Grading Standards and Education Quality

By Raphael Boleslavsky and Christopher Cotton

American Economic Journal: Microeconomics, May 2015

We consider school competition in a Bayesian persuasion framework. Schools compete to place graduates by investing in education quality and by choosing grading policies. In equilibrium, schools strategically adopt grading policies that do not perfectly re...

State Censorship

By Mehdi Shadmehr and Dan Bernhardt

American Economic Journal: Microeconomics, May 2015

We characterize a ruler's decision of whether to censor media reports that convey information to citizens who decide whether to revolt. We find: (i) a ruler gains (his ex ante expected payoff increases) by committing to censoring slightly less than he doe...

Preferences over Equality in the Presence of Costly Income Sorting

By Gilat Levy and Ronny Razin

American Economic Journal: Microeconomics, May 2015

We analyze preferences over redistribution in societies with costly (positive) sorting according to income. We identify a new motivation for redistribution, where individuals support taxation in order to reduce the incentives to sort. We characterize a si...

Front Matter

American Economic Journal: Microeconomics, May 2015

The Tax Gradient: Spatial Aspects of Fiscal Competition

By David R. Agrawal

American Economic Journal: Economic Policy, May 2015

State borders create a discontinuous tax treatment of retail sales. In a Nash game, local tax rates will be higher on the low state tax side of a border. Local taxes will decrease from the nearest high-tax border and increase from the low-tax border. Usin...

Telecracy: Testing for Channels of Persuasion

By Guglielmo Barone, Francesco D'Acunto, and Gaia Narciso

American Economic Journal: Economic Policy, May 2015

We consider the long-lived slant towards Berlusconi in political information on Italian television (TV). We exploit a shock to the slanted exposure of viewers: idiosyncratic deadlines to switch to digital TV from 2008 to 2012, which increased the number o...

Calculation of a Population Externality

By Henning Bohn and Charles Stuart

American Economic Journal: Economic Policy, May 2015

It is known that when people generate externalities, a birth also generates an externality and efficiency requires a Pigou tax/subsidy on having children. The size of the externality from a birth is important for studying policy. We calculate the size of ...

Can Tax Breaks Beat Geography? Lessons from the French Enterprise Zone Experience

By Anthony Briant, Miren Lafourcade, and Benoît Schmutz

American Economic Journal: Economic Policy, May 2015

This paper shows that urban geography matters to the effectiveness of place-based policies, using the French enterprise zone program as a case study. Whereas this program created more jobs in spatially integrated neighborhoods, its impact on local wages w...

Behind the GATE Experiment: Evidence on Effects of and Rationales for Subsidized Entrepreneurship Training

By Robert W. Fairlie, Dean Karlan, and Jonathan Zinman

American Economic Journal: Economic Policy, May 2015

Theories of market failures and targeting motivate the promotion of entrepreneurship training programs and generate testable predictions regarding heterogeneous treatment effects from such programs. Using a large randomized evaluation in the United States...

Does Vertical Integration Decrease Prices? Evidence from the Paramount Antitrust Case of 1948

By Ricard Gil

American Economic Journal: Economic Policy, May 2015

I empirically examine the impact of the 1948 Paramount antitrust case on ticket prices using a unique dataset collected from Variety magazine issues between 1945 and 1955. With information on prices, revenues, and theater ownership for an unbalanced panel...

Does Agriculture Generate Local Economic Spillovers? Short-Run and Long-Run Evidence from the Ogallala Aquifer

By Richard Hornbeck and Pinar Keskin

American Economic Journal: Economic Policy, May 2015

Agriculture may support the local nonagricultural economy in rural areas, though agricultural expansion may also crowd-out nonagricultural activity. On the United States Plains, areas over the Ogallala aquifer experienced windfall agricultural gains when ...

Mansion Tax: The Effect of Transfer Taxes on the Residential Real Estate Market

By Wojciech Kopczuk and David Munroe

American Economic Journal: Economic Policy, May 2015

Using discontinuities in housing transaction taxes in New York and New Jersey we find robust price bunching. Incidence for transactions local to the notch falls on sellers, with no evidence of evasion. The volume of missing transactions above the notch ex...

New Evidence on Taxes and the Timing of Birth

By Sara LaLumia, James M. Sallee, and Nicholas Turner

American Economic Journal: Economic Policy, May 2015

This paper uses data from the universe of tax returns filed between 2001 and 2010 to test whether parents shift the timing of childbirth around the New Year to gain tax benefits. Filers have an incentive to shift births from early January into late Decemb...

The Economics of Nationalism

By Xiaohuan Lan and Ben G. Li

American Economic Journal: Economic Policy, May 2015

This paper provides an economic framework for examining how economic openness affects nationalism. Within a country, a region's level of nationalism varies according to its economic interests in its domestic market relative to its foreign market. All else...

Comparing Charitable Fundraising Schemes: Evidence from a Natural Field Experiment and a Structural Model

By Steffen Huck, Imran Rasul, and Andrew Shephard

American Economic Journal: Economic Policy, May 2015

We present evidence from a natural field experiment and structural model to shed light on the efficacy of alternative fundraising schemes. In conjunction with the Bavarian State Opera, we mailed 25,000 opera attendees a letter describing a charitable fund...

Open Skies: Estimating Travelers' Benefits from Free Trade in Airline Services

By Clifford Winston and Jia Yan

American Economic Journal: Economic Policy, May 2015

The United States has negotiated bilateral open skies agreements to deregulate airline competition on US international routes, but little is known about their effects on travelers' welfare and the gains from the US negotiating agreements with more countri...

Front Matter

American Economic Journal: Economic Policy, May 2015

A Retrospective Look at Rescuing and Restructuring General Motors and Chrysler

[Symposium: The Bailouts of 2007-2009]

By Austan D. Goolsbee and Alan B. Krueger

Journal of Economic Perspectives, Spring 2015

The rescue of the US automobile industry amid the 2008-2009 recession and financial crisis was a consequential, controversial, and difficult decision made at a fraught moment for the US economy. Both of us were involved in the decision process at the time...

The Rescue of Fannie Mae and Freddie Mac

[Symposium: The Bailouts of 2007-2009]

By W. Scott Frame, Andreas Fuster, Joseph Tracy, and James Vickery

Journal of Economic Perspectives, Spring 2015

The imposition of federal conservatorships on September 6, 2008, at the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation—commonly known as Fannie Mae and Freddie Mac—was one of the most dramatic events of th...

An Assessment of TARP Assistance to Financial Institutions

[Symposium: The Bailouts of 2007-2009]

By Charles W. Calomiris and Urooj Khan

Journal of Economic Perspectives, Spring 2015

Six years after the passage of the 2008 Troubled Asset Relief Program, commonly known as TARP, it remains hard to measure the total social costs and benefits of the assistance to banks provided under TARP programs. TARP was not a single approach to assist...