National Bureau of Economic Research

Displaying 1-40 of 1317 results

  • White Papers // Aug 2011

    Innovation And Productivity

    What do we know about the relationship between innovation and productivity among firms? The workhorse model of this relationship is presented and the implications of analysis using this model and the usually available data on product and process innovation are derived. The recent empirical evidence on the relationship between innovation...

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  • White Papers // Aug 2011

    A Gains From Trade Perspective On Macroeconomic Fluctuations

    Business cycles reflect changes over time in the amount of trade between individuals. In this paper, the authors show that incorporating explicitly intra-temporal gains from trade between individuals into a macroeconomic model can provide new insight into the potential mechanisms driving economic fluctuations as well as modify key policy implications....

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  • White Papers // Aug 2011

    Are Corporate Default Probabilities Consistent With The Static Tradeoff Theory?

    Default probability plays a central role in the static tradeoff theory of capital structure. The authors directly test this theory by regressing the probability of default on proxies for costs and benefits of debt. Contrary to predictions of the theory, firms with higher bankruptcy costs, i.e., smaller firms and firms...

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  • White Papers // Aug 2011

    The Extensive Margin, Sectoral Shares And International Business Cycles

    This paper documents some previously neglected features of sectoral shares at business cycle frequencies in OECD economies. In particular, the authors find that the nontraded sector share of output is as volatile as aggregate GDP, and that for most countries, the nontraded sector is distinctly countercyclical. While the standard international...

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  • White Papers // Aug 2011

    Consumption Risk-sharing And The Real Exchange Rate: Why Does The Nominal Exchange Rate Make Such A Difference?

    A basic prediction of efficient risk-sharing is that relative consumption growth rates across countries or regions should be positively related to real exchange rate growth rates across the same areas. The authors investigate this hypothesis, employing a newly constructed multi-country and multi-regional data set. Within countries, they find significant evidence...

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  • White Papers // Aug 2011

    Would People Behave Differently If They Better Understood Social Security? Evidence From A Field Experiment

    This paper presents the results of a field experiment in which a sample of older workers was randomized between a treatment group that was given information about key Social Security provisions and a control group that was not. The experiment was designed to examine whether it is possible to affect...

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  • White Papers // Aug 2011

    Exam High Schools And Academic Achievement: Evidence From New York City

    Publicly funded exam schools educate many of the world's most talented students. These schools typically contain higher achieving peers, more rigorous instruction, and additional resources compared to regular public schools. This paper uses a sharp discontinuity in the admissions process at three prominent exam schools in New York City to...

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  • White Papers // Aug 2011

    Covariances Versus Characteristics In General Equilibrium

    The authors question a deep-ingrained doctrine in asset pricing: if an empirical characteristic-return relation is consistent with investor "Rationality," the relation must be "Explained" by a risk factor model. The investment approach changes the big picture of asset pricing. Factors formed on characteristics are not necessarily risk factors: characteristics-based factor...

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  • White Papers // Aug 2011

    Equilibrium Wage And Employment Dynamics In A Model Of Wage Posting Without Commitment

    A rich but tractable variant of the Burdett-Mortensen model of wage setting behavior is formulated and a dynamic market equilibrium solution to the model is defined and characterized. In the model, firms cannot commit to wage contracts. Instead, the Markov perfect equilibrium to the wage setting game, characterized by Coles...

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  • White Papers // Aug 2011

    A Simple Nonparametric Approach To Estimating The Distribution Of Random Coefficients In Structural Models

    The authors explore a nonparametric mixtures estimator for recovering the joint distribution of random coefficients in economic models. The estimator is based on linear regression subject to linear inequality constraints and is computationally attractive compared to alternative, nonparametric estimators. They provide conditions under which the estimated distribution function converges to...

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  • White Papers // Aug 2011

    Foreign Firms And Local Communities

    The literature on the effects of Foreign Direct Investment (FDI) and activities of MultiNational Enterprises (MNEs) on host-countries has been almost exclusively focused on issues of productivity, growth and wages. The authors argue that this leaves quite a bit of important unexplored areas of inquiry, particularly those connected with the...

