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- Blame it on the Jews? Economic Incentives and Persecutions during the Black Death
by missiaia in NEP-HIS blog, 2017-04-25 15:16:21 UTC
Negative Shocks and Mass Persecutions: Evidence from the Black Death
by Remi Jedwab ( George Washington University ), Noel D. Johnson ( George Mason University ) and Mark Koyama ( George Mason University )
ABSTRACT- In this paper we study the Black Death persecutions (1347-1352) against Jews in order to shed light on the factors determining when a minority group will face persecution. We develop a theoretical framework which predicts that negative shocks increase the likelihood that minorities are scapegoated and persecuted. By contrast, as the shocks become more severe, persecution probabilit [...]
- Is There Really a Retirement-Savings Crisis?
by Cody Kallen in The American, 2017-04-24 15:22:38 UTC
The following is an excerpt from an April 24, 2017, Wall Street Journal conversation between the WSJ’s Anne Tergesen, AEI’s Andrew Biggs, and Boston College’s Alicia Munnell.
WSJ: Do we face a retirement crisis?
Andrew Biggs: A “retirement crisis” is when inadequate savings cause large numbers of households to face a substantial drop in their standard of living in retirement. That is not going to happen.
Yes, some studies show most Americans falling short. But others show fewer Americans falling short, and smaller shortfalls.
Seniors have the lowest poverty rates in the population. Three- [...]
- Understanding Business Dynamism
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2017-04-24 12:04:34 UTC
“[T]he overall ability of entrepreneurship to facilitate … economic prosperity depends disproportionately on the … performance of a very small number of new firms.” Guzman and Stern, 2016 . For at least the past 30 years, the rate of U.S. business formation has been falling and the average age of existing firms has been rising. Since 2000, two other things have happened: productivity growth has slowed, while many skilled jobs have disappeared. Startups are thought be a key source of innovation in the economy and of net job creation. At the same time, as Schumpeter’s notion of creative destru [...]
- How Bad is Peer Review? Evidence From Undergraduate Referee Reports on the Currency Unions and Trade Lit
by Doug Campbell in Douglas L. Campbell, 2017-04-24 10:30:00 UTC
In a recent paper, Glick and Rose (2017) suggest that the Euro led to a staggering 50% increase in trade. To me, this sounded a bit dubious, particularly given my own participation in the previous currency unions and trade literature (which I wrote up� here ; my own research on this subject is� here ). This literature includes papers by Robert Barro that imply that currency unions increase trade on a magical 10 fold basis, and a QJE paper which suggests that currency unions even increase growth. In my own eyes, the Euro has been a significant source of economic weakness for many European count [...]
- Has there been a sea change in the way banks respond to capital requirements?
by bankunderground in Bank Underground, 2017-04-24 08:00:35 UTC
Sebastian J A de-Ramon, William Francis and Qun Harris
Shakespeare first coined the term ‘sea change’ in The Tempest to describe King Alonso’s lasting transformation after his mystical death by drowning. Resting five fathoms deep, Alonso suffers a sea change into something rich and strange, with coral for bones and pearls for eyes. In a recent working paper , we explore for evidence of a possible sea change in UK banks’ balance sheets using data spanning the 2007-09 crisis. Our initial dive into the still murky, post-crisis waters shows signs of something strange and unrecognizable, with UK b [...]
- An Academic Named "Kahn" (not me) Opines About Climate Change Adaptation in the NY Times
by Matthew Kahn in Environmental and Urban Economics, 2017-04-23 14:36:00 UTC
The NY Times Magazine has published a whole issue today about climate change . I've skimmed all of the articles and I believe that the magazine chose to avoid the economists (except in a brief correct quote here ) for some insights. Below is a "subtle" cartoon from the Mooallem piece and here is some standard "doom and gloom" from a psychologist named "Kahn" ; "Still, we insulate ourselves from the disorientation and alarm in other, more pernicious ways, too. We seem able to normalize catastrophes as we absorb them, a phenomenon that points to what Peter Kahn, a professor of psychology at [...]
- Bank holidays & productivity
by chris in Stumbling and Mumbling, 2017-04-23 12:07:12 UTC
Labour wants us to have more bank holidays. There might be a good economic case for this.
My chart hints at the point. It shows that, across 35 OECD nations, there is a very strong negative correlation (of minus 0.77) between annual working hours and GDP per hour worked. Countries that work less are more productive. The French, for example, are far more productive than the UK even though they spend all their time eating cheese.
The same correlation exists over time. We work only around half as much now as we did in the 19 th century, but we’re far more productive in those hours we do work.
- How do the French think?
by Diane Coyle in The Enlightened Economist, 2017-04-23 11:12:56 UTC
Well, we will find out tonight I suppose, with the exit polls from the first stage of the French presidential election. After Brexit and Trump, I’m bracing myself. It seemed a good week to read Sudhir Hazareesingh’s How The French Think , out now in paperback, and I’ve greatly enjoyed it. I was a teenage existentialist (just like Sarah Bakewell ), deeply influenced by Simone de Beauvoir’s The Second Sex , and a Francophile since primary school. Who knows why? It might just have been the most exotic place I could imagine growing up in a small Lancashire mill town. So How The French Think has be [...]
- Ny viden om ulandsbistand ved EPCS-konferencen
by Christian BjÃ¸rnskov in Punditokraterne, 2017-04-22 08:17:41 UTC
Jeg er pt. på vej hjem fra den årlige konference i the European Public Choice Society, der i år var på CEU i Budapest. Konference var, som tidligere år, et af årets højdepunkter – både videnskabeligt og socialt. Videnskabeligt reflekterede den helt særligt, hvor meget interessant forskning i ulandsbistand, der foregår i public choice og politisk økonomi for tiden. En del af denne forskning er centreret omkring Axel Drehers Lehrstuhl ved universitetet i Heidelberg, og hans glimrende hold af PhD-studerende og post docs, og omkring gruppens venner. To præsentationer var specielt interessante, den [...]
