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AN NBER PUBLICATION ISSUE: No. 7, July 2010

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
A 10 percent decrease in the third party coverage rate is associated with a 4 percent decrease in emergency room visits. In The Effect of Health Insurance Coverage on the Use of Medical Services (NBER Working Paper No. 15823), co-authors Michael Anderson, Carlos Dobkin, and Tal Gross exploit the abrupt change in third party coverage that occurs between ages 18 and 19 -- the result of young adults "aging out" of their parents' insurance plans -- to estimate the effect...

Research Summaries

Article
The current [inverted block pricing] rate structure cuts the electricity bills of households in the lowest income bracket by about 12 percent, but a targeted low-income program may offer as much assistance while distorting prices less. With rising energy costs and a growing awareness of the threat of climate change, some policymakers believe that retail energy prices will have to rise to reflect the true cost of energy consumption. At the same time there is concern...
Article
In-hospital mortality increased by 19.4 percent and hospital readmissions increased by 6.5 percent for patients admitted during a strike. U.S. hospitals were excluded from collective bargaining laws for three decades longer than other sectors because of fears that strikes by nurses might imperil patients' health. Today, while unionization has been declining in general, it is growing rapidly in hospitals, with the number of unionized workers rising from 679,000...
Article
While industrial customers face prices that are close to marginal cost (2.5 percent markup), most residential and commercial customers face prices closer to average cost (40 percent markup). In Do Americans Consume Too Little Natural Gas? An Empirical Test of Marginal Cost Pricing (NBER Working Paper No. 15885), co-authors Lucas Davis and Erich Muehlegger measure the extent to which prices exceeded marginal costs from 1991-2007 in the U.S. natural gas distribution...
Article
Some of the 'softer' features of entrepreneurial financing, such as angels' mentoring and networks of business contacts, may have helped the new ventures the most. Angel investment groups are an important and growing source of entrepreneurial finance. These groups "which are typically semi-formal networks of high-net-worth individuals" meet regularly to hear aspiring entrepreneurs pitch their business plans before deciding whether to invest in such ventures. In...
Article
Universities with endowment portfolios invested in hedge funds, private equity, and other relatively illiquid vehicles, tend to make larger faculty and secretarial cuts [in market downturns] than schools with more liquid, traditional portfolios. Endowments have become increasingly important funding sources for America's doctoral universities over the past twenty years. In Why I Lost My Secretary: the Effect of Endowment Shocks on University Operations (NBER Working...

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