In Pursuit of Balance: Randomization in Practice in Development Field Experiments

By Miriam Bruhn and David McKenzie

American Economic Journal: Applied Economics, October 2009

We present new evidence on the randomization methods used in existing experiments, and new simulations comparing these methods. We find that many papers do not describe the randomization in detail, implying that better reporting is needed. Our simulat...

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 ...

Modern Macroeconomics in Practice: How Theory Is Shaping Policy

[Symposium: Macroeconomic Lessons]

By V. V. Chari and Patrick J. Kehoe

Journal of Economic Perspectives, Fall 2006

Over the last three decades, macroeconomic theory and the practice of macroeconomics by economists have changed significantly -- for the better. Macroeconomics is now firmly grounded in the principles of economic theory. We focus on the role of economic t...

Social Networks and the Decision to Insure

By Jing Cai, Alain De Janvry, and Elisabeth Sadoulet

American Economic Journal: Applied Economics, April 2015

Using data from a randomized experiment in rural China, we study the influence of social networks on weather insurance adoption and the mechanisms through which they operate. To quantify network effects, the experiment provides intensive information sessi...

The Effects of the Real Oil Price on Regional Wage Dispersion

By Matthias Kehrig and Nicolas L. Ziebarth

American Economic Journal: Macroeconomics, April 2017

We find that oil supply shocks decrease average real wages, particularly skilled wages, and increase wage dispersion across regions, particularly unskilled wage dispersion. In a model with spatial energy intensity differences and nontradables, labor deman...

Lessons Learned: Generalizing Learning Across Games

By David J. Cooper and John H. Kagel

American Economic Review, May 2003

This paper synthesizes findings from an ongoing research program on learning in signaling games. The present paper focuses on crossgame learning (the ability of subjects to take what has been learned in one game and generalize it to related games), an iss...

Globalization and Innovation in Emerging Markets

By Yuriy Gorodnichenko, Jan Svejnar, and Katherine Terrell

American Economic Journal: Macroeconomics, April 2010

Globalization brings opportunities and pressures for domestic firms in emerging markets to innovate and improve their competitive position. Using data from 27 emerging market economies, we estimate the effects of foreign competition and linkages with f...

Endogenous Growth and Cross-Country Income Differences

By Peter Howitt

American Economic Review, September 2000

A multicountry Schumpeterian growth model is constructed. Because of technology transfer, R&D-performing countries converge to parallel growth paths; other countries stagnate. A parameter change that would have raised a country's growth rate in standard S...

The Origin of the Winner's Curse: A Laboratory Study

By Gary Charness and Dan Levin

American Economic Journal: Microeconomics, February 2009

The Winner's Curse (WC) is a robust and persistent deviation from theoretical predictions established in experimental economics and claimed to exist in field environments. Recent attempts to reconcile such deviation include "cursed equilibrium" and lev...

Russia's Billionaires

By Daniel Treisman

American Economic Review, May 2016

Using data collected by Forbes since the 1990s, I examine the emergence and survival of the super-wealthy in Russia over the past two decades and compare Russia's record to those of other countries. The major surge in the number of Russian billionaires ca...

The Indian Gaming Regulatory Act and Its Effects on American Indian Economic Development

By Randall K. Q. Akee, Katherine A. Spilde, and Jonathan B. Taylor

Journal of Economic Perspectives, Summer 2015

The Indian Gaming Regulatory Act (IGRA), passed by the US Congress in 1988, was a watershed in the history of policymaking directed toward reservation-resident American Indians. IGRA set the stage for tribal government-owned gaming facilities. It also sha...

Intergenerational Persistence of Earnings: The Role of Early and College Education

By Diego Restuccia and Carlos Urrutia

American Economic Review, December 2004

Recent empirical evidence from the United States indicates a high degree of persistence in earnings across generations. Designing effective public policies to increase social mobility requires identifying and measuring the major sources of persistence and...

Timing Decisions in Organizations: Communication and Authority in a Dynamic Environment

By Steven R. Grenadier, Andrey Malenko, and Nadya Malenko

American Economic Review, September 2016

We consider a problem where an uninformed principal makes a timing decision interacting with an informed but biased agent. Because time is irreversible, the direction of the bias crucially affects the agent's ability to credibly communicate information. W...

"3rd of tha Month": Do Social Security Recipients Smooth Consumption Between Checks?

By Melvin Stephens Jr.

American Economic Review, March 2003

Education and the Age Profile of Literacy into Adulthood

[Symposium: Investment in Children]

By Elizabeth Cascio, Damon Clark, and Nora Gordon

Journal of Economic Perspectives, Summer 2008

American teenagers perform considerably worse on international assessments of achievement than do teenagers in other high-income countries. This observation has been a source of great concern since the first international tests were administered in the 19...

Understanding Why Crime Fell in the 1990s: Four Factors that Explain the Decline and Six that Do Not

By Steven D. Levitt

Journal of Economic Perspectives, Winter 2004

Crime dropped sharply and unexpectedly in the United States in the 1990s. I conclude that four factors collectively explain the entire drop in crime: increases in the number of police, increases in the size of the prison population, the waning of the crac...

Financing Investment

By Joao F. Gomes

American Economic Review, December 2001

We examine investment behavior when firms face costs in the access to external funds. We find that despite the existence of liquidity constraints, standard investment regressions predict that cash flow is an important determinant of investment only if one...

Ownership Risk, Investment, and the Use of Natural Resources

By Henning Bohn and Robert T. Deacon

American Economic Review, June 2000

The effect of insecure ownership on ordinary investment and natural resource use is examined. Insecure ownership is postulated to depend on the type of government regime in power and the prevalence of political violence or instability. The political deter...

Monetary Policy Surprises, Credit Costs, and Economic Activity

By Mark Gertler and Peter Karadi

American Economic Journal: Macroeconomics, January 2015

We provide evidence on the transmission of monetary policy shocks in a setting with both economic and financial variables. We first show that shocks identified using high frequency surprises around policy announcements as external instruments produce resp...

How Auctions Work for Wine and Art

[Symposium: Auctions]

By Orley Ashenfelter

Journal of Economic Perspectives, Summer 1989

At the first wine auction I ever attended, I saw the repeal of the law of one price. This empirical surprise led me to begin collecting data on wine auctions, to interview auctioneers, and even to buy a little wine. In the meantime I have also had the opp...