- California's High Taxes and "Spatial Equilibrium"
by Matthew Kahn in Environmental and Urban Economics, 2017-04-21 13:07:00 UTC
Back 25 years ago, Sherwin Rosen tried to teach me many economics ideas. I think of him as I read Robert Reich's December 2016 piece " Have Liberal States Won America's Tax Experiment?" Here are a few quotes from Mr. Reich. "But what about so-called over-taxed, over-regulated, high-wage California? California leads the nation in the rate of economic growth — more than twice the national average. In other words, conservatives have it exactly backwards. So why are Kansas and Texas doing so badly? And California so well? Because taxes enable states to invest in their people – their educat [...]
- Friday links: the most famous ecologist, March for Science, and more
by ? in Dynamic Ecology, 2017-04-21 11:00:00 UTC
Also this week: PowerPoint vs. Alan Turing, self-organized grant funding, changing Waterman Award criteria, how to RELATE, the hater’s guide to reproducibility, incentivizing replication, academia coloring book, negative results on resurrection, #ove [...]
- Unequal opportunity, unequal growth
by ? in Let's Talk Development, 2017-04-20 16:15:00 UTC
Inequality can be both good and bad for growth, depending on what inequality and whose growth. Unequal societies may be holding back one segment of the population while helping another. Similarly, high levels of inequality may be due to a variety of facto [...]
- Thesis Thursday: Sara Machado
by Chris Sampson in The Academic Health Economists' Blog, 2017-04-20 06:00:41 UTC
On the third Thursday of every month, we speak to a recent graduate about their thesis and their studies. This month’s guest is Dr Sara Machado who graduated with a PhD from Boston University . If you would like to suggest a candidate for an upcoming Thesis Thursday, get in touch .
Essays on the economics of blood donations
Daniele Paserman , Johannes Schmieder , Albert Ma
What makes blood donation an interesting context for economic research?
I’m generally interested in mark [...]
- What the 2017 Conservative manifesto should say about the NHS
by Artemis JP in British Politics and Policy at LSE, 2017-04-19 23:00:26 UTC
The Conservative Party’s record on healthcare is not its strongest point in the polls. With the NHS caught in what seems like a perpetual crisis, and with services suffering all the more as a result, what promises can Theresa May make in her snap election manifesto? Tony Hockley writes that there is one critical pledge: the NHS must have its own 2% inflation target.
The Conservative Party is riding high in the polls despite widespread gloom over the prospects for public services. The Party’s electoral vulnerability on the health service creates an interest on the part of the NHS and its politi [...]
- Proposed changes to IDEAS/RePEc ranking: Euclid and outliers
by Christian Zimmermann in RePEc blog, 2017-04-19 15:51:53 UTC
The IDEAS/RePEc rankings are a popular way to assess the strength of economists, serials and institutions. They are built on a large number of criteria that are relatively stable in definition. As rankings matter a lot for some, we do not want to disturb the definitions before prior approval by the community. Hence, we are putting to a vote several changes for the aggregate rankings of economists and serials. Voting ends one month from this post, 19 May 2017. Any approved change is expected to be available in the May rankings released in early June 2017.
Euclidian ranking for economists
The Eu [...]
- Wednesday assorted links
by Tyler Cowen in Marginal Revolution, 2017-04-19 15:48:19 UTC
1. Learning to love the scientific consensus . And Los Angeles is America’s most important symphony orchestra, period (NYT). And the making of Michael Anton ?
2. Why it is hard to hunt squirrels .
3. “ We instead offered co-authorship for a second, yet to be written, paper to other scholars willing to independently replicate our study. ”
4. If Bangkok goes ahead and bans all of its street food vendors , I will never visit again. Gary Leff comments , maybe KL is the big winner.
5. Roman roads to prosperity (pdf, slides).
6. Good Twitter thread on the British general election .
The post Wedne [...]
- Assessing the Determinants of Economic Growth in South East Asia
by Fernando Arteaga in NEP-HIS blog, 2017-04-18 15:23:27 UTC
The Historical State, Local Collective Action, and Economic Development in Vietnam
By Melissa Dell (Harvard University), Nathaniel Lane (Stockholm University), Pablo Querubin (New York University)
Abstract – This study examines how the historical state conditions long-run development, using Vietnam as a laboratory. Northern Vietnam (Dai Viet) was ruled by a strong centralized state in which the village was the fundamental administrative unit. Southern Vietnam was a peripheral tributary of the Khmer (Cambodian) Empire, which followed a patron-client model with weaker, more personalized power r [...]
- Directed Search with Phantom Vacancies
by Christian Zimmermann in NEP-DGE blog, 2017-04-18 15:10:17 UTC
By James Albrecht, Bruno Decreuse and Susan Vroman
When vacancies are filled, the ads that were posted are generally not withdrawn, creating phantom vacancies. The existence of phantoms implies that older job listings are less likely to represent true vacancies than are younger ones. We assume that job seekers direct their search based on the listing age for otherwise identical listings and so equalize the probability of matching across listing age. Forming a match with a vacancy of age a creates a phantom of age a and thus creates [...]
- The impact of emigration on MENA labor markets
by pmakdissi in NEP-ARA blog, 2017-04-18 14:16:52 UTC
By David Anda (DIAL) and Mohamed Ali Marouani (Paris 1 – Panthéon-Sorbone and DIAL)
Migration has emerged as a major global policy issue in 2015 following the massive influx of Syrian and other refugees in Europe. However migration has always been a major phenomenon in the Middle East and North Africa (MENA), which is among the first regions in terms of origin and destination for migrants. The MENA region also ranks first in terms of unemployment rate in the World (ILO, 2015). It thus seems particularly relevant to study the [...]
