Coordination with Cognitive Noise

By Cary Frydman and Salvatore Nunnari

American Economic Journal: Microeconomics

We experimentally study how cognitive noise affects behavior in coordination games. Our key testable prediction is that equilibrium behavior depends on context, which we define as the distribution from which games are drawn. This prediction arises from ...

How Border and Distance Effects Shape the Multinational Wage Premium

By Hartmut Egger, Elke Jahn, and Udo Kreickemeier

American Economic Journal: Microeconomics

The multinational wage premium is well documented across countries. Using a new German dataset, we identify two previously overlooked determinants. First, wages paid by foreign multinationals in German plants increase with the distance between headquarte...

Racial Promotion Gaps

By Deepak Hegde, Alexander Ljungqvist, and Manav Raj

American Economic Review

We study racial disparities in promotions in a setting in which promotions are formulaic: the US patent office. Using detailed administrative data that allow us to observe who is eligible for promotion when, we document that Black patent examiners exper...

Screening and Segmenting: A Consumer Surplus Perspective

By Dirk Bergemann, Tibor Heumann, and Michael C. Wang

American Economic Review

We analyze consumer surplus when a monopolist can adjust both prices and product qualities across segments, engaging in second- and third-degree price discrimination simultaneously. We characterize the consumer-optimal segmentation and show that it has a...

Front Matter

American Economic Journal: Applied Economics, July 2026

The Dynamic Effects of Cash Transfers to Agricultural Households

By Shilpa Aggarwal, Jenny C. Aker, Dahyeon Jeong, Naresh Kumar, David Sungho Park, Jonathan Robinson, and Alan Spearot

American Economic Journal: Applied Economics, July 2026

Little is known about the evolution and persistence of the effects of one-time cash transfers, especially in rural agricultural settings with limited productive investment opportunities. We use bimonthly phone surveys to estimate dynamic impacts for cash ...

The Political Geography of Cities

By Richard Bluhm, Christian Lessmann, and Paul Schaudt

American Economic Journal: Applied Economics, July 2026

We study the link between regional capitals and urban development. We exploit new global data on hundreds of first-order administrative and capital city reforms from 1987 until 2018 to estimate the capital city premium. Gaining capital status increases ci...

Order Effects and Teacher Labor Supply: A Nationwide RCT in Ecuador

By Nicolás Ajzenman, Gregory Elacqua, Luana Marotta, and Anne Sofie Olsen

American Economic Journal: Applied Economics, July 2026

We evaluate a nationwide zero-cost intervention to reduce teacher sorting, where lower-income students are more likely to attend understaffed schools with less qualified teachers. Our approach was grounded in an insight from behavioral economics known as ...

Dominated Pension Investments: The Role of Search Frictions and Unawareness

By Karin Kinnerud and Louise Lorentzon

American Economic Journal: Applied Economics, July 2026

We conduct a large-scale field experiment in the Swedish pension system to examine to what extent information and search frictions explain dominated high-fee index fund choices. Three findings standout: (i) Letters that increase awareness of a dominated c...

Which Reference Groups Matter and How? A Relative Income Information Experiment with Administrative Data

By Xiaogeng Xu, Satu Metsälampi, Michael Kirchler, Kaisa Kotakorpi, Peter Hans Matthews, and Topi Miettinen

American Economic Journal: Applied Economics, July 2026

Received wisdom holds that income rank matters for life satisfaction, but causal evidence on the nature and impact of income comparisons is limited. We randomize individuals from a representative sample of mid-career Finns to receive personal rank informa...

The Welfare Economics of Reference Dependence

By Daniel Reck and Arthur Seibold

American Economic Journal: Applied Economics, July 2026

We analyze welfare under reference-dependent preferences. We decompose the first-order welfare effects of reference point and price changes into direct and behavioral effects. The sign of these effects depends on the form of reference-dependent payoffs; w...

Fostering Cooperation: The Conflict-Reducing Effects of Intervillage Competition for Government Transfers

By Teevrat Garg, Caterina Gennaioli, Stefania Lovo, and Gregor Singer

American Economic Journal: Applied Economics, July 2026

We examine the effect of intergroup competition on within-group violent conflict in Indonesia. Using a triple-differences design, we find that higher competition for national government transfers between villages reduces within-village conflict. These eff...

Turbocharging Profits? Contract Gaming and Revenue Allocation in Healthcare

By Atul Gupta, Ambar La Forgia, and Adam Sacarny

American Economic Journal: Applied Economics, July 2026

Firms often exploit weaknesses in government contracts to boost revenues, yet little is known about how they allocate these funds. We study how hospitals allocated $3 billion obtained from gaming a Medicare loophole. The average gaming hospital increased ...

Reserve Price Competition with Demand Uncertainty

By James Peck and Jeevant Rampal

American Economic Journal: Microeconomics

We consider duopoly competition under aggregate demand uncertainty, where firms compete by choosing reserve prices and holding uniform-price auctions. Consumers observe their valuation, but not the demand state, commit to a firm and participate in its ...

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The Evolution of Black-White Differences in Occupational Mobility Across Post-Civil War America

By Steven Durlauf, Gueyon Kim, Dohyeon Lee, and Xi Song

American Economic Journal: Applied Economics

We examine long-run differences in intergenerational occupational mobility between Black and White Americans using linked censuses and survey data from 1850 to 2021. We document two main results. First, shifts in mobility dynamics, most notably for the...

Front Matter

American Economic Journal: Macroeconomics, July 2026

Resource Misallocation in European Firms: The Role of Constraints, Firm Characteristics, and Managerial Decisions

By Yuriy Gorodnichenko, Debora Revoltella, Jan Svejnar, and Christoph T. Weiss

American Economic Journal: Macroeconomics, July 2026

Using a new survey, we document high dispersion of marginal revenue products across firms in the European Union. To interpret this dispersion, we develop a highly portable framework to quantify gains from better allocation of resources. We demonstrate tha...

TFPR: Dispersion and Cyclicality

By Russell Cooper and Ozgen Ozturk

American Economic Journal: Macroeconomics, July 2026

This paper studies the dispersion and cyclicality of TFPR. Recent business cycle models assume countercyclical dispersion in TFPQ based on evidence of countercyclical dispersion in TFPR, though TFPR reflects endogenous prices. An overlapping generations m...

Deciphering Federal Reserve Communication via Text Analysis of Alternative FOMC Statements

By Taeyoung Doh, Dongho Song, and Shu-Kuei Yang

American Economic Journal: Macroeconomics, July 2026

We propose a text-based measure of monetary policy stance that models FOMC statements as convex combinations of dovish and hawkish alternatives, providing a tractable representation of the Committee's position along the policy spectrum. Leveraging staff-d...