Thirty Years of Prospect Theory in Economics: A Review and Assessment

By Nicholas C. Barberis

Journal of Economic Perspectives, Winter 2013

In 1979, Daniel Kahneman and Amos Tversky, published a paper in Econometrica titled "Prospect Theory: An Analysis of Decision under Risk." The paper presented a new model of risk attitudes called "prospect theory," which elegantly captured the e...

Pass-Through in Retail and Wholesale

By Emi Nakamura

American Economic Review, May 2008

Sacred Cars? Cost-Effective Regulation of Stationary and Nonstationary Pollution Sources

By Meredith Fowlie, Christopher R. Knittel, and Catherine Wolfram

American Economic Journal: Economic Policy, February 2012

For political and practical reasons, environmental regulations sometimes treat point-source polluters, such as power plants, differently from mobile-source polluters, such as vehicles. This paper measures the extent of this regulatory asymmetry in the cas...

Federalism as a Commitment to Reserving Market Incentives

[Symposium: Fiscal Federalism]

By Yingyi Qian and Barry R. Weingast

Journal of Economic Perspectives, Fall 1997

The authors advance a new perspective in the study of federalism. Their approach views federalism as a governance solution of the state to credibly preserving market incentives. Market incentives are preserved if the state is credibly prevented from compr...

Managerial Attention and Worker Performance

By Marina Halac and Andrea Prat

American Economic Review, October 2016

We present a novel theory of the employment relationship. A manager can invest in attention technology to recognize good worker performance. The technology may break and is costly to replace. We show that as time passes without recognition, the worker's b...

Nonparametric Evidence on the Effects of Financial Incentives on Retirement Decisions

By Day Manoli and Andrea Weber

American Economic Journal: Economic Policy, November 2016

This paper presents new evidence on the effects of retirement benefits on labor force participation decisions. The analysis is based on a mandated rule for employer-provided retirement benefits in Austria that creates discontinuities in the incentives for...

How Do You Measure a "Technological Revolution"?

By Carol A. Corrado and Charles R. Hulten

American Economic Review, May 2010

Gender Differences in Accepting and Receiving Requests for Tasks with Low Promotability

By Linda Babcock, Maria P. Recalde, Lise Vesterlund, and Laurie Weingart

American Economic Review, March 2017

Gender differences in task allocations may sustain vertical gender segregation in labor markets. We examine the allocation of a task that everyone prefers be completed by someone else (writing a report, serving on a committee, etc.) and find evidence that...

Front Matter

Journal of Economic Literature, March 2014

Group Strategy-Proofness in Private Good Economies

By Salvador Barberà, Dolors Berga, and Bernardo Moreno

American Economic Review, April 2016

Many salient rules to allocate private goods are not only strategy-proof, but also group strategy-proof, in appropriate domains of definition, hence diminishing the traditional conflict between incentives and efficiency. That is so for solutions to matc...

Input Sourcing and Multinational Production

By Stefania Garetto

American Economic Journal: Macroeconomics, April 2013

I propose a general equilibrium framework where firms decide whether to outsource or integrate input manufacturing, domestically or abroad. By outsourcing, firms may benefit from suppliers' technologies, but pay mark-up prices. By sourcing intrafirm, th...

How Big a Problem is Too Big to Fail? A Review of Gary Stern and Ron Feldman's Too Big to Fail: The Hazards of Bank Bailouts

By Frederic S. Mishkin

Journal of Economic Literature, December 2006

This review essay examines whether too-big-to-fail is as serious a problem as Gary Stern and Ron Feldman contend. This essay argues that Stern and Feldman overstate the importance of the too-big-to-fail problem and do not give enough credit to the FDIC...

What Does Debt Relief Do for Development? Evidence from India's Bailout for Rural Households

By Martin Kanz

American Economic Journal: Applied Economics, October 2016

This paper studies the impact of debt relief, using a natural experiment arising from India's "Agricultural Debt Waiver and Debt Relief Scheme," one of the largest household-level debt relief initiatives in history. I find that debt relief has a substanti...

The Financial Education Fallacy

By Lauren E. Willis

American Economic Review, May 2011

Research to date does not demonstrate a causal chain from financial education to welfare-enhancing financial behavior, in part due to biases, heuristics, and emotional influences on decisions. Yet the search for effective financial education continues. Bu...

Cultural and Institutional Bifurcation: China and Europe Compared

By Avner Greif and Guido Tabellini

American Economic Review, May 2010

Micro and Macro Labor Supply Elasticities: A Reassessment of Conventional Wisdom

By Michael Keane and Richard Rogerson

Journal of Economic Literature, June 2012

The response of aggregate labor supply to various changes in the economic environment is central to many economic issues, especially the optimal design of tax policies. Conventional wisdom based on studies in the 1980s and 1990s has long held that the ana...

The Economics Major as Part of a Liberal Education: The Teagle Report: Comment

By David W. Breneman

American Economic Review, May 2009

Managing Currency Pegs

By Stephanie Schmitt-Grohé and Martín Uribe

American Economic Review, May 2012

The combination of a fixed exchange rate and downward nominal wage rigidity creates a real rigidity. In turn, this real rigidity makes the economy prone to involuntary unemployment during external crises. This paper presents a graphical analysis of alte...

The Evolution of U.S. Airline Competition

[Symposium: Airline Deregulation]

By Severin Borenstein

Journal of Economic Perspectives, Spring 1992

The next section reviews the evolution of the domestic airline industry since the late 1970s, when it was abruptly freed from most regulatory constraints on pricing, entry, and exit. (International air travel is considered here only as it relates to compe...

The Neuroeconomic Theory of Learning

By Andrew Caplin and Mark Dean

American Economic Review, May 2007