Big Data and Firm Dynamics

By Maryam Farboodi, Roxana Mihet, Thomas Philippon, and Laura Veldkamp

AEA Papers and Proceedings, May 2019

We study a model where firms accumulate data as a valuable intangible asset. Data accumulation affects firms' dynamics. It increases the skewness of the firm size distribution as large firms generate more data and invest more in active experimentation. On...

Common Ownership and the Secular Stagnation Hypothesis

By José Azar and Xavier Vives

AEA Papers and Proceedings, May 2019

We extend the model in Azar and Vives (2018) to allow for investment and show that higher effective market concentration (augmented by common ownership) leads to lower equilibrium wages, real interest rates, lower output, lower labor share, and lower capi...

Age and High-Growth Entrepreneurship

By Pierre Azoulay, Benjamin F. Jones, J. Daniel Kim, and Javier Miranda

American Economic Review: Insights, March 2020

Many observers, and many investors, believe that young people are especially likely to produce the most successful new firms. Integrating administrative data on firms, workers, and owners, we study start-ups systematically in the United States and find th...

Inside Job or Deep Impact? Extramural Citations and the Influence of Economic Scholarship

By Josh Angrist, Pierre Azoulay, Glenn Ellison, Ryan Hill, and Susan Feng Lu

Journal of Economic Literature, March 2020

Does academic economic research produce material of general scientific value, or do academic economists write only for peers? Is economics scholarship uniquely insular? We address these questions by quantifying interactions between economics and other d...

Measuring Labor Market Power Two Ways

By José Azar, Ioana Marinescu, and Marshall Steinbaum

AEA Papers and Proceedings, May 2019

We compute the "applications elasticity" as a proxy for firm-level labor supply elasticity by regressing the applications to a given job on the posted wage. The average applications elasticity in our data is 0.42. We then relate our elasticity estimates t...

Report: Committee on Economic Education

By KimMarie McGoldrick

AEA Papers and Proceedings, May 2019

Estimating US Consumer Gains from Chinese Imports

By Liang Bai and Sebastian Stumpner

American Economic Review: Insights, September 2019

We estimate the size of US consumer gains from Chinese imports during 2004–2015. Using barcode-level price and expenditure data, we construct inflation rates under CES preferences, and use Chinese exports to Europe as an instrument. We find significant ...

Trade Liberalization and Mortality: Evidence from US Counties

By Justin R. Pierce and Peter K. Schott

American Economic Review: Insights, March 2020

We investigate the impact of a large and persistent economic shock on "deaths of despair." We find that areas more exposed to a plausibly exogenous change in international trade policy exhibit relative increases in fatal drug overdoses, specifically among...

The Impact of Media Censorship: 1984 or Brave New World?

By Yuyu Chen and David Y. Yang

American Economic Review, June 2019

Media censorship is a hallmark of authoritarian regimes. We conduct a field experiment in China to measure the effects of providing citizens with access to an uncensored internet. We track subjects' media consumption, beliefs regarding the media, econom...

Minding Your Ps and Qs: Going from Micro to Macro in Measuring Prices and Quantities

By Gabriel Ehrlich, John Haltiwanger, Ron Jarmin, David Johnson, and Matthew D. Shapiro

AEA Papers and Proceedings, May 2019

Key macro indicators such as output, productivity, and inflation are based on a complex system across multiple statistical agencies using different samples and levels of aggregation. The Census Bureau collects nominal sales, the Bureau of Labor Statistics...

What Can Machines Learn, and What Does It Mean for Occupations and the Economy?

By Erik Brynjolfsson, Tom Mitchell, and Daniel Rock

AEA Papers and Proceedings, May 2018

Advances in machine learning (ML) are poised to transform numerous occupations and industries. This raises the question of which tasks will be most affected by ML. We apply the rubric evaluating task potential for ML in Brynjolfsson and Mitchell (2017) to...

Contractual Managerial Incentives with Stock Price Feedback

By Tse-Chun Lin, Qi Liu, and Bo Sun

American Economic Review, July 2019

We study the effect of financial market frictions on managerial compensation. We embed a market microstructure model into an otherwise standard contracting framework, and analyze optimal pay-for-performance when managers use information they learn from th...

Early Voting Laws, Voter Turnout, and Partisan Vote Composition: Evidence from Ohio

By Ethan Kaplan and Haishan Yuan

American Economic Journal: Applied Economics, January 2020

We estimate effects of early voting on voter turnout using a 2010 homogenization law from Ohio that forced some counties to expand and others to contract early voting. Using voter registration data, we compare individuals who live within the same 2x2 mile...

Do Free Trade Agreements Affect Tariffs of Nonmember Countries? A Theoretical and Empirical Investigation

By Kamal Saggi, Andrey Stoyanov, and Halis Murat Yildiz

American Economic Journal: Applied Economics, July 2018

We investigate the effects of free trade agreements (FTAs) on tariffs of non-member countries. In our multi-country model, the formation of an FTA leads members to reduce their exports to the rest of the world. Such external trade diversion weakens the ab...

Consumer Imperfect Information and Endogenous Price Rigidity

By Jean-Paul L'Huillier

American Economic Journal: Macroeconomics, April 2020

This paper studies the propagation of monetary shocks in an economy featuring a strategic microfoundation for price rigidities. Following an aggregate shock to money, most consumers are initially uninformed. The market for goods is decentralized. Firms ar...

Retrospectives: Lord Keynes and Mr. Say: A Proximity of Ideas

By Alain Béraud and Guy Numa

Journal of Economic Perspectives, Summer 2019

Since the publication of Keynes's General Theory of Employment, Interest and Money, generations of economists have been led to believe that Say was Keynes's ultimate nemesis. By means of textual and contextual analysis, we show that Keynes and Say held ...

Frictions or Mental Gaps: What's Behind the Information We (Don't) Use and When Do We Care?

By Benjamin Handel and Joshua Schwartzstein

Journal of Economic Perspectives, Winter 2018

Consumers suffer significant losses from not acting on available information. These losses stem from frictions such as search costs, switching costs, and rational inattention, as well as what we call mental gaps resulting from wrong priors/worldviews, o...

What Happened: Financial Factors in the Great Recession

[Symposium: Macroeconomics a Decade after the Great Recession]

By Mark Gertler and Simon Gilchrist

Journal of Economic Perspectives, Summer 2018

At the onset of the recent global financial crisis, the workhorse macroeconomic models assumed frictionless financial markets. These frameworks were thus not able to anticipate the crisis, nor to analyze how the disruption of credit markets changed what i...

Reducing Child Mortality in the Last Mile: Experimental Evidence on Community Health Promoters in Uganda

By Martina Björkman Nyqvist, Andrea Guariso, Jakob Svensson, and David Yanagizawa-Drott

American Economic Journal: Applied Economics, July 2019

The delivery of basic health products and services remains abysmal in many parts of the world where child mortality is high. This paper shows the results from a large-scale randomized evaluation of a novel approach to health care delivery. In randomly sel...

Recommendations for Further Reading

By Timothy Taylor

Journal of Economic Perspectives, Summer 2019