We begin with two uncontroversial hypotheses - firm productivity is expensive to measure and employment entails relationship-specific investments. These assumptions imply that firms would optimally choose fixed-wage contracts, and complement these with bo...

Slowing down the population boom

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How family planning efforts reduced fertility rates after World War II.

Race and Gender Differences under Federal Sentencing Guidelines

By Todd Sorensen, Supriya Sarnikar, and Ronald L. Oaxaca

American Economic Review, May 2012

Using data from the United States Sentencing Commission, we examine how judicial biases may have influenced sentences during the era of the Federal criminal sentencing guidelines. Our utility maximization model of judicial sentencing preferences leads to ...

Monetary Policy without Interest Rates: Evidence from France's Golden Age (1948 to 1973) Using a Narrative Approach

By Eric Monnet

American Economic Journal: Macroeconomics, October 2014

Central banking in France from 1948 to 1973 was a paradigmatic example of a policy that relied on quantities rather than interest rates. Standard SVAR analyses support the common view that monetary policy was ineffective during this period. However, th...

Marriage Networks, Nepotism, and Labor Market Outcomes in China

By Shing-Yi Wang

American Economic Journal: Applied Economics, July 2013

This paper considers the role of marriage in improving labor market outcomes through the expansion of an individual's networks. I focus on the impact of the relationship with the father-in-law on a young man's career using panel data from China. The id...

Wearable Technologies and Health Behaviors: New Data and New Methods to Understand Population Health

By Benjamin Handel and Jonathan Kolstad

American Economic Review, May 2017

We study a randomized control trial in a large employer population of access to "wearable" technologies and the associated planning and monitoring tools on improved health behaviors (sleep and exercise). Both ITT and IV estimates based on actual plan enro...

Time to Ditch the NAIRU

[Symposium: The Natural Rate of Unemployment]

By James K. Galbraith

Journal of Economic Perspectives, Winter 1997

The concept of a natural rate of unemployment, or nonaccelerating inflation rate of unemployment (NAIRU), remains controversial after twenty-five years. This essay presents a brief for no-confidence, in four parts. First, the theoretical case for the natu...

Using a Free Permit Rule to Forecast the Marginal Abatement Cost of Proposed Climate Policy

By Kyle C. Meng

American Economic Review, March 2017

This paper develops a method for forecasting the marginal abatement cost (MAC) of climate policy using three features of the failed Waxman-Markey bill. First, the MAC is revealed by the price of traded permits. Second, the permit price is estimated using ...

The Quest for QWERTY

By Tanjim Hossain and John Morgan

American Economic Review, May 2009

Unemployment Insurance: Strengthening the Relationship between Theory and Policy

[Symposium: American Employment]

By Walter Nicholson and Karen Needels

Journal of Economic Perspectives, Summer 2006

Ever since the U.S. federal-state system of unemployment insurance was founded in the 1930s, it has provided partial, temporary replacement of wages to eligible workers who lose jobs -- through no fault of their own -- (as determined by state-level regula...

Fetal Exposures to Toxic Releases and Infant Health

By Janet Currie and Johannes F. Schmieder

American Economic Review, May 2009

Three Principles for Market-Based Credit Regulation

By Perry Mehrling

American Economic Review, May 2012

A key lesson of the financial crisis 2007-09 is that the Bagehot Rule, "lend freely but at a high rate," needs to be updated for the emerging market-based credit system. A modern rule is suggested: Markets, not Banks; Outside spread, not Inside spread;...

Does the EITC Buffer against Neighborhood Transition? Evidence from Washington, DC

By LaTanya Brown-Robertson, Marcus Casey, Bradley Hardy, and Daniel Muhammad

American Economic Review, May 2016

Gentrification in major cities has led to concerns that poor and nonwhite residents are being displaced. This paper uses administrative data on tax filing households in Washington DC to examine the potential role that increases in the Earned Income Tax Cr...

Taxes, Cigarette Consumption, and Smoking Intensity: Reply

By Jérôme Adda and Francesca Cornaglia

American Economic Review, December 2013

This paper shows that smoking intensity, i.e. the amount of nicotine extracted per cigarette smoked, responds to changes in excise taxes and tobacco prices. We exploit NHANES data covering the period 1988 to 2006 across many US states. Moreover, using ...

Mood-Driven Behavior in Strategic Interactions

By Mónica C. Capra

American Economic Review, May 2004

Distinguished Lecture on Economics in Government: Fighting Poverty: Lessons from Recent U.S. History

By Rebecca M. Blank

Journal of Economic Perspectives, Spring 2000

Welfare reform efforts in the 1990s aimed at reducing welfare dependence and moving women into work. Public assistance use fell and labor force participation among mothers rose at a stunning rate over the decade. Poverty declined, but at a slower rate. Th...

Designing Matching Mechanisms under General Distributional Constraints

By Masahiro Goto, Fuhito Kojima, Ryoji Kurata, Akihisa Tamura, and Makoto Yokoo

American Economic Journal: Microeconomics, May 2017

To handle various applications, we study matching under constraints. The only requirement on the constraints is heredity; given a feasible matching, any matching with fewer students at each school is also feasible. Heredity subsumes existing constraints s...

Migration, Remittances, and Agricultural Productivity in China

By Scott Rozelle, J. Edward Taylor, and Alan deBrauw

American Economic Review, May 1999

Medicare Part D and Portfolio Choice

By Padmaja Ayyagari and Daifeng He

American Economic Review, May 2016

Economic theory suggests that medical spending risk affects the extent to which households are willing to accept financial risk, and consequently their investment portfolios. In this study, we focus on the elderly for whom medical spending represents a su...