The Housing Market Impacts of Shale Gas Development

By Lucija Muehlenbachs, Elisheba Spiller, and Christopher Timmins

American Economic Review, December 2015

Using data from Pennsylvania and an array of empirical techniques to control for confounding factors, we recover hedonic estimates of property value impacts from nearby shale gas development that vary with water source, well productivity, and visibility. ...

Long-Term Neighborhood Effects on Low-Income Families: Evidence from Moving to Opportunity

By Jens Ludwig, Greg J. Duncan, Lisa A. Gennetian, Lawrence F. Katz, Ronald C. Kessler, Jeffrey R. Kling, and Lisa Sanbonmatsu

American Economic Review, May 2013

We examine long-term neighborhood effects on low-income families using data from the Moving to Opportunity (MTO) randomized housing-mobility experiment. This experiment offered to some public-housing families but not to others the chance to move to less-d...

Retrospectives: How Economists Came to Accept Expected Utility Theory: The Case of Samuelson and Savage

By Ivan Moscati

Journal of Economic Perspectives, Spring 2016

Expected utility theory dominated the economic analysis of individual decision-making under risk from the early 1950s to the 1990. Among the early supporters of the expected utility hypothesis in the von Neumann–Morgenstern version were Milton Friedman ...

Self-Confirming Equilibrium and Model Uncertainty

By Pierpaolo Battigalli, Simone Cerreia-Vioglio, Fabio Maccheroni, and Massimo Marinacci

American Economic Review, February 2015

We analyze a notion of self-confirming equilibrium with non-neutral ambiguity attitudes that generalizes the traditional concept. We show that the set of equilibria expands as ambiguity aversion increases. The intuition is quite simple: by playing the ...

The Impact of Ethnic Diversity in Bureaucracies: Evidence from the Nigerian Civil Service

By Imran Rasul and Daniel Rogger

American Economic Review, May 2015

We document the correlation between the workplace diversity in bureaucratic organizations and public service delivery. We do so in the context of Nigeria, where ethnicity is a salient form of self-identity. We thus expand the empirical management literatu...

Learning about Risk and Return: A Simple Model of Bubbles and Crashes

By William A. Branch and George W. Evans

American Economic Journal: Macroeconomics, July 2011

This paper demonstrates that an asset pricing model with least-squares learning can lead to bubbles and crashes as endogenous responses to the fundamentals driving asset prices. When agents are risk-averse they need to make forecasts of the conditional v...

Networks in the Understanding of Economic Behaviors

[Symposium: Social Networks]

By Matthew O. Jackson

Journal of Economic Perspectives, Fall 2014

As economists endeavor to build better models of human behavior, they cannot ignore that humans are fundamentally a social species with interaction patterns that shape their behaviors. People's opinions, which products they buy, whether they invest in edu...

Institutional Determinants of Labor Reallocation in Transition

[Symposium: Transition Economies]

By Tito Boeri and Katherine Terrell

Journal of Economic Perspectives, Winter 2002

The transition process differed in the countries of the Former Soviet Union (FSU) and those of Central and Eastern Europe (CEE) in terms of reallocation of labor real wage, employment and output adjustment. We sift through the theoretical and empirical li...

The Costs and Consequences of Clean Air Act Regulation of CO2 from Power Plants

By Dallas Burtraw, Josh Linn, Karen Palmer, and Anthony Paul

American Economic Review, May 2014

US climate policy is unfolding under the Clean Air Act. Mobile source and construction permitting regulations are in place. Most important, EPA and the states will determine the form and stringency of the regulations for power plants. Various approaches w...

Is Tiger Woods Loss Averse? Persistent Bias in the Face of Experience, Competition, and High Stakes

By Devin G. Pope and Maurice E. Schweitzer

American Economic Review, February 2011

Although experimental studies have documented systematic decision errors, many leading scholars believe that experience, competition, and large stakes will reliably extinguish biases. We test for the presence of a fundamental bias, loss aversion, in a hig...

Price Discrimination and Bargaining: Empirical Evidence from Medical Devices

By Matthew Grennan

American Economic Review, February 2013

Many important issues in business-to-business markets involve price discrimination and negotiated prices, situations where theoretical predictions are ambiguous. This paper uses new panel data on buyer-supplier transfers and a structural model to empiri...

Sequentially Rationalizable Choice

By Paola Manzini and Marco Mariotti

American Economic Review, December 2007

A sequentially rationalizable choice function is a choice function that can be retrieved by applying sequentially to each choice problem the same fixed set of asymmetric binary relations (rationales) to remove inferior alternatives. These concepts tran...

Assessing the Case for Social Experiments

[Symposium: Social Experiments]

By James J. Heckman and Jeffrey A. Smith

Journal of Economic Perspectives, Spring 1995

This paper analyzes the method of social experiments. The assumptions that justify the experimental method are exposited. Parameters of interest in evaluating social programs are discussed. The authors show how experiments sometimes serve as instrumental ...

Health Care Costs: On the Rise Again

By Sherry Glied

Journal of Economic Perspectives, Spring 2003

Since 1999, health care costs have been growing faster than national income. This rapid growth has occurred as the ability of private and public purchasers to reduce service utilization and bargain for lower prices has fallen, insurers have recouped lost ...

Capital Tax Reform and the Real Economy: The Effects of the 2003 Dividend Tax Cut

By Danny Yagan

American Economic Review, December 2015

This paper tests whether the 2003 dividend tax cut—one of the largest reforms ever to a US capital tax rate—stimulated corporate investment and increased labor earnings, using a quasi-experimental design and US corporate tax returns from years...

Who Gets the Job Referral? Evidence from a Social Networks Experiment

By Lori Beaman and Jeremy Magruder

American Economic Review, December 2012

We use recruitment into a laboratory experiment in Kolkata, India to analyze how social networks select individuals for jobs. The experiment allows subjects to refer actual network members for casual jobs as experimental subjects under exogenously varied...

Genes, Eyeglasses, and Social Policy

[Symposium: Genetics and Economics]

By Charles F. Manski

Journal of Economic Perspectives, Fall 2011

Someone reading empirical research relating human genetics to personal outcomes must be careful to distinguish two types of work: An old literature on heritability attempts to decompose cross-sectional variation in observed outcomes into unobservable gene...

Evaluating the Classification of Economic Activity into Recessions and Expansions

By Travis J. Berge and Òscar Jordà

American Economic Journal: Macroeconomics, April 2011

The Business Cycle Dating Committee of the National Bureau of Economic Research provides a historical chronology of business cycle turning points. We investigate three central aspects of this chronology. How skillful is the Dating Committee when classifyi...

Happiness and Time Preference: The Effect of Positive Affect in a Random-Assignment Experiment

By John Ifcher and Homa Zarghamee

American Economic Review, December 2011

We conduct a random-assignment experiment to investigate whether positive affect impacts time preference, where time preference denotes a preference for present over future utility. Our result indicates that, compared to neutral affect, mild positive affe...

The Effects of Rural Electrification on Employment: New Evidence from South Africa

By Taryn Dinkelman

American Economic Review, December 2011

This paper estimates the impact of electrification on employment growth by analyzing South Africa's mass roll-out of electricity to rural households. Using several new data sources and two different identification strategies (an instrumental variables str...