- An Answer to Steve Ballmer's Question About Government Expenditure Patterns
by Matthew Kahn in Environmental and Urban Economics, 2017-04-18 02:53:00 UTC
The NY Times p resents a long article focused o n a good question posed by the billionaire Steve Ballmer. Mr Ballmer wants to know what our federal, state and local governments spend $ on and what we get for this expenditure. In a series of recent papers, I have explored this same question. I s Local Public Sector Rent Extraction Higher in Progressive Cities or High Amenity Cities? Public finance theories of the median voter’s preferences and local public sector rent extraction posit that liberal cities and high amenity cities will feature a larger, better paid local public sector. Compensa [...]
- Dr. Krugman's New Piece on "All Jobs Matter" Ignores Some Key Urban Economics
by Matthew Kahn in Environmental and Urban Economics, 2017-04-17 14:00:00 UTC
Paul Krugman has written an important column for the NY Times. He asks why lost resource extraction jobs (coal miners) garner so much of the President's attention relative to jobs lost in other sectors such as suburban mall retail and downtown Macy department store closings. He argues, without much evidence, that since white guys have had the coal jobs that this explains why Trump has focused on them. Let me sketch a couple of thoughts. 1. Is Amazon a villain? I don't think so. Professor Krugman knows the Dixit and Stiglitz taste for variety model. Amazon has sharply increased all of our [...]
- Revisiting Market Liquidity: The Case of U.S. Corporate Bonds
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2017-04-17 13:34:54 UTC
“…a small reduction in liquidity from regulatory changes—even if present, which is not obvious—may be a reasonable price to pay for greater safety.” FRB Vice Chair Stanley Fischer Speech , November 15, 2016 Prior to the financial crisis of 2007-2009, many people took market liquidity for granted. So, when the ability to convert assets into cash eroded, the issue became one of survival for some intermediaries. Today, both investors and regulators are focusing on “the ability to rapidly execute sizable securities transactions at a low cost and with a limited price impact” (see Fischer ). And the [...]
- Moral Rights: what are they good for?
by Nicholas Gruen in Club Troppo, 2017-04-17 11:57:47 UTC
I’m no fan of moral rights, but there you are. Artists are, so perhaps I should change my tune.
The Valuation of Moral Rights: A Field Experiment
By: Stefan Bechtold (ETH Zürich) ; Christoph Engel (Max Planck Institute for Research on Collective Goods)
U.S. intellectual property law is firmly rooted in utilitarian principles. Copyright law is viewed as a means to give proper monetary incentives to authors for their creative effort. Many European copyright systems pursue additional goals: Authors have the right to be named as author, to control alterations and to retract their work in case thei [...]
- Own Group Preferences in the Year 2017
by Matthew Kahn in Environmental and Urban Economics, 2017-04-17 01:04:00 UTC
A black teacher argues in the NY Times today that black students gain more from having him as their teacher. � This "productivity from own group" exposure was one theme of my Civil War work with Dora Costa. � �In our 2006 paper, we document the costs and benefits of fighting with diverse peers for black civil war solders. � In our 2003 paper, we document the costs of fighting in more diverse war companies. Based on our research (and common sense), people are more comfortable when they are with members of their own group but they are more likely to learn from others when they are with members o [...]
- California's Cap & Trade and Suburban Pocketbook Expenditure Dynamics
by Matthew Kahn in Environmental and Urban Economics, 2017-04-16 20:56:00 UTC
As I read t his LA Times article , I see that a real debate is about to begin on California's carbon cap and trade program. �A basic question in public finance economics focuses on economic incidence. �In English, who bears the costs of new regulations such as higher gas taxes? �This matters because California's cap and trade program will raise gas prices and electricity prices and water prices. �We can (and should) debate how much they will increase. I n my own research, I have documented that suburbanites and Republicans do not support California's cap and trade program. � �This suggests tha [...]
- Against marginal product
by chris in Stumbling and Mumbling, 2017-04-16 12:31:38 UTC
David Moyes says Jordan Pickford has been a better player than Dele Alli this season. This set me wondering about marginal productivity theory.
To see my point, think about how we’d test Moyes’ claim. We could look at what the two teams did in games which Alli and Pickford missed. But there are too few of these to draw robust inferences, and doing so would be impossible for a player who hadn’t missed any games*. Instead, we could compare how Sunderland would have done if Pickford were replaced with a next-best alternative to how S***s would have done with a next-best replacement for Alli. In e [...]
- Optimal Progressive Income Taxation in a Bewley-Grossman Framework
by Christian Zimmermann in NEP-DGE blog, 2017-04-14 20:55:36 UTC
By Juergen Jung and Chung Tran
We study the optimal progressivity of income taxation in a Bewley-Grossman model of health capital accumulation where individuals are exposed to earnings and health risks over the lifecycle. We impose the U.S. tax and transfer system and calibrate the model to match U.S. data. We then optimize the progressivity of the income tax code. The optimal income tax system is more progressive than current U.S. income taxes with zero taxes at the lower end of the income distribution and a marginal tax rate of over 50 pe [...]
- The Zero Lower Bound and Monetary Policy
by Stephen Williamson in Stephen Williamson: New Monetarist Economics, 2017-04-13 22:34:00 UTC
Ben Bernanke has written a couple of blog posts on the zero lower bound (ZLB) on nominal interest rates, and some implications for monetary policy going forward. The first deals with the extent of the ZLB "problem," and the second with monetary policy solutions. In a previous post I wrote about the low-real-interest-rate phenomenon, and how central bankers view the implications for monetary policy. Basically, the real rate of return on government debt in the United States, and around the world, has been persistently low because of low productivity growth, demographic factors, and - most import [...]
