The Changing Incidence of Geography

By James E. Anderson and Yoto V. Yotov

American Economic Review, December 2010

The incidence of bilateral trade costs is calculated here using neglected properties of the structural gravity model, disaggregated by commodity and region, and re-aggregated into forms useful for economic geography. For Canada's provinces, 1992-2003, sel...

Naked Exclusion with Private Offers

By Jeanine Miklós-Thal and Greg Shaffer

American Economic Journal: Microeconomics, November 2016

We consider a seller's ability to deter potential entrants by offering exclusive contracts to downstream buyers. Previous literature has shown that this can be a profitable strategy if there is a coordination failure on the part of the buyers or if the se...

The Effect of Evaluation on Teacher Performance

By Eric S. Taylor and John H. Tyler

American Economic Review, December 2012

Teacher performance evaluation has become a dominant theme in school reform efforts. Yet, whether evaluation changes the performance of teachers, the focus of this paper, is unknown. Instead, evaluation has largely been studied as an input to selective d...

A Theory of Political Transitions

By Daron Acemoglu and James A. Robinson

American Economic Review, September 2001

We develop a theory of political transitions inspired by the experiences of Western Europe and Latin America. Nondemocratic societies are controlled by a rich elite. The initially disenfranchised poor can contest power by threatening revolution, especiall...

The Causes and Consequences of Wal-Mart's Growth

By Emek Basker

Journal of Economic Perspectives, Summer 2007

Wal-Mart is the largest retailer and the largest private employer in the United States. The competitive pressures created by large retailers have long been controversial, and Wal-Mart's growth has raised concerns about its economic impact on workers, comm...

Unconventional Fiscal Policy at the Zero Bound

By Isabel Correia, Emmanuel Farhi, Juan Pablo Nicolini, and Pedro Teles

American Economic Review, June 2013

When the zero lower bound on nominal interest rates binds, monetary policy cannot provide appropriate stimulus. We show that, in the standard New Keynesian model, tax policy can deliver such stimulus at no cost and in a time-consistent manner. There is...

Sticky-Price Models and Durable Goods

By Robert B. Barsky, Christopher L. House, and Miles S. Kimball

American Economic Review, June 2007

The inclusion of a durable goods sector in sticky-price models has strong and unexpected implications. Even if most prices are flexible, a small durable goods sector with sticky prices may be sufficient to make aggregate output react to monetary policy as...

Retrospectives: Who Said "Debauch the Currency": Keynes or Lenin?

By Michael V. White and Kurt Schuler

Journal of Economic Perspectives, Spring 2009

One frequently quoted passage from the work of John Maynard Keynes is that "the best way to destroy the capitalist system [is] to debauch the currency." The passage, attributed to Vladimir Illyich Lenin, appears in Keynes' book The Economic Consequenc...

Sanctions: Some Simple Analytics

By Jonathan Eaton and Maxim Engers

American Economic Review, May 1999

The Nature of Risk Preferences: Evidence from Insurance Choices

By Levon Barseghyan, Francesca Molinari, Ted O'Donoghue, and Joshua C. Teitelbaum

American Economic Review, October 2013

We use data on insurance deductible choices to estimate a structural model of risky choice that incorporates "standard" risk aversion (diminishing marginal utility for wealth) and probability distortions. We find that probability distortions—characte...

Puzzles: Love and Spaghetti, the Opportunity Cost of Virtue

By Ted Bergstrom

Journal of Economic Perspectives, Spring 1989

In honor of St. Valentine's day, we offer a puzzle about love and a puzzle about virtue.

Some Economics of Trade Secret Law

[Symposium: Intellectual Property]

By David D. Friedman, William M. Landes, and Richard A. Posner

Journal of Economic Perspectives, Winter 1991

Despite the practical importance of trade secrets to the business community, the law of trade secrets is a neglected orphan in economic analysis. This paper sketches an approach to the economics of trade secret law that connects it more closely both to ot...

What Trade-Off of Risk and Incentives?

By Canice Prendergast

American Economic Review, May 2000

European Telecommunications Markets on the Verge of Full Liberalization

[Symposium: Telecommunications Deregulation Around The World]

By Leonard Waverman and Esen Sirel

Journal of Economic Perspectives, Fall 1997

January 1, 1998 is the date when voice telephony is fully liberalized in most European countries. The process of privatization and liberalization has been uneven across Europe; actively embraced by countries such as the U. K., Sweden, and Finland, while o...

Learning from the Doers: Developing Country Lessons for Advanced Economy Growth

By Anusha Chari and Peter Blair Henry

American Economic Review, May 2014

From 1980 to 1992, emerging and developing countries grew by 3.4 percent per year. Their annual rate of growth increased to 5.4 percent between 1993 and 2012. No such increase occurred for advanced nations, whose average growth from 1980 to 2012 was rough...

Trade Agreements and the Nature of Price Determination

By Pol Antràs and Robert W. Staiger

American Economic Review, May 2012

According to the terms-of-trade theory, negotiations over tariffs alone, coupled with an effective market access preservation rule, can bring governments to the efficiency frontier. In this paper, we show that the nature of international price determinati...

What Policies Increase Prosocial Behavior? An Experiment with Referees at the Journal of Public Economics

[Symposium: Academic Production]

By Raj Chetty, Emmanuel Saez, and Laszlo Sandor

Journal of Economic Perspectives, Summer 2014

We evaluate policies to increase prosocial behavior using a field experiment with 1,500 referees at the Journal of Public Economics. We randomly assign referees to four groups: a control group with a six-week deadline to submit a referee report; ...

Does Exchange-Rate Stability Increase Trade and Welfare?

By Philippe Bacchetta and Eric van Wincoop

American Economic Review, December 2000

This paper develops a simple general-equilibrium framework to study the effect of the exchange-rate system on trade and welfare. An important feature of the model is deviations from purchasing-power parity, caused by rigid price setting in buyers' currenc...

Diagnosing Hospital System Bargaining Power in Managed Care Networks

By Matthew S. Lewis and Kevin E. Pflum

American Economic Journal: Economic Policy, February 2015

We investigate the impact of hospital system membership on negotiations between hospitals and managed care organizations (MCOs). Previous research finds that system hospitals secure higher reimbursements by exploiting local market concentration. By levera...

Motivating Wealth-Constrained Actors

By Tracy R. Lewis and David E. M. Sappington

American Economic Review, September 2000

We examine how owners of productive resources (e.g. public enterprises or financial capital) optimally allocate their resources among wealth-constrained operators of unknown ability. Optimal allocations exhibit: (1) shared enterprise profit--the resource ...