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  • White Papers // Aug 2011

    Systemic Risk Exposures: A 10-by-10-by-10 Approach

    Here, the author presents and discuss a "10-by-10-by-10" network-based approach to monitoring systemic financial risk. Under this approach, a regulator would analyze the exposures of a core group of systemically important financial firms to a list of stressful scenarios, say 10 in number. For each scenario, about 10 such designated...

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  • White Papers // Aug 2011

    The Exact Law Of Large Numbers For Independent Random Matching

    This paper provides a mathematical foundation for independent random matching of a large population, as widely used in the economics literature. The authors consider both static and dynamic systems with random mutation, partial matching arising from search, and type changes induced by matching. Under independence assumptions at each randomization step,...

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  • White Papers // Aug 2011

    The Importance Of The Meaning And Measurement Of "Affordable" In The Affordable Care Act

    This working paper highlights the practical importance of two critical but under-explored assumptions behind existing estimates of the Affordable Care Act (ACA)'s potential impact on the mix of employees and families who may have Employer-Sponsored health Insurance (ESI) in the future or may receive subsidies in the new health insurance...

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  • White Papers // Aug 2011

    Deregulation, Consolidation, And Efficiency: Evidence From U.S. Nuclear Power

    For the first four decades of its existence the U.S. nuclear power industry was run by regulated utilities, with most companies owning only one or two reactors. Beginning in the late 1990s electricity markets in many states were deregulated and almost half of the nation's 103 reactors were sold to...

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  • White Papers // Aug 2011

    Propose With A Rose? Signaling In Internet Dating Markets

    The large literature on costly signaling and the somewhat scant literature on preference signaling had varying success in showing the effectiveness of signals. The authors use a field experiment to show that even when everyone can send a signal, signals are free and the only costs are opportunity costs, sending...

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  • White Papers // Aug 2011

    Financial Literacy, Retirement Planning, And Household Wealth

    There is sample empirical evidence documenting widespread financial illiteracy and limited pension knowledge. At the same time, the distribution of wealth is widely dispersed and many workers arrive on the verge of retirement with few or no personal assets. In this paper, the authors investigate the relationship between financial literacy...

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  • White Papers // Aug 2011

    A Model Of The Consumption Response To Fiscal Stimulus Payments

    A wide body of empirical evidence, based on randomized experiments, finds that 20-40 percent of fiscal stimulus payments (e.g. tax rebates) are spent on nondurable household consumption in the quarter that they are received. The authors develop a structural economic model to interpret this evidence. Their model integrates the classical...

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  • White Papers // Aug 2011

    Ethnic Innovation And U.S. Multinational Firm Activity

    This paper studies the impact that immigrant innovators have on the global activities of U.S. firms by analyzing detailed data on patent applications and on the operations of the foreign affiliates of U.S. multinational firms. The results indicate that increases in the share of a firm's innovation performed by inventors...

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  • White Papers // Aug 2011

    Carry Trades And Risk

    Carry trades, in which an investor borrows a low interest rate currency and lends a high interest rate currency, have been profitable historically. The risk exposure of carry traders might explain their high returns, but conventional models of risk do not work because traditional risk factors, used to price the...

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  • White Papers // Aug 2011

    The Continental Dollar: Initial Design, Ideal Performance, And The Credibility Of Congressional Commitment

    An alternative history of the Continental Dollar is constructed from the original resolutions passed by Congress. The Continental Dollar was a zero-interest bearer bond, not a fiat currency. The public could redeem it at face value in specie at fixed future dates. Being a zero-interest bearer bond, discounting must be...

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  • White Papers // Aug 2011

    Substitution Between Individual And Cultural Capital: Pre-migration Labor Supply, Culture And US Labor Market Outcomes Among Immigrant Women

    In this paper, the authors use New Immigrant Survey data to investigate the impact of immigrant women's own labor supply prior to migrating and female labor supply in their source country to provide evidence on the role of human capital and culture in affecting their labor supply and wages in...