- DÃ©clin des centres-villes et lutte des classes
by Antoine Belgodere in Optimum, 2017-04-12 10:19:00 UTC
On parle beaucoup depuis quelques mois du déclin des centres-villes des
villes françaises moyennes. L'indicateur qui illustre ces craintes est celui de
la vacance commerciale, qui correspond au pourcentage de commerces fermés dans
une ville donnée. Un
rapport de l'inspection générale des finances et du conseil général de
l'environnement et du développement durable a mis en lumière sa forte
augmentation dans de nombreux centres de villes moyennes depuis une dizaine
d'années. La ville de Bézier est souvent citée en exemple, en raison de son
taux particulièrement élevé (un quart) et du lien [...]
- Information-driven Business Cycles: A Primal Approach
by Christian Zimmermann in NEP-DGE blog, 2017-04-12 03:14:56 UTC
By Ryan Chahrour and Robert Ulbricht
We develop a methodology to estimate DSGE models with incomplete information, free of parametric restrictions on information structures. First, we define a “primal” economy in which deviations from full information are captured by wedges in agents’ equilibrium expectations. Second, we provide implementability conditions, which ensure the existence of an information structure that implements these wedges. We apply the approach to estimate a New Keynesian model in which firms, households and the monetary autho [...]
- Exorbitant privilege and the income puzzle in the U.S. : How to gain investment income despite being in debt
by ? in FRED blog, 2017-04-10 13:00:39 UTC
For most of us, the returns we gain on our assets are typically lower than the interest payments we make on debt and liabilities. This applies to most countries, too. The U.S., however, is an exception: For the U.S., liabilities with foreigners greatly surpass U.S. assets and claims on foreigners. In other words, the U.S. net international investment position is currently negative and has been for a long time. However, net income received by the U.S. is positive, which is not what we’d expect. This rather puzzling feature of the data is referred to as the U.S. income puzzle.
FRED can illustra [...]
- The sporting life, & taxes
by chris in Stumbling and Mumbling, 2017-04-10 12:58:47 UTC
One question that was doing the rounds on Twitter over the weekend was: would you rather have a big trust fund or sporting ability that enabled you to earn similar money?
The question makes sense because a trust fund and athletic potential are both things we inherit from our parents. Both are, in Rawls’ words, “arbitrary from a moral point of view.” And both are forms of capital. One is financial capital, the other human capital. Granted, the concept of human capital does a poor job of explaining income inequalities, but it is useful to think of it when we are managing our own finances.
So, wh [...]
- The Fed's Balance Sheet and the Stance of Monetary Policy
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2017-04-10 12:06:33 UTC
U.S. monetary policy is tightening, as everyone who pays even the slightest attention to the financial news knows. But when and how? Here, the discussion is focused on two complementary aspects of Federal Reserve policy: interest rates and the balance sheet. The first of these concerns policy of the old-style conventional type. The second is about the consequences of quantitative easing. At $4.23 trillion, more than 5 times the 2007 level, the size of securities holdings raises a series of questions: When will the Federal Reserve’s Open Market Committee (FOMC) start to shrink its balance shee [...]
- Sam Watsonâs journal round up for 10th April 2017
by Sam Watson in The Academic Health Economists' Blog, 2017-04-10 10:00:00 UTC
Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch .
Expertise versus Bias in Evaluation: Evidence from the NIH . American Economic Journal: Applied Economics. Published April 2017.
As an academic’s career progresses, she learns two things: patience and learning [...]
- Trade: The benefits of foreign banks
by bankunderground in Bank Underground, 2017-04-10 08:00:54 UTC
Stijn Claessens and Neeltje van Horen.
Foreign banks can be important for trade. They can increase the availability of external finance for exporting firms and help overcome information asymmetries. Consistent with these channels, we show that firms in emerging markets tend to export more when foreign banks are present, especially when the parent bank is headquartered in the importing country. In advanced countries, where financial markets are more developed and information is more readily available, the presence of foreign banks does not play such a role. Financial globalization through the [...]
- Â«Â The IslandÂ Â» sur M6 : les candidats dÃ©couvrent lâÃ©conomie pratique [Replay]
by Guillaume Nicoulaud in Contrepoints, 2017-04-10 03:25:43 UTC
Par Guillaume Nicoulaud.
Vous avez peut-être déjà suivi un ou plusieurs épisodes de The Island sur M6. Si ce n’est pas le cas, on peut décrire cette émission comme une sorte de Koh-Lanta sans Denis Brogniart, ses jeux, ses sacs de riz et ses réserves d’eau potable. The Island , à quelques détails près 1 , c’est l’état de nature : une quinzaine d’homo sapiens qui se retrouvent parachutés sur une île perdue au milieu du pacifique et qui doivent se débrouiller pour y tenir 28 jours.
The Island, l’économie concrète
Concrètement, cela signifie que les candidats de The Island se retrouvent dans une [...]
- The free rider problem â and opportunity: you heard it first at Troppo
by Nicholas Gruen in Club Troppo, 2017-04-09 10:32:59 UTC
Well I’ve been going on and on about it , but here’s an academic paper contrasting the free rider problem and opportunity.
Knowledge Properties and Economic Policy: A New Look
By Antonelli, Cristiano (University of Turin)
This paper explores the full range of effects of knowledge properties and explains how knowledge properties such as transient appropriability, nonexhaustibility and indivisibility do not only have negative effects, but also positive ones. Knowledge externalities help reduce the cost of knowledge and imitation externalities reduce the revenue and profitability of innovations. [...]
- When did Krugman change? And why?
by ssumner in The Money Illusion, 2017-04-07 19:49:44 UTC
Paul Krugman frequently suggests that his famous 1998 article (“ It’s Baaack, Japan’s Slump and the Return of the Liquidity Trap” ) led him to rethink the role of monetary and fiscal policy. He says that the “expectations trap” model in that paper convinced him that monetary policy might be ineffective at the zero bound, and that fiscal policy might then become necessary.
Previously I’ve pointed to a 1999 Krugman essay that advocated monetary stimulus for Japan, and was quite dismissive of the idea of fiscal stimulus. While cleaning out my office, I came across a Krugman editorial from the y [...]
