Showing papers in "Journal of Political Economy in 2020"
TL;DR: This article study the effects of industrial robots on US labor markets and show that robots may reduce employment and wages and that their local impacts can be estimated using variation in expo-expansions.
Abstract: We study the effects of industrial robots on US labor markets. We show theoretically that robots may reduce employment and wages and that their local impacts can be estimated using variation in exp...
508 citations
TL;DR: This article developed a framework to estimate willingness to pay for clean air from defensive investments on differentiated products, and applied this framework to scanner data on air purifier sales in China, where they found that consumers were willing to pay more for cleaner air.
Abstract: We develop a framework to estimate willingness to pay for clean air from defensive investments on differentiated products. Applying this framework to scanner data on air purifier sales in China, we...
162 citations
TL;DR: Using a random judge design and panel data from Norway, this article found that imprisonment discourages further criminal behavior, with reoffense probabilities falling by 29 percentage points and crimina...
Abstract: Using a random judge design and panel data from Norway, we estimate that imprisonment discourages further criminal behavior, with reoffense probabilities falling by 29 percentage points and crimina...
157 citations
TL;DR: In this paper, the authors build a model of the US economy with multiple aggregate shocks that generate fluctuations in equilibrium house prices through counterfactual experiments, and study the housing boom-bust around t
Abstract: We build a model of the US economy with multiple aggregate shocks that generate fluctuations in equilibrium house prices. Through counterfactual experiments, we study the housing boom-bust around t...
144 citations
TL;DR: In this article, the authors used the Becker-DeGroot-Marschak (BDM) mechanism to estimate the willingness to pay for clean drinking water technology in northern Ghana.
Abstract: We utilize the Becker-DeGroot-Marschak (1964) mechanism to estimate the willingness to pay for clean drinking water technology in northern Ghana. The BDM mechanism has attractive properties for empirical research, allowing us to directly estimate demand, compute heterogeneous treatment effects, and study the screening and causal effects of prices with minor modifications to a standard field experiment setting. We demonstrate the implementation of BDM along these three dimensions, compare it to the standard take-it-or-leave it method for eliciting willingness to pay, and discuss practical issues for implementing the mechanism in true field settings. JEL Classifications: C93, D12, D82, L11, L31
136 citations
TL;DR: A new method to measure CEO behavior in large samples via a survey that collects high-frequency, high-dimensional diary data and a machine learning algorithm that estimates behavioral types reveals two types: “leaders,” who do multifunction,High-level meetings, and “managers,’ who do individual meetings with core functions.
Abstract: We develop a new method to measure CEO behavior in large samples via a survey that collects high-frequency, high-dimensional diary data and a machine learning algorithm that estimates behavioral ty...
124 citations
TL;DR: In this paper, the authors document an important consequence of bride price, a payment made by the groom to the bride's family at marriage, and find that among ethnic groups, the bride price is more important than the groom's payment.
Abstract: We document an important consequence of bride price, a payment made by the groom to the bride’s family at marriage. Revisiting Indonesia’s school construction program, we find that among ethnic gro...
114 citations
TL;DR: There are striking differences in inequality and redistribution between the United States and Scandinavia as mentioned in this paper, and they conducted a study to study whether there are corresponding differences in social preferences, and found that there is a strong correlation between inequality and social preferences.
Abstract: There are striking differences in inequality and redistribution between the United States and Scandinavia. To study whether there are corresponding differences in social preferences, we conducted a...
110 citations
TL;DR: In this article, the authors present evidence on the role of social environment for the formation of prosociality and show that socioeconomic status (SES) as well as intensity of mother-child interaction and mother...
Abstract: This study presents evidence on the role of social environment for the formation of prosociality. We show that socioeconomic status (SES) as well as intensity of mother-child interaction and mother...
104 citations
TL;DR: In this paper, the nonparametric identification of gross output production functions under the environment of the commonly employed proxy variable methods is studied. And the authors show that applying these methods to gross output is NP-hard.
Abstract: We study the nonparametric identification of gross output production functions under the environment of the commonly employed proxy variable methods. We show that applying these methods to gross ou...
101 citations
TL;DR: In this article, the authors present results from an experiment that randomized the expansion of electric grid infrastructure in rural Kenya, where electricity distribution is a canonical example of a natural monopoly, and the experiment was conducted in the Central African Republic.
