Getting the help they need

[Research Highlight]

November 17, 2021

How did cuts to special education in Texas affect the long-run outcomes for students?

Front Matter

American Economic Review, December 2021

Synthetic Difference-in-Differences

By Dmitry Arkhangelsky, Susan Athey, David A. Hirshberg, Guido W. Imbens, and Stefan Wager

American Economic Review, December 2021

We present a new estimator for causal effects with panel data that builds on insights behind the widely used difference-in-differences and synthetic control methods. Relative to these methods we find, both theoretically and empirically, that this "synthet...

Sectoral Media Focus and Aggregate Fluctuations

By Ryan Chahrour, Kristoffer Nimark, and Stefan Pitschner

American Economic Review, December 2021

We formalize the editorial role of news media in a multisector economy and show that media can be an independent source of business cycle fluctuations, even when they report accurate information. Public reporting about a subset of sectoral developments th...

Tax Administration versus Tax Rates: Evidence from Corporate Taxation in Indonesia

By M. Chatib Basri, Mayara Felix, Rema Hanna, and Benjamin A. Olken

American Economic Review, December 2021

We compare two approaches to increasing tax revenue: tax administration and tax rates. We show that when Indonesia moved top regional firms into "medium taxpayer offices," with high staff-to-taxpayer ratios, tax revenue more than doubled. Examining nonlin...

Team-Specific Human Capital and Team Performance: Evidence from Doctors

By Yiqun Chen

American Economic Review, December 2021

This paper studies whether team members' past collaboration creates team-specific human capital and influences current team performance. Using administrative Medicare claims for two heart procedures, I find that shared work experience between the doctor w...

Product Innovation, Product Diversification, and Firm Growth: Evidence from Japan's Early Industrialization

By Serguey Braguinsky, Atsushi Ohyama, Tetsuji Okazaki, and Chad Syverson

American Economic Review, December 2021

We explore how firms grow by adding products. We leverage detailed data from Japan's cotton spinning industry at the turn of the last century to do so. This setting allows us to fully characterize the type of differentiation (vertical or horizontal) of ...

M Equilibrium: A Theory of Beliefs and Choices in Games

By Jacob K. Goeree and Philippos Louis

American Economic Review, December 2021

We introduce a set-valued solution concept, M equilibrium, to capture empirical regularities from over half a century of game theory experiments. We show M equilibrium serves as a meta theory for various models that hitherto were considered unrelated. M e...

Delegation in Veto Bargaining

By Navin Kartik, Andreas Kleiner, and Richard Van Weelden

American Economic Review, December 2021

A proposer requires a veto player's approval to change a status quo. Proposer is uncertain about Vetoer's preferences. We show that Vetoer is typically given a non-singleton menu, or delegation set, of options to pick from. The optimal set balances the ex...

Optimal Lockdown in a Commuting Network

By Pablo D. Fajgelbaum, Amit Khandelwal, Wookun Kim, Cristiano Mantovani, and Edouard Schaal

American Economic Review: Insights, December 2021

We study optimal dynamic lockdowns against COVID-19 within a commuting network. Our framework integrates canonical spatial epidemiology and trade models and is applied to cities with varying initial viral spread: Seoul, Daegu, and the New York City metrop...

Do Women Respond Less to Performance Pay? Building Evidence from Multiple Experiments

By Oriana Bandiera, Greg Fischer, Andrea Prat, and Erina Ytsma

American Economic Review: Insights, December 2021

Existing empirical work raises the hypothesis that performance pay—whatever its output gains—may widen the gender earnings gap because women may respond less to incentives. We evaluate this possibility by aggregating evidence from existing experiments...

Optimal Targeted Lockdowns in a Multigroup SIR Model

By Daron Acemoglu, Victor Chernozhukov, Iván Werning, and Michael D. Whinston

American Economic Review: Insights, December 2021

We study targeted lockdowns in a multigroup SIR model where infection, hospitalization, and fatality rates vary between groups—in particular between the "young," the "middle-aged," and the "old." Our model enables a tractable quantitative analysis of op...

Cheating with Models

By Kfir Eliaz, Ran Spiegler, and Yair Weiss

American Economic Review: Insights, December 2021

Beliefs and decisions are often based on confronting models with data. What is the largest "fake" correlation that a misspecified model can generate, even when it passes an elementary misspecification test? We study an "analyst" who fits a model, represen...

Long-Term Effects of the Targeting the Ultra Poor Program

By Abhijit Banerjee, Esther Duflo, and Garima Sharma

American Economic Review: Insights, December 2021

This paper studies the long-run effects of a "big-push" program providing a large asset transfer to the poorest Indian households. In a randomized controlled trial that follows these households over ten years, we find positive effects on consumption (0.6 ...

Allocation Mechanisms without Reduction

By David Dillenberger and Uzi Segal

American Economic Review: Insights, December 2021

We study a simple variant of the house allocation problem (one-sided matching). We demonstrate that agents with recursive preferences may systematically prefer one allocation mechanism to the other, even among mechanisms that are considered to be the same...

Front Matter

American Economic Review: Insights, December 2021

The Tax Elasticity of Capital Gains and Revenue-Maximizing Rates

By Ole Agersnap and Owen Zidar

American Economic Review: Insights, December 2021

This paper uses a direct-projections approach to estimate the effect of capital gains taxation on realizations at the state level and then develops a framework for determining revenue-maximizing rates at the federal level. We find that the elasticity of r...

3rd Annual Conference of the Private Sector Development Research Network

[News]

November 30, 2021

The conference will be held on December 9-10, 2021.

Patent disclosure

[Page]

Does access to patent documentation spur follow-on innovation?

Webinar: Helping Faculty Help Students get into PhD Programs in Economics

[News]

December 02, 2021

This webinar will be held on Friday, January 28, 2022 at 1:00 pm EST.