- My Upcoming David S. Saurman Provocative Lecture at SJSU
by Matthew Kahn in Environmental and Urban Economics, 2017-04-07 14:00:00 UTC
On Thursday April 13th, I will give the � David S. Saurman Provocative Lecture at San Jose State University. � My friend and co-author Matt Holian serves on their faculty. � �I am aware that I am a provocative thinker. �Google "Matthew Kahn and Joe Romm" to see what provocation looks like. �Now that it is "acceptable" to discuss the microeconomics of climate change adaptation, �my views have become more mainstream. �Read wha t I wrote in 2010 , I stick to this logic. �Read m y new 2017 Hamilton Project �paper. �Listen to my April 5th NPR podcast . �I think that I'm a reasonable man. �Do you ag [...]
- Immigration mechanisms
by chris in Stumbling and Mumbling, 2017-04-07 12:35:40 UTC
Jonathan Portes makes a vitally important point – that statistics are reality. Apparently arid numbers summarize the lived experience of real people. As Raymond Wolfinger said , “the plural of anecdote is data”. Statistics tell us about facts, whereas anecdotes are subject to sampling error.
Sadly, however, all this misses something – that it takes a theory to kill a theory. When Niall McCrae denies that migrants haven’t depressed wages by saying “Try telling that to my landscape gardener friend, who has been severely undercut by waves of east Europeans” he’s appealing for something more than [...]
- The Real Exchange Rates and Trade Literature
by Doug Campbell in Douglas L. Campbell, 2017-04-06 20:50:00 UTC
Noah Smith asks about the literature on the real exchange rate (RER) and trade. My own main line of research is about RERs and manufacturing �(also here �on workers), RER measurement , and I've also done work on the impact of currency unions on trade , or lack thereof. The first and third of these papers does include a bit on trade, although in neither case is it the focus. The third paper shows that the class of Weighted-Average Relative (WAR) exchange rates does a better job predicting US trade balances than do traditional indices. The difference is largely that the WAR indices reflect the i [...]
- To Ease The Student Debt Crisis, Hold Colleges Responsible
by Doug Webber in FiveThirtyEight Economics, 2017-04-06 10:00:45 UTC
The U.S. provides significant subsidies to students who wish to pursue a college education. Numerous studies have found that this is a wise investment both in terms of social factors and economic growth. But that investment doesn’t pay off for everyone: Roughly one out of every six student loans is expected to default over its lifetime, a situation that can create long-term financial problems for borrowers while leaving taxpayers on the hook for what amounts to billions of dollars in bad loans.
In recent years, the public debate over student debt has often focused on the roles of the students [...]
- Sleep deprivation, even when moderate, hurts employment
by ? in LSE Business Review, 2017-04-06 06:00:00 UTC
Lack of sleep is responsible for human fatigue, and can undermine economic performance. Paradoxically, the extent to which sleep time is a productive activity, or not, has received very limited attention in economics research so far. Sleep is often overlo [...]
- Bonito, democrÃ¡tico, y sabio
by Leopoldo Fergusson in Foco Económico, 2017-04-04 20:25:03 UTC
Leopoldo Fergusson ( @LeopoldoTweets )
El 26 de marzo los habitantes de Cajamarca, una población colombiana de unos 20.000 habitantes, acudieron a las urnas para decidir si permitían las actividades mineras en su territorio. Su decisión fue un rotundo No que venció al Sí con más del 98% de los votos, y superó el umbral de participación a pesar de la lluvia. Las reacciones no tardaron. De todo se ha dicho: esto debilita las instituciones, espanta la inversión extranjera, sustituye la minería legal y responsable por la ilegal y destructiva, impone un costo para el país en su conjunto por bene [...]
- Little Britain? Empire and the rise of protectionism in interwar Britain.
by crowleymarkj in NEP-HIS blog, 2017-04-04 10:00:17 UTC
When Britain turned inward: Protection and the shift towards Empire in interwar Britain
By Alan de Bromhead (Queen’s University Belfast), Alan Fernihough (Queen’s University Belfast), Markus Lampe (Vienna University of Economics and Business) and Kevin Hjortshøj O’Rourke (University of Oxford)
International trade became much less multilateral during the 1930s. Previous studies, looking at aggregate trade flows, have argued that discriminatory trade policies had comparatively little to do with this. Using highly disaggregated information on the UK’s imports and trade policies, we find that poli [...]
- Government for the people, of the people, by people who are pretending
by Nicholas Gruen in Club Troppo, 2017-04-03 13:05:24 UTC
Choosing a Public-Spirited Leader. An experimental investigation of political selection By: Thomas Markussen (epartment of Economics, University of Copenhagen) ; Jean-Robert Tyran (Department of Economics, University of Copenhagen)
In this experiment, voters select a leader who can either act in the public interest, i.e. make efficient and equitable policy choices, or act in a corrupt way, i.e. use public funds for private gain. Voters can observe candidates’ pro-social behavior and their score in a cognitive ability test prior to the election, and this fact is known to candidates. Therefore, [...]
- The case for a higher inflation target gets stronger
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2017-04-03 12:48:01 UTC
For several years, economists and policymakers have been debating the wisdom of raising the inflation target. Today, roughly two-thirds of global GDP is produced in countries that are either de jure or de facto inflation targeters (see our earlier post ). In most advanced economies, the target is (close to) 2 percent. Is 2 percent enough? Advocates of raising the target believe that central banks need greater headroom to use conventional interest rate policy in battling business cycle downturns. More specifically, the case for a higher target is based on a desire to reduce the frequency and du [...]