Abstract: We present results from an experiment that randomized the expansion of electric grid infrastructure in rural Kenya. Electricity distribution is a canonical example of a natural monopoly. Experiment...
TL;DR: In this article, a new model of consumption-based habit generates time-varying risk premia on bonds and stocks from log-linear, homoskedastic macroeconomic dynamics.
Abstract: Our new model of consumption-based habit generates time-varying risk premia on bonds and stocks from log-linear, homoskedastic macroeconomic dynamics. Consumers’ first-order condition for the real ...
TL;DR: The authors used the 1995 Mexican Peso crisis as an exogenous push factor that raised Mexican migration to the US and found that high-immigration states see their low-skilled labor force increase and native low-skill wages decrease, with an implied local labor demand elasticity of -.7.
Abstract: How does the US labor market absorb low-skilled immigration? I address this question using the 1995 Mexican Peso Crisis, an exogenous push factor that raised Mexican migration to the US. In the short run, high-immigration states see their low-skilled labor force increase and native low-skilled wages decrease, with an implied local labor demand elasticity of -.7. Internal relocation dissipates this shock spatially. In the long run, the only lasting consequences are for low-skilled natives who entered the labor force in high-immigration years. A simple quantitative many-region model allows me to obtain the counterfactual local wage evolution absent the immigration shock.
TL;DR: This article established currency as an important factor shaping global portfolios and demonstrated that investor holdings are biased toward their own currencies to such an extent. But they did not consider the effect of currency exchange rates on global portfolio performance.
Abstract: We establish currency as an important factor shaping global portfolios. Using a new security-level data set, we demonstrate that investor holdings are biased toward their own currencies to such an ...
TL;DR: The extent to which a designer can manipulate agents’ beliefs by disclosing information is characterized and the structure of optimal belief distributions is described, including a concave-envelope representation that subsumes the single-agent result of Kamenica and Gentzkow.
Abstract: Information provision in games influences behavior by affecting agents’ beliefs about the state as well as their higher-order beliefs. We first characterize the extent to which a designer can manip...
TL;DR: This paper quantifies and aggregates the multiple lifetime benefits of an influential high-quality early-childhood program with outcomes measured through midlife and is a template for synthesizing experimental and nonexperimental data using economic theory to estimate the long-run life-cycle benefits of social programs.
Abstract: This paper quantifies and aggregates the multiple lifetime benefits of an influential high-quality early childhood program with outcomes measured through midlife. Guided by economic theory, we supplement experimental data with non-experimental data to forecast the life-cycle benefits and costs of the program. Our point estimate of the internal rate of return is 13.7% with an associated benefit/cost ratio of 7.3. We account for model estimation and forecasting error and present estimates from extensive sensitivity analyses. This paper is a template for synthesizing experimental and non-experimental data using economic theory to estimate the long-run life-cycle benefits of social programs.
TL;DR: In this paper, a new long-run data set based on archival data from historical waves of the Survey of Consumer Finances (SOCF) is introduced, where the joint distribution of household income and wealth is studied.
Abstract: This paper introduces a new long-run data set based on archival data from historical waves of the Survey of Consumer Finances. Studying the joint distribution of household income and wealth, we exp...
TL;DR: In this article, the authors show that suppliers exposed to a large and exogenous decline in bank financing are more likely to be negatively affected by bank defaults and defaults than other suppliers.
Abstract: How do shocks to the banking sector travel through the corporate economy? Using a novel data set of interfirm sales, I show that suppliers exposed to a large and exogenous decline in bank financing...
TL;DR: In this paper, the authors introduce a simple model of dynamic matching in networked markets, where agents arrive and depart stochastically and the composition of the trade network depends endogenously on the matching algorithm.
Abstract: We introduce a simple model of dynamic matching in networked markets, where agents arrive and depart stochastically and the composition of the trade network depends endogenously on the matching alg...
TL;DR: A positive demand shock for coltan, a mineral whose bulky output cannot be concealed, leads armed actors to create illicit customs and provide protection at coltan mines, where they settle as “statemen" as mentioned in this paper.
Abstract: A positive demand shock for coltan, a mineral whose bulky output cannot be concealed, leads armed actors to create illicit customs and provide protection at coltan mines, where they settle as “stat...
TL;DR: This article showed that upcoding in private Medicare plans generates billions in excess public spending and significant distortions to firm and consumer behavior, suggesting a principal-agent problem faced by insurers, who desire more intense coding from the providers with whom they contract.
