Heterogeneity in Intra-monthly Consumption Patterns, Self-Control, and Savings at Retirement

By Giovanni Mastrobuoni and Matthew Weinberg

American Economic Journal: Economic Policy, August 2009

Using data from the Continuing Survey of Food Intake by Individuals, this paper describes the shape of consumption profiles over the month for Social Security benefit recipients that have saved different amounts for retirement. Individuals with income ...

The Paradox of Declining Female Happiness

By Betsey Stevenson and Justin Wolfers

American Economic Journal: Economic Policy, August 2009

The lives of women in the United States have improved over the past 35 years by many objective measures, yet we show that measures of subjective well-being indicate that women's happiness has declined both absolutely and relative to men. This decline i...

Front Matter

American Economic Review, September 2009

Can News about the Future Drive the Business Cycle?

By Nir Jaimovich and Sergio Rebelo

American Economic Review, September 2009

Aggregate and sectoral comovement are central features of business cycles, so the ability to generate comovement is a natural litmus test for macroeconomic models. But it is a test that most models fail. We propose a unified model that generates aggreg...

Portfolio Claustrophobia: Asset Pricing in Markets with Illiquid Assets

By Francis A. Longstaff

American Economic Review, September 2009

Many classes of assets are illiquid or nonmarketable in that they cannot always be traded immediately. Thus, a portfolio position in these becomes at least temporarily irreversible. We study the asset-pricing implications of this type of illiquidity in...

Salience and Taxation: Theory and Evidence

By Raj Chetty, Adam Looney, and Kory Kroft

American Economic Review, September 2009

Using two strategies, we show that consumers underreact to taxes that are not salient. First, using a field experiment in a grocery store, we find that posting tax-inclusive price tags reduces demand by 8 percent. Second, increases in taxes included in...

Decentralized Organizational Learning: An Experimental Investigation

By Andreas Blume, John Duffy, and April M. Franco

American Economic Review, September 2009

We experimentally study decentralized organizational learning. Our objective is to understand how learning members of an organization cope with the confounding effects of the simultaneous learning of others. We test the predictions of a stylized, ratio...

Think Locally, Act Locally: Spillovers, Spillbacks, and Efficient Decentralized Policymaking

By Hikaru Ogawa and David E. Wildasin

American Economic Review, September 2009

We analyze models with interjurisdictional spillovers among heterogeneous jurisdictions, such as CO2 emissions that affect the global environment. Each jurisdiction's emissions depend upon the local stock of capital, which is interjurisdictionally mobi...

The Origins of State Capacity: Property Rights, Taxation, and Politics

By Timothy Besley and Torsten Persson

American Economic Review, September 2009

Economists generally assume that the state has sufficient institutional capacity to support markets and levy taxes. This paper develops a framework where "policy choices" in market regulation and taxation are constrained by past investments in legal an...

Spousal Control and Intra-household Decision Making: An Experimental Study in the Philippines

By Nava Ashraf

American Economic Review, September 2009

I elicit causal effects of spousal observability and communication on financial choices of married individuals in the Philippines. When choices are private, men put money into their personal accounts. When choices are observable, men commit money to co...

Active and Passive Waste in Government Spending: Evidence from a Policy Experiment

By Oriana Bandiera, Andrea Prat, and Tommaso Valletti

American Economic Review, September 2009

We propose a distinction between active and passive waste as determinants of the cost of public services. Active waste entails utility for the public decision maker, whereas passive waste does not. We analyze purchases of standardized goods by Italian ...

One Chance in a Million: Altruism and the Bone Marrow Registry

By Theodore C. Bergstrom, Rodney J. Garratt, and Damien Sheehan-Connor

American Economic Review, September 2009

Stem cell transplants save lives of many patients with blood diseases. Donation is painful, but rarely has lasting adverse effects. Patients can accept transplants only from donors with compatible immune systems. Those lacking a sibling match must seek...

Institution Formation in Public Goods Games

By Michael Kosfeld, Akira Okada, and Arno Riedl

American Economic Review, September 2009

Sanctioning institutions are of utmost importance for overcoming free-riding tendencies and enforcing outcomes that maximize group welfare in social dilemma situations. We investigate, theoretically and experimentally, the endogenous formation of insti...

Tax Changes and Asset Pricing

By Clemens Sialm

American Economic Review, September 2009

The tax burden on equity securities has varied substantially over time and remains a source of continuing policy debate. This paper investigates whether investors were compensated for the tax burden of equity securities over the period between 1913 and...

The Effects of High Stakes High School Achievement Awards: Evidence from a Randomized Trial

By Joshua Angrist and Victor Lavy

American Economic Review, September 2009

The Israeli matriculation certificate is a prerequisite for most postsecondary schooling. In a randomized trial, we attempted to increase certification rates among low-achievers with cash incentives. The experiment used a school-based randomization des...

Monetary Policy Analysis with Potentially Misspecified Models

By Marco Del Negro and Frank Schorfheide

American Economic Review, September 2009

Policy analysis with potentially misspecified dynamic stochastic general equilibrium (DSGE) models faces two challenges: estimation of parameters that are relevant for policy trade-offs, and treatment of the deviations from the cross-equation restricti...

Technological Revolutions and Stock Prices

By Ľuboš Pástor and Pietro Veronesi

American Economic Review, September 2009

We develop a general equilibrium model in which stock prices of innovative firms exhibit "bubbles" during technological revolutions. In the model, the average productivity of a new technology is uncertain and subject to learning. During technological r...

Hindsight, Foresight, and Insight: An Experimental Study of a Small-Market Investment Game with Common and Private Values

By Asen Ivanov, Dan Levin, and James Peck

American Economic Review, September 2009

We experimentally test an endogenous-timing investment model in which subjects privately observe their cost of investing and a signal correlated with the common investment return. Subjects overinvest, relative to Nash. We separately consider whether su...

Narrow Bracketing and Dominated Choices

By Matthew Rabin and Georg Weizsäcker

American Economic Review, September 2009

We show that any decision maker who "narrowly brackets" (evaluates decisions separately) and does not have constant-absolute-risk-averse preferences will make a first-order stochastically dominated combined choice in some simple pair of independent bin...

Why Do Sellers (Usually) Prefer Auctions?

By Jeremy Bulow and Paul Klemperer

American Economic Review, September 2009

We compare the most common methods for selling a company or other asset when participation is costly: a simple simultaneous auction, and a sequential process in which potential buyers decide in turn whether to enter the bidding. The sequential process ...