Incentivizing Better Quality of Care: The Role of Medicaid and Competition in the Nursing Home Industry

By Martin B. Hackmann

American Economic Review, May 2019

This paper develops a model of the nursing home industry to investigate the quality effects of policies that either raise regulated reimbursement rates or increase local competition. Using data from Pennsylvania, I estimate the parameters of the model. Th...

Payroll Taxes, Firm Behavior, and Rent Sharing: Evidence from a Young Workers' Tax Cut in Sweden

By Emmanuel Saez, Benjamin Schoefer, and David Seim

American Economic Review, May 2019

This paper uses administrative data to analyze a large employer-borne payroll tax rate cut for young workers in Sweden. We find no effect on net-of-tax wages of young treated workers relative to slightly older untreated workers, and a 2–3 percentage poi...

Religion, Division of Labor, and Conflict: Anti-semitism in Germany over 600 Years

By Sascha O. Becker and Luigi Pascali

American Economic Review, May 2019

We study the role of economic incentives in shaping the coexistence of Jews, Catholics, and Protestants, using novel data from Germany for 1,000+ cities. The Catholic usury ban and higher literacy rates gave Jews a specific advantage in the moneylending...

Walk on the Wild Side: Temporarily Unstable Paths and Multiplicative Sunspots

By Guido Ascari, Paolo Bonomolo, and Hedibert F. Lopes

American Economic Review, May 2019

We propose a generalization of the rational expectations framework to allow for temporarily unstable paths. Our approach introduces multiplicative sunspot shocks and it yields drifting parameters and stochastic volatility. Then, we provide an econometric ...

Trade, Migration, and Productivity: A Quantitative Analysis of China

By Trevor Tombe and Xiaodong Zhu

American Economic Review, May 2019

We study how goods- and labor-market frictions affect aggregate labor productivity in China. Combining unique data with a general equilibrium model of internal and international trade, and migration across regions and sectors, we quantify the magnitude an...

Structural Interpretation of Vector Autoregressions with Incomplete Identification: Revisiting the Role of Oil Supply and Demand Shocks

By Christiane Baumeister and James D. Hamilton

American Economic Review, May 2019

Traditional approaches to structural vector autoregressions (VARs) can be viewed as special cases of Bayesian inference arising from very strong prior beliefs. These methods can be generalized with a less restrictive formulation that incorporates uncertai...

Revenue Guarantee Equivalence

By Dirk Bergemann, Benjamin Brooks, and Stephen Morris

American Economic Review, May 2019

We revisit the revenue comparison of standard auction formats, including first-price, second-price, and English auctions. We rank auctions according to their revenue guarantees, i.e., the greatest lower bound of revenue across all informational environm...

Differentiated Durable Goods Monopoly: A Robust Coase Conjecture

By Francesco Nava and Pasquale Schiraldi

American Economic Review, May 2019

The paper analyzes a durable goods monopoly problem in which multiple varieties can be sold. A robust Coase conjecture establishes that the market eventually clears, with profits exceeding static optimal market-clearing profits and converging to this lowe...

Monetary Policy and Rational Asset Price Bubbles: Comment

By Jianjun Miao, Zhouxiang Shen, and Pengfei Wang

American Economic Review, May 2019

We revisit Galí’s (2014) analysis by extending his model to incorporate persistent bubble shocks. We find that, under adaptive learning, a stable bubbly steady state and the associated sunspot solutions under optimal monetary policy are not E-stable. W...

Front Matter

Journal of Economic Perspectives, Spring 2019

Automation and New Tasks: How Technology Displaces and Reinstates Labor

[Symposium: Automation and Employment]

By Daron Acemoglu and Pascual Restrepo

Journal of Economic Perspectives, Spring 2019

We present a framework for understanding the effects of automation and other types of technological changes on labor demand, and use it to interpret changes in US employment over the recent past. At the center of our framework is the allocation of tasks...

Artificial Intelligence: The Ambiguous Labor Market Impact of Automating Prediction

[Symposium: Automation and Employment]

By Ajay Agrawal, Joshua S. Gans, and Avi Goldfarb

Journal of Economic Perspectives, Spring 2019

Recent advances in artificial intelligence are primarily driven by machine learning, a prediction technology. Prediction is useful because it is an input into decision-making. In order to appreciate the impact of artificial intelligence on jobs, it is imp...

"Automation" of Manufacturing in the Late Nineteenth Century: The Hand and Machine Labor Study

[Symposium: Automation and Employment]

By Jeremy Atack, Robert A. Margo, and Paul W. Rhode

Journal of Economic Perspectives, Spring 2019

Recent advances in artificial intelligence and robotics have generated a robust debate about the future of work. An analogous debate occurred in the late nineteenth century when mechanization first transformed manufacturing. We analyze an extraordinary da...

The Rise of Robots in China

[Symposium: Automation and Employment]

By Hong Cheng, Ruixue Jia, Dandan Li, and Hongbin Li

Journal of Economic Perspectives, Spring 2019

China is the world's largest user of industrial robots. In 2016, sales of industrial robots in China reached 87,000 units, accounting for around 30 percent of the global market. To put this number in perspective, robot sales in all of Europe and the Ame...

Ten Years after the Financial Crisis: What Have We Learned from the Renaissance in Fiscal Research?

[Symposium: Fiscal Policy]

By Valerie A. Ramey

Journal of Economic Perspectives, Spring 2019

This paper takes stock of what we have learned from the "Renaissance" in fiscal research in the ten years since the financial crisis. I first discuss the new innovations in methodology and various strengths and weaknesses of the main approaches to estimat...

Rising Government Debt: Causes and Solutions for a Decades-Old Trend

[Symposium: Fiscal Policy]

By Pierre Yared

Journal of Economic Perspectives, Spring 2019

Over the past four decades, government debt as a fraction of GDP has been on an upward trajectory in advanced economies, approaching levels not reached since World War II. While normative macroeconomic theories can explain the increase in the level of d...

Effects of Austerity: Expenditure- and Tax-Based Approaches

[Symposium: Fiscal Policy]

By Alberto Alesina, Carlo Favero, and Francesco Giavazzi

Journal of Economic Perspectives, Spring 2019

We review the debate surrounding the macroeconomic effects of deficit reduction policies (austerity). The discussion about "austerity" in general has distracted commentators and policymakers from a very important result, namely the enormous difference, on...

The Declining Labor Market Prospects of Less-Educated Men

[Symposium: The Problems of Men]

By Ariel J. Binder and John Bound

Journal of Economic Perspectives, Spring 2019

Over the last half century, US wage growth stagnated, wage inequality rose, and the labor-force participation rate of prime-age men steadily declined. In this article, we examine these worrying labor market trends, focusing on outcomes for males without...

When Labor's Lost: Health, Family Life, Incarceration, and Education in a Time of Declining Economic Opportunity for Low-Skilled Men

[Symposium: The Problems of Men]

By Courtney C. Coile and Mark G. Duggan

Journal of Economic Perspectives, Spring 2019

The economic progress of US men has stagnated in recent decades. The labor force participation rate of men ages 25-54 peaked in the mid-1960s and has declined since then (according to the Bureau of Labor Statistics), while men's real median earnings hav...

The Tenuous Attachments of Working-Class Men

[Symposium: The Problems of Men]

By Kathryn Edin, Timothy Nelson, Andrew Cherlin, and Robert Francis

Journal of Economic Perspectives, Spring 2019

In this essay, we explore how working-class men describe their attachments to work, family, and religion. We draw upon in-depth, life history interviews conducted in four metropolitan areas with racially and ethnically diverse groups of working-class me...