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  • White Papers // Aug 2011

    Unemployment In Latin America And The Caribbean

    This paper constructs a new data set on unemployment rates in Latin America and the Caribbean and then explores the determinants of unemployment. The authors compare different countries, finding that unemployment is influenced by the size of the rural population and that the effects of government regulations are generally weak....

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  • White Papers // Aug 2011

    Healthy, Wealthy And Wise? Revisited: An Analysis Of The Causal Pathways From Socio-Economic Status To Health

    Much has been said about the stylized fact that the economically successful are not only wealthier but also healthier than the less affluent. There is little doubt about the existence of this socio-economic gradient in health, but there remains a vivid debate about its source. In this paper, the authors...

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  • White Papers // Aug 2011

    Country Heterogeneity And The International Evidence On The Effects Of Fiscal Policy

    This paper shows how the richer frequency and variety of fiscal policy shocks available in an international sample can be analyzed recognizing the heterogeneity that exists across different countries. The main conclusion of the authors' empirical analysis is that the question "What is the fiscal policy multiplier" is an ill-posed...

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  • White Papers // Aug 2011

    Long-term Barriers To The International Diffusion Of Innovations

    The authors document an empirical relationship between the cross-country adoption of technologies and the degree of long-term historical relatedness between human populations. Historical relatedness is measured using genetic distance, a measure of the time since two populations' last common ancestors. They find that the measure of human relatedness that is...

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  • White Papers // Aug 2011

    Employment, Wages And Voter Turnout

    This paper argues that, since activities that provide political information are complementary with leisure, increased labor market activity should lower turnout, but should do so least in prominent elections where information is ubiquitous. Using official county-level voting data and a variety of OLS and TSLS models, the authors find that...

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  • White Papers // Aug 2011

    Why Did U.S. Banks Invest In Highly-rated Securitization Tranches?

    The authors estimate holdings of highly-rated tranches of mortgage securitizations of American deposit-taking banks ahead of the credit crisis and evaluate hypotheses that have been advanced to explain these holdings. They find that holdings of highly-rated tranches were economically trivial for the typical bank, but banks with greater holdings performed...

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  • White Papers // Aug 2011

    Tax Expenditures, The Size And Efficiency Of Government, And Implications For Budget Reform

    One possible explanation for the difficulty in controlling the budget is that a major component of spending - tax expenditures - receives privileged status. It is treated as tax cuts rather than spending. This paper explores the implications of that misclassification and illustrates how it can lead to higher taxes,...

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  • White Papers // Aug 2011

    The Influence Of Irving Fisher On Milton Friedman's Monetary Economics

    This paper examines the influence of Irving Fisher's writings on Milton Friedman's work in monetary economics. The authors focus first on Fisher's influences in monetary theory (the quantity theory of money, the Fisher effect, Gibson's Paradox, the monetary theory of business cycles, and the Phillips Curve, and empirics, e.g. distributed...

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  • White Papers // Aug 2011

    Beauty Is The Promise Of Happiness?

    The authors measure the impact of individuals' looks on life satisfaction/happiness. Using five data sets, from the U.S., Canada, the U.K., and Germany, they construct beauty measures in different ways that allow placing lower bounds on the effects of beauty. Beauty raises happiness: a one standard-deviation change in beauty generates...

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  • White Papers // Aug 2011

    Cycles Of Wage Discrimination

    Using CPS data from 1979-2009 the authors examine how cyclical downturns and industry-specific demand shocks affect wage differentials between white non-Hispanic males and women, Hispanics and African-Americans. Women's and Hispanics' relative earnings are harmed by negative shocks, while the earnings disadvantage of African-Americans may drop with negative shocks. Negative shocks...

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  • White Papers // Aug 2011

    Health And Mortality Delta: Assessing The Welfare Cost Of Household Insurance Choice

    The authors develop a pair of risk measures for the universe of health and longevity products that includes life insurance, annuities, and supplementary health insurance. Health delta measures the differential payoff that a policy delivers in poor health, while mortality delta measures the differential payoff that a policy delivers at...

