Salience and Asset Prices

By Pedro Bordalo, Nicola Gennaioli, and Andrei Shleifer

American Economic Review, May 2013

We present a simple model of asset pricing in which payoff salience drives investors' demand for risky assets. The key implication is that extreme payoffs receive disproportionate weight in the market valuation of assets. The model accounts for several pu...

Pricing in the Market for Anticancer Drugs

By David H. Howard, Peter B. Bach, Ernst R. Berndt, and Rena M. Conti

Journal of Economic Perspectives, Winter 2015

In 2011, Bristol-Myers Squibb set the price of its newly approved melanoma drug ipilimumab— brand name Yervoy—at $120,000 for a course of therapy. The drug was associated with an incremental increase in life expectancy of four months. Drugs ...

Understanding Consumption Behavior: Evidence from Consumers' Reaction to Shopping Vouchers

By Kamhon Kan, Shin-Kun Peng, and Ping Wang

American Economic Journal: Economic Policy, February 2017

This paper advances our understanding of consumption behavior using the 2009 Taiwan Shopping Voucher Program. This program was universal and well publicized, and its payment to each individual was medium-sized. Based on survey data, it is found that the m...

Report of the Editor: American Economic Journal: Applied Economics

By Esther Duflo

American Economic Review, May 2010

Exploiting Naïvete about Self-Control in the Credit Market

By Paul Heidhues and Botond Kőszegi

American Economic Review, December 2010

We analyze contract choices, loan-repayment behavior, and welfare in a model of a competitive credit market when borrowers have a taste for immediate gratification. Consistent with many credit cards and subprime mortgages, for most types of nonsophisticat...

How the Electoral College Influences Campaigns and Policy: The Probability of Being Florida

By David Stromberg

American Economic Review, June 2008

This paper analyzes how US presidential candidates should allocate resources across states to maximize the probability of winning the election, by developing and estimating a probabilistic-voting model of political competition under the Electoral Colle...

Fertility and the Personal Exemption: Comment

By Richard Crump, Gopi Shah Goda, and Kevin J. Mumford

American Economic Review, June 2011

One of the most commonly cited studies on the effect of child subsidies on fertility, Whittington, Alm, and Peters (1990), claimed a large positive effect of child tax benefits on fertility using time series methods. We revisit this question in light of r...

Economic Shocks and Civil Conflict: A Comment

By Antonio Ciccone

American Economic Journal: Applied Economics, October 2011

Edward Miguel, Shanker Satyanath, and Ernest Sergenti (2004), henceforth MSS, argue that lower rainfall levels and negative rainfall shocks increase conflict risk in sub-Saharan Africa. This conclusion rests on their finding of a negative correlation betw...

Growth in Women's Relative Wages and in Inequality among Men: One Phenomenon or Two?

By Finis Welch

American Economic Review, May 2000

Economics and Electronic Commerce

[Symposium: E-Commerce]

By Severin Borenstein and Garth Saloner

Journal of Economic Perspectives, Winter 2001

Dealing with Monetary Paralysis at the Zero Bound

[Symposium: The Global Monetary System]

By Kenneth Rogoff

Journal of Economic Perspectives, Summer 2017

Recently, the key constraint for central banks is the zero lower bound on nominal interest rates. Central banks fear that if they push short-term policy interest rates too deeply negative, there will be a massive flight into paper currency. This paper...

Global Warming Policy: A Public Finance Perspective

[Symposium]

By James M. Poterba

Journal of Economic Perspectives, Fall 1993

In the last few years, a substantial volume of research has considered the design of taxes to slow greenhouse gas emissions as well as the economic effects of such policies. In this paper, I summarize the insights that have emerged from this work. I begin...

Costly Persuasion

By Matthew Gentzkow and Emir Kamenica

American Economic Review, May 2014

We study the design of informational environments in settings where generating information is costly. We assume that the cost of a signal is proportional to the expected reduction in uncertainty. We show that Kamenica & Gentzkow's (2011) concavification a...

The Role of Potential Competition in Industrial Organization

By Richard J. Gilbert

Journal of Economic Perspectives, Summer 1989

Potential competition is important as a mechanism to control market power. I assess the strengths and limitations of alternative theories of potential competition by examining the available theoretical, empirical and institutional knowledge. I consider fo...

Attrition in Economics Ph.D. Programs

By Wendy A. Stock, T. Aldrich Finegan, and John J. Siegfried

American Economic Review, May 2006

Evidence on Discrimination in Mortgage Lending

[Symposium: Discrimination in Product, Credit and Labor Markets]

By Helen F. Ladd

Journal of Economic Perspectives, Spring 1998

Much of the controversy about whether mortgage lenders discriminate against minorities can be explained in terms of the confusion about how to define discrimination. Based on the legal definition, careful studies of loan denial rates, such as that done by...

Recommendations for Further Reading

By Bernard Saffran

Journal of Economic Perspectives, Spring 1990

Aid, Policies, and Growth

By Craig Burnside and David Dollar

American Economic Review, September 2000

This paper uses a new database on foreign aid to examine the relationships among foreign aid, economic policies, and growth per capita GDP. We find that aid has a positive impact on growth in developing countries with good fiscal, monetary, and trade poli...

Peer Effects and Alcohol Use among College Students

By Michael Kremer and Dan Levy

Journal of Economic Perspectives, Summer 2008

This paper examines the extent to which college students who drink alcohol influence their peers. We exploit a natural experiment in which students at a large state university were randomly assigned roommates through a lottery system. We find that on aver...

The Taylor Rule and Optimal Monetary Policy

By Michael Woodford

American Economic Review, May 2001