The 2024 AEJ Best Paper Awards have been announced. The papers selected are highlighted below.

AEJ: Applied Economics 

In "Disability and Distress: The Effect of Disability Programs on Financial Outcomes," authors Manasi Deshpande, Tal Gross, and Yalun Su estimated the impact of disability programs on financial distress. They find that US disability allowances decrease the likelihood of bankruptcy by 20 percent, foreclosure by 33 percent, and home sale by 15 percent. They argue that such significant declines in financial distress lend support to policies that reduce the waiting times between a disability application and the receipt of the benefits. (AEJ: Applied Economics, Volume 13, No. 2, April 2021)

AEJ: Economic Policy 

In "The Labor Market for Teachers under Different Pay Schemes," author Barbara Biasi examined the introduction of a flexible pay scheme for Wisconsin public school teachers, in which teachers are compensated according to performance rather than by seniority and education alone. Her findings show that districts adopting the new pay scheme were able to attract and retain better talent than those that did not, providing insight into what motivates teachers and highlighting inefficiencies produced by union-negotiated pay structures. (AEJ: Economic Policy, Vol. 13, No. 3, August 2021)

Read the Research Highlight here.

AEJ: Macroeconomics 

In "The Transmission of Monetary Policy Shocks," authors Silvia Miranda-Agrippino and Giovanni Ricco studied widely used instruments for the identification of monetary policy disturbances. They show how these instruments give rise to common empirical puzzles, and propose a new high-frequency instrument for monetary policy shocks that accounts for informational rigidities. Using this novel instrument, they find that monetary tightening is unequivocally contractionary. (American Economic Journal: Macroeconomics Vol. 13 No. 3 July 2021)

AEJ: Microeconomics 

In "A Reputational Theory of Firm Dynamics," authors Simon Board and Moritz Meyer-ter-Vehn investigated the incentives that companies have to maintain quality when consumers have limited information about the quality of their products or services. They model how consumers learn about such products via public breakthroughs. In their model, if firms fail to generate such breakthroughs, they will lose revenue and eventually exit. Their findings may have important implications for evaluating the impact of policy changes that affect businesses. (American Economic Journal: Microeconomics Vol. 14 No. 2 May 2022)