- Voluntary Restraint in the Age of President Trump
by Matthew Kahn in Environmental and Urban Economics, 2017-04-03 02:53:00 UTC
As President Trump rolls back carbon mitigation regulations, how many consumers will respond by engaging in "voluntary restraint" such that they reduce their GHG emissions even if regulation does not force them to do so? If the price of gasoline were high enough, most people would seek out fuel efficient vehicles. But, when gas prices are low and if CAFE standards are weak, who seeks out the Prius and the other green vehicles? You already know the answer; the answer is that liberal/environmentalists walk this walk. I document this point in the following papers; Dora L. Costa & Matthew E. [...]
- I cambi dell'Argentina
by Alberto Bagnai in Goofynomics, 2017-04-02 14:31:00 UTC
Poco fa una persona simpatica mi ha chiesto su Twitter cosa ne fosse del cambio argentino. Lo ha fatto per DM, quindi inutile che andiate a rovistare. Ora, sapete bene che di tasso di cambio non ce n'è uno solo, per cui chi parla di "valuta che non ha mai svalutato" o di "valuta stabile" senza ulteriori qualificazioni (cioè senza dire rispetto a quale altra valuta) si sbugiarda come un irrimediabile dilettante (il che spiega, poi, certi incidenti di percorso... ma non torniamo, per ora, su queste tristi vicende)! Qui sotto vi propongo in un grafico tre misure del tasso di cambio dell'Argentina [...]
- When Work Disappears: Manufacturing Decline and the Falling Marriage-Market Value of Men
by maximorossi in NEP-LTV blog, 2017-03-31 13:24:55 UTC
David Autor ; David Dorn ; Gordon Hanson
The structure of marriage and child-rearing in U.S. households has undergone two marked shifts in the last three decades: a steep decline in the prevalence of marriage among young adults, and a sharp rise in the fraction of children born to unmarried mothers or living in single-headed households. A potential contributor to both phenomena is the declining labor-market opportunities faced by males, which make them less valuable as marital partners. We exploit large scale, plausibly exogenous labor-demand shocks stemming from rising internat [...]
- The Simple Economics of Public Transit "Cannibalization"
by Matthew Kahn in Environmental and Urban Economics, 2017-03-31 13:13:00 UTC
LA Magazine reports that an unintended consequence of the popularity of the Los Angeles new Expo Light Rail line is that bus ridership along substitute routes has fallen sharply. � Back in 2005, Nate Baum-Snow and I analyzed the impact of 16 new rail transit openings across the U.S. �Our Brookings Paper is available here.� "We develop a simple model in order to fix ideas about the types of responses one might expect to see in the data to new rail transit infrastructure. The primary lesson from the model is that most mode switchers from car to rail are likely to live far from the city center. T [...]
- The Life-cycle Benefits of an Influential Early Childhood Program
by maximorossi in NEP-LTV blog, 2017-03-31 13:11:48 UTC
García, Jorge Luis (University of Chicago) ; Heckman, James J. (University of Chicago) ; Leaf, Duncan Ermini (University of Southern California) ; Prados, Maria José (University of Southern California)
This paper estimates the long-term benefits from an influential early childhood program targeting disadvantaged families. The program was evaluated by random assignment and followed participants through their mid-30s. It has substantial beneficial impacts on health, children’s future labor incomes, crime, education, and mothers’ labor incomes, with greater monetized benefits for m [...]
- Global Inequality Dynamics: New Findings from WID.world
by maximorossi in NEP-LTV blog, 2017-03-31 13:10:25 UTC
Facundo Alvaredo ; Lucas Chancel ; Thomas Piketty ; Emmanuel Saez ; Gabriel Zucman
This paper presents new findings on global inequality dynamics from the World Wealth and Income Database (WID.world), with particular emphasis on the contrast between the trends observed in the United States, China, France, and the United Kingdom. We observe rising top income and wealth shares in nearly all countries in recent decades. But the magnitude of the increase varies substantially, thereby suggesting that different country-specific policies and institutions matter considerably. Long-run w [...]
- Creative destruction and subjective well-being
by maximorossi in NEP-LTV blog, 2017-03-31 13:09:25 UTC
Philippe Aghion ; Ufuk Akcigit ; Angus Deaton ; Alexandra Roulet
In this paper we analyze the relationship between turnover-driven growth and subjective well-being. Our model of innovation-led growth and unemployment predicts that: (i) the effect of creative destruction on expected individual welfare should be unambiguously positive if we control for unemployment, less so if we do not; (ii) job creation has a positive and job destruction has a negative impact on well-being; (iii) job destruction has a less negative impact in areas with more generous unemployment insurance polici [...]
- The U.S. economy just got hit with a disturbing piece of bad news
by Jeff Guo in Wonkblog, 2017-03-30 16:22:08 UTC
Maybe we haven't seen the full benefit of these newfangled technologies yet. (Kiyoshi Ota/Bloomberg)
Americans actually became less productive in 2016, the first time since 2009, according to government numbers released today.
The data show that multifactor productivity — economist shorthand for overall man and machine efficiency — dipped about 0.2 percent last year. This means that the 1.7 growth in the economy last year was entirely caused by companies hiring more people and buying more machines and software, not by improvements in technology or organization or anything else that allows comp [...]
- Direct democracy and small government
by Nicholas Gruen in Club Troppo, 2017-03-30 11:22:12 UTC
Direct democracy and government size: evidence from Spain
By: Carlos Sanz (Banco de España)
Direct democracy is spreading across the world, but little is known about its effects on policy. I provide evidence from a unique scenario. In Spain, national law determines that municipalities follow either direct or representative democracy, depending on their population. Regression discontinuity estimates indicate that direct democracy leads to smaller government, reducing public spending by around 8%. Public revenue decreases by a similar amount and, therefore, there is no effect on budget defi ci [...]
- Low Real Interest Rates and Monetary Policy
by Stephen Williamson in Stephen Williamson: New Monetarist Economics, 2017-03-29 21:41:00 UTC
That real rates of return on government debt are at historical lows is well-established. Of course, the anticipated real rate of return on government debt - which is what matters for economic behavior - is unobservable, and that's problematic. Typically, macroeconomists resort to proxy measures as a starting point for addressing issues related to low real interest rates. For example, we could use the current twelve-month measured inflation rate as a proxy for anticipated inflation, and subtract that from some observed nominal interest rate to get a crude measure of the real interest rate. Like [...]
