Free Trade Agreements and the Consolidation of Democracy

By Xuepeng Liu and Emanuel Ornelas

American Economic Journal: Macroeconomics, April 2014

We study the relationship between participation in free trade agreements (FTAs) and the sustainability of democracy. Our model shows that FTAs can critically reduce the incentive of authoritarian groups to seek power by destroying protectionist rents, ...

Organizing for Synergies

By Wouter Dessein, Luis Garicano, and Robert Gertner

American Economic Journal: Microeconomics, November 2010

Large companies are usually organized into business units, yet some activities are almost always centralized in a company-wide functional unit. We first show that organizations endogenously create an incentive conflict between functional managers (who de...

How Richard Nixon Pressured Arthur Burns: Evidence from the Nixon Tapes

By Burton A. Abrams

Journal of Economic Perspectives, Fall 2006

Evidence from the Nixon tapes, now available to researchers, shows that President Richard Nixon pressured the chairman of the Federal Reserve, Arthur Burns, to engage in expansionary monetary policies in the run-up to the 1972 election. This paper quotes...

Cluster-Sample Methods in Applied Econometrics

By Jeffrey M. Wooldridge

American Economic Review, May 2003

Does Agriculture Generate Local Economic Spillovers? Short-Run and Long-Run Evidence from the Ogallala Aquifer

By Richard Hornbeck and Pinar Keskin

American Economic Journal: Economic Policy, May 2015

Agriculture may support the local nonagricultural economy in rural areas, though agricultural expansion may also crowd-out nonagricultural activity. On the United States Plains, areas over the Ogallala aquifer experienced windfall agricultural gains when ...

Experimental Evidence on the Long-Run Impact of Community-Based Monitoring

By Martina Björkman Nyqvist, Damien de Walque, and Jakob Svensson

American Economic Journal: Applied Economics, January 2017

We evaluate the longer run impact of a local accountability intervention in primary health care provision in Uganda. Short-run improvements in health care delivery and health outcomes remained in the longer run despite minimal follow-up. We find no impact...

Does Competition Destroy Ethical Behavior?

By Andrei Shleifer

American Economic Review, May 2004

Market Socialism: A Case for Rejuvenation

By Pranab Bardhan and John E. Roemer

Journal of Economic Perspectives, Summer 1992

In this paper, we will outline a feasible economic mechanism of "competitive socialism." Our claim is that competitive markets are necessary to achieve an efficient and vigorous economy, but that full-scale private ownership is not necessary for the succe...

The Economics of Structured Finance

[Symposium: Early Stages of the Credit Crunch]

By Joshua Coval, Jakub Jurek, and Erik Stafford

Journal of Economic Perspectives, Winter 2009

This paper investigates the spectacular rise and fall of structured finance. The essence of structured finance activities is the pooling of economic assets like loans, bonds, and mortgages, and the subsequent issuance of a prioritized capital structure of...

Classroom Games: Rent-Seeking and the Inefficiency of Non-market Allocations

By Jacob K. Goeree and Charles A. Holt

Journal of Economic Perspectives, Summer 1999

Economics is often taught at a level of abstraction that can hinder some students from gaining basic intuition. However, lecture and textbook presentations can be complemented with classroom exercises in which students make decisions and interact. The app...

A Behavioral Model of the Popularity and Regulation of Demandable Liabilities

By Julio J. Rotemberg

American Economic Journal: Macroeconomics, July 2015

Overoptimism regarding one's ability to arrive early in a queue is shown to rationalize deposit contracts in which people can withdraw their funds on demand even if consumption takes place later. Capitalized institutions serving overoptimistic depositors ...

Assortative Matching under Asymmetric Information: Evidence from Malawi

By Manuela Angelucci and Daniel Bennett

American Economic Review, May 2017

Asymmetric information is a key feature of the marriage market. In HIV-endemic settings, HIV risk is an important partner attribute that may influence marriage timing and partner selection. We use a sample of married women in rural Malawi to validate a mo...

Conflict and the Persistence of Ethnic Bias

By Moses Shayo and Asaf Zussman

American Economic Journal: Applied Economics, October 2017

How persistent are the effects of conflict on bias toward co-ethnics? What are the channels of persistence? We employ a measure of ethnic bias derived from decisions made by Israeli Arab and Jewish judges to study the levels and determinants of bias durin...

Incentive-Enhancing Preferences: Personality, Behavior, and Earnings

By Samuel Bowles, Herbert Gintis, and Melissa Osborne

American Economic Review, May 2001

Which Entrepreneurs Are Coachable and Why?

By Kevin A. Bryan, András Tilcsik, and Brooklynn Zhu

American Economic Review, May 2017

Is coachability a usable concept for startups? Using a dataset on high-growth startups in a prominent university incubator, we show that firm characteristics do predict which firms are likely to follow advice but that these "coachable" firms are not more ...

The Bond Premium in a DSGE Model with Long-Run Real and Nominal Risks

By Glenn D. Rudebusch and Eric T. Swanson

American Economic Journal: Macroeconomics, January 2012

The term premium in standard macroeconomic DSGE models is far too small and stable relative to the data—an example of the "bond premium puzzle." However, in endowment economy models, researchers have generated reasonable term premiums by assuming in...

Corporate Diversificaton

By Cynthia A. Montgomery

Journal of Economic Perspectives, Summer 1994

This paper documents the significant presence of diversified firms in the U.S. economy and presents three views on why firms diversify. The market power view argues that firms diversify to wield conglomerate power across markets. The agency view argues th...

Inherited Trust and Growth

By Yann Algan and Pierre Cahuc

American Economic Review, December 2010

This paper develops a new method to uncover the causal effect of trust on economic growth by focusing on the inherited component of trust and its time variation. We show that inherited trust of descendants of US immigrants is significantly influenced by t...

The Law and Economics of the Economic Expert Witness

[Symposium: Economists as Expert Witnesses]

By Richard A. Posner

Journal of Economic Perspectives, Spring 1999

I will consider the law and economics of the use of economic expert witnesses. After introducing the law governing the use of expert witnesses (including economists), I analyze and respond to several concerns regarding the use of expert witnesses. The fir...

The Environment and Directed Technical Change

By Daron Acemoglu, Philippe Aghion, Leonardo Bursztyn, and David Hemous

American Economic Review, February 2012

This paper introduces endogenous and directed technical change in a growth model with environmental constraints. The final good is produced from "dirty" and "clean" inputs. We show that: (i) when inputs are sufficiently substitutable, sustainable growth c...