Groups Make Better Self-Interested Decisions

By Gary Charness and Matthias Sutter

Journal of Economic Perspectives, Summer 2012

In this paper, we describe what economists have learned about differences between group and individual decision-making. This literature is still young, and in this paper, we will mostly draw on experimental work (mainly in the laboratory) that has compare...

A Model of Housing in the Presence of Adjustment Costs: A Structural Interpretation of Habit Persistence

By Marjorie Flavin and Shinobu Nakagawa

American Economic Review, March 2008

The paper provides a model of household consumption and portfolio allocation which incorporates housing as both a consumption good and a component of wealth. Household utility depends, possibly nonseparably, on two goods: nondurable consumption, which is ...

Urbanization, Mortality, and Fertility in Malthusian England

By Gregory Clark and Neil Cummins

American Economic Review, May 2009

Estimating the Effect of Student Aid on College Enrollment: Evidence from a Government Grant Policy Reform

By Helena Skyt Nielsen, Torben Sørensen, and Christopher Taber

American Economic Journal: Economic Policy, May 2010

In this paper, we estimate the response of college enrollment to changes in student aid arising from a Danish reform. We separately identify the effect of aid from that of other observed and unobserved variables such as parental income. We exploit the com...

Valuing New Goods in a Model with Complementarity: Online Newspapers

By Matthew Gentzkow

American Economic Review, June 2007

Many important economic questions hinge on the extent to which new goods either crowd out or complement consumption of existing products. Recent methods for studying new goods rule out complementarity by assumption, so their applicability to these ques...

Marginal Tax Rates and Income Inequality in a Life-Cycle Model

By David Altig and Charles T. Carlstrom

American Economic Review, December 1999

In this paper we study the quantitative impact of marginal tax rates on the distribution of income. Our methodology builds on computable general-equilibrium framework. We find that distortions from marginal tax rate changes of the sort implied by the Tax ...

Financial Control in the Transition from Classical Socialism to a Market Economy

[Symposium: Economic Transition in the Soviet Union and Eastern Europe]

By Ronald I. McKinnon

Journal of Economic Perspectives, Fall 1991

The transition from socialism to capitalism poses severe problems of financial management that have yet to be resolved in principle, let alone in practice. One unfortunate consequence is continual financial turmoil as socialist economies of the Soviet Uni...

Matching with Contracts: Comment

By John William Hatfield and Fuhito Kojima

American Economic Review, June 2008

Hatfield and Milgrom (2005) present a unified model of matching with contracts phrased in terms of hospitals and doctors, which subsumes the standard two-sided matching and some package auction models. They show that a stable allocation exists if contract...

Estimation of De Facto Flexibility Parameter and Basket Weights in Evolving Exchange Rate Regimes

By Jeffrey Frankel and Daniel Xie

American Economic Review, May 2010

Third-Degree Price Discrimination in Input Markets: Output and Welfare

By Yoshihiro Yoshida

American Economic Review, March 2000

Pareto-Efficient International Taxation

By Michael Keen and David Wildasin

American Economic Review, March 2004

This paper analyzes Pareto-efficient international tax regimes. Because every country faces its own national budget constraint, the Diamond-Mirrlees production-efficiency theorem, which underlies key tenets of policy advice in international taxation - the...

The Constitutional Dilemma of Economic Liberty

[Symposium: Institutions]

By Barry R. Weingast

Journal of Economic Perspectives, Summer 2005

This paper studies the problem of self-enforcing constitutions, addressing the question, how do some constitutions provide incentives for political officials to abide by the constraints announced in the constitution? To understand the mechanisms underlyin...

Debt Contracts with Partial Commitment

By Natalia Kovrijnykh

American Economic Review, December 2013

This paper analyzes a dynamic lending relationship where the borrower cannot be forced to make repayments, and the lender offers long-term contracts that are imperfectly enforced and repeatedly renegotiated. No commitment and full commitment by the len...

CONDI: A Cost-of-Nominal-Distortions Index

By Stefano Eusepi, Bart Hobijn, and Andrea Tambalotti

American Economic Journal: Macroeconomics, July 2011

We construct a PCE-based price index whose weights minimize the welfare costs of nominal distortions: a cost-of-nominal-distortions index. We compute these weights in a multi-sector New Keynesian model, calibrated to match US data on price stickiness, lab...

Hassle Costs and Price Discrimination: An Empirical Welfare Analysis

By Guillermo Marshall

American Economic Journal: Applied Economics, July 2015

This paper studies a market where soda is sold in both refillable and nonrefillable bottles. Purchasing refillables is inconvenient but cheaper. Using a discrete choice model, I find that price-sensitive customers put less weight on the inconveniences of ...

Trade Policy and Loss Aversion

By Caroline Freund and Caglar Ozden

American Economic Review, September 2008

We develop a political economy model where loss aversion and reference dependence are important in shaping people’s preferences over trade policy. The policy implications of the augmented model differ in three ways: there is a region of compensating pro...

Economic Analysis of Social Interactions

By Charles F. Manski

Journal of Economic Perspectives, Summer 2000

Economics is broadening its scope from analysis of markets to study of general social interactions. Developments in game theory, the economics of the family, and endogenous growth theory have led the way. Economists have also performed new empirical resea...

New Evidence on the Money's Worth of Individual Annuities

By Olivia S. Mitchell, James M. Poterba, Mark J. Warshawsky, and Jeffrey R. Brown

American Economic Review, December 1999

Central-Bank Credibility: Why Do We Care? How Do We Build It?

By Alan S. Blinder

American Economic Review, December 2000

Hicksian Welfare Measures and the Normative Endowment Effect

By Thomas A. Weber

American Economic Journal: Microeconomics, November 2010

We show that the Hicksian welfare measures of compensating variation and equivalent variation coincide if one of them is evaluated at a compensated income. The measures are nondecreasing in income if the varied attribute and income are complementary, and...