- Wednesday links: an amazing computer
by ? in Abnormal Returns, 2017-03-29 16:21:00 UTC
MarketsThe case for bonds. (finance.yahoo.com)It's hard to come up with a plausible scenario for high future stock returns. (fortune.com)StrategyMichael Kahn, "Charts are tools, not your momma." (quicktakespro.blogspot.com)Eric Cinnamond, "It’s hard [...]
- Green China?
by Matthew Kahn in Environmental and Urban Economics, 2017-03-29 15:39:00 UTC
The New York Times devotes a lot of effort to bashing the Chinese Communist Party, thus it is interesting that today th e Chinese leadership receives praise from the NY Times. � The backstory is the fact that President Trump is repealing President Obama's low carbon policies. �The New York Times now is hoping and saying that China will have to lead the world's low carbon agenda. � For those interested in academic economics, I suggest that you take a look at a couple of my papers on this subject; our 2016 book our 2017 Journal of Economic Perspectives paper my 2011 Energy Policy paper My piece [...]
- Newt troubles
by chris in Stumbling and Mumbling, 2017-03-29 12:50:17 UTC
Why has the UK suffered weak economic growth for years? Is it because falling profits have choked off investment? Is it because there’s a dearth of good innovations? Or because of fiscal austerity ? Or because the Bank of England has failed to target money GDP growth ? Or because bosses are lazy mediocrities ? Or because pessimistic (pdf) expectations have proven self- fulfilling ? Or is it because the financial crisis had a long-lasting adverse effect upon the economy?
No, no, no, no, no, no and no. It’s all because of the great crested newt. In its demand to cut EU-imposed red tape, the Tel [...]
- From Wood to Coal: Directed Technical Change and the British Industrial Revolution
by email@example.com (David Stern) in Stochastic Trend, 2017-03-29 03:38:00 UTC
We have finally posted our long-promised paper on the Industrial Revolution as a CAMA Working Paper . This is the final paper from our ARC-funded DP12 project: "Energy Transitions: Past, Present and Future" . The paper is coauthored with Jack Pezzey and Yingying Lu. We wrote our ARC proposal in 2011, but we "only" started work on the current model in late 2014 after I read Acemoglu's paper " Directed Technical Change " in detail on a flight back to Australia and figured out how to apply it to our case. We have presented the paper many times in seminars and conferences, though I will be present [...]
- Some Robot Economics
by Matthew Kahn in Environmental and Urban Economics, 2017-03-28 20:45:00 UTC
The NY Times has published a great piece about Acemoglu's co-authored piece on the economics of robots. � The "headline" claim in Daron's new paper is that robots cost us jobs (substitutes not complements). � I'd like to sketch a few claims that might explain their fact; 1. � Robots don't need health insurance. �In the language of economics, to employ a worker requires fixed costs (health insurance, life insurance) and variable costs (wages and benefits). � As fixed costs of hiring workers rise, this increases the average cost for firms per hour worked and this encourages substitution from lab [...]
- The Fed's successful tightening
by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2017-03-27 12:33:49 UTC
No one should be surprised that the Fed is tightening monetary policy and expects to tighten significantly further over coming years. The U.S. economy will soon enter the eighth year of its current expansion . Unemployment is less than 5 percent, consistent with normal use of resources. Inflation is approaching the FOMC’s 2 percent objective. And policy rates remain below what simple guides would suggest as normal. (You can confirm this by trying out various policy rules using the FRB Atlanta’s Taylor Rule Utility .) A key issue facing policymakers today is whether the Fed’s new operational fr [...]
- Sam Watsonâs journal round-up for 27th March 2017
by Sam Watson in The Academic Health Economists' Blog, 2017-03-27 11:00:00 UTC
Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch .
The minimum legal drinking age and morbidity in the United States . Review of Economics and Statistics Published 23rd February 2017
Governments have tried multiple different policies to reduce the physical and [...]
- Corporations in the Age of Inequality: A Skeptic's Take
by Doug Campbell in Douglas L. Campbell, 2017-03-26 09:45:00 UTC
Nick Bloom contributes an article to the Harvard Business Review: " Corporations in the Age of Inequality ". It's also an interesting read, based on his " Firming Up Inequality " paper, which I also recommend. The story of inequality they tell is also one which is essentially technology based (IT and outsourcing), as they find that inequality is almost entirely driven by changes in between firm inequality. They deserve credit for presenting an interesting set of facts. However, while intriguing, I'm not yet totally convinced this is the key to understanding inequality.� Macromon also had an ex [...]
- Adapting to Urban Terror Risk vs. Urban Climate Change Risk
by Matthew Kahn in Environmental and Urban Economics, 2017-03-25 18:09:00 UTC
The NY Times has published a touching piece about London in the aftermath of the recent terror attack. �Several years ago, I published a piece that contrasts adaptation to terror risk versus climate change risk. �I think it is useful to restate my key points (here is an unpublished draft) . 1. �The rational terrorist chooses a set of targets such that there is no predictable pattern of the attacks. In the language of time series statistics, there is no serial correlation in the attack targets. If you hijack airplanes on 9/11/01 then you hit another target at a later date. �Why? � The victim is [...]
- The Saga of Currency Unions and Trade
by Doug Campbell in Douglas L. Campbell, 2017-03-24 19:36:00 UTC
One of the first full papers I wrote was on currency unions and trade. I was taking Alan Taylor's field course at UC Davis, which was essentially and Open-Economy Macro History course, and the famous Glick/Rose findings that currency unions double trade was on the syllabus. Not to be outdone, Robert Barro and coauthors then found that currency unions increase trade on a 7-fold and 14-fold basis! This raised the prospect that Frenchman may suddenly go out and buy a dozen or more Volkswagens instead of settling for just one after the adoption of the Euro. Another paper, published in the QJE, fou [...]
