Identifying the Effects of Bank Failures from a Natural Experiment in Mississippi during the Great Depression

By Nicolas L. Ziebarth

American Economic Journal: Macroeconomics, January 2013

I examine the causal effect of bank failures during the Great Depression using the quasi-experimental setup of Richardson and Troost (2009). The experiment is based on Mississippi being divided into two Federal Reserve districts, which followed differe...

Untitled Land, Occupational Choice, and Agricultural Productivity

By Chaoran Chen

American Economic Journal: Macroeconomics, October 2017

The prevalence of untitled land in poor countries helps explain the international agricultural productivity differences. Since untitled land cannot be traded across farmers, it creates land misallocation and distorts individuals' occupational choice betwe...

The Cyclical Behavior of Debt and Equity Finance

By Francisco Covas and Wouter J. Den Haan

American Economic Review, April 2011

Debt and equity issuance are procyclical for most size-sorted firm categories of listed US firms and the procyclicality of equity issuance decreases monotonically with firm size. At the aggregate level, however, the results for equity issuance are not con...

Government Form and Public Spending: Theory and Evidence from US Municipalities

By Stephen Coate and Brian Knight

American Economic Journal: Economic Policy, August 2011

There are two main forms of government in US cities: council-manager and mayor-council. This paper develops a theory of fiscal policy determination under these two forms. The theory predicts that expected public spending will be lower under mayor-council ...

Policy Watch: Economics and the Clean Air Act

By Paul R. Portney

Journal of Economic Perspectives, Fall 1990

The Clean Air Act, arguably the nation's most important environmental statute, is sure to be amended by the 101st Congress. In neither its current nor its likely new form does the Act feature much of a role for economic considerations. In fact, one approa...

Task Specialization, Immigration, and Wages

By Giovanni Peri and Chad Sparber

American Economic Journal: Applied Economics, July 2009

Large inflows of less educated immigrants may reduce wages paid to comparably-educated, native-born workers. However, if less educated foreign- and native-born workers specialize in different production tasks, because of different abilities, immigratio...

Undergraduate Econometrics Instruction: Through Our Classes, Darkly

[Symposium: Recent Ideas in Econometrics]

By Joshua D. Angrist and Jörn-Steffen Pischke

Journal of Economic Perspectives, Spring 2017

The past half-century has seen economic research become increasingly empirical, while the nature of empirical economic research has also changed. In the 1960s and 1970s, an empirical economist's typical mission was to "explain" economic variables like wag...

Policy Uncertainty, Trade, and Welfare: Theory and Evidence for China and the United States

By Kyle Handley and Nuno Limão

American Economic Review, September 2017

We examine the impact of policy uncertainty on trade, prices, and real income through firm entry investments in general equilibrium. We estimate and quantify the impact of trade policy on China's export boom to the United States following its 2001 WTO acc...

Imperfect Competition in the Interbank Market for Liquidity as a Rationale for Central Banking

By Viral V. Acharya, Denis Gromb, and Tanju Yorulmazer

American Economic Journal: Macroeconomics, April 2012

We study interbank lending and asset sales markets in which banks with surplus liquidity have market power vis-à-vis banks needing liquidity, frictions arise in lending due to moral hazard, and assets are bank-specific. Surplus banks ration lending...

The Pragmatist's Guide to Comparative Effectiveness Research

[Symposium: Constraining Healthcare Costs]

By Amitabh Chandra, Anupam B. Jena, and Jonathan S. Skinner

Journal of Economic Perspectives, Spring 2011

Following an acrimonious healthcare reform debate involving charges of "death panels," in 2010, Congress explicitly forbade the use of cost-effectiveness analysis in government programs of the Patient Protection and Affordable Care Act. In this context, ...

The Evolution of Time Preference with Aggregate Uncertainty

By Arthur J. Robson and Larry Samuelson

American Economic Review, December 2009

We examine the evolutionary foundations of intertemporal preferences. When all the risk affecting survival and reproduction is idiosyncratic, evolution selects for agents who maximize the discounted sum of expected utility, discounting at the sum of th...

African American and White Differences in the Impacts of Monetary Policy on the Duration of Unemployment

By William M. Rodgers

American Economic Review, May 2008

Annuitization Puzzles

[Symposium: After Retirement]

By Shlomo Benartzi, Alessandro Previtero, and Richard H. Thaler

Journal of Economic Perspectives, Fall 2011

In his Nobel Prize acceptance speech given in 1985, Franco Modigliani drew attention to the "annuitization puzzle": that annuity contracts, other than pensions through group insurance, are extremely rare. Rational choice theory predicts that households w...

Tightening Environmental Standards: The Benefit-Cost or the No-Cost Paradigm?

[Symposium: Might Environmental Regulation Promote Growth?]

By Karen Palmer, Wallace E. Oates, and Paul R. Portney

Journal of Economic Perspectives, Fall 1995

This paper takes issue with the Porter-van der Linde claim that traditional benefit-cost analysis is a fundamental misrepresentation of the environmental problem. They contend that stringent environmental measures induce innovative efforts leading to impr...

Price Changes in the Euro Area and the United States: Some Facts from Individual Consumer Price Data

By Emmanuel Dhyne, Luis J. Alvarez, Herve Le Bihan, Giovanni Veronese, Daniel Dias, Johannes Hoffmann, Nicole Jonker, Patrick Lunnemann, Fabio Rumler, and Jouko Vilmunen

Journal of Economic Perspectives, Spring 2006

Prices of goods and services do not adjust immediately in response to changing demand and supply conditions. This paper characterizes the average frequency and size of price changes in the euro area and its member countries, investigates the determinants ...

The Cost of Business Cycles Under Endogenous Growth

By Gadi Barlevy

American Economic Review, September 2004

Robert E. Lucas, Jr. argued that the welfare gains from reducing aggregate consumption volatility are negligible. Subsequent work that revisited his calculation continued to find small welfare benefits, further reinforcing the perception that business cyc...

Mortality Inequality: The Good News from a County-Level Approach

[Symposium: Inequality Beyond Income]

By Janet Currie and Hannes Schwandt

Journal of Economic Perspectives, Spring 2016

In this essay, we ask whether the distributions of life expectancy and mortality have become generally more unequal, as many seem to believe, and we report some good news. Focusing on groups of counties ranked by their poverty rates, we show that gains in...

Search-Theoretic Models of the Labor Market: A Survey

By Richard Rogerson, Robert Shimer, and Randall Wright

Journal of Economic Literature, December 2005

We survey the literature on search-theoretic models of the labor market. We show how this approach addresses many issues, including the following: Why do workers sometimes choose to remain unemployed? What determines the lengths of employment and unemploy...

What's in a Surname? The Effects of Surname Initials on Academic Success

By Liran Einav and Leeat Yariv

Journal of Economic Perspectives, Winter 2006

In this paper, we focus on the effects of surname initials on professional outcomes in the academic labor market for economists. We begin our analysis with data on faculty in all top 35 U.S. economics departments. Faculty with earlier surname initials are...

The Q-Theory of Mergers

By Boyan Jovanovic and Peter L. Rousseau

American Economic Review, May 2002