Is There Too Little Antitrust Enforcement in the US Hospital Sector?

By Zarek Brot, Zack Cooper, Stuart V. Craig, and Lev Klarnet

American Economic Review: Insights, December 2024

From 2002 to 2020, there were over 1,000 mergers of US hospitals. During this period, the FTC took enforcement actions against 13 transactions. However, using the FTC's standard screening tools, we find that 20 percent of these mergers could have been pre...

The Impact of Criminal Financial Sanctions: A Multistate Analysis of Survey and Administrative Data

By Keith Finlay, Matthew Gross, Carl Lieberman, Elizabeth Luh, and Michael Mueller-Smith

American Economic Review: Insights, December 2024

We estimate the impact of financial sanctions in the US criminal justice system, leveraging nine natural experiments in a regression discontinuity design framework across a diverse range of enforcement levels ($17–$6,000) and institutional environments....

Large Shocks Travel Fast

By Alberto Cavallo, Francesco Lippi, and Ken Miyahara

American Economic Review: Insights, December 2024

We document a sizeable increase in the frequency of price adjustments following the large energy shocks of 2022. We use a tractable New Keynesian model, calibrated to the preshock data, to interpret such a pattern. The calibration highlights the state dep...

Law-Abiding Immigrants: The Incarceration Gap between Immigrants and the US-Born, 1870–2020

By Ran Abramitzky, Leah Boustan, Elisa Jácome, Santiago Pérez, and Juan David Torres

American Economic Review: Insights, December 2024

We provide the first nationally representative long-run series (1870–2020) of incarceration rates for immigrants and the US-born. As a group, immigrants have had lower incarceration rates than the US-born for 150 years. Moreover, relative to the US-born...

On the Equilibrium Properties of Spatial Models

By Treb Allen, Costas Arkolakis, and Xiangliang Li

American Economic Review: Insights, December 2024

We consider a broad class of spatial models where there are many types of interactions across a large number of locations. We provide a new theorem that offers an iterative algorithm for calculating an equilibrium and sufficient and "globally necessary" c...

The AI Dilemma: Growth versus Existential Risk

By Charles I. Jones

American Economic Review: Insights, December 2024

Advances in artificial intelligence (AI) are a double-edged sword. On the one hand, they may increase economic growth as AI augments our ability to innovate. On the other hand, many experts worry that these advances entail existential risk: creating a sup...

Noise-Tolerant Community Enforcement and the Strength of Small Stakes

By Drew Fudenberg and Alexander Wolitzky

American Economic Review: Insights, December 2024

We study community enforcement in a large population with noisy monitoring. We focus on equilibria in the prisoner's dilemma that are coordination proof, meaning that matched partners never play a Pareto-dominated Nash equilibrium in the one-shot game ind...

Front Matter

American Economic Review: Insights, December 2024

The optimal size of local governments

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How the allocation of villages to government units in India affects the delivery of public services.

Front Matter

American Economic Review, December 2024

Curbing Leakage in Public Programs: Evidence from India's Direct Benefit Transfer Policy

By Prabhat Barnwal

American Economic Review, December 2024

Targeted price subsidies create a gap between subsidized and unsubsidized prices. The resulting dual pricing can lead to arbitrage opportunities where intermediaries divert subsidized goods to unintended beneficiaries via the black market. I study India's...

Aiming for the Goal: Contribution Dynamics of Crowdfunding

By Joyee Deb, Aniko Öry, and Kevin R. Williams

American Economic Review, December 2024

We study a dynamic contribution game where investors seek private benefits offered in exchange for contributions, and a single, publicly minded donor values project success. We show that donor contributions serve as costly signals that encourage socially ...

Beliefs in Repeated Games: An Experiment

By Masaki Aoyagi, Guillaume R. Fréchette, and Sevgi Yuksel

American Economic Review, December 2024

This paper uses a laboratory experiment to study beliefs and their relationship to action and strategy choices in finitely and indefinitely repeated prisoners' dilemma games. We find subjects' elicited beliefs about the other player's action are generally...

Contamination Bias in Linear Regressions

By Paul Goldsmith-Pinkham, Peter Hull, and Michal Kolesár

American Economic Review, December 2024

We study regressions with multiple treatments and a set of controls that is flexible enough to purge omitted variable bias. We show these regressions generally fail to estimate convex averages of heterogeneous treatment effects—instead, estimates of eac...

Decisions under Risk Are Decisions under Complexity

By Ryan Oprea

American Economic Review, December 2024

We provide evidence that classic lottery anomalies like probability weighting and loss aversion are not special phenomena of risk. They also arise (and often with equal strength) when subjects evaluate deterministic, positive monetary payments that have b...

Measuring Science: Performance Metrics and the Allocation of Talent

By Sebastian Hager, Carlo Schwarz, and Fabian Waldinger

American Economic Review, December 2024

We study how performance metrics affect the allocation of talent by exploiting the introduction of the first citation database in science. For technical reasons, it only covered citations from certain journals and years, creating quasi-random variation: s...

Political Correctness, Social Image, and Information Transmission

By Luca Braghieri

American Economic Review, December 2024

A prominent argument in the political correctness debate is that people feel pressure to publicly espouse sociopolitical views they do not privately hold, and that such misrepresentations might render public discourse less vibrant and informative. This pa...

Loans for the "Little Fellow": Credit, Crisis, and Recovery in the Great Depression

By Sarah Quincy

American Economic Review, December 2024

This paper identifies how bank branching benefited local economies during the Great Depression. Using archival data and narrative evidence, I show how Bank of America's branch network in 1930s California created an internal capital market that diversified...

Bias and Sensitivity under Ambiguity

By Zhen Huo, Marcelo Pedroni, and Guangyu Pei

American Economic Review, December 2024

This paper characterizes the effects of ambiguity aversion under dispersed information. The equilibrium outcome is observationally equivalent to a Bayesian forecast of the fundamental with increased sensitivity to signals and a pessimistic bias. This equi...

Annual Meeting Registration, Ongoing SF Labor Strike, and Other Announcements

[News]

December 02, 2024

View the AEA Member Announcement from December 2, 2024.