Capitalism and Socialism: A Review of Kornai's Dynamism, Rivalry, and the Surplus Economy

By Chenggang Xu

Journal of Economic Literature, March 2017

Understanding the nature of capitalism has been a central theme of economics. The collapse of the Eastern Bloc and the global financial crisis spurred the reemergence of the political economy as a new frontier and the revival of interest in the nature of ...

Liquidity and Insurance for the Unemployed

By Robert Shimer and Ivan Werning

American Economic Review, December 2008

We study unemployment insurance for workers who sequentially sample job opportunities. We focus on the optimal timing of benefits and the desirability of allowing borrowing and saving. When workers have constant absolute risk aversion, a simple policy ...

Katrina's Children: Evidence on the Structure of Peer Effects from Hurricane Evacuees

By Scott A. Imberman, Adriana D. Kugler, and Bruce I. Sacerdote

American Economic Review, August 2012

In 2005, Hurricanes Katrina and Rita forced many children to relocate across the Southeast. While schools quickly enrolled evacuees, families in receiving schools worried about the impacts on incumbent students. We find no effect, on average, of the inflo...

Price Cutting and Business Stealing in Imperfect Cartels

By B. Douglas Bernheim and Erik Madsen

American Economic Review, February 2017

Although economists have made substantial progress toward formulating theories of collusion in industrial cartels that account for a variety of fact patterns, important puzzles remain. Standard models of repeated interaction formalize the observation that...

Raj Chetty: 2013 Clark Medal Recipient

By Martin Feldstein

Journal of Economic Perspectives, Spring 2014

Raj Chetty is eminently deserving of being awarded the John Bates Clark Medal at the age of 33. His research has transformed the field of public economics. His work is motivated by important public policy issues in the fields of taxation, social insurance...

The Historical Background of the Communist Manifesto

By George R. Boyer

Journal of Economic Perspectives, Fall 1998

This paper attempts to place the economic analysis of Karl Marx and Friedrich Engels's Communist Manifesto in historical perspective. The author begins by summarizing the analysis of capitalist economic development in the Manifesto, and showing how it was...

Asset Pricing with Distorted Beliefs: Are Equity Returns Too Good to Be True?

By Stephen G. Cecchetti, Pok-sang Lam, and Nelson C. Mark

American Economic Review, September 2000

We study a Lucas asset-pricing model that is standard in all respects, except that the representative agent's subjective beliefs about endowment growth are distorted. Using constant relative risk-aversion (CRRA) utility, with a CRRA coefficient below 10; ...

Retrospectives: What Did the Ancient Greeks Mean by Oikonomia?

By Dotan Leshem

Journal of Economic Perspectives, Winter 2016

Nearly every economist has at some point in the standard coursework been exposed to a brief explanation that the origin of the word "economy" can be traced back to the Greek word oikonomia, which in turn is composed of two words: oikos, whic...

Spatial Differentiation and Vertical Mergers in Retail Markets for Gasoline

By Jean-François Houde

American Economic Review, August 2012

This paper studies an empirical model of spatial competition applied to gasoline markets. The main feature is to specify commuting paths as the "locations" of consumers in a Hotelling-style model. As a result, spatial differentiation depends in an intuiti...

Economic Education in U.S. High Schools

By William B. Walstad

Journal of Economic Perspectives, Summer 2001

The teaching of economics at the high school level is vital for increasing basic economic literacy. This assessment of high school economics in the United States covers seven topics: enrollments in courses; course content; the testing of students; achieve...

The Economic Benefits from Immigration

[Symposium: Immigration]

By George J. Borjas

Journal of Economic Perspectives, Spring 1995

Natives benefit from immigration mainly because of production complementarities between immigrant workers and other factors of production, and these benefits are larger when immigrants are sufficiently 'different' from the stock of native productive input...

Extending the Bounds of Rationality: Evidence and Theories of Preferential Choice

By Jörg Rieskamp, Jerome R. Busemeyer, and Barbara A. Mellers

Journal of Economic Literature, September 2006

Most economists define rationality in terms of consistency principles. These principles place “bounds” on rationality—bounds that range from perfect consistency to weak stochastic transitivity. Several decades of research on preferential choice has d...

Mental Retirement

[Symposium: Retirement and Work Choices]

By Susann Rohwedder and Robert J. Willis

Journal of Economic Perspectives, Winter 2010

Early retirement appears to have a significant negative impact on the cognitive ability of people in their early 60s that is both quantitatively important and causal. We obtain this finding using cross-nationally comparable survey data from the United Sta...

The New Economics of Religion

By Sriya Iyer

Journal of Economic Literature, June 2016

The economics of religion is a relatively new field of research in economics. This survey serves two purposes--it is backward-looking in that it traces the historical and sociological origins of this field, and it is forward-looking in that it examines th...

A Simple Approach for Deciding When to Invest

By Jonathan B. Berk

American Economic Review, December 1999

The Evolution of Top Incomes: A Historical and International Perspective

By Thomas Piketty and Emmanuel Saez

American Economic Review, May 2006

Measuring the Impacts of Teachers: Comment

By Jesse Rothstein

American Economic Review, June 2017

Chetty, Friedman, and Rockoff (2014a, b) study value-added (VA) measures of teacher effectiveness. CFR (2014a) exploits teacher switching as a quasi-experiment, concluding that student sorting creates negligible bias in VA scores. CFR (2014b) finds VA sco...

The Lessons of Limited Market-Oriented Reform

[Symposium: Economic Transition in the Soviet Union and Eastern Europe]

By Thomas A. Wolf

Journal of Economic Perspectives, Fall 1991

The waves of reform and restructuring now engulfing most of Eastern Europe did not begin from the same starting point in each country. While they all share a common economic legacy—the traditional Soviet-type centrally planned economy—some cou...

The Credibility Revolution in Empirical Economics: How Better Research Design Is Taking the Con out of Econometrics

[Symposium: Con out of Economics]

By Joshua D. Angrist and Jörn-Steffen Pischke

Journal of Economic Perspectives, Spring 2010

Since Edward Leamer's memorable 1983 paper, "Let's Take the Con out of Econometrics," empirical microeconomics has experienced a credibility revolution. While Leamer's suggested remedy, sensitivity analysis, has played a role in this, we argue that the pr...

Going to a Better School: Effects and Behavioral Responses

By Cristian Pop-Eleches and Miguel Urquiola

American Economic Review, June 2013

This paper applies a regression discontinuity design to the Romanian secondary school system, generating two findings. First, students who have access to higher achievement schools perform better in a (high stakes) graduation test. Second, the stratifi...