AN NBER PUBLICATION ISSUE: No. 6, June 2009

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
The number of Vietnam-era VDC beneficiaries grew rapidly in the late 1990s, growth that accelerated in the early part of this century and has not yet leveled off. The Veterans Disability Compensation Program (VDC), which provides a monthly stipend to disabled veterans, is the third largest American disability insurance program. Since the late 1990s, VDC growth has been driven primarily by an increase in claims from Vietnam veterans, raising concerns about costs as...

Research Summaries

Article
Good or bad investing experiences early in life leave a lasting impression that fades away only very slowly. In Depression Babies: Do Macroeconomic Experiences Affect Risk-Taking (NBER Working Paper No. 14813), co-authors Ulrike Malmendier and Stefan Nagel confirm that experience over a lifetime strongly influences where households choose to place their investments. Using the Survey of Consumer Finances for 1964-2004 -- which contains data on household investments...
Article
A two-to-three-minute explanation [of tax incentives] can have substantial effects on labor supply over the subsequent year. In Teaching the Tax Code: Earnings Responses to an Experiment with EITC Recipients(NBER Working Paper No. 14836), authors Raj Chetty and Emmanuel Saez test whether providing information about the Earned Income Tax Credit (EITC) affects EITC recipients' labor supply and earnings decisions. The EITC is the largest cash transfer program for...
Article
Research productivity is highest for schools in states that allow more autonomy. Highly productive universities both control their own destinies and face stiff external competition, according to a recent NBER Working Paper. In The Governance and Performance of Research Universities: Evidence from Europe and the U.S. (NBER Working Paper No. 14851), authors Philippe Aghion, Mathias Dewatripont, Caroline M. Hoxby, Andreu Mas-Colell, and Andr� Sapir construct an index...
Article
Greater transparency of central bank operations is the most dramatic recent change in the conduct of monetary policy. Central bankers around the world have become more open about their goals and operations, which has been a boon to taming the ups and downs of inflation. In Central Bank Transparency: Causes, Consequences, and Updates (NBER Working Paper No. 14791), authors Nergiz Dincer and Barry Eichengreen examine the central banks of 100 nations and find that their...
Article
U.S. target firms undergo significant restructuring after acquisition by emerging market firms....Increasing profitability measured by the return on assets coupled with declining sales, employment and capital is consistent with improvements in firm efficiency. In Foreign Ownership and Firm Performance: Emerging Market Acquisitions in the United States (NBER Working Paper No. 14786), Anusha Chari, Wenjie Chen, and Kathryn M.E. Dominguez conduct the first systematic...

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