National Bureau of Economic Research

There is surprisingly little empirical evidence on how households choose among complex financial products such as mortgages. A key reason is the difficulty in determining the choice sets that borrowers face when selecting among potential loans. Usually, researchers see only the mortgage that the borrower ultimately chooses.

In Price Discrimination and Mortgage Choice (NBER Working Paper 31652), Jamie Coen, Anil K Kashyap, and May Rostom assemble a unique dataset that contains information on the…

Central banks of many countries are seriously considering replacing cash with some form of central bank digital currency — often referred to as CBDC. This will be a large change, perhaps second only in importance to the widespread adoption of fiat currency during the twentieth century. As with any new, untried system, evaluation of it has to rely both on theoretical ideas and on empirical studies that quantify the effects of past reforms that most resemble the proposed change. In this piece I summarize some of the empirical work that various colleagues and I have done to shed light on the potential effects of adopting a CBDC. Most of the work uses either natural or field experiments we thought could help evaluate the cost and benefit of replacing cash with a nationwide, centralized digital...

The Safe Drinking Water Act regulates over 90 contaminants — such as lead and arsenic — in community water systems. These regulations establish maximum contaminant levels (MCLs) for each contaminant; levels that exceed MCLs are considered violations. However, even among water systems that meet regulatory standards, the levels of contaminants can vary. In Drinking Water Contaminant Concentrations and Birth Outcomes (NBER Working Paper 31567), researchers Richard DiSalvo and Elaine L. Hill show that elevated levels of contaminants — even in communities where the concentrations are compliant with regulations — adversely affect birth…

The COVID-19 pandemic and its associated health and economic burdens have unfolded quite differently across states in the US. These differences are due to a variety of factors, including population density, socioeconomic status, health, and state policies. Variation across states in the timing and magnitude of the pandemic as well as in state characteristics and policies may have affected the dynamics of federal disability applications during this period.

In Inter-State Variation in Disability Applications During the COVID-19 Pandemic (NBER RDRC Working Paper 22-02), researchers Pinka Chatterji, Yiran Han, Kajal Lahiri, Jinman Pang, and Yimeng Yin examine inter-state differences in the monthly dynamics of disability applications after the onset...

In Do Entrepreneurs Want Control? And Should They Get What They Want? A Historical and Theoretical Exploration (NBER Working Paper 31106), Naomi R. Lamoreaux and Jean-Laurent Rosenthal develop a model of startup financing in which founders and outside investors compete for control of the firm. They apply their framework to study how companies’ outcomes, in particular subsequent innovations, are influenced by which group has the upper hand.

The researchers find that no simple corporate governance rule fits all circumstances. Entrepreneurs want a company to fund their vision of continued technological development. Investors want to earn favorable returns on the funds they invest in an entrepreneur’s project. Because entrepreneurs can personally gain...