Vertical Integration and Exclusivity in Platform and Two-Sided Markets

By Robin S. Lee

American Economic Review, December 2013

This paper measures the impact of vertically integrated and exclusive software on industry structure and welfare in the sixth-generation of the US video game industry (2000-2005). I specify and estimate a dynamic model of both consumer demand for hardw...

Conclusions Regarding Cross-Group Differences in Happiness Depend on Difficulty of Reaching Respondents

By Ori Heffetz and Matthew Rabin

American Economic Review, December 2013

A growing literature explores differences in subjective well-being across demographic groups, often relying on surveys with high nonresponse rates. By using the reported number of call attempts made to participants in the University of Michigan's Surve...

The Demand for Youth: Explaining Age Differences in the Volatility of Hours

By Nir Jaimovich, Seth Pruitt, and Henry E. Siu

American Economic Review, December 2013

Over the business cycle young workers experience much greater volatility of hours worked than prime-aged workers. This can arise from age differences in labor supply or labor demand characteristics. To distinguish between these, we document that, for yo...

News, Noise, and Fluctuations: An Empirical Exploration

By Olivier J. Blanchard, Jean-Paul L'Huillier, and Guido Lorenzoni

American Economic Review, December 2013

We explore empirically models of aggregate fluctuations in which consumers form anticipations about the future based on noisy sources of information and these anticipations affect output in the short run. Our objective is to separate fluctuations due to...

Polarization and Ambiguity

By Sandeep Baliga, Eran Hanany, and Peter Klibanoff

American Economic Review, December 2013

We offer a theory of polarization as an optimal response to ambiguity. Suppose individual A's beliefs first-order stochastically dominate individual B's. They observe a common signal. They exhibit polarization if A's posterior dominates her prior and B'...

Social Preferences under Risk: Equality of Opportunity versus Equality of Outcome

By Kota Saito

American Economic Review, December 2013

This paper axiomatizes a utility function for social preferences under risk. In the model, a single parameter captures a preference for equality of opportunity (i.e., equality of exante expected payoffs) relative to equality of outcome (i.e., equality o...

Taxes, Cigarette Consumption, and Smoking Intensity: Reply

By Jérôme Adda and Francesca Cornaglia

American Economic Review, December 2013

This paper shows that smoking intensity, i.e. the amount of nicotine extracted per cigarette smoked, responds to changes in excise taxes and tobacco prices. We exploit NHANES data covering the period 1988 to 2006 across many US states. Moreover, using ...

The New Economics of Equilibrium Sorting and Policy Evaluation Using Housing Markets

By Nicolai V. Kuminoff, V. Kerry Smith, and Christopher Timmins

Journal of Economic Literature, December 2013

Households "sort" across neighborhoods according to their wealth and their preferences for public goods, social characteristics, and commuting opportunities. The aggregation of these individual choices in markets and in other institutions influences th...

Exchange Rate Predictability

By Barbara Rossi

Journal of Economic Literature, December 2013

The main goal of this article is to provide an answer to the question: does anything forecast exchange rates, and if so, which variables? It is well known that exchange rate fluctuations are very difficult to predict using economic models, and that a r...

Facts and Challenges from the Great Recession for Forecasting and Macroeconomic Modeling

By Serena Ng and Jonathan H. Wright

Journal of Economic Literature, December 2013

This paper provides a survey of business cycle facts, updated to take account of recent data. Emphasis is given to the Great Recession, which was unlike most other postwar recessions in the United States in being driven by deleveraging and financial mar...

A Review Essay about Foundations of Neuroeconomic Analysis by Paul Glimcher

By Colin F. Camerer

Journal of Economic Literature, December 2013

Neuroeconomics aims to discover mechanisms of economic decision, and express them mathematically, to predict observed choice. While the contents of neuroeconomic models and evidence are obviously different than in traditional economics, (some of the) go...

Book Reviews

Journal of Economic Literature, December 2013

Annotated Listing of New Books

Journal of Economic Literature, December 2013

Front Matter

Journal of Economic Literature, December 2013

JEL Classification System

Journal of Economic Literature, December 2013

Doctoral Dissertations in Economics

Journal of Economic Literature, December 2013

Sales Taxes and Internet Commerce

By Liran Einav, Dan Knoepfle, Jonathan Levin, and Neel Sundaresan

American Economic Review, January 2014

We estimate the sensitivity of Internet retail purchasing to sales taxes using eBay data. Our first approach exploits the fact that a seller's location—and therefore the applicable tax rate—is revealed only after a buyer has expressed interest in a...

Risk Shocks

By Lawrence J. Christiano, Roberto Motto, and Massimo Rostagno

American Economic Review, January 2014

We augment a standard monetary dynamic general equilibrium model to include a Bernanke-Gertler-Gilchrist financial accelerator mechanism. We fit the model to US data, allowing the volatility of cross-sectional idiosyncratic uncertainty to fluctuate ove...

Aligned Delegation

By Alexander Frankel

American Economic Review, January 2014

A principal delegates multiple decisions to an agent, who has private information relevant to each decision. The principal is uncertain about the agent's preferences. I solve for max-min optimal mechanisms— those which maximize the principal's payoff...

Immigration and the Diffusion of Technology: The Huguenot Diaspora in Prussia

By Erik Hornung

American Economic Review, January 2014

This paper analyzes long-term effects of skilled-worker immigration on productivity for the Huguenot migration to Prussia. In 1685, religiously persecuted French Huguenots settled in Brandenburg- Prussia and compensated for population losses due to pla...