Retrospectives: The Cold-War Origins of the Value of Statistical Life

By H. Spencer Banzhaf

Journal of Economic Perspectives, Fall 2014

This paper traces the history of the "Value of Statistical Life" (VSL), which today is used routinely in benefit-cost analysis of life-saving investments. The "value of statistical life" terminology was introduced by Thomas Schelling (1968) in his essay, ...

Recommendations for Further Reading

By Timothy Taylor

Journal of Economic Perspectives, Fall 2014

The Missing Middle: Correspondence

By James Tybout

Journal of Economic Perspectives, Fall 2014

Front Matter

Journal of Economic Perspectives, Fall 2014

Optimal Allocation with Costly Verification

By Elchanan Ben-Porath, Eddie Dekel, and Barton L. Lipman

American Economic Review, December 2014

A principal allocates an object to one of I agents. Each agent values receiving the object and has private information regarding the value to the principal of giving it to him. There are no monetary transfers, but the principal can check an agent's inf...

Ambiguity Aversion with Three or More Outcomes

By Mark J. Machina

American Economic Review, December 2014

Ambiguous choice problems which involve three or more outcome values can reveal aspects of ambiguity and ambiguity aversion which cannot be displayed in the classic two-outcome Ellsberg urn problems, and hence are not always captured by models designed...

Hospital Choices, Hospital Prices, and Financial Incentives to Physicians

By Kate Ho and Ariel Pakes

American Economic Review, December 2014

We estimate an insurer-specific preference function which rationalizes hospital referrals for privately insured births in California. The function is additively separable in: a hospital price paid by the insurer, the distance traveled, and plan- and se...

Is It Whom You Know or What You Know? An Empirical Assessment of the Lobbying Process

By Marianne Bertrand, Matilde Bombardini, and Francesco Trebbi

American Economic Review, December 2014

Do lobbyists provide issue-specific information to members of Congress? Or do they provide special interests access to politicians? We present evidence to assess the role of issue expertise versus connections in the US Federal lobbying process and illus...

The Effects of Poor Neonatal Health on Children's Cognitive Development

By David Figlio, Jonathan Guryan, Krzysztof Karbownik, and Jeffrey Roth

American Economic Review, December 2014

We make use of a new data resource -- merged birth and school records for all children born in Florida from 1992 to 2002 -- to study the relationship between birth weight and cognitive development. Using singletons as well as twin and sibling fixed eff...

Private Equity, Jobs, and Productivity

By Steven J. Davis, John Haltiwanger, Kyle Handley, Ron Jarmin, Josh Lerner, and Javier Miranda

American Economic Review, December 2014

Private equity critics claim that leveraged buyouts bring huge job losses and few gains in operating performance. To evaluate these claims, we construct and analyze a new dataset that covers US buyouts from 1980 to 2005. We track 3,200 target firms and...

Hot and Cold Seasons in the Housing Market

By L. Rachel Ngai and Silvana Tenreyro

American Economic Review, December 2014

Every year housing markets in the United Kingdom and the United States experience systematic above-trend increases in prices and transactions during the spring and summer ("hot season") and below-trend falls during the autumn and winter ("cold season")...

Reputation and Persistence of Adverse Selection in Secondary Loan Markets

By V. V. Chari, Ali Shourideh, and Ariel Zetlin-Jones

American Economic Review, December 2014

The volume of new issuances in secondary loan markets fluctuates over time and falls when collateral values fall. We develop a model with adverse selection and reputation that is consistent with such fluctuations. Adverse selection ensures that the vol...

The Dynamic Efficiency Costs of Common-Pool Resource Exploitation

By Ling Huang and Martin D. Smith

American Economic Review, December 2014

We conduct the first empirical investigation of common-pool resource users' dynamic and strategic behavior at the micro level using real-world data. Fishermen's strategies in a fully dynamic game account for latent resource dynamics and other players' ...

Trade Wars and Trade Talks with Data

By Ralph Ossa

American Economic Review, December 2014

How large are optimal tariffs? What tariffs would prevail in a worldwide trade war? How costly would a breakdown of international trade policy cooperation be? And what is the scope for future multilateral trade negotiations? I address these and other qu...

Consume Now or Later? Time Inconsistency, Collective Choice, and Revealed Preference

By Abi Adams, Laurens Cherchye, Bram De Rock, and Ewout Verriest

American Economic Review, December 2014

We develop a revealed preference methodology that allows us to explore whether time inconsistencies in household choice are the product of individual preference nonstationarities or the result of individual heterogeneity and renegotiation within the ho...

Present Bias and Collective Dynamic Choice in the Lab

By Matthew O. Jackson and Leeat Yariv

American Economic Review, December 2014

We study collective decisions by time-discounting individuals choosing a common consumption stream. We show that with any heterogeneity in time preferences, utilitarian aggregation necessitates a present bias. In lab experiments three quarters of "soci...

Consumption and Debt Response to Unanticipated Income Shocks: Evidence from a Natural Experiment in Singapore

By Sumit Agarwal and Wenlan Qian

American Economic Review, December 2014

This paper uses a unique panel dataset of consumer financial transactions to study how consumers respond to an exogenous unanticipated income shock. Consumption rose significantly after the fiscal policy announcement: during the ten subsequent months, for...

Risk Matters: The Real Effects of Volatility Shocks: Comment

By Benjamin Born and Johannes Pfeifer

American Economic Review, December 2014

We show that the risk-shock business cycle model of Fernández-Villaverde et al. (2011) must be recalibrated because it underpredicts the targeted business cycle moments by a factor of three once a time aggregation error is corrected. Recalibrating the co...

Front Matter

American Economic Review, December 2014

News-Driven Business Cycles: Insights and Challenges

By Paul Beaudry and Franck Portier

Journal of Economic Literature, December 2014

There is a widespread belief that changes in expectations may be an important independent driver of economic fluctuations. The news view of business cycles offers a formalization of this perspective. In this paper we discuss mechanisms by which changes in...