The New Econometrics of Structural Change: Dating Breaks in U.S. Labour Productivity

[Symposium: Econometric Tools]

By Bruce E. Hansen

Journal of Economic Perspectives, Fall 2001

We have seen the emergence of three major innovations in the econometrics of structural change in the past fifteen years: (1) tests for a structural break of unknown timing; (2) estimation of the timing of a structural break; and (3) tests to distinguish ...

The International Monetary Fund: 70 Years of Reinvention

[Symposium: The Bretton Woods Institutions]

By Carmen M. Reinhart and Christoph Trebesch

Journal of Economic Perspectives, Winter 2016

A sketch of the International Monetary Fund's 70-year history reveals an institution that has reinvented itself over time along multiple dimensions. This history is primarily consistent with a "demand driven" theory of institutional change, as the needs o...

Yugoslavia: The Case of Self-Managing Market Socialism

By Saul Estrin

Journal of Economic Perspectives, Fall 1991

For many years the Yugoslav economic system appeared to offer a middle way between capitalism and Soviet central planning. The Yugoslavs' brand of market socialism placed reliance on markets to guide both domestic and international production and exchange...

Can Hepatitis B Mothers Account for the Number of Missing Women? Evidence from Three Million Newborns in Taiwan

By Ming-Jen Lin and Ming-Ching Luoh

American Economic Review, December 2008

The "missing women" phenomenon in many Asian countries has previously been regarded as the result of son preference. However, some studies have argued half of the missing women can be explained by infection with Hepatitis B virus (HBV). We demonstrate tha...

The Use of Violence in Illegal Markets: Evidence from Mahogany Trade in the Brazilian Amazon

By Ariaster B. Chimeli and Rodrigo R. Soares

American Economic Journal: Applied Economics, October 2017

We provide evidence on the effect of market illegality on violence. Brazil was historically the main exporter of mahogany. Starting in the 1990s, trade was restricted and eventually prohibited. We build on previous evidence that mahogany trade persisted a...

Winter Blues: A SAD Stock Market Cycle

By Mark J. Kamstra, Lisa A. Kramer, and Maurice D. Levi

American Economic Review, March 2003

The Welfare Economics of Default Options in 401(k) Plans

By B. Douglas Bernheim, Andrey Fradkin, and Igor Popov

American Economic Review, September 2015

Default contribution rates for 401(k) pension plans powerfully influence choices. Potential causes include opt-out costs, procrastination, inattention, and psychological anchoring. Using realistically parameterized models, we show how the optimal default,...

Cash Distributions to Shareholders

By Laurie Simon Bagwell and John B. Shoven

Journal of Economic Perspectives, Summer 1989

Economists have long been puzzled by why firms pay dividends when alternative methods of rewarding shareholders and financiers exist which involve less taxes. This paper will highlight the fact that firms can distribute cash to equity holders in ways more...

The Wind of Change: Maritime Technology, Trade, and Economic Development

By Luigi Pascali

American Economic Review, September 2017

The 1870-1913 period marked the birth of the first era of trade globalization. How did this tremendous increase in trade affect economic development? This work isolates a causality channel by exploiting the fact that the introduction of the steamship in t...

The Sky Is Not Flat: How Discriminatory Is the Access to International Air Services?

By Roberta Piermartini and Linda Rousová

American Economic Journal: Economic Policy, August 2013

Using information on 2,300 Air Services Agreements covering 184 countries, we investigate the impact of air services liberalization on passenger flows. We find that a certain level of liberalization is required to have a positive effect on passenger traff...

Altruism and the Child Cycle of Alumni Donations

By Jonathan Meer and Harvey S. Rosen

American Economic Journal: Economic Policy, February 2009

We study alumni contributions to an anonymous research university. If alumni believe donations will increase the likelihood of their child's admission, and if this belief helps motivate their giving, then the pattern of giving should vary systematicall...

Incentives Work: Getting Teachers to Come to School

By Esther Duflo, Rema Hanna, and Stephen P. Ryan

American Economic Review, June 2012

We use a randomized experiment and a structural model to test whether monitoring and financial incentives can reduce teacher absence and increase learning in India. In treatment schools, teachers' attendance was monitored daily using cameras, and their sa...

How Effective Are Capital Controls?

[Symposium: Global Financial Instability]

By Sebastian Edwards

Journal of Economic Perspectives, Fall 1999

A number of authors have recently argued that, in order to avoid financial instability, emerging countries should rely on capital controls. Two type of controls have been considered: controls on capital outflows, and controls on capital inflows. In this p...

The Nature of Credit Constraints and Human Capital

By Lance J. Lochner and Alexander Monge-Naranjo

American Economic Review, October 2011

We develop a human capital model with borrowing constraints explicitly derived from government student loan (GSL) programs and private lending under limited commitment. The model helps explain the persistent strong positive correlation between ability and...

The Trouble With Electricity Markets: Understanding California's Restructuring Disaster

By Severin Borenstein

Journal of Economic Perspectives, Winter 2002

In June 2000, after two years of fairly smooth operation, California's deregulated wholesale electricity market began producing extremely high prices and threats of supply shortages. The upheaval demonstrated dramatically why most current electricity mark...

Evaluating the Medical Malpractice System and Options for Reform

[Symposium: Constraining Healthcare Costs]

By Daniel P. Kessler

Journal of Economic Perspectives, Spring 2011

The U.S. medical malpractice liability system has two principal objectives: to compensate patients who are injured through the negligence of healthcare providers and to deter providers from practicing negligently. In practice, however, the system is slow ...

Value-Added Taxes, Chain Effects, and Informality

By Áureo de Paula and Jose A. Scheinkman

American Economic Journal: Macroeconomics, October 2010

We present an equilibrium model of tax avoidance and test its implications using a survey of firms in Brazil. In the model, the credit method used to collect value-added tax (VAT) creates informality chains-clients or suppliers of informal firms are more ...

Auctions as an Allocation Mechanism in Academia: The Case of Faculty Offices

[Symposium: Auctions]

By William J. Boyes and Stephen K. Happel

Journal of Economic Perspectives, Summer 1989

A six-story addition to Arizona State University's College of Business was completed in 1983, causing entire departments to be uprooted and relocated. Faculty offices had to be reassigned as a result. What seemed to be a trivial problem, the allocation of...

How Longer Work Lives Ease the Crunch of Population Aging

[Symposium: Retirement and Work Choices]

By Nicole Maestas and Julie Zissimopoulos

Journal of Economic Perspectives, Winter 2010

Population aging is not a looming crisis of the future -- it is already here. Economic challenges arise when the increase in people surviving to old age and the decline in the number of young people alive to support them cause the growth in society's cons...

Replication, Meta-analysis, and Research Synthesis in Economics

By Richard G. Anderson and Areerat Kichkha

American Economic Review, May 2017

Replicability is essential to assure the scientific integrity of empirical economic research. Some authors have suggested metadata analysis as a complementary tool. This suggestion must be addressed with caution. Empirical studies in most of economics are...