Goodbye Washington Consensus, Hello Washington Confusion? A Review of the World Bank's Economic Growth in the 1990s: Learning from a Decade of Reform

By Dani Rodrik

Journal of Economic Literature, December 2006

Proponents and critics alike agree that the policies spawned by the Washington Consensus have not produced the desired results. The debate now is not over whether the Washington Consensus is dead or alive, but over what will replace it. An important ma...

The Cross Section of Foreign Currency Risk Premia and Consumption Growth Risk

By Hanno Lustig and Adrien Verdelhan

American Economic Review, March 2007

Aggregate consumption growth risk explains why low interest rate currencies do not appreciate as much as the interest rate differential and why high interest rate currencies do not depreciate as much as the interest rate differential. Domestic investor...

Bureaucrats or Politicians? Part I: A Single Policy Task

By Alberto Alesina and Guido Tabellini

American Economic Review, March 2007

This paper investigates the normative criteria that guide the allocation of a policy task to an elected politician versus an independent bureaucrat. The bureaucrat is preferable for technical tasks for which ability is more important than effort, or if ...

The Motivation and Bias of Bureaucrats

By Canice Prendergast

American Economic Review, March 2007

Many individuals are motivated to exert effort because they care about their jobs, rather than because there are monetary consequences to their actions. The intrinsic motivation of bureaucrats is the focus of this paper, and three primary results are s...

Bounding Revenue Comparisons across Multi-Unit Auction Formats under ε-Best Response

By James T. E. Chapman, David McAdams, and Harry J. Paarsch

American Economic Review, May 2007

The Search for Economics Talent: Doctoral Completion and Research Productivity

By Wayne A. Grove and Stephen Wu

American Economic Review, May 2007

Adding a Stick to the Carrot? The Interaction of Bonuses and Fines

By Ernst Fehr and Klaus M. Schmidt

American Economic Review, May 2007

On Quitting Rights in Mechanism Design

By Olivier Compte and Philippe Jehiel

American Economic Review, May 2007

An Ascending Auction for Interdependent Values: Uniqueness and Robustness to Strategic Uncertainty

By Dirk Bergemann and Stephen Morris

American Economic Review, May 2007

Some Evolutionary Economics of Family Partnerships

By Theodore C. Bergstrom

American Economic Review, May 2007

Habits, Peers, and Happiness: An Evolutionary Perspective

By Luis Rayo and Gary S. Becker

American Economic Review, May 2007

Integrated Insurance Design in the Presence of Multiple Medical Technologies

By Dana Goldman and Tomas J. Philipson

American Economic Review, May 2007

How Occupied France Financed Its Own Exploitation in World War II

By Filippo Occhino, Kim Oosterlinck, and Eugene N. White

American Economic Review, May 2007

Signaling Character in Electoral Competition

By Navin Kartik and R. Preston McAfee

American Economic Review, June 2007

We study a one-dimensional Hotelling-Downs model of electoral competition with the following innovation: a fraction of candidates have "character" and are exogenously committed to a campaign platform; this is unobservable to voters. Character is desira...

Harmonization and Side Payments in Political Cooperation

By Bård Harstad

American Economic Review, June 2007

For two districts or countries that try to internalize externalities, I analyze a bargaining game under private information. I derive conditions for when it is efficient with uniform policies across regions—with and without side payments— a...

Trust as a Signal of a Social Norm and the Hidden Costs of Incentive Schemes

By Dirk Sliwka

American Economic Review, June 2007

An explanation for motivation crowding-out phenomena is developed in a social preferences framework. Besides selfish and fair or altruistic types, a third type of agent is introduced. These "conformists" have social preferences if they believe that suffic...

Vertical Integration and Firm Boundaries: The Evidence

By Francine Lafontaine and Margaret Slade

Journal of Economic Literature, September 2007

Since Ronald H. Coase's (1937) seminal paper, a rich set of theories has been developed that deal with firm boundaries in vertical or input–output structures. In the last twenty-five years, empirical evidence that can shed light on those theories also...

Contracting with Repeated Moral Hazard and Private Evaluations

By William Fuchs

American Economic Review, September 2007

A repeated moral hazard setting in which the Principal privately observes the Agent's output is studied. The optimal contract for a finite horizon is characterized, and shown to require burning of resources. These are only burnt after the worst possible r...

Overconfidence, Insurance, and Paternalism

By Alvaro Sandroni and Francesco Squintani

American Economic Review, December 2007

It is well known that when agents are fully rational, compulsory public insurance may make all agents better off in the Rothschild and Stiglitz (1976) model of insurance markets. We find that when sufficiently many agents underestimate their personal ri...

Efficiency and Information Aggregation in Auctions

By Wolfgang Pesendorfer and Jeroen M. Swinkels

American Economic Review, June 2000

The tension between allocative efficiency and information aggregation is explored in the context of an auction: k identical objects of unknown quality are auctioned off to n bidders whose tastes affect their valuation of an object of given quality. Bidder...