How Prevalent Is Downward Rigidity in Nominal Wages? International Evidence from Payroll Records and Pay Slips

By Michael W. L. Elsby and Gary Solon

Journal of Economic Perspectives, Summer 2019

For more than 80 years, many macroeconomic analyses have been premised on the assumption that workers' nominal wage rates cannot be cut. Contrary evidence from household surveys reasonably has been discounted on the grounds that the measurement of frequen...

Gender Bias and Temporal Effects in Standard Evaluations of Teaching

By Whitney Buser, Jill Hayter, and Emily C. Marshall

AEA Papers and Proceedings, May 2019

This study investigates whether gender differences in SET vary over the course of a semester, particularly in response to feedback from the instructor. We survey principles of economics courses at multiple institutions three times during the semester to a...

Who Pays for the Minimum Wage?

By Peter Harasztosi and Attila Lindner

American Economic Review, August 2019

This paper provides a comprehensive assessment of the margins along which firms responded to a large and persistent minimum wage increase in Hungary. We show that employment elasticities are negative but small even four years after the reform; that around...

Front Matter

Journal of Economic Perspectives, Winter 2019

Using JEP Articles as Course Readings? Tell Us About It!

Journal of Economic Perspectives, Winter 2018

Casting a Wider Tax Net: Experimental Evidence from Costa Rica

By Anne Brockmeyer, Spencer Smith, Marco Hernandez, and Stewart Kettle

American Economic Journal: Economic Policy, August 2019

The majority of firms in developing countries are informal, yet even among registered firms, tax filing rates are low. We argue that non-filing of taxes among registered firms constitutes an important intermediate form of informality, which can be tackled...

Are Price-Cost Markups Rising in the United States? A Discussion of the Evidence

[Symposium: Markups]

By Susanto Basu

Journal of Economic Perspectives, Summer 2019

A number of recent papers have argued that US firms exert increasing market power, as measured by their markups of price over marginal cost. I review three of the main approaches to estimating economy-wide markups and show that all are based on the hypo...

A Bridge from Monty Hall to the Hot Hand: The Principle of Restricted Choice

By Joshua B. Miller and Adam Sanjurjo

Journal of Economic Perspectives, Summer 2019

We show how classic conditional probability puzzles, such as the Monty Hall problem, are intimately related to the recently discovered hot hand selection bias. We explain the connection by way of the principle of restricted choice, an intuitive inferentia...

Microeconomic Heterogeneity and Macroeconomic Shocks

[Symposium: Macroeconomics a Decade after the Great Recession]

By Greg Kaplan and Giovanni L. Violante

Journal of Economic Perspectives, Summer 2018

In this essay, we discuss the emerging literature in macroeconomics that combines heterogeneous agent models, nominal rigidities, and aggregate shocks. This literature opens the door to the analysis of distributional issues, economic fluctuations, and sta...

Stimulating the Vote: ARRA Road Spending and Vote Share

By Emiliano Huet-Vaughn

American Economic Journal: Economic Policy, February 2019

This paper estimates the impact of public good spending on voting behavior in the United States, using a quasi-experimental design and the distribution of American Recovery and Reinvestment Act (ARRA) road projects in New Jersey. I find an approximate 1.5...

Economists (and Economics) in Tech Companies

By Susan Athey and Michael Luca

Journal of Economic Perspectives, Winter 2019

As technology platforms have created new markets and new ways of acquiring information, economists have come to play an increasingly central role in tech companies-tackling problems such as platform design, strategy, pricing, and policy. Over the past f...

Exchange-Traded Funds 101 for Economists

By Martin Lettau and Ananth Madhavan

Journal of Economic Perspectives, Winter 2018

Exchange-traded funds (ETFs) represent one of the most important financial innovations in decades. An ETF is an investment vehicle, with a specific architecture that typically seeks to track the performance of a specific index. The first US-listed ETF, ...

Do Increasing Markups Matter? Lessons from Empirical Industrial Organization

[Symposium: Markups]

By Steven Berry, Martin Gaynor, and Fiona Scott Morton

Journal of Economic Perspectives, Summer 2019

This article considers the recent literature on firm markups in light of both new and classic work in the field of industrial organization. We detail the shortcomings of papers that rely on discredited approaches from the "structure-conduct-performance"...

The Impact of Brexit on Foreign Investment and Production

By Ellen R. McGrattan and Andrea Waddle

American Economic Journal: Macroeconomics, January 2020

Using simulations from a multicountry neoclassical growth model, we analyze several post-Brexit scenarios. First, the United Kingdom unilaterally imposes tighter restrictions on FDI and trade from other EU nations. Second, the European Union retaliates an...

Some Journal of Economic Perspectives Articles Recommended for Classroom Use

By Timothy Taylor

Journal of Economic Perspectives, Summer 2019

In 2018, the editors of the Journal of Economic Perspectives invited faculty to send us examples of JEP articles that they had found useful for teaching. We received 250 responses. On the JEP website, we have created a landing page (http...

Protecting Competition in the American Economy: Merger Control, Tech Titans, Labor Markets

[Symposium: Issues in Antitrust]

By Carl Shapiro

Journal of Economic Perspectives, Summer 2019

Accumulating evidence points to the need for more vigorous antitrust enforcement in the United States in three areas. First, stricter merger control is warranted in an economy where large, highly efficient and profitable "superstar" firms account for an i...

Inequality and Globalization: A Review Essay

By Martin Ravallion

Journal of Economic Literature, June 2018

As normally measured, "global inequality" is the relative inequality of incomes found among all people in the world no matter where they live. Francois Bourguignon and Branko Milanovic have written insightful and timely books on global inequality, emp...

Nonmonetary Incentives and the Implications of Work as a Source of Meaning

[Symposium: Incentives in the Workplace]

By Lea Cassar and Stephan Meier

Journal of Economic Perspectives, Summer 2018

Empirical research in economics has begun to explore the idea that workers care about nonmonetary aspects of work. An increasing number of economic studies using survey and experimental methods have shown that nonmonetary incentives and nonpecuniary aspec...

Why Do Defaults Affect Behavior? Experimental Evidence from Afghanistan

By Joshua Blumenstock, Michael Callen, and Tarek Ghani

American Economic Review, October 2018

We report on an experiment examining why default options impact behavior. By randomly assigning employees to different varieties of a salary-linked savings account, we find that default enrollment increases participation by 40 percentage points—an effec...

Measuring the Effects of Corporate Tax Cuts

[Symposium: The Tax Cuts and Jobs Act]

By Alan J. Auerbach

Journal of Economic Perspectives, Fall 2018

On December 22, 2017, President Donald Trump signed the Tax Cuts and Jobs Act (TCJA), the most sweeping revision of US tax law since the Tax Reform Act of 1986. The law introduced many significant changes. However, perhaps none was as important as the c...