Abstract: In most US health insurance markets, plans face strong incentives to "upcode" the patient diagnoses they report to the regulator, as these affect the risk-adjusted payments plans receive. We show that enrollees in private Medicare plans generate 6% to 16% higher diagnosis-based risk scores than they would under fee-for-service Medicare, where diagnoses do not affect most provider payments. Our estimates imply that upcoding generates billions in excess public spending and significant distortions to firm and consumer behavior. We show that coding intensity increases with vertical integration, suggesting a principal-agent problem faced by insurers, who desire more intense coding from the providers with whom they contract.
TL;DR: The authors used a regression discontinuity (RD) design to find that one additional day care month at age 0-2 reduces intelligence quotient by 0.1. But they did not consider the Bologna day care system.
Abstract: Exploiting admission thresholds to the Bologna day care system, we show using a regression discontinuity (RD) design that one additional day care month at age 0–2 reduces intelligence quotient by 0...
TL;DR: In this paper, health-dependent utility is introduced into a model with incomplete markets in which pre-existing wealth holders spend down assets much more slowly than predicted by classic life-cycle models.
Abstract: Older wealth holders spend down assets much more slowly than predicted by classic life-cycle models. This paper introduces health-dependent utility into a model with incomplete markets in which pre...
TL;DR: It is found that early-childhood education has a strong causal impact on social preferences, and the importance of taking a broad perspective when designing and evaluating early- childhood educational programs is highlighted.
Abstract: We present results from the first study to examine the causal impact of early-childhood education on the social preferences of children. We compare children who, at 3–4 years old, were randomized i...
TL;DR: In this paper, the authors developed a model of agriculture on heterogeneous land to study the relation between trade, productivity, and welfare in Peru, where farmers face high internal and external trade costs.
Abstract: I develop a model of agriculture on heterogeneous land to study the relation between trade, productivity, and welfare in Peru, where farmers face high internal and external trade costs. I quantify ...
TL;DR: The authors show that genetic endowments associated with human capital accumulation are associated with wealth not only through educational attainment and labor income, but also through a facility with complex financial decision-making.
Abstract: We show that genetic endowments linked to educational attainment strongly and robustly predict wealth at retirement. The estimated relationship is not fully explained by flexibly controlling for education and labor income. We therefore investigate a host of additional mechanisms that could account for the gene-wealth gradient, including inheritances, mortality, risk preferences, portfolio decisions, beliefs about the probabilities of macroeconomic events, and planning horizons. We provide evidence that genetic endowments related to human capital accumulation are associated with wealth not only through educational attainment and labor income, but also through a facility with complex financial decision-making.
TL;DR: In this paper, the class of multiround, multiproduct clock procurement auctions that reduce offered prices at each round is studied and when prices stop declining, the remaining bidders become the winning sellers.
Abstract: We study the class of multiround, multiproduct clock procurement auctions that reduce offered prices at each round. When prices stop declining, the remaining bidders become the winning sellers. For...
TL;DR: This article found that almost half of missing women in India are of postreproductive ages and intra-household gender inequality and asymmetry in poverty explain a portion of these missing women.
Abstract: Almost half of missing women in India are of postreproductive ages. Can intrahousehold gender inequality and asymmetry in poverty explain a portion of these missing women? Using a natural experimen...
TL;DR: In this article, the impact of global food price shocks on local violence across Africa was studied and it was shown that higher prices reduce conflict over the control of territory (factor conflict) and increas...
Abstract: We study the impact of global food price shocks on local violence across Africa. In food-producing areas, higher prices reduce conflict over the control of territory (“factor conflict”) and increas...
TL;DR: In this paper, a model of school choices by households under one of the most pop- ular procedures known as the Boston mechanism (BM) was developed and estimated by recovering the joint distribution of household preferences and sophistication types using adminis- trative data from Barcelona.
Abstract: An important debate centers on what procedure should be used to allocate students across public schools. We contribute to this debate by developing and estimating a model of school choices by households under one of the most pop- ular procedures known as the Boston mechanism (BM). We recover the joint distribution of household preferences and sophistication types using adminis- trative data from Barcelona. Our counterfactual policy analyses show that a change from BM to the Gale-Shapley student deferred acceptance mechanism would create more losers than winners, while a change from BM to the top trading cycles mechanism has the opposite effect.