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  • White Papers // Aug 2011

    Organ Allocation Policy And The Decision To Donate

    Organ donations from deceased donors provide the majority of transplanted organs in the United States, and one deceased donor can save numerous lives by providing multiple organs. Nevertheless, most Americans are not registered organ donors despite the relative ease of becoming one. The authors study in the laboratory an experimental...

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  • White Papers // Aug 2011

    The Recovery Theorem

    The authors can only estimate the distribution of stock returns but they observe the distribution of risk neutral state prices. Risk neutral state prices are the product of risk aversion - the pricing kernel - and the natural probability distribution. The Recovery Theorem enables them to separate these and to...

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  • White Papers // Aug 2011

    Was What Ail'd Ya' What Kill'd Ya'?

    Making use of those Union Army veterans for whom death certificates are available, the authors compare the conditions with which they were diagnosed by Civil War pension surgeons to the causes of death on the certificates. They divide the data between those veterans who entered the pension system early because...

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  • White Papers // Aug 2011

    Implicit Guarantees And Risk Taking: Evidence From Money Market Funds

    A firm's termination generates bankruptcy costs. This may create incentives for a firm's owner to bail out a firm in bankruptcy and to curb the firm's risk taking outside bankruptcy. The authors analyze the role of such implicit guarantees in the context of financial institutions that sponsor money market mutual...

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  • White Papers // Aug 2011

    Country Size, International Trade, And Aggregate Fluctuations In Granular Economies

    This paper proposes a new mechanism by which country size and international trade affect macroeconomic volatility. The authors study a multi-country, multi-sector model with heterogeneous firms that are subject to idiosyncratic firm-specific shocks. When the distribution of firm sizes follows a power law with an exponent close to -1, the...

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  • White Papers // Aug 2011

    Behavioral Corporate Finance: An Updated Survey

    The authors survey the theory and evidence of behavioral corporate finance, which generally takes one of two approaches. The market timing and catering approach views managerial financing and investment decisions as rational managerial responses to securities mispricing. The managerial biases approach studies the direct effects of managers' biases and nonstandard...

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  • White Papers // Aug 2011

    Asset Liquidity And International Portfolio Choice

    The authors study optimal asset portfolio choice in a two-country search-theoretic model of monetary exchange. They allow assets not only to represent claims on future consumption, but also to serve as means of payment. Assuming foreign assets trade at a cost, they characterize equilibria in which different countries' assets arise...

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  • White Papers // Jan 2003

    International Debt Service and Economic Growth: Some Simple Analytics

    The pension records contain information relevant to meeting the legal requirements of pension eligibility. Pension records can include information relating to the history of the veteran, as well as important health and demographic information relating to the military history of the veteran before, during, and after the war. The carded...

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  • White Papers // May 2005

    Asset Float and Speculative Bubbles

    This report models the relationship between asset float (tradeable shares) and speculative bubbles. Investors trade a stock with limited float because of insider lock-ups. They have heterogeneous beliefs due to overconfidence and face short-sales constraints. A bubble arises as price overweighs optimists' beliefs and investors anticipate the option to resell...

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  • White Papers // Jun 2005

    Growth or Glamour? Fundamentals and Systematic Risk in Stock Returns

    The cash flows of growth stocks are particularly sensitive to temporary movements in aggregate stock prices, while the cash flows of value stocks are particularly sensitive to permanent movements in aggregate stock prices. Growth stocks are not merely ?glamour stocks? whose systematic risks are purely driven by investor sentiment. More...

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  • White Papers // May 2005

    Bank Credit Cycles

    Private information about prospective borrowers produced by a bank can affect rival lenders due to a "winner's curse" effect. Strategic interaction between banks with respect to the intensity of costly information production results in endogenous credit cycles, periodic "credit crunches." Empirical tests are constructed based on parameterizing public information about...

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  • White Papers // Feb 2002

    Does Function Follow Organizational Form? Evidence From the Lending Practices of Large and Small Banks

    The paper explores the idea in the context of bank lending to small firms, an activity that is typically thought of as relying heavily on soft information. It finds that large banks are less willing than small banks to lend to informationally 'difficult' credits, such as firms that do not...

