Limited Attention and Income Distribution

By Abhijit V. Banerjee and Sendhil Mullainathan

American Economic Review, May 2008

Spontaneous Discrimination

By Marcin Pęski and Balázs Szentes

American Economic Review, October 2013

We consider a dynamic economy in which agents are repeatedly matched and decide whether or not to form profitable partnerships. Each agent has a physical color and a social color. An agent's social color acts as a signal, conveying information about th...

Reciprocity in Groups and the Limits to Social Capital

By Francis Bloch, Garance Genicot, and Debraj Ray

American Economic Review, May 2007

On the Welfare Cost of Inflation and the Recent Behavior of Money Demand

By Peter N. Ireland

American Economic Review, June 2009

Post-1980 US data trace out a stable long-run money demand relationship of Cagan's semi-log form between the M1-income ratio and the nominal interest rate, with an interest semielasticity below 2. Integrating under this money demand curve yields estimates...

Segregation, Rent Control, and Riots: The Economics of Religious Conflict in an Indian City

By Erica Field, Matthew Levinson, Rohini Pande, and Sujata Visaria

American Economic Review, May 2008

Fraudulent Claims and Nitpicky Insurers

By Jean-Marc Bourgeon and Pierre Picard

American Economic Review, September 2014

Insurers have the reputation of being bad payers who nitpick when- ever an opportunity arises. However, this nitpicking activity has a positive impact on their auditing strategy since auditing may prove profitable when claims are not fraudulent. We show t...

Using Engel's Law to Estimate CPI Bias

By Bruce W. Hamilton

American Economic Review, June 2001

Segregation and the Quality of Government in a Cross Section of Countries

By Alberto Alesina and Ekaterina Zhuravskaya

American Economic Review, August 2011

We provide a new compilation of data on ethnic, linguistic, and religious composition at the subnational level for a large number of countries. Using these data, we measure segregation of groups within the country. To overcome the endogeneity problem that...

Entrepreneurship as Experimentation

[Symposium: Entrepreneurship]

By William R. Kerr, Ramana Nanda, and Matthew Rhodes-Kropf

Journal of Economic Perspectives, Summer 2014

Entrepreneurship research is on the rise but many questions about the fundamental nature of entrepreneurship still exist. We argue that entrepreneurship is about experimentation; the probabilities of success are low, extremely skewed, and unknowable until...

Liquidity, Monetary Policy, and the Financial Crisis: A New Monetarist Approach

By Stephen D. Williamson

American Economic Review, October 2012

A model of public and private liquidity integrates financial intermediation theory with a New Monetarist monetary framework. Non-passive fiscal policy and costs of operating a currency system imply that an optimal policy deviates from the Friedman rule. ...

Anomalies: Parimutuel Betting Markets: Racetracks and Lotteries

By Richard H. Thaler and William T. Ziemba

Journal of Economic Perspectives, Spring 1988

Economists have given great attention to stock markets in their efforts to test the concepts of market efficiency and rationality. Yet wagering markets are, in one key respect, better suited for testing market efficiency and rationality. The advantage of ...

Life Expectancy and Old Age Savings

By Mariacristina De Nardi, Eric French, and John Bailey Jones

American Economic Review, May 2009

Income Inequality and Progressive Income Taxation in China and India, 1986-2015

By Thomas Piketty and Nancy Qian

American Economic Journal: Applied Economics, April 2009

This paper evaluates income tax reforms in China and India. The combination of fast income growth and under-indexed tax schedule in China implies the fraction of the Chinese population subject to income tax has increased from less than 0.1 percent in 1...

The Case for Trade Liberalization in Developing Countries

[Symposium: Trade Liberalization and Development]

By Rudiger Dornbusch

Journal of Economic Perspectives, Winter 1992

This paper reviews the actual situation of protection in developing countries, and then discusses the prospective gains from liberalization. Three experiences with liberalization, from three different parts of the world, are sketched: Turkey, Korea, and M...

Estimating the Deterrent Effect of Incarceration Using Sentencing Enhancements

By David S. Abrams

American Economic Journal: Applied Economics, October 2012

Increasing criminal sanctions may reduce crime through two primary mechanisms: deterrence and incapacitation. Disentangling their effects is crucial for optimal policy setting. I use sentence enhancements due to the introduction of state add-on gun laws...

Rethinking Social Insurance

By Martin Feldstein

American Economic Review, March 2005

How the Second-Order Free Rider Problem Is Solved in a Small-Scale Society

By Sarah Mathew

American Economic Review, May 2017

Moralistic punishment enables human cooperation, but an outstanding question is why people voluntarily sanction when they can obtain the benefits of punishment without being enforcers themselves. To address how decentralized societies solve this second-or...

Precautionary Saving and Consumption Fluctuations

By Jonathan A. Parker and Bruce Preston

American Economic Review, September 2005

This paper uses the consumption Euler equation to derive a decomposition of consumption growth into four sources. These four sources are new information, and three sources of predictable consumption growth: intertemporal substitution, changes in the prefe...

Matching and Money

By Dean Corbae, Ted Temzelides, and Randall Wright

American Economic Review, May 2002

Chaotic Interest-Rate Rules

By Jess Benhabib, Stephanie Schmitt-Grohé, and Martín Uribe

American Economic Review, May 2002