Real Wages and the Business Cycle: Accounting for Worker, Firm, and Job Title Heterogeneity

By Anabela Carneiro, Paulo Guimarães, and Pedro Portugal

American Economic Journal: Macroeconomics, April 2012

Using a longitudinal matched employer-employee dataset for Portugal over the 1986-2007 period, this study analyzes the wage responses to aggregate labor market conditions for newly hired workers and existing workers within the same firm. Accounting for w...

Rebalancing Frequency and the Welfare Cost of Inflation

By André C. Silva

American Economic Journal: Macroeconomics, April 2012

Cash-in-advance models usually require agents to reallocate money and bonds in fixed periods. Every month or quarter, for example. I show that fixed periods underestimate the welfare cost of inflation. I use a model in which agents choose how often they e...

Imperfect Competition in the Interbank Market for Liquidity as a Rationale for Central Banking

By Viral V. Acharya, Denis Gromb, and Tanju Yorulmazer

American Economic Journal: Macroeconomics, April 2012

We study interbank lending and asset sales markets in which banks with surplus liquidity have market power vis-à-vis banks needing liquidity, frictions arise in lending due to moral hazard, and assets are bank-specific. Surplus banks ration lending...

How Important Is Technology Capital for the United States?

By Marek Kapička

American Economic Journal: Macroeconomics, April 2012

I construct measures of technology capital and country openness for the US economy and the rest of the world for 1982-2007. The key identifying assumption is that firms equalize returns on tangible and technology capital. For the US economy, technology ca...

Front Matter

American Economic Journal: Applied Economics, April 2012

What Linear Estimators Miss: The Effects of Family Income on Child Outcomes

By Katrine V. Løken, Magne Mogstad, and Matthew Wiswall

American Economic Journal: Applied Economics, April 2012

We assess the implications of nonlinearity for IV and FE estimation when the estimated model is inappropriately assumed to be linear. Our application is the causal link between family income and child outcomes. Our nonlinear IV and FE estimates show an ...

What Makes Firm-Based Vocational Training Schemes Successful? The Role of Commitment

By Christian Dustmann and Uta Schönberg

American Economic Journal: Applied Economics, April 2012

This paper studies a possible market failure in the firm-based vocational training market: training may be too complex to be specified in a contract so that it is legally enforceable, resulting in the inability of firms to commit to training provision. We...

Reexamining the Impact of Family Planning Programs on US Fertility: Evidence from the War on Poverty and the Early Years of Title X

By Martha J. Bailey

American Economic Journal: Applied Economics, April 2012

Almost 50 years after domestic US family planning programs began, their effects on childbearing remain controversial. Using the county-level roll-out of these programs from 1964 to 1973, this paper reevaluates their shorter and longer term effects on US ...

The Impact of Credit on Village Economies

By Joseph P. Kaboski and Robert M. Townsend

American Economic Journal: Applied Economics, April 2012

This paper evaluates the short- and longer term impact of Thailand's "Million Baht Village Fund" program, among the largest scale government microfinance iniatives in the world, using pre- and post-program panel data and quasi-experimental cross-village v...

Risk Pooling, Risk Preferences, and Social Networks

By Orazio Attanasio, Abigail Barr, Juan Camilo Cardenas, Garance Genicot, and Costas Meghir

American Economic Journal: Applied Economics, April 2012

Using data from an experiment conducted in 70 Colombian communities, we investigate who pools risk with whom when trust is crucial for enforcing risk pooling arrangements. We explore the roles played by risk attitudes and social networks. Both empirically...

Productivity Spillovers across Firms through Worker Mobility

By Andrey Stoyanov and Nikolay Zubanov

American Economic Journal: Applied Economics, April 2012

Using matched firm-worker data from Danish manufacturing, we observe firm-to-firm worker movements and find that firms that hired workers from more productive firms experience productivity gains one year after the hiring. The productivity gains associated...

Indirect Effects of a Policy Altering Criminal Behavior: Evidence from the Italian Prison Experiment

By Francesco Drago and Roberto Galbiati

American Economic Journal: Applied Economics, April 2012

We exploit the 2006 Italian prison pardon to evaluate peer effects in criminal behavior. The pardon randomly commutes actual sentences to expected sentences for 40 percent of the Italian prison population. Using prison and geographical origin to construct...

The Effect of Shift Structure on Performance

By Tanguy Brachet, Guy David, and Andrea M. Drechsler

American Economic Journal: Applied Economics, April 2012

The effect of shift structure on worker performance and productivity is of increasing interest to firms and regulatory bodies. Using approximately 743,000 emergency medical incidents attended by 2,381 paramedics in Mississippi, we evaluate the extent that...

Cash Transfers, Behavioral Changes, and Cognitive Development in Early Childhood: Evidence from a Randomized Experiment

By Karen Macours, Norbert Schady, and Renos Vakis

American Economic Journal: Applied Economics, April 2012

Cash transfer programs have become extremely popular in the developing world. A large literature analyzes their effects on schooling, health and nutrition, but relatively little is known about possible impacts on child development. This paper analyzes the...

Castes and Labor Mobility

By Viktoria Hnatkovska, Amartya Lahiri, and Sourabh Paul

American Economic Journal: Applied Economics, April 2012

We examine the relative fortunes of the historically disadvantaged scheduled castes and tribes (SC/ST) in India in terms of their education attainment, occupation choices, consumption and wages. We study the period 1983-2005 using household survey data fr...

Front Matter

American Economic Review, April 2012

Front Matter includes photograph of Orley Ashenfelter as part of a series of photographs of past presidents of the Association.

Comparing Real Wage Rates: Presidential Address

By Orley Ashenfelter

American Economic Review, April 2012

A real wage rate is a nominal wage rate divided by the price of a good and is a transparent measure of how much of the good an hour of work buys. It provides an important indicator of the living standards of workers, and also of the productivity of worker...

The Welfare Effects of Bundling in Multichannel Television Markets

By Gregory S. Crawford and Ali Yurukoglu

American Economic Review, April 2012

We measure how the bundling of television channels affects short-run welfare. We estimate an industry model of viewership, demand, pricing, bundling, and input-market bargaining using data on ratings, purchases, prices, bundles, and input costs. We condu...

The Use of Full-Line Forcing Contracts in the Video Rental Industry

By Katherine Ho, Justin Ho, and Julie Holland Mortimer

American Economic Review, April 2012

Bundling is at the forefront of many policy debates as new technologies allow firms to implement more complex bundling arrangements. Realistic analyses of bundling—particularly between suppliers and retailers—require detailed data on both sup...

Slow to Anger and Fast to Forgive: Cooperation in an Uncertain World

By Drew Fudenberg, David G. Rand, and Anna Dreber

American Economic Review, April 2012

We study the experimental play of the repeated prisoner's dilemma when intended actions are implemented with noise. In treatments where cooperation is an equilibrium, subjects cooperate substantially more than in treatments without cooperative equilibria....