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  • White Papers // Apr 2001

    Payment Systems and Interchange Fees

    In a typical bank credit card transaction, the merchant's bank pays an interchange fee, collectively determined by all participating banks, to the cardholder's bank. This paper shows how the interchange fee balances charges between cardholders and merchants under imperfect competition. The privately optimal fee depends mainly on differences between cardholders'...

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  • White Papers // Nov 2005

    Liability for Accidents

    This paper presents a survey of legal liability for accidents addressing three general aspects of accident liability. The first is the effect of liability on incentives, both whether to engage in activities and how much care to exercise to reduce risk when so doing. The second general aspect concerns risk-bearing...

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  • White Papers // Jul 2010

    Human Capital And The Indian Software Industry

    The importance of human capital - skilled and creative workers - to a "High-tech" industry is routinely acknowledged but often public policy discussions tend to focus on more trendy prescriptions such technology parks, venture capital, incubators and university industry centers. Software relies intensively upon human capital, perhaps more so than...

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  • White Papers // May 2010

    Personnel Economics: Hiring And Incentives

    This paper surveys the Personnel Economics literature, focusing on how firms establish, maintain, and end employment relationships and on how firms provide incentives to employees. The author has been very successful in generating models and empirical work about incentive systems. Some of the unanswered questions in this area - for...

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  • White Papers // May 2010

    Why Has California's Residential Electricity Consumption Been So Flat Since The 1980s?

    The authors use detailed microeconomic data to investigate why aggregate residential electricity consumption in California has been flat since 1980. Using unique micro data, they document the role that household demographics and ideology play in determining electricity demand. They show that building codes have been effective for homes built after...

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  • White Papers // May 2010

    Human Resource Management And Productivity

    This paper focuses on labor economics that one examines the relationship between Human Resource Management (HRM) and productivity. HRM includes incentive pay (individual and group) as well as many non-pay aspects of the employment relationship such as matching and work organization. They place HRM more generally within the literature on...

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  • White Papers // Jan 2011

    Foreclosures, House Prices, And The Real Economy

    A central idea in macroeconomic theory is that negative price effects from the leverage-induced forced sale of durable goods can amplify negative shocks and reduce economic activity. The authors show that states that require judicial process for a foreclosure sale have significantly lower rates of foreclosures relative to states that...

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  • White Papers // Jan 2011

    U.S. International Equity Investment And Past And Prospective Returns

    Counter to extant stylized facts, using newly available data on country allocations in U.S. investors' foreign equity portfolios the authors find that U.S. investors do not exhibit returns-chasing behavior, but, consistent with partial portfolio rebalancing, tend to sell past winners; and U.S. investors increase portfolio weights on a country's equity...

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  • White Papers // Jan 2011

    Globalization, Governance, And The Returns To Cross-Border Acquisitions

    Using a sample of control cross-border acquisitions from 61 countries from 1990 to 2007, the authors find that acquirers from countries with better governance gain more from such acquisitions and their gains are higher when targets are from countries with worse governance. Other acquirer country characteristics are not consistently related...

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  • White Papers // Jan 2011

    Non-Production Benefits Of Education: Crime, Health, And Good Citizenship

    A growing body of work suggests that education offers a wide-range of benefits that extend beyond increases in labor market productivity. Improvements in education can lower crime, improve health, and increase voting and democratic participation. This chapter reviews recent developments on these 'non-production' benefits of education with an emphasis on...

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  • White Papers // Jan 2011

    Social Security And Retirement Around The World: Mortality And Health, Employment, And Disability Insurance Participation And Reforms

    The authors consider changes in mortality over time and in particular the relationship between mortality and labor force participation, thinking of mortality as one indicator of health that is comparable across countries and over time in the same country. They then consider how mortality is related to other indicators of...

