"3rd of tha Month": Do Social Security Recipients Smooth Consumption Between Checks?

By Melvin Stephens Jr.

American Economic Review, March 2003

Education and the Age Profile of Literacy into Adulthood

[Symposium: Investment in Children]

By Elizabeth Cascio, Damon Clark, and Nora Gordon

Journal of Economic Perspectives, Summer 2008

American teenagers perform considerably worse on international assessments of achievement than do teenagers in other high-income countries. This observation has been a source of great concern since the first international tests were administered in the 19...

Understanding Why Crime Fell in the 1990s: Four Factors that Explain the Decline and Six that Do Not

By Steven D. Levitt

Journal of Economic Perspectives, Winter 2004

Crime dropped sharply and unexpectedly in the United States in the 1990s. I conclude that four factors collectively explain the entire drop in crime: increases in the number of police, increases in the size of the prison population, the waning of the crac...

Financing Investment

By Joao F. Gomes

American Economic Review, December 2001

We examine investment behavior when firms face costs in the access to external funds. We find that despite the existence of liquidity constraints, standard investment regressions predict that cash flow is an important determinant of investment only if one...

Ownership Risk, Investment, and the Use of Natural Resources

By Henning Bohn and Robert T. Deacon

American Economic Review, June 2000

The effect of insecure ownership on ordinary investment and natural resource use is examined. Insecure ownership is postulated to depend on the type of government regime in power and the prevalence of political violence or instability. The political deter...

Monetary Policy Surprises, Credit Costs, and Economic Activity

By Mark Gertler and Peter Karadi

American Economic Journal: Macroeconomics, January 2015

We provide evidence on the transmission of monetary policy shocks in a setting with both economic and financial variables. We first show that shocks identified using high frequency surprises around policy announcements as external instruments produce resp...

How Auctions Work for Wine and Art

[Symposium: Auctions]

By Orley Ashenfelter

Journal of Economic Perspectives, Summer 1989

At the first wine auction I ever attended, I saw the repeal of the law of one price. This empirical surprise led me to begin collecting data on wine auctions, to interview auctioneers, and even to buy a little wine. In the meantime I have also had the opp...

Middlemen Margins and Globalization

By Pranab Bardhan, Dilip Mookherjee, and Masatoshi Tsumagari

American Economic Journal: Microeconomics, November 2013

We study a competitive theory of middlemen with brand-name reputations necessary to overcome product quality moral hazard problems. Agents with heterogeneous abilities sort into different sectors and occupations. Middleman margins do not equalize acros...

Human Capital and Growth

By Robert E. Lucas Jr.

American Economic Review, May 2015

This paper describes a growth model with the property that human capital accumulation can account for all observed growth. The model is shown to be consistent with evidence on individual productivities as measured by census earnings data. The central hypo...

The Cost of Contract Renegotiation: Evidence from the Local Public Sector

By Philippe Gagnepain, Marc Ivaldi, and David Martimort

American Economic Review, October 2013

Contract theory claims that renegotiation prevents attainment of the efficient solution that could be obtained under full commitment. Assessing the cost of renegotiation remains an open issue from an empirical viewpoint. We fit a structural principal-a...

The Wages of Sinistrality: Handedness, Brain Structure, and Human Capital Accumulation

By Joshua Goodman

Journal of Economic Perspectives, Fall 2014

Left- and right-handed individuals have different neurological wiring, particularly with regard to language processing. Multiple datasets from the United States and the United Kingdom show that lefties exhibit significant human capital deficits relative t...

An Alternative Test of Racial Prejudice in Motor Vehicle Searches: Theory and Evidence

By Shamena Anwar and Hanming Fang

American Economic Review, March 2006

We propose a simple model of trooper behavior to design empirical tests for whether troopers of different races are monolithic in their search behavior, and whether they exhibit relative racial prejudice in motor vehicle searches. Our test of relative rac...

Effects of Terms of Trade Gains and Tariff Changes on the Measurement of US Productivity Growth

By Robert C. Feenstra, Benjamin R. Mandel, Marshall B. Reinsdorf, and Matthew J. Slaughter

American Economic Journal: Economic Policy, February 2013

The acceleration in US productivity growth since 1995 is often attributed to declining prices for information technology (IT ) goods, and therefore enhanced productivity growth in that sector. We investigate an alternative explanation for these IT price m...

Social Comparisons and Pro-social Behavior: Testing "Conditional Cooperation" in a Field Experiment

By Bruno S. Frey and Stephan Meier

American Economic Review, December 2004

Subjective Expectations and Asset-Return Puzzles

By Martin L. Weitzman

American Economic Review, September 2007

In textbook expositions of the equity-premium, riskfree-rate and equity-volatility puzzles, agents are sure of the economy's structure while growth rates are normally distributed. But because of parameter uncertainty the thin-tailed normal distribution...

The Safe Assets Shortage Conundrum

[Symposium: The Global Monetary System]

By Ricardo J. Caballero, Emmanuel Farhi, and Pierre-Olivier Gourinchas

Journal of Economic Perspectives, Summer 2017

A safe asset is a simple debt instrument that is expected to preserve its value during adverse systemic events. The supply of safe assets, private and public, has historically been concentrated in a small number of advanced economies, most prominently t...

Reforming LIBOR and Other Financial Market Benchmarks

By Darrell Duffie and Jeremy C. Stein

Journal of Economic Perspectives, Spring 2015

LIBOR is the London Interbank Offered Rate: a measure of the interest rate at which large banks can borrow from one another on an unsecured basis. LIBOR is often used as a benchmark rate—meaning that the interest rates that consumers and businesses ...

"Fisher Dynamics" in US Household Debt, 1929-2011

By J. W. Mason and Arjun Jayadev

American Economic Journal: Macroeconomics, July 2014

The evolution of debt-income ratios over time depends on income growth, inflation, and interest rates, independent of any changes in borrowing. We examine the effect of these "Fisher dynamics" on household debt-income ratios in the United States over the ...

Agricultural Volatility and Investments in Children

By Robert Jensen

American Economic Review, May 2000

A Century of US Central Banking: Goals, Frameworks, Accountability

[Symposium: The First 100 Years of the Federal Reserve]

By Ben S. Bernanke

Journal of Economic Perspectives, Fall 2013

Several key episodes in the 100-year history of the Federal Reserve have been referred to in various contexts with the adjective "Great" attached to them: the Great Experiment of the Federal Reserve's founding, the Great Depression, the Great Inflation ...