18 October 2013

What Do Health Insurance Brokers Do?

Pinar Karaca-Mandic, Roger Feldman, and Peter Graven combine data on the number of health insurance brokers in local markets with information on employers to investigate how the degree of competition in the broker market affects insurance outcomes. They find that in markets with more competition between brokers, small firms are more likely to offer health insurance, premiums are lower, and the degree of dispersion in premiums is smaller than in less competitive markets.

17 October 2013

Does Extended Copyright Increase the Profitability of Authorship?

Megan MacGarvie and Petra Moser investigate how changes in copyright protection affect the return to authorship. They analyze historical data on the amounts that publishers paid to the authors of British fiction before and after a doubling of the length of copyright protection in 1814. They find that author payments were nearly twice as great after the copyright extension as before. Their results suggest that copyright protection can have an important influence on the profitability of authorship, particularly if the level of protection starts at a very low level.

16 October 2013

Medicare Leads the Market in Setting Physician Payments

Jeffrey Clemens and Joshua Gottlieb find that when Medicare increases its relative payment for a surgical procedure by $1, private payments for such procedures increase by even more: $1.30. The effect of a Medicare reimbursement increase on non-Medicare payments is greatest in markets in which physicians are not organized into provider groups.

15 October 2013

Measurement Error in Consumer Price Indices

Jessie Handbury, Tsutomu Watanabe, and David Weinstein analyze a large data set on prices and quantities in Japan for the 1989-2010 period. They compute a Törnqvist inflation index, the price index that is derived from economic theory, and compare it with the reported Consumer Price Index (CPI). They find that when the inflation rate computed from the Törnqvist index is above 2.4 percent, the two inflation measures agree reasonably well, but that at lower inflation rates, there is substantial measurement error in the reported CPI.

11 October 2013

Using Travel Mode Choices to Estimate the Value of a Statistical Life

Gianmarco León and Edward Miguel study the choices that travelers make when traveling from Freetown, Sierra Leone to that city's international airport. There are several different ways to travel to the airport, which is separated from the capital by water. Ferries, hovercraft, water taxis, and helicopters differ both in their safety and in their cost. The authors conclude from cost-versus-safety tradeoffs that the average African traveler values his or her life at $577,000, compared to $924,000 for non-African travelers. Income differences can explain much of this disparity.

10 October 2013

How Retracting a Scientific Paper Affects Author Citations

Ginger Zhe Jin, Benjamin Jones, Susan Feng Lu, and Brian Uzzi use data from the Web of Science to explore how retracting a jointly-authored article in a scientific journal affects subsequent citations to the previous work of the co-authors. They find that eminent co-authors experience relatively little reduction in citation patterns, while less well-known and less distinguished co-authors experience a substantial drop in citations to their previous research.

9 October 2013

Sovereigns versus Banks: Credit, Crises, and Consequences

Ňscar Jordŕ, Moritz Schularick, and Alan Taylor study the links between public borrowing, private borrowing, and financial crises in developed economies since 1870. They find that financial stability risks have largely arisen from private sector credit booms, rather than from the expansion of public debt. High levels of public debt, however, are associated with longer recovery times from financial crises.

8 October 2013

The Effect of "Use it or Lose it" Budget Rules

Jeffrey Liebman and Neale Mahoney investigate the effect of federal budget rules that require some agencies to forfeit any funds that were budgeted but not spent before the end of the fiscal year. They analyze data on federal procurement spending, and find that spending in the last week of the fiscal year is nearly five times higher than that in an average week. For information technology projects funded in the last week, the average ex post quality review is substantially lower than the average for all other weeks.

7 October 2013

The CARD Act Reduced Borrowing Costs

Sumit Agarwal, Souphala Chomsisengphet, Neale Mahoney, and Johannes Stroebel find that the 2009 Credit Card Accountability Responsibility and Disclosure (CARD) Act, which placed new limits on credit card fees, reduced consumer borrowing costs by an annualized 2.8% of average daily balances. Their study, which analyzes data on more than 150 million consumer credit card accounts, also finds that the declines were larger, more than 10 percent, for those with the lowest credit scores.

4 October 2013

Stable Prices During Supply Disruptions

Alberto Cavallo, Eduardo Cavallo, and Roberto Rigobon study the behavior of product availability and the prices charged by supermarkets following the 2010 Chilean and 2011 Japanese earthquakes. Both natural disasters resulted in a sharp decline in the availability of many products. In Chile, the number of products available fell 32 percent, while the analogous decline in Japan was 17 percent. Many goods remained unavailable for as long as six months. In spite of these severe shortages, retail prices were stable. The findings are consistent with models in which retailers fear "customer anger" if prices rise during periods of shortage.
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