- The Saga of Currency Unions and Trade
by Mark Thoma in Economist's View, 2017-03-24 13:16:37 UTC
The Saga of Currency Unions and Trade : One of the first full papers I wrote was on currency unions and trade. I was taking Alan Taylor's field course at UC Davis, which was essentially and Open-Economy Macro History course, and the famous Glick/Rose findings that currency unions double trade was on the syllabus. Not to be outdone, Robert Barro and coauthors then found that currency unions increase trade on a 7-fold and 14-fold basis! This raised the prospect that Frenchman may suddenly go out and buy a dozen or more Volkswagens instead of settling for just one after the ad [...]
- Data Revisions and DSGE Models
by Christian Zimmermann in NEP-DGE blog, 2017-03-23 21:00:05 UTC
By Ana Beatriz Galvao
The typical estimation of DSGE models requires data on a set of macroeconomic aggregates, such as output, consumption and investment, which are subject to data revisions. The conventional approach employs the time series that is currently available for these aggregates for estimation, implying that the last observations are still subject to many rounds of revisions. This paper proposes a release-based approach that uses revised data of all observations to estimate DSGE models, but the model is still helpful for real-time fo [...]
- Literature search on IDEAS: a tutorial
by Christian Zimmermann in RePEc blog, 2017-03-23 16:59:04 UTC
RePEc is foremost a initiative to enhance the dissemination of economics research. IDEAS is one of several RePEc services that make the RePEc bibliographic database available to anybody. This tutorial demonstrates how IDEAS can be leveraged to perform powerful literature searches.
A good starting point can be to do a search for some keyword. A search on IDEAS can be much more useful that a search on a more general tool as IDEAS is dedicated to economics, thus results should not be “polluted” by results from other fields or that are not research. Say you are interested in some economic [...]
- Two New Working Papers
by firstname.lastname@example.org (David Stern) in Stochastic Trend, 2017-03-23 01:25:00 UTC
We have just posted two new working papers: Technology Choices in the U.S. Electricity Industry before and after Market Restructuring and An Analysis of the Costs of Energy Saving and CO2 Mitigation in Rural Households in China . The first paper, coauthored with Zsuzsanna Csereklyei , is the first to emerge from our ARC funded DP16 project .� Our goal was to look at the factors associated with the adoption of more or less energy efficient electricity generating technologies using a detailed US dataset. For example, combined cycle gas turbines are more energy efficient than regular ga [...]
- Socio-Economic Inequalities in Maternity Care under Political Instability: Evidence from Egypt, Jordan, and Yemen
by pmakdissi in NEP-ARA blog, 2017-03-22 22:11:21 UTC
By Mesbah Fathy Sharaf (Assistant Professor, Department of Economics, University of Alberta, Canada) and Ahmed Shoukry Rashad (Visiting Assistant Professor, Department of Economics, Frankfurt School of Finance and Management, Germany).
Medical care during pregnancy is crucial for protecting women from health risks during and after pregnancy and has been consistently linked to better child health outcomes. As part of the global efforts to curb maternal mortality, the United Nations included the reduction in maternal mortality by two-third, betw [...]
- Granger Causality and the Factors underlying the Role of Younger Generations in Economic, Social and Political Changes in Arab Countries
by pmakdissi in NEP-ARA blog, 2017-03-22 22:09:08 UTC
By Ahmed Driouchi and Tahar Harkat, Institute of Economic Analysis & Prospective Studies (IEAPS), Al Akhawayn University, Ifrane, Morocco
The youngest segments of the population are considered as the main engine of economic, social, and political change. Recent literature underlines the roles of youth in Arab countries and their contributions in conducting major changes. Thus, understanding the characteristics of the current young Arab generation are of prime importance. The latest contributions highlight major differences between new generat [...]
- Dynastic human capital, inequality and intergenerational mobility
by maximorossi in NEP-LTV blog, 2017-03-22 18:23:48 UTC
Adermon, Adrian (IFAU – Institute for Evaluation of Labour Market and Education Policy) ; Lindahl, Mikael (Department of Economics, University of Gothenburg; IFAU; IZA; UCLS; CESifo) ; Palme, Mårten (Department of economics, Stockholm University; IZA)
We study the importance of the extended family – or the dynasty – for the persistence in human capital inequality across generations. We use data including the entire Swedish population, linking four generations. This data structure enables us to – in addition to parents, grandparents and great grandparents – identify parents’ sibl [...]
- An Analysis of the Labor Market for Uberâs Driver-Partners in the United States
by maximorossi in NEP-LTV blog, 2017-03-22 18:22:00 UTC
Jonathan V. Hall ; Alan B. Krueger
Uber, the ride-sharing company launched in 2010, has grown at an exponential rate. This paper provides the first comprehensive analysis of the labor market for Uber’s driver-partners, based on both survey and administrative data. Drivers who partner with Uber appear to be attracted to the platform largely because of the flexibility it offers, the level of compensation, and the fact that earnings per hour do not vary much with the number of hours worked. Uber’s driver-partners are more similar in terms of their age and education to the general w [...]
- Whatâs the good of education on our overall quality of life?: a simultaneous equation model of education and life satisfaction for Australia
by maximorossi in NEP-LTV blog, 2017-03-22 18:20:54 UTC
Nattavudh Powdthavee ; Warn N. Lekfuangfu ; Mark Wooden
Many economists and educators favour public support for education on the premise that education improves the overall quality of life of citizens. However, little is known about the different pathways through which education shapes people’s satisfaction with life overall. One reason for this is because previous studies have traditionally analysed the effect of education on life satisfaction using single-equation models that ignore interrelationships between different theoretical explanatory variables. In order to advance our [...]