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AN NBER PUBLICATION ISSUE: No. 6, June 2011

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
Stimulus payments boosted personal consumption expenditures somewhere between 1.3 and 2.3 percent during the second quarter of 2008. A recent NBER study by Jonathan Parker, Nicholas Souleles, David Johnson, and Robert McClelland finds that households spent an average of 12 to 30 percent of the government's 2008 economic stimulus payments on nondurable goods and another significant portion on durable goods, especially cars and trucks. In Consumer Spending and the...

Research Summaries

Article
On average, households aged 60 to 69 with personal retirement accounts withdraw only about 2 percent of their account balances each year. Over the past thirty years, retirement savings for private sector workers have undergone a dramatic shift, from employer-provided defined benefit pension plans typically paid out in the form of lifetime annuities to personal retirement accounts (PRAs) in defined contribution pension plans, such as 401(k)s. In 2008, private sector...
Article
The reduction in emissions associated with donations in support of green electricity outweighs the increase in emissions brought on by the increased electricity demand. The purchase of a hybrid car, solar panels, or home weatherization products may be justified to an individual based on the payback period, but in many cases the rate of return is too low to fully explain such purchases. Indeed, the purchase of certain green products or carbon offsets, or participation...
Article
Increased foreclosures are associated with a decrease in permits for new residential construction and a decline in auto sales. In Foreclosures, House Prices, and the Real Economy (NBER Working Paper No. 16685), co-authors Atif Mian, Amir Sufi, and Francesco Trebbi demonstrate that foreclosures not only reduce house prices but also were an important factor in weak residential investment and in durable consumption patterns during and after the recession of 2007-9....
Article
[Indian] firms were often not aware of the existence of many modern management practices [and] ... they [did not] appreciate how these could improve performance. Do differences in management practices cause differences in firm performance? Although economists typically have believed that competition will simply drive badly managed firms out of the market, co-authors Nicholas Bloom, Benn Eifert, Aprajit Mahajan, David McKenzie, and John Roberts find that that is not...
Article
States that require dental hygienists to be supervised by dentists suffer a 1 percent annual reduction in the output of dental services. U.S. states require occupational licenses for everyone from surgeons to interior decorators. Licensing in effect creates a regulatory barrier to entry into licensed occupations, and thus results in higher income for those with licenses. In Battles among Licensed Occupations: Analyzing Government Regulations on Labor Market...

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