Long-Term Employment Effects from Job Losses during the COVID-19 Crisis? A Comparison to the Great Recession and Its Slow Recovery

By Till von Wachter

AEA Papers and Proceedings, May 2021

This paper compares predictions for the long-term reductions in the employment-to-population (EPOP) ratio based on estimates of the overall job-loss rate and the long-term effects of job loss with the actual evolution of the EPOP ratio. It took about ten ...

Disability Insurance in the Great Recession: Ease of Access, Program Enrollment, and Local Hysteresis

By Melissa S. Kearney, Brendan M. Price, and Riley Wilson

AEA Papers and Proceedings, May 2021

We examine the interaction between Social Security Disability Insurance (SSDI) access and economic shocks during the Great Recession by exploiting exogenous variation in SSDI appeals processing time—a measure of hassle or access—between neighboring zi...

Wage Insurance and Labor Market Trajectories

By Benjamin G. Hyman, Brian K. Kovak, Adam Leive, and Theodore Naff

AEA Papers and Proceedings, May 2021

Wage insurance provides income support to displaced workers who find reemployment at a lower wage. We study the effects of the wage insurance provisions of the US Trade Adjustment Assistance (TAA) program using administrative data from the state of Virgin...

Working for Your Bread: The Labor Supply Effects of SNAP

By Marianne Bitler, Jason Cook, and Jonathan Rothbaum

AEA Papers and Proceedings, May 2021

The Supplemental Nutrition Assistance Program (SNAP), the only universal US means-tested safety net program, has a low benefit-reduction rate. Thus, many SNAP recipients are working. We apply recent methods to study whether there is evidence of moral haza...

Jackson, the Bank War, and the Legacy of the Second Bank of the United States

By Peter L. Rousseau

AEA Papers and Proceedings, May 2021

President Jackson vetoed the bill to recharter the Second Bank of the United States on July 10, 1832. I describe events leading to the veto and through the bank's dissolution in 1836 using private correspondence and official government documents. These ...

Off the Rails: The Real Effects of Railroad Bond Defaults following the Panic of 1873

By Christopher Cotter

AEA Papers and Proceedings, May 2021

Although corporate default crises are often quite severe, previous work has found little impact on real macroeconomic variables. This article investigates the relationship between railroad defaults and the balance sheets of local banks following the Panic...

How Contagious Was the Panic of 1907? New Evidence from Trust Company Stocks

By Caroline Fohlin and Zhikun Lu

AEA Papers and Proceedings, May 2021

Using a new dataset of all NYC trust company stocks, we study the impact of the Panic of 1907 and the ensuing cash infusion by JP Morgan and the Treasury. Using synthetic controls, we find that three "troubled" trusts performed far worse than the other tr...

Public Economics and Inequality: Uncovering Our Social Nature

By Emmanuel Saez

AEA Papers and Proceedings, May 2021

This paper argues that the social nature of humans, absent from the standard economic model, is crucial for understanding our large modern social states and why concerns about inequality are so pervasive. A social solution arises when a situation is resol...

Indigenous Self-Governance and Development on American Indian Reservations

By Dustin Frye and Dominic P. Parker

AEA Papers and Proceedings, May 2021

The UN Declaration on the Rights of Indigenous People promotes self-governance as a matter of justice rather than economics. How will self-governance affect the incomes of indigenous people? To gain insight, we compare long-run income growth on American I...

Custom Elections and Local Policies: The Case of Canada's First Nations

By Fernando M. Aragón and Anke S. Kessler

AEA Papers and Proceedings, May 2021

We examine the effect of community-designed electoral codes on Canadian First Nation communities. Adopting a custom code for local elections allows for changes such as increasing term duration, creating appeal and supervisory bodies, and incorporating tra...

