The top 10 percent through the ages

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How unequal were the Middle Ages compared to today?

CSMGEP Profile: Juan Carlos Suárez Serrato

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Deadly deadlines

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“Desk-clearing” by drug agencies has consequences for public safety.

Front Matter

American Economic Journal: Applied Economics, April 2021

The Power of Social Pensions: Evidence from China's New Rural Pension Scheme

By Wei Huang and Chuanchuan Zhang

American Economic Journal: Applied Economics, April 2021

This paper utilizes the county-by-county rollout of China's New Rural Pension Scheme (NRPS) and finds that, among age-eligible people, the pension scheme leads to higher household income and food expenditure, less farmwork, better health, and lower mortal...

Physician Practice Organization and Negotiated Prices: Evidence from State Law Changes

By Naomi Hausman and Kurt Lavetti

American Economic Journal: Applied Economics, April 2021

We study the relationship between physician organizational structures and prices negotiated with private insurers. Using variation caused by state-level judicial law changes, we show that a 10 percent increase in the enforceability of noncompete agreement...

Growing Markets through Business Training for Female Entrepreneurs: A Market-Level Randomized Experiment in Kenya

By David McKenzie and Susana Puerto

American Economic Journal: Applied Economics, April 2021

A common concern with efforts to directly help some small businesses to grow is that their growth comes at the expense of their unassisted competitors. We test this possibility using a two-stage randomized experiment in Kenya that randomizes business trai...

The Power of Example: Corruption Spurs Corruption

By Nicolás Ajzenman

American Economic Journal: Applied Economics, April 2021

Does political corruption erode civic values and foster dishonest behavior? I test this hypothesis in the context of Mexico by combining data on local government corruption and cheating on school tests. I find that, following revelations of corruption by ...

Subways and Road Congestion

By Yizhen Gu, Chang Jiang, Junfu Zhang, and Ben Zou

American Economic Journal: Applied Economics, April 2021

We study whether subways alleviate road congestion by examining 45 subway line launches in China and by using detailed data on road speed. Our difference-in-differences estimation finds that in the first year after a subway line is launched, rush hour spe...

Intergenerational Spillovers in Disability Insurance

By Gordon B. Dahl and Anne C. Gielen

American Economic Journal: Applied Economics, April 2021

Using a 1993 Dutch policy reform and a regression discontinuity design, we find children of parents whose disability insurance (DI) eligibility was reduced are 11 percent less likely to participate in DI themselves, do not alter their use of other governm...

Improving Last-Mile Service Delivery Using Phone-Based Monitoring

By Karthik Muralidharan, Paul Niehaus, Sandip Sukhtankar, and Jeffrey Weaver

American Economic Journal: Applied Economics, April 2021

Improving "last-mile" public service delivery is a recurring challenge in developing countries. Could the widespread adoption of mobile phones provide a scalable, cost-effective means for improvement? We use a large-scale experiment to evaluate the impact...

AEACGR: Government Activities

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Front Matter

American Economic Journal: Macroeconomics, April 2021

Risk, the College Premium, and Aggregate Human Capital Investment

By Kartik Athreya and Janice Eberly

American Economic Journal: Macroeconomics, April 2021

Despite increases in the college earnings premium to persistently high levels, investment in college education remains low. We can understand this apparent puzzle by considering the risk of attending college and, in particular, the possibility of failing ...

The Trade-Comovement Puzzle

By Lukasz A. Drozd, Sergey Kolbin, and Jaromir B. Nosal

American Economic Journal: Macroeconomics, April 2021

Standard international transmission mechanism of productivity shocks predicts a weak endogenous linkage between trade and business cycle synchronization: a problem known as the trade-comovement puzzle. We provide the foundational analysis of the puzzle, p...

Interest Rate Liberalization and Capital Misallocations

By Zheng Liu, Pengfei Wang, and Zhiwei Xu

American Economic Journal: Macroeconomics, April 2021

We study the consequences of interest rate liberalization in a two-sector general equilibrium model of China. The model captures a key feature of China's distorted financial system: state-owned enterprises (SOEs) have greater incentive to expand productio...

History Dependence in the Housing Market

By Philippe Bracke and Silvana Tenreyro

American Economic Journal: Macroeconomics, April 2021

Using data on the universe of housing transactions in England and Wales over a 20-year period, we document that sale prices and selling propensities are affected by house prices prevailing in the period in which properties were previously bought. Using ad...

Monetary Policy and Inequality under Labor Market Frictions and Capital-Skill Complementarity

By Juan J. Dolado, Gergő Motyovszki, and Evi Pappa

American Economic Journal: Macroeconomics, April 2021

We provide a new channel through which monetary policy has distributional consequences at business cycle frequencies. We show that an unexpected monetary easing increases labor income inequality between high-skilled and less-skilled workers. To rationaliz...

Monetary Policy and Bubbles in a New Keynesian Model with Overlapping Generations

By Jordi Galí

American Economic Journal: Macroeconomics, April 2021

I analyze an extension of the New Keynesian model that features overlapping generations of finitely lived agents and (stochastic) transitions to inactivity. In contrast with the standard model, the proposed framework allows for the existence of rational e...

The Choice Channel of Financial Innovation

By Felipe S. Iachan, Plamen T. Nenov, and Alp Simsek

American Economic Journal: Macroeconomics, April 2021

Financial innovation in recent decades has expanded portfolio choice. We investigate how greater choice affects investors' savings and asset returns. We establish a choice channel by which greater portfolio choice increases investors' savings—by enablin...