Doctoral Dissertations in Economics

Journal of Economic Literature, December 2019

Front Matter

American Economic Review, January 2020

Putting the Cycle Back into Business Cycle Analysis

By Paul Beaudry, Dana Galizia, and Franck Portier

American Economic Review, January 2020

Are business cycles mainly a response to persistent exogenous shocks, or do they instead reflect a strong endogenous mechanism which produces recurrent boom-bust phenomena? In this paper we present evidence in favor of the second interpretation and we hig...

Estimating the Production Function for Human Capital: Results from a Randomized Controlled Trial in Colombia

By Orazio Attanasio, Sarah Cattan, Emla Fitzsimons, Costas Meghir, and Marta Rubio-Codina

American Economic Review, January 2020

We examine the channels through which a randomized early childhood intervention in Colombia led to significant gains in cognitive and socio-emotional skills among a sample of disadvantaged children aged 12 to 24 months at baseline. We estimate the determi...

Positive Long-Run Capital Taxation: Chamley-Judd Revisited

By Ludwig Straub and Iván Werning

American Economic Review, January 2020

According to the Chamley-Judd result, capital should not be taxed in the long run. In this paper, we overturn this conclusion, showing that it does not follow from the very models used to derive it. For the main model in Judd (1985), we prove that the l...

Regulating Innovation with Uncertain Quality: Information, Risk, and Access in Medical Devices

By Matthew Grennan and Robert J. Town

American Economic Review, January 2020

We study the impact of regulating product entry and quality information requirements on an oligopoly equilibrium and consumer welfare. Product testing can reduce consumer uncertainty, but also increase entry costs and delay entry. Using variation between ...

Efficient Child Care Subsidies

By Christine Ho and Nicola Pavoni

American Economic Review, January 2020

We study the design of child care subsidies in an optimal welfare problem with heterogeneous private market productivities. The optimal subsidy schedule is qualitatively similar to the existing US scheme. Efficiency mandates a subsidy on formal child care...

Way Down in the Hole: Adaptation to Long-Term Water Loss in Rural India

By David Blakeslee, Ram Fishman, and Veena Srinivasan

American Economic Review, January 2020

Worsening environmental conditions threaten to undermine progress in reducing rural poverty. Little is known, however, about the prospects for farmer adaptations to mitigate this threat, in particular through opportunities for income diversification prese...

Diffusion Games

By Evan Sadler

American Economic Review, January 2020

Behaviors and information often spread via person-to-person diffusion. This paper highlights how diffusion processes can facilitate coordination. I study contagion in a discrete network with Bayesian players. In addition to characterizing the extent and r...

Diffusing Coordination Risk

By Deepal Basak and Zhen Zhou

American Economic Review, January 2020

In a regime change game, privately informed agents sequentially decide whether to attack without observing others' previous actions. To dissuade them from attacking, a principal adopts a dynamic information disclosure policy, frequent viability tests. A v...

Optimal Taxation with Behavioral Agents

By Emmanuel Farhi and Xavier Gabaix

American Economic Review, January 2020

This paper develops a theory of optimal taxation with behavioral agents. We use a general framework that encompasses a wide range of biases such as misperceptions and internalities. We revisit the three pillars of optimal taxation: Ramsey (linear commodit...

Front Matter

American Economic Journal: Macroeconomics, January 2020

Rational Inattention in Hiring Decisions

By Sushant Acharya and Shu Lin Wee

American Economic Journal: Macroeconomics, January 2020

We provide an information-based theory of matching efficiency fluctuations. Rationally inattentive firms have limited capacity to process information and cannot perfectly identify suitable applicants. During recessions, higher losses from hiring unsuitabl...

The Collateral Composition Channel

By Frédéric Boissay and Russell Cooper

American Economic Journal: Macroeconomics, January 2020

Wholesale financial markets reallocate deposits. Because of incentive problems, these flows are limited by endogenous collateral constraints. The composition of collateral matters. The use of inside collateral creates a "collateral pyramid": cash flows fr...

The Impact of Brexit on Foreign Investment and Production

By Ellen R. McGrattan and Andrea Waddle

American Economic Journal: Macroeconomics, January 2020

Using simulations from a multicountry neoclassical growth model, we analyze several post-Brexit scenarios. First, the United Kingdom unilaterally imposes tighter restrictions on FDI and trade from other EU nations. Second, the European Union retaliates an...

Temporary Price Changes, Inflation Regimes, and the Propagation of Monetary Shocks

By Fernando Alvarez and Francesco Lippi

American Economic Journal: Macroeconomics, January 2020

We present a sticky price model that features the coexistence of many price changes, most of which are temporary, with a modest flexibility of the aggregate price level. Stickiness is introduced in the form of a price plan, namely a set of two prices: eit...

The Agricultural Wage Gap: Evidence from Brazilian Micro-data

By Jorge A. Alvarez

American Economic Journal: Macroeconomics, January 2020

A key feature of developing economies is that wages in agriculture are below those of other sectors. Using Brazilian household surveys and administrative panel data, I use information on workers who switch sectors and workers with multiple jobs to assess ...

Older Americans Would Work Longer If Jobs Were Flexible

By John Ameriks, Joseph Briggs, Andrew Caplin, Minjoon Lee, Matthew D. Shapiro, and Christopher Tonetti

American Economic Journal: Macroeconomics, January 2020

Older Americans, even those who are long retired, have strong willingness to work, especially in jobs with flexible schedules. For many, labor force participation near or after normal retirement age is limited more by a lack of acceptable job opportunitie...

Multidimensional Skill Mismatch

By Fatih Guvenen, Burhan Kuruscu, Satoshi Tanaka, and David Wiczer

American Economic Journal: Macroeconomics, January 2020

What determines the earnings of a worker relative to his peers in the same occupation? What makes a worker fail in one occupation but succeed in another? More broadly, what are the factors that determine the productivity of a worker-occupation match? To...

Leverage and Deepening Business-Cycle Skewness

By Henrik Jensen, Ivan Petrella, Søren Hove Ravn, and Emiliano Santoro

American Economic Journal: Macroeconomics, January 2020

We document that the United States and other G7 economies have been characterized by an increasingly negative business-cycle asymmetry over the last three decades. This finding can be explained by the concurrent increase in the financial leverage of house...