Good Principals or Good Peers? Parental Valuation of School Characteristics, Tiebout Equilibrium, and the Incentive Effects of Competition among Jurisdictions

By Jesse M. Rothstein

American Economic Review, September 2006

In a multicommunity model, high-income families cluster together in any equilibrium, and cluster near effective schools if effectiveness is an important component of community desirability. Governmental fragmentation facilitates this residential sorting. ...

Fiscal Unions

By Emmanuel Farhi and Iván Werning

American Economic Review, December 2017

We study cross-country risk sharing as a second-best problem for members of a currency union using an open economy model with nominal rigidities and provide two key results. First, we show that if financial markets are incomplete, the value of gaining acc...

Impossibility of Collusion under Imperfect Monitoring with Flexible Production

By Yuliy Sannikov and Andrzej Skrzypacz

American Economic Review, December 2007

We show that it is impossible to achieve collusion in a duopoly when (a) goods are homogenous and firms compete in quantities; (b) new, noisy information arrives continuously, without sudden events; and (c) firms are able to respond to new information ...

Knowledge Spillovers and Inequality

By Jan Eeckhout and Boyan Jovanovic

American Economic Review, December 2002

We develop a dynamic model with knowledge spillovers in production. The model contains two opposing forces. Imitation of other firms helps followers catch up with leaders, but the prospect of doing so makes followers want to free ride. The second force do...

The Baby Boom and Baby Bust

By Jeremy Greenwood, Ananth Seshadri, and Guillaume Vandenbroucke

American Economic Review, March 2005

What caused the baby boom? And can it be explained within the context of the secular decline in fertility that has occurred over the last 200 years? The hypothesis is that:(a) The secular decline in fertility is due to the relentless rise in real wages th...

Heterogeneity in Risky Choice Behavior in a Broad Population

By Hans-Martin von Gaudecker, Arthur van Soest, and Erik Wengstrom

American Economic Review, April 2011

We analyze risk preferences using an experiment with real incentives in a representative sample of 1,422 Dutch respondents. Our econometric model incorporates four structural parameters that vary with observed and unobserved characteristics: utility curva...

Relational Incentive Contracts

By Jonathan Levin

American Economic Review, June 2003

Standard incentive theory models provide a rich framework for studying informational problems but assume that contracts can be perfectly enforced. This paper studies the design of self-enforced relational contracts. I show that optimal contracts often can...

Gender Gap in High-Growth Ventures: Evidence from a University Venture Mentoring Program

By Erin L. Scott and Pian Shu

American Economic Review, May 2017

We track high-growth ventures from the idea stage to commercialization and investigate the nature of the gender gap early in the venture lifecycle. Using data on 651 venture ideas that collectively attracted over $700 million in venture financing, we find...

Multinationals and Anti-sweatshop Activism

By Ann Harrison and Jason Scorse

American Economic Review, March 2010

During the 1990s, anti-sweatshop activists campaigned to improve conditions for workers in developing countries. This paper analyzes the impact of anti-sweatshop campaigns in Indonesia on wages and employment. Identification is based on comparing the w...

Peer Effects in Program Participation

By Gordon B. Dahl, Katrine V. Løken, and Magne Mogstad

American Economic Review, July 2014

We estimate peer effects in paid paternity leave in Norway using a regression discontinuity design. Coworkers and brothers are 11 and 15 percentage points, respectively, more likely to take paternity leave if their peer was exogenously induced to take up ...

Slow to Anger and Fast to Forgive: Cooperation in an Uncertain World

By Drew Fudenberg, David G. Rand, and Anna Dreber

American Economic Review, April 2012

We study the experimental play of the repeated prisoner's dilemma when intended actions are implemented with noise. In treatments where cooperation is an equilibrium, subjects cooperate substantially more than in treatments without cooperative equilibria....

Paid Parental Leave Laws in the United States: Does Short-Duration Leave Affect Women's Labor-Force Attachment?

By Tanya S. Byker

American Economic Review, May 2016

I analyze the effects of short-duration paid parental leave on maternal labor supply. Using monthly longitudinal data from the Survey of Income and Program Participation, my event-study research design estimates impacts of paid leave laws in California an...

Reputation and Persistence of Adverse Selection in Secondary Loan Markets

By V. V. Chari, Ali Shourideh, and Ariel Zetlin-Jones

American Economic Review, December 2014

The volume of new issuances in secondary loan markets fluctuates over time and falls when collateral values fall. We develop a model with adverse selection and reputation that is consistent with such fluctuations. Adverse selection ensures that the vol...

Exports, Export Destinations, and Skills

By Irene Brambilla, Daniel Lederman, and Guido Porto

American Economic Review, December 2012

This paper explores the links between exports, export destinations, and skill utilization. We identify two mechanisms behind these links: differences across destinations in quality valuation and in exporting required services, activities that are inten...

Trafficking Networks and the Mexican Drug War

By Melissa Dell

American Economic Review, June 2015

Drug trade-related violence has escalated dramatically in Mexico since 2007, and recent years have also witnessed large-scale efforts to combat trafficking, spearheaded by Mexico's conservative PAN party. This study examines the direct and spillover effec...

Intra-industry Foreign Direct Investment

By Laura Alfaro and Andrew Charlton

American Economic Review, December 2009

We use a new firm-level dataset that establishes the location, ownership, and activity of 650,000 multinational subsidiaries. Using a combination of four-digit-level information and input-output tables, we find the share of vertical FDI (subsidiaries that...

Fundamentals, Panics, and Bank Distress During the Depression

By Charles W. Calomiris and Joseph R. Mason

American Economic Review, December 2003

We assemble bank-level and other data for Fed member banks to model determinants of bank failure. Fundamentals explain bank failure risk well. The first two Friedman-Schwartz crises are not associated with positive unexplained residual failure risk, or in...

Constructivist and Ecological Rationality in Economics

By Vernon L. Smith

American Economic Review, June 2003

One, Two, (Three), Infinity, ...: Newspaper and Lab Beauty-Contest Experiments

By Antoni Bosch-Domènech, José G. Montalvo, Rosemarie Nagel, and Albert Satorra

American Economic Review, December 2002

Information Acquisition in a War of Attrition

By Kyungmin Kim and Frances Zhiyun Xu Lee

American Economic Journal: Microeconomics, May 2014

We consider a war of attrition where the players can learn about a state that determines their payoffs at stochastic deadline. We study how the incentives to acquire information depend on the (un)verifiability of information and its implications for ef...