Systemic Risk and Stability in Financial Networks

By Daron Acemoglu, Asuman Ozdaglar, and Alireza Tahbaz-Salehi

American Economic Review, February 2015

This paper argues that the extent of financial contagion exhibits a form of phase transition: as long as the magnitude of negative shocks affecting financial institutions are sufficiently small, a more densely connected financial network (corresponding...

Book Reviews

Journal of Economic Literature, September 2013

Is the Phillips Curve Alive and Well after All? Inflation Expectations and the Missing Disinflation

By Olivier Coibion and Yuriy Gorodnichenko

American Economic Journal: Macroeconomics, January 2015

We evaluate explanations for the absence of disinflation during the Great Recession and find popular explanations to be insufficient. We propose a new explanation for this puzzle within the context of a standard Phillips curve. If firms' inflation expecta...

Is the WTO Passé?

By Kyle Bagwell, Chad P. Bown, and Robert W. Staiger

Journal of Economic Literature, December 2016

The WTO has delivered policy outcomes that are very different from those likely to emerge out of the recent wave of preferential trade agreements (PTAs). Should economists see this as an efficient institutional hand-off, where the WTO has carried trade li...

Mafia and Public Spending: Evidence on the Fiscal Multiplier from a Quasi-experiment

By Antonio Acconcia, Giancarlo Corsetti, and Saverio Simonelli

American Economic Review, July 2014

A law issued to combat political corruption and Mafia infiltration of city councils in Italy has resulted in episodes of large, unanticipated, temporary contractions in local public spending. Using these episodes as instruments, we estimate the output mul...

The Numerical Reliability of Econometric Software

By B. D. McCullough and H. D. Vinod

Journal of Economic Literature, June 1999

Numerous examples show that some econometric software packages contain serious flaws, and that users cannot safely assume that their software is accurate. A brief survey of the fundamentals of computer arithmetic discusses the sources of numerical error a...

Effects of Deregulation and Consolidation of the Broadcast Television Industry

By Jessica Calfee Stahl

American Economic Review, August 2016

This paper exploits deregulation in the 1990s to estimate viewership and revenue effects of consolidation in broadcast television, then finds cost effects that explain the ownership structure given viewership and revenue effects. Results suggest that cons...

US Food Aid and Civil Conflict

By Nathan Nunn and Nancy Qian

American Economic Review, June 2014

We study the effect of U.S. food aid on conflict in recipient countries. Our analysis exploits time variation in food aid shipments due to changes in U.S. wheat production and cross-sectional variation in a country's tendency to receive any U.S. food ai...

Legal Realism for Economists

By Matthew C. Stephenson

Journal of Economic Perspectives, Spring 2009

Economists have made great progress in understanding the incentives and behavior of actors who operate outside of traditional economic markets, including voters, legislators, and bureaucrats. The incentives and behavior of judges, however, remain largely ...

Distributional Effects of Globalization in Developing Countries

By Pinelopi Koujianou Goldberg and Nina Pavcnik

Journal of Economic Literature, March 2007

The authors discuss recent empirical research on how globalization has affected income inequality in developing countries. They begin with a discussion of conceptual issues regarding the measurement of globalization and inequality. Next, they present e...

Changing Household Financial Opportunities and Economic Security

[Symposium: Household Risks]

By Karen E. Dynan

Journal of Economic Perspectives, Fall 2009

Households have experienced an expansion of financial opportunities over the past several decades. Expanded financial opportunities, such as the democratization of credit and new lending approaches, can yield benefits in terms of household economic securi...

Long-Term Consequences of Vietnam-Era Conscription: New Estimates Using Social Security Data

By Joshua D. Angrist, Stacey H. Chen, and Jae Song

American Economic Review, May 2011

We use the draft lottery to construct instrumental variables (IV) estimates of the impact of Vietnam-era military service on veterans' Social Security (SSA) earnings through 2007. We also use SSA data to construct IV estimates for employment (as measured ...

Estimating Average and Local Average Treatment Effects of Education when Compulsory Schooling Laws Really Matter

By Philip Oreopoulos

American Economic Review, March 2006

The change to the minimum school-leaving age in the United Kingdom from 14 to 15 had a powerful and immediate effect that redirected almost half the population of 14-year-olds in the mid-twentieth century to stay in school for one more year. The magnitude...

Globalization and Growth

By Gene M. Grossman and Elhanan Helpman

American Economic Review, May 2015

How does globalization affect economic growth? We discuss mechanisms that link international integration to the incentives for knowledge accumulation and the efficacy of that process. First, integration facilitates the flow of knowledge across national bo...

Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Comment

By David Neumark and William Wascher

American Economic Review, December 2000

Media and Political Persuasion: Evidence from Russia

By Ruben Enikolopov, Maria Petrova, and Ekaterina Zhuravskaya

American Economic Review, December 2011

This paper compares electoral outcomes of 1999 parliamentary elections in Russia among geographical areas with differential access to the only national TV channel independent from the government. It was available to three-quarters of Russia's population a...

Targeting with Agents

By Paul Niehaus, Antonia Atanassova, Marianne Bertrand, and Sendhil Mullainathan

American Economic Journal: Economic Policy, February 2013

Targeting assistance to the poor is a central problem in development. We study the problem of designing a proxy means test when the implementing agent is corruptible. Conditioning on more poverty indicators may worsen targeting in this environment beca...

Trying to Explain Home Bias in Equities and Consumption

By Karen K. Lewis

Journal of Economic Literature, June 1999

Investors hold a substantially larger proportion of their wealth portfolios in domestic assets than standard portfolio theory would suggest, a phenomenon called "equity home bias." In the absence of this bias, investors would optimally diversify domestic ...

Dynamic Free Riding with Irreversible Investments

By Marco Battaglini, Salvatore Nunnari, and Thomas R. Palfrey

American Economic Review, September 2014

We study the Markov equilibria of a model of free riding in which n infinitely lived agents choose between private consumption and irreversible contributions to a durable public good. We show that the set of equilibrium steady states converges to a unique...

Time-Varying Effects of Oil Supply Shocks on the US Economy

By Christiane Baumeister and Gert Peersman

American Economic Journal: Macroeconomics, October 2013

Using time-varying BVARs, we find a substantial decline in the shortrun price elasticity of oil demand since the mid-1980s. This finding helps explain why an oil production shortfall of the same magnitude is associated with a stronger response of oil p...