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  • White Papers // Jan 2011

    Trade Induced Technical Change? The Impact Of Chinese Imports On Innovation, It And Productivity

    The authors examine the impact of Chinese import competition on patenting, IT, R&D and TFP using a panel of up to half a million firms over 1996-2007 across twelve European countries. They correct for endogeneity using the removal of product-specific quotas following China's entry into the World Trade Organization. Chinese...

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  • White Papers // Jan 2011

    Risk Response In Agriculture

    Crop production is subject to supply shocks, and both expected and realized outputs as well as output prices are unknown when inputs are chosen. The process by which producers form expectations is difficult to model, especially when working with aggregate data. The authors present a necessary and sufficient condition on...

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  • White Papers // Jan 2011

    Implications Of Population Aging For Economic Growth

    The share of the population aged 60 and over is projected to increase in nearly every country in the world during 2005-2050. Population ageing will tend to lower both labor-force participation and savings rates, thereby raising concerns about a future slowing of economic growth. The calculations suggest that OECD countries...

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  • White Papers // Jan 2011

    Determinants Of Foreign Direct Investment

    Empirical studies of bilateral Foreign Direct Investment (FDI) activity show substantial differences in specifications with little agreement on the set of covariates that are included. The authors use Bayesian statistical techniques that allow one to select from a large set of candidates those variables most likely to be determinants of...

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  • White Papers // Jan 2011

    Matching Firms, Managers And Incentives

    The authors exploit a unique combination of administrative sources and survey data to study the match between firms and managers. The data includes manager characteristics, such as risk aversion and talent; firm characteristics, such as ownership; detailed measures of managerial practices relative to incentives, dismissals and promotions; and measurable outcomes,...

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  • White Papers // Jan 2011

    Partnership Law And Credit Availability

    Legal and economic historians now emphasize the centrality of organizational law in determining the contractual boundaries of the firm. Nineteenth-century US law recognized a small set of firm types - proprietorship, partnership and corporation - and enforced the creditor rights and priorities associated with them. This paper investigates how those...

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  • White Papers // Jan 2011

    Capital-Market Effects Of Securities Regulation: The Role Of Implementation And Enforcement

    This paper examines capital market effects of changes in securities regulation. The authors analyze two key capital market directives in the European Union (EU) that tightened market abuse and transparency regulation and, in particular, their enforcement. All EU member states were required to adopt these two directives but did so...

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  • White Papers // Jan 2011

    Does Indivisible Labor Explain The Difference Between Micro And Macro Elasticities? A Meta-Analysis Of Extensive Margin Elasticities

    Macroeconomic calibrations imply much larger labor supply elasticity's than micro econometric studies. The most well known explanation for this divergence is that indivisible labor generates extensive margin responses that are not captured in micro studies of hour's choices. The authors evaluate whether existing calibrations of macro models are consistent with...

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  • White Papers // Jan 2011

    Behavioral Economics Perspectives On Public Sector Pension Plans

    The authors describe the pension plan features of the states and the largest cities and counties in the U.S. Unlike in the private sector, Defined Benefit (DB) pensions are still the norm in the public sector. However, a few jurisdictions have shifted towards Defined Contribution (DC) plans as their primary...

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  • White Papers // Dec 2010

    Venture Capital And Other Private Equity: A Survey

    The authors view the theory and evidence on Venture Capital (VC) and other private equity: why professional private equity exists, what private equity managers do with their portfolio companies, what returns they earn, who earns more and why, what determines the design of contracts signed between private equity managers and...

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  • White Papers // Jan 2011

    Informational Rents, Macroeconomic Rents, And Efficient Bailouts

    The authors analyze government interventions to alleviate debt overhang among banks. Interventions generate two types of rents. Informational rents arise from opportunistic participation based on private information while macroeconomic rents arise from free riding. Minimizing informational rents is a security design problem and they show that warrants and preferred stocks...

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  • White Papers // Jan 2011

    Liquidity Mergers

    The authors focus the interplay between corporate liquidity and asset reallocation opportunities. The model shows that financially distressed firms are acquired by liquid firms in their industries even when there are no operational synergies associated with the merger. They also provide a detailed analysis of firms' liquidity policies as a...

