Natural Expectations and Macroeconomic Fluctuations

[Symposium: Macroeconomics after the Financial Crisis]

By Andreas Fuster, David Laibson, and Brock Mendel

Journal of Economic Perspectives, Fall 2010

A large body of empirical evidence suggests that beliefs systematically deviate from perfect rationality. Much of the evidence implies that economic agents tend to form forecasts that are excessively influenced by recent changes. We present a parsimonious...

Task-Specific Human Capital

By Robert Gibbons and Michael Waldman

American Economic Review, May 2004

Online Ad Auctions

By Hal R. Varian

American Economic Review, May 2009

Inputs in the Production of Early Childhood Human Capital: Evidence from Head Start

By Christopher R. Walters

American Economic Journal: Applied Economics, October 2015

This paper uses data from a randomized evaluation of Head Start to answer two questions: (i) How much do short-run causal effects vary across Head Start centers? and (ii) Do observed inputs explain this variation? I find that the cross-center standard dev...

Investing Cash Transfers to Raise Long-Term Living Standards

By Paul J. Gertler, Sebastian W. Martinez, and Marta Rubio-Codina

American Economic Journal: Applied Economics, January 2012

Using data from a randomized experiment, we find that poor rural Mexican households invested part of their cash transfers from the Oportunidades program in productive assets, increasing agricultural income by almost 10 percent after 18 months of benefits...

Optimal Incentives for Teams

By Yeon-Koo Che and Seung-Weon Yoo

American Economic Review, June 2001

Much of the existing theory of incentives describes a static relationship that lasts for just one transaction. This static assumption is not only unrealistic, but the resulting predictions appear to be at odds with many work organizations. The current pap...

Crises and Prices: Information Aggregation, Multiplicity, and Volatility

By George-Marios Angeletos and Iván Werning

American Economic Review, December 2006

Crises are volatile times when endogenous sources of information are closely monitored. We study the role of information in crises by introducing a financial market in a coordination game with imperfect information. The asset price aggregates dispersed...

The Contingent Valuation Debate: Why Economists Should Care

[Symposium: Contingent Valuation]

By Paul R. Portney

Journal of Economic Perspectives, Fall 1994

The contingent valuation method, wherein sample surveys are used to elicit individuals' willingness to pay for certain types of policies, is playing an important role in government decision-making. The most prominent applications are in the valuation of d...

The Impact of Attending a School with High-Achieving Peers: Evidence from the New York City Exam Schools

By Will Dobbie and Roland G. Fryer Jr.

American Economic Journal: Applied Economics, July 2014

This paper uses data from three prominent exam high schools in New York City to estimate the impact of attending a school with high-achieving peers on college enrollment and graduation. Our identification strategy exploits sharp discontinuities in the adm...

Corporate Finance and the Legacy of Miller and Modigliani

By Sudipto Bhattacharya

Journal of Economic Perspectives, Fall 1988

[This is a comment on "The Modigliani-Miller Propositions after Thirty Years" by Merton H. Miller in this same issue.] The influence of the Modigliani-Miller (1958) propositions on capital structure and the Miller-Modigliani (1961) theses on dividend poli...

Cross-Country Evidence on the Relationship between Overwork and Skilled Women's Job Choices

By Patricia Cortes and Jessica Pan

American Economic Review, May 2017

This paper examines the relationship between the prevalence of overwork and skilled women's labor force participation and occupational choice. Using country-level variation, we find a negative relationship between the share of males working 50+ hours a we...

Can Informed Public Deliberation Overcome Clientelism? Experimental Evidence from Benin

By Thomas Fujiwara and Leonard Wantchekon

American Economic Journal: Applied Economics, October 2013

This paper studies the electoral effects of town hall meetings based on programmatic, nonclientelist platforms. The experiment involves the cooperation of leading candidates in a presidential election in Benin. A campaign strategy based solely on these...

The Winner's Curse and Public Information in Common Value Auctions: Reply

By Colin M. Campbell, John H. Kagel, and Dan Levin

American Economic Review, March 1999

One Size Fits All? Heckscher-Ohlin Specialization in Global Production

By Peter K. Schott

American Economic Review, June 2003

This paper introduces a new technique for testing the Heckscher-Ohlin model that allows for the possibility that countries with sufficiently disparate endowments specialize in unique subsets of goods. Results based upon industry-level data reject one-size...

The Case of the Missing Trade and Other Mysteries: Reply

By Daniel Trefler

American Economic Review, March 2002

Are Consumers Myopic? Evidence from New and Used Car Purchases

By Meghan R. Busse, Christopher R. Knittel, and Florian Zettelmeyer

American Economic Review, February 2013

We investigate whether car buyers are myopic about future fuel costs. We estimate the effect of gasoline prices on short-run equilibrium prices of cars of different fuel economies. We then compare the implied changes in willingness-to-pay to the associat...

Employment, Wages, and Voter Turnout

By Kerwin Kofi Charles and Melvin Stephens Jr.

American Economic Journal: Applied Economics, October 2013

Using county-level data across several decades, and various OLS and TSLS models, we find that higher local wages and employment lower turnout in elections for governor, senator, US Congress and state House of Representatives, but have no effect on pres...

Rational Attention and Adaptive Coding: A Puzzle and a Solution

By Camillo Padoa-Schioppa and Aldo Rustichini

American Economic Review, May 2014

Adaptive Coding is the property of the brain to adjust its response to statistical properties of the environment. Its effect is an improved discrimination among signals under the constraints on the dynamic range of its response. It can thus be considered ...

Inventories and the Business Cycle: An Equilibrium Analysis of (S, s) Policies

By Aubhik Khan and Julia K. Thomas

American Economic Review, September 2007

We develop an equilibrium business cycle model where nonconvex delivery costs lead firms to follow (S, s) inventory policies. Calibrated to postwar US data, the model reproduces two-thirds of the cyclical variability of inventory investment. Moreover, ...

A Theory of Countercyclical Government Multiplier

By Pascal Michaillat

American Economic Journal: Macroeconomics, January 2014

I develop a New Keynesian model in which a type of government multiplier doubles when unemployment rises from 5 percent to 8 percent. This multiplier indicates the additional number of workers employed when one worker is hired in the public sector. Gra...