Heterogeneity, Inattention, and Bayesian Updates

By Raffaella Giacomini, Vasiliki Skreta, and Javier Turen

American Economic Journal: Macroeconomics, January 2020

We formulate a theory of expectations updating that fits the dynamics of accuracy and disagreement in a new survey of professional forecasters. We document new stylized facts, including the puzzling persistence of disagreement as uncertainty resolves. Our...

The Weak Job Recovery in a Macro Model of Search and Recruiting Intensity

By Sylvain Leduc and Zheng Liu

American Economic Journal: Macroeconomics, January 2020

We show that cyclical fluctuations in search and recruiting intensity are quantitatively important for explaining the weak job recovery from the Great Recession. We demonstrate this result using an estimated labor search model that features endogenous sea...

Front Matter

American Economic Journal: Applied Economics, January 2020

Estimating Adjustment Frictions Using Nonlinear Budget Sets: Method and Evidence from the Earnings Test

By Alexander M. Gelber, Damon Jones, and Daniel W. Sacks

American Economic Journal: Applied Economics, January 2020

We introduce a method for estimating the cost of adjusting earnings, as well as the earnings elasticity with respect to the net-of-tax share. Our method uses information on bunching in the earnings distribution at convex budget set kinks before and after ...

Early Voting Laws, Voter Turnout, and Partisan Vote Composition: Evidence from Ohio

By Ethan Kaplan and Haishan Yuan

American Economic Journal: Applied Economics, January 2020

We estimate effects of early voting on voter turnout using a 2010 homogenization law from Ohio that forced some counties to expand and others to contract early voting. Using voter registration data, we compare individuals who live within the same 2x2 mile...

A Precinct Too Far: Turnout and Voting Costs

By Enrico Cantoni

American Economic Journal: Applied Economics, January 2020

I study the effects of voting costs—specifically, distance to polling location—using geographic discontinuities. Opposite sides of boundaries between voting precincts are observationally identical, except for their assigned polling locations. This dis...

The Long-Run Dynamics of Electricity Demand: Evidence from Municipal Aggregation

By Tatyana Deryugina, Alexander MacKay, and Julian Reif

American Economic Journal: Applied Economics, January 2020

We study the dynamics of residential electricity demand by exploiting a natural experiment that produced large and long-lasting price changes in over 250 Illinois communities. Using a flexible difference-in-difference matching approach, we estimate that t...

Do Energy Efficiency Investments Deliver at the Right Time?

By Judson Boomhower and Lucas Davis

American Economic Journal: Applied Economics, January 2020

Most analyses of energy efficiency investments ignore that the value of electricity varies widely across hours. We show how much timing matters. Using novel hourly consumption data from an air conditioner rebate program in California, we find that energy ...

Crafting Intellectual Property Rights: Implications for Patent Assertion Entities, Litigation, and Innovation

By Josh Feng and Xavier Jaravel

American Economic Journal: Applied Economics, January 2020

We show that examiner-driven variation in patent rights leads to quantitatively large impacts on several patent outcomes, including patent value, citations, and litigation. Notably, Patent Assertion Entities (PAEs) overwhelmingly purchase patents granted ...

Un-Fortunate Sons: Effects of the Vietnam Draft Lottery on the Next Generation's Labor Market

By Sarena Goodman and Adam Isen

American Economic Journal: Applied Economics, January 2020

We examine whether the considerable shock generated by the Vietnam draft lottery affected the next generation's labor market. Using the universe of US federal tax returns, we link fathers from draft cohorts to their sons' adult outcomes and find that sons...

Women's Empowerment in Action: Evidence from a Randomized Control Trial in Africa

By Oriana Bandiera, Niklas Buehren, Robin Burgess, Markus Goldstein, Selim Gulesci, Imran Rasul, and Munshi Sulaiman

American Economic Journal: Applied Economics, January 2020

We evaluate a multifaceted policy intervention attempting to jump-start adolescent women's empowerment in Uganda by simultaneously providing them vocational training and information on sex, reproduction, and marriage. We find that four years postintervent...

All the Single Ladies: Job Promotions and the Durability of Marriage

By Olle Folke and Johanna Rickne

American Economic Journal: Applied Economics, January 2020

We study how promotions to top jobs affect the probability of divorce. We compare the relationship trajectories of winning and losing candidates for mayor and parliamentarian and find that a promotion to one of these jobs doubles the baseline probability ...

Race to the Bottom? Local Tax Break Competition and Business Location

By Evan Mast

American Economic Journal: Applied Economics, January 2020

I analyze how competition between localities affects tax breaks and business location decisions. I first use a geographic instrument to show that spatial competition substantially increases firm-specific property tax breaks. I then use this pattern to est...

Tipping and the Effects of Segregation

By Anders Böhlmark and Alexander Willén

American Economic Journal: Applied Economics, January 2020

We analyze how neighborhood ethnic population composition affects the short- and long-run education and labor market outcomes of natives and immigrants. To overcome the problem of nonrandom sorting across neighborhoods, we borrow theoretical insights from...

Educational Investment Responses to Economic Opportunity: Evidence from Indian Road Construction

By Anjali Adukia, Sam Asher, and Paul Novosad

American Economic Journal: Applied Economics, January 2020

The rural poor in developing countries, once economically isolated, are increasingly being connected to outside markets. Whether these new connections crowd out or encourage educational investment is a central question. We examine the effects on education...

Front Matter

American Economic Review, February 2020

The Dynamics of Motivated Beliefs

By Florian Zimmermann

American Economic Review, February 2020

A key question in the literature on motivated reasoning and self-deception is how motivated beliefs are sustained in the presence of feedback. In this paper, we explore dynamic motivated belief patterns after feedback. We establish that positive feedback ...

Outsourcing Education: Experimental Evidence from Liberia

By Mauricio Romero, Justin Sandefur, and Wayne Aaron Sandholtz

American Economic Review, February 2020

In 2016, the Liberian government delegated management of 93 randomly selected public schools to private providers. Providers received US$50 per pupil, on top of US$50 per pupil annual expenditure in control schools. After one academic year, students in ou...

Factory Productivity and the Concession System of Incorporation in Late Imperial Russia, 1894–1908

By Amanda G. Gregg

American Economic Review, February 2020

In Imperial Russia, incorporation required an expensive special concession, yet over 4,000 Russian firms incorporated before 1914. I identify the characteristics of incorporating firms and measure the productivity gains and growth in machine power enjoyed...

Bargaining and News

By Brendan Daley and Brett Green

American Economic Review, February 2020

We study a bargaining model in which a buyer makes frequent offers to a privately informed seller, while gradually learning about the seller's type from "news." We show that the buyer's ability to leverage this information to extract more surplus from the...