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  • White Papers // Jan 2011

    Selection In Insurance Markets: Theory And Empirics In Pictures

    The authors present a graphical framework for analyzing both theoretical and empirical work on selection in insurance markets. They begin by using this framework to review the "Textbook" adverse selection environment and its implications for insurance allocation, social welfare, and public policy. They then discuss several important extensions to this...

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  • White Papers // Jan 2011

    A Structural Approach To Market Definition With An Application To The Hospital Industry

    Market definition is essential to merger analysis. Because no standard approach to market definition exists, opposing parties in antitrust cases often disagree about the extent of the market. These differences have been particularly relevant in the hospital industry, where the courts have denied seven of eight merger challenges since 1994,...

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  • White Papers // Dec 2010

    The Equity And Efficiency Of Two-Part Tariffs In U.S. Natural Gas Markets

    Residential natural gas customers in the United States face volumetric charges for natural gas that average about 30% more than marginal cost. The large markup on natural gas - which is used to cover the fixed infrastructure and operating costs of the local distribution companies - is widely recognized to...

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  • White Papers // Jan 2011

    The Drawdown Of Personal Retirement Assets

    This paper presents evidence on the pattern of withdrawals at different ages. The authors find a relatively modest rate of withdrawals prior to the age at which households are required to take minimum required distributions. Only seven percent of PRA-owning households between the ages of 60 and 69 take annual...

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  • White Papers // Jan 2011

    International Happiness

    This paper describes the findings from a new, and intrinsically interdisciplinary, literature on happiness and human well-being. The paper focuses on international evidence. The authors put the patterns in modern data; they discuss what has been persuasively established and what has not; they suggest paths for future research. Looking ahead,...

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  • White Papers // Jan 2011

    International Trade, Offshoring And Heterogeneous Firms

    Recent trade models determine the equilibrium distribution of firm-level efficiency endogenously and show that freer trade shifts the distribution towards higher average productivity due to entry and exit of firms. These models ignore the possibility that freer trade also alters the firm-size distribution via international firm migration; firms must, by...

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  • White Papers // Jan 2011

    Household Incomes In South Africa

    This paper uses national household survey data to examine changes in real per capita incomes in South Africa between 1993 and 2008; the start and the end of the first fifteen years of post-apartheid South Africa. These data show an increase in average per capita real incomes across the distribution....

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  • White Papers // Dec 2010

    How Does The Business Cycle Affect Eating Habits?

    As economic expansions raise employment and wages, associated shifts in income and time constraints would be expected to also impact individuals' health. This study utilizes information from the Behavioral Risk Factor Surveillance System to explore the relationship between the risk of unemployment and the consumption of various healthy and unhealthy...

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  • White Papers // Jan 2010

    Wholesalers And Retailers In U.S. Trade

    The authors combine data on individual trade transactions from U.S. customs records with comprehensive information on firms' employment from the Census Bureau's business register to examine wholesalers and retailers in U.S. exports and imports. Exporters and importers with 100 percent employment in wholesale and retail differ from pure "Producer and...

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  • White Papers // Mar 2010

    Sovereign Debt Risk Premia And Fiscal Policy In Sweden

    This paper takes a step toward providing a general equilibrium framework within which to study the nub of the current fiscal debate around the world: what are the tradeoffs between short-run stabilization and long-run sustainability when the perceived riskiness of government debt depends, in part, on the current and expected...

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  • White Papers // Apr 2010

    Unemployment Fiscal Multipliers

    The authors estimate the effects of fiscal policy on the labor market in US data. An increase in government spending of 1 percent of GDP generates output and unemployment multipliers respectively of about 1.2 per cent and 0.6 percentage points. Each percentage point increase in GDP produces an increase in...

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  • White Papers // Oct 2009

    Activist Fiscal Policy To Stabilize Economic Activity

    The authors review the evidence on the practice and effects of discretionary fiscal policy, particularly in the context of recent efforts to stimulate the economy, reaching two main conclusions. First, policy interventions have increased in this decade, pre-dating the 2009 stimulus. Second, despite a large economic literature on the topic,...

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