Structural Change in a Multisector Model of Growth

By L. Rachel Ngai and Christopher A. Pissarides

American Economic Review, March 2007

We study a multisector model of growth with differences in TFP growth rates across sectors and derive sufficient conditions for the coexistence of structural change, characterized by sectoral labor reallocation and balanced aggregate growth. The condition...

Individual Perceptions of the Criminal Justice System

By Lance Lochner

American Economic Review, March 2007

This paper empirically examines belief updating of the perceived probability of arrest and its criminal deterrence effects using two longitudinal data sources. While beliefs about the probability of arrest are positively correlated with local official arr...

Vignettes and Self-Reports of Work Disability in the United States and the Netherlands

By Arie Kapteyn, James P. Smith, and Arthur van Soest

American Economic Review, March 2007

In contrast to the believed similarity in their health outcomes, workers in different Western countries report very different rates of work disability. Using new data from the United States and the Netherlands, we offer a partial resolution to this parado...

Credible Commitment to Optimal Escape from a Liquidity Trap: The Role of the Balance Sheet of an Independent Central Bank

By Olivier Jeanne and Lars E. O. Svensson

American Economic Review, March 2007

Central banks target CPI inflation; independent central banks are concerned about their balance sheet and the level of their capital. The first fact makes it difficult for a central bank to implement the optimal escape from a liquidity trap, because it un...

Conditional Cash Transfers, Public Provision of Private Goods, and Income Redistribution

By Firouz Gahvari and Enlinson Mattos

American Economic Review, March 2007

This paper examines the role of cash transfers as a screening device when combined with in-kind transfers. It shows that linking in-kind to cash transfers makes first-best redistribution possible despite the government's inability to tell rich and poor in...

Credit Traps and Credit Cycles

By Kiminori Matsuyama

American Economic Review, March 2007

We develop a simple macroeconomic model of credit market imperfections with heterogeneous investment projects. The projects differ in productivity, the investment requirement, and the severity of agency problems behind the borrowing constraints. A movemen...

Minimax Play at Wimbledon: Comment

By Shih-Hsun Hsu, Chen-Ying Huang, and Cheng-Tao Tang

American Economic Review, March 2007

Testing for Indeterminacy: An Application to U.S. Monetary Policy: Comment

By Andreas Beyer and Roger E. A. Farmer

American Economic Review, March 2007

Testing for Indeterminacy: An Application to U.S. Monetary Policy: Reply

By Thomas A. Lubik and Frank Schorfheide

American Economic Review, March 2007

Secession and the Limits of Taxation: Toward a Theory of Internal Exit: Comment

By Grégoire Rota Graziosi

American Economic Review, March 2007

Making Famine History

By Cormac Ó Gráda

Journal of Economic Literature, March 2007

This paper reviews recent contributions to the economics and economic history of famine. It provides a context for the history of famine in the twentieth century, which is unique. During the century, war and totalitarianism produced more famine deaths ...

Distributional Effects of Globalization in Developing Countries

By Pinelopi Koujianou Goldberg and Nina Pavcnik

Journal of Economic Literature, March 2007

The authors discuss recent empirical research on how globalization has affected income inequality in developing countries. They begin with a discussion of conceptual issues regarding the measurement of globalization and inequality. Next, they present e...

A Flat World, a Level Playing Field, a Small World After All, or None of the Above? A Review of Thomas L Friedman's The World is Flat

By Edward E. Leamer

Journal of Economic Literature, March 2007

Geography, flat or not, creates special relationships between buyers and sellers who reside in the same neighborhoods, but Friedman turns this metaphor inside-out by using The World is Flat to warn us of the perils of a relationship-free world in w...

Whither Russia? A Review of Andrei Shleifer's A Normal Country

By Ekaterina Zhuravskaya

Journal of Economic Literature, March 2007

In this review, the author reflects on the heated debates around views about Russia's postcommunist transition expressed in essays collected in new Andrei Shleifer's book, A Normal Country: Russia after Communism (Harvard University Press, 2005), ...

The Big One: A Review of Richard Posner's Catastrophe: Risk and Response

By Edward A. Parson

Journal of Economic Literature, March 2007

Richard Posner's Catastrophe: Risk and Response (Oxford University Press, 2004) examines four risks whose worst cases could end advanced human civilization or worse: asteroid impacts, a catastrophic chain reaction initiated in high-energy particle ...

Book Reviews

Journal of Economic Literature, March 2007

Annotated Listing of New Books

Journal of Economic Literature, March 2007

JEL Classification System

Journal of Economic Literature, March 2007

Optimal Inattention to the Stock Market

By Andrew B. Abel, Janice C. Eberly, and Stavros Panageas

American Economic Review, May 2007

Uncertainty and the Dynamics of R&D

By Nick Bloom

American Economic Review, May 2007