31 July 2015

Substituting Time for Money:
Evidence from the Great Recession

During the Great Recession, households purchased more on-sale, large size, and generic products, according to research by Aviv Nevo and Arlene Wong. Consumers also increased coupon usage and shopping at discount stores. The researchers interpret this as suggesting a significant decrease in households' opportunity cost of time during this period.

30 July 2015

Measurement Error and Health Disparities
Across Education Classes

Many household surveys suggest that better--educated individuals tend to be in better health than their less well-educated counterparts.John Cawley and Anna Choi explore how differential patterns of health reporting errors at different education levels may affect the estimated relationship between health and education. They find that better-educated individuals report their health more accurately; they calculate that this leads to nearly a 20 percent underestimate of true health disparities across education classes.

29 July 2015

The Annual Martin S. Feldstein Lecture

Alan B. Krueger of Princeton University and the NBER analyzed the long-term decline in participation rate in the U.S. labor force in the 2015 Martin S. Feldstein Lecture, a feature of the NBER's Summer Institute. Krueger, a former chair of President Obama's Council of Economic Advisers, delivered the lecture on July 22 in Cambridge.

New NBER Research

29 July 2015

Effects of Changing the Minimum Price
Variation for Quoting Stocks

Robert P. Bartlett, III and Justin McCrary analyze the effect of increasing the minimum price variation (MPV) for quoting equity securities. They find that a larger MPV encourages investors to trade in dark venues at the midpoint of the national best bid and offer. This reduces price competition by exchange liquidity providers, reduces volatility, and increases trading volume.

28 July 2015

Self-Protection Investment Exacerbates Air Pollution
Exposure Inequality in Urban China

Households in urban China invest more in masks and air filter products when ambient pollution levels exceed key alert thresholds, according to an analysis by Siqi Zheng, Cong Sun, and Matthew E. Kahn. Richer people are more likely to invest in air filters, which are much more expensive and effective than masks; this may contribute to inequality in human capital accumulation and quality of life.

27 July 2015

How Taxes and the Culture of Leisure
Affect Labor Supply in Europe

European taxes affect the labor force participation and hours worked of men and women born in Europe to immigrant parents, according to research by Naci H. Mocan and Luiza Pogorelova. By focusing on immigrants, the authors try to identify individuals who may not share in the culture of their adopted nation, and thereby to separate tax and culture effects.

24 July 2015

Understanding Recent Declines
in Labor's Share in U.S. Income

Robert Z. Lawrence estimates that even though measured capital-labor ratios have risen in some industries, labor-augmenting technical change in the U.S. has been sufficiently rapid that effective capital-labor ratios have actually fallen in the industries that account for the largest portion of the declining labor share in income since 1980. This finding, combined with consensus estimates of the elasticity of substitution, can account for much of the recent fall in labor’s share in U.S. income.

23 July 2015

Human Capital: Quality Variation Across States

Differences in human capital account for 20 to 35 percent of the current variation in per-capita GDP among states, according to research by Eric A. Hanushek, Jens Ruhose, and Ludger Woessmann. They find that school attainment and cognitive skills make roughly equal contributions to the gap.

22 July 2015

Hospitals as Insurers of Last Resort

American hospitals are required to provide emergency medical care to the uninsured. Craig Garthwaite, Tal Gross, and Matthew J. Notowidigdo find that each additional uninsured person costs local hospitals $900 per year in uncompensated care. Increases in the uninsured population also lower hospital profit margins, which suggests that hospitals cannot simply pass along increased costs to privately insured patients

21 July 2015

Can Employment Reduce
Lawlessness and Rebellion?

Can employment programs deter high-risk men from crime and violence? Christopher Blattman and Jeannie Annan evaluate a program of agricultural training, capital inputs, and counseling for Liberian ex-fighters who were illegally mining or occupying rubber plantations. They find that men in the program increased their farm employment, shifted work hours away from illicit activities, and displayed reduced interest in mercenary work in a nearby war.
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