Do We Follow Others When We Should? A Simple Test of Rational Expectations

By Georg Weizsäcker

American Economic Review, December 2010

The paper presents a meta dataset covering 13 experiments on social learning games. It is found that in situations where it is empirically optimal to follow others and contradict one's own information, the players err in the majority of cases, forgoing su...

Exclusive Goods and Formal-Sector Employment

By Reto Foellmi and Josef Zweimüller

American Economic Journal: Macroeconomics, January 2011

We explore how the underemployment problem of less-developed economies is related to income inequality. Consumers have nonhomothetic preferences over differentiated products of formal-sector goods and thus inequality affects the composition of aggregate ...

Classroom Games: Strategic Interaction on the Internet

By Marko Grobelnik, Charles A. Holt, and Vesna Prasnikar

Journal of Economic Perspectives, Spring 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...

Does Antitrust Need to be Modernized?

By Dennis W. Carlton

Journal of Economic Perspectives, Summer 2007

Economics has had an enormous positive effect on the evolution of antitrust policy over the last 30 years or so. However, the evolving forces of technology and globalization, together with experience gained over time, suggest that further modernization is...

Information Cascades: Replication and an Extension to Majority Rule and Conformity-Rewarding Institutions

By Angela A. Hung and Charles R. Plott

American Economic Review, December 2001

A Community College Instructor Like Me: Race and Ethnicity Interactions in the Classroom

By Robert W. Fairlie, Florian Hoffmann, and Philip Oreopoulos

American Economic Review, August 2014

Administrative data from a large and diverse community college are used to examine if underrepresented minority students benefit from taking courses with underrepresented minority instructors. To identify racial interactions we estimate models that includ...

The Implications of Electronic Commerce for Fiscal Policy (and Vice Versa)

[Symposium: E-Commerce]

By Austan Goolsbee

Journal of Economic Perspectives, Winter 2001

Validating Migration Responses to Flooding Using Satellite and Vital Registration Data

By Joyce J. Chen, Valerie Mueller, Yuanyuan Jia, and Steven Kuo-Hsin Tseng

American Economic Review, May 2017

Rainfall measures may be imperfect proxies for floods, given factors such as upstream water balance, proximity to rivers, and topography. We check the robustness of flooding-migration relationships by combining nationally-representative survey data with m...

How Large Are Non-Budget-Constraint Effects of Prices on Demand?

By Ori Heffetz and Moses Shayo

American Economic Journal: Applied Economics, October 2009

Elementary consumer theory assumes prices affect demand only because they affect the budget constraint (BC). Alternative models, and some evidence, suggest prices can affect demand through other, non-BC channels (e.g., by signaling quality). This paper...

Externalities in the Classroom: How Children Exposed to Domestic Violence Affect Everyone's Kids

By Scott E. Carrell and Mark L. Hoekstra

American Economic Journal: Applied Economics, January 2010

There is a widespread perception that externalities from troubled children are significant, though measuring them is difficult due to data and methodological limitations. We estimate the negative spillovers caused by children from troubled families by ...

Introducing Incentives in the Market for Live and Cadaveric Organ Donations

[Symposium: Organ Transplants]

By Gary S. Becker and Julio Jorge Elías

Journal of Economic Perspectives, Summer 2007

We evaluate the introduction of monetary incentives in the market for live and cadaveric organ donations. We show that monetary incentives would increase the supply of organs for transplant sufficiently to eliminate the very large queues in organ markets,...

Investment Behavior, Observable Expectations, and Internal Funds: Corrigendum

By Jason G. Cummins, Kevin A. Hassett, and Stephen D. Oliner

American Economic Review, June 2013

Religious Beliefs, Religious Participation, and Cooperation

By Gilat Levy and Ronny Razin

American Economic Journal: Microeconomics, August 2012

We analyze the relation between religious beliefs, religious participation, and social cooperation. We focus on religions that instill beliefs about the connection between rewards and punishments and social behavior. We show how religious organizations a...

Strategic Leniency and Cartel Enforcement

By Nathan H. Miller

American Economic Review, June 2009

The cornerstone of cartel enforcement in the United States and elsewhere is a commitment to the lenient prosecution of early confessors. A burgeoning gametheoretical literature is ambiguous regarding the impacts of leniency. I develop a theoretical mod...

Altruistic Capital

By Nava Ashraf and Oriana Bandiera

American Economic Review, May 2017

To understand altruistic behavior, we must understand the process through which altruism develops and is shaped by the agents' own choices and exogenous factors. We introduce the concept of altruistic capital, which grows with effort devoted to altruistic...

Rational Inattention: Beyond the Linear-Quadratic Case

By Christopher A. Sims

American Economic Review, May 2006

Anomalies: Saving, Fungibility, and Mental Accounts

By Richard H. Thaler

Journal of Economic Perspectives, Winter 1990

Last New Year's day, after a long evening of rooting the right team to victory in the Orange Bowl, I was lucky enough to win $300 in a college football betting pool. I then turned to the important matter of splurging the proceeds wisely. Would a case of c...

Running on Empty? Financial Leverage and Product Quality in the Supermarket Industry

By David A. Matsa

American Economic Journal: Microeconomics, February 2011

This paper examines whether debt financing can undermine a supermarket firm's incentive to provide product quality. In the supermarket industry, product availability is an important measure of a retailer's quality. Using US consumer price index microdata...

Balanced Growth Despite Uzawa

By Gene M. Grossman, Elhanan Helpman, Ezra Oberfield, and Thomas Sampson

American Economic Review, April 2017

The evidence for the United States points to balanced growth despite falling investment good prices and a less-than-unitary elasticity of substitution between capital and labor. This is inconsistent with the Uzawa Growth Theorem. We extend Uzawa's theorem...

The Impact of Nearly Universal Insurance Coverage on Health Care Utilization: Evidence from Medicare

By David Card, Carlos Dobkin, and Nicole Maestas

American Economic Review, December 2008

The onset of Medicare eligibility at age 65 leads to sharp changes in the health insurance coverage of the US population. These changes lead to increases in the use of medical services, with a pattern of gains across socioeconomic groups that varies by ty...