NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Arlene Wong

Department of Economics
Princeton University
192A Julis Romo Rabinowitz Building
Princeton, NJ 08544
Tel: 609-258-4016

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NBER Program Affiliations: EFG , ME
NBER Affiliation: Faculty Research Fellow

NBER Working Papers and Publications

July 2017Measuring Social Connectedness
with Michael Bailey, Ruiqing (Rachel) Cao, Theresa Kuchler, Johannes Stroebel: w23608
We introduce a new measure of social connectedness between U.S. county-pairs, as well as between U.S. counties and foreign countries. Our measure, which we call the "Social Connectedness Index" (SCI), is based on the number of friendship links on Facebook, the world's largest online social networking service. Within the U.S., social connectedness is strongly decreasing in geographic distance between counties: for the population of the average county, 62.8% of friends live within 100 miles. The populations of counties with more geographically dispersed social networks are generally richer, more educated, and have a higher life expectancy. Region-pairs that are more socially connected have higher trade flows, even after controlling for geographic distance and the similarity of regions along ...
September 2015Trading Down and the Business Cycle
with Nir Jaimovich, Sergio Rebelo: w21539
We document two facts. First, during the Great Recession, consumers traded down in the quality of the goods and services they consumed. Second, the production of low-quality goods is less labor intensive than that of high-quality goods. When households traded down, labor demand fell, increasing the severity of the recession. We find that the trading-down phenomenon accounts for a substantial fraction of the fall in U.S. employment in the recent recession. We show that embedding quality choice in a business-cycle model improves the model's amplification and comovement properties.
July 2015The Elasticity of Substitution Between Time and Market Goods: Evidence from the Great Recession
with Aviv Nevo: w21318
We document a change in household shopping behavior during the Great Recession. Households purchased more on sale, larger sizes and generic products, increased coupon usage, and shopping at discount stores. We estimate that the returns to these shopping activities declined during the recession and therefore this behavior implies a significant decrease in households’ opportunity cost of time. Using the estimated cost of time and time use data, we estimate a high elasticity of substitution between market expenditure and time spent on non-market work. We find that households smooth a sizable fraction of consumption by varying their time allocation during recessions.
 
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