Appropriate Institutions? Traditional Governance and Public Goods Provision in Oaxaca, Mexico

By Gustavo J. Bobonis, Juan C. Chaparro, Marco Gonzalez-Navarro, and Marta Rubio-Codina

AEA Papers and Proceedings, May 2021

What are the consequences of the adoption of traditional governance institutions among indigenous groups for local government affairs? We study the 1995 Usos y Costumbres traditional governance reform in the state of Oaxaca, which legitimized these struct...

Secured Transactions Laws and Economic Development on American Indian Reservations

By Christian Dippel, Donna Feir, Bryan Leonard, and Marc Roark

AEA Papers and Proceedings, May 2021

Harmonized commercial laws are considered an essential ingredient to commerce and trade and have been called the backbone of American commerce. Key components of these laws are those governing secured transactions. In recent years, Native American tribal ...

Preparing for a Pandemic: Accelerating Vaccine Availability

By Amrita Ahuja, Susan Athey, Arthur Baker, Eric Budish, Juan Camilo Castillo, Rachel Glennerster, Scott Duke Kominers, Michael Kremer, Jean Lee, Canice Prendergast, Christopher M. Snyder, Alex Tabarrok, Brandon Joel Tan, and Witold Więcek

AEA Papers and Proceedings, May 2021

Vaccinating the world's population quickly in a pandemic has enormous health and economic benefits. We analyze the problem faced by governments in determining the scale and structure of procurement for vaccines. We analyze alternative approaches to procur...

Private and Social Returns to R&D: Drug Development and Demographics

By Efraim Benmelech, Janice Eberly, Dimitris Papanikolaou, and Joshua Krieger

AEA Papers and Proceedings, May 2021

Investment in intangible capital such as R&D has increased dramatically since the 1990s. However, productivity growth remains sluggish in recent years. One potential reason is that a significant share of the increase in intangible investment is geared tow...

Private and Public Investments in Biomedical Research

By Maya Durvasula, Lisa Larrimore Ouellette, and Heidi Williams

AEA Papers and Proceedings, May 2021

Recent policy attention has focused on proposals to reduce prices for drugs that have received public funding. From an implementation perspective, such policies rely on public disclosure of government support for research. In this paper, we highlight two ...

The Economics of Crisis Innovation Policy: A Historical Perspective

By Daniel P. Gross and Bhaven N. Sampat

AEA Papers and Proceedings, May 2021

Since the beginning of the COVID-19 pandemic, policymakers, researchers, and journalists have made comparisons to World War II. In 1940, a group of top US science administrators organized a major coordinated research effort to support the Allied war effor...

Keynesian Production Networks and the COVID-19 Crisis: A Simple Benchmark

By David Baqaee and Emmanuel Farhi

AEA Papers and Proceedings, May 2021

The COVID-19 crisis is a seemingly all-encompassing shock to supply and demand. These negative shocks affected industries differently: some switched to remote work, maintaining employment and production, while others reduced capacity and shed workers. We ...

Sectoral Effects of Social Distancing

By Jean-Noël Barrot, Basile Grassi, and Julien Sauvagnat

AEA Papers and Proceedings, May 2021

The outbreak of the COVID-19 virus has led many states to take the drastic measures of social distancing. Using US executive order, occupation, and survey data, we measure the fall in labor supply due to these measures. Starting from a model of production...

COVID-19 and Small- and Medium-Sized Enterprises: A 2021 "Time Bomb"?

By Pierre-Olivier Gourinchas, Şebnem Kalemli-Özcan, Veronika Penciakova, and Nick Sander

AEA Papers and Proceedings, May 2021

This paper assesses the prospects of a 2021 "time bomb" in small- and medium-sized enterprise (SME) failures triggered by the generous support policies enacted during the 2020 COVID-19 crisis. Policies implemented in 2020 do not on their own create a 2021...

COVID-19 Is a Persistent Reallocation Shock

By Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, and Brent H. Meyer

AEA Papers and Proceedings, May 2021

Drawing on data from the firm-level Survey of Business Uncertainty, we present three pieces of evidence that COVID-19 is a persistent reallocation shock. First, rates of excess job and sales reallocation over 24-month periods (looking back 12 months and a...