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AN NBER PUBLICATION ISSUE: No. 7, July 2011

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
[The] effects of a rise in the profits per share on option exercise are considerably more powerful than the incentive effects of an increase in the number of options held in terms of employee job performance. In Stock Option Exercise and Gift Exchange Relationships: Evidence from a Large U.S. Company (NBER Working Paper No. 16814), co-authors Peter Cappelli and Martin Conyon use data from the exercise of stock options by roughly 4500 managers in a large public company...

Research Summaries

Article
... Rises and falls [in the African export revenues] are primarily attributable to changes in the quantity exported. Price changes only account for 10 percent of the changes ... The exports of sub-Saharan African nations include some "big hits" -- that is, exports that dominate national trade. These exports change over time in a way that can't be easily explained by commodity prices or other global factors, according to recent research by William Easterly and...
Article
Two factors seem to be the major drivers of the [airline] industry's poor profit performance:  the severe demand downturn after 9/11, [and] the large cost differential between legacy airlines and the low-cost carriers. The dismal financial record of the domestic airline market, more than 30 years after deregulation, is somewhat puzzling. In 2008 and 2009, U.S. passenger airlines reported aggregate net losses before extraordinary income and charges of $14 billion...
Article
Counterfeits ... steal demand from low-end authentic products, but [have] positive spillover effects for high-end authentic products. In fiscal 2009, the U.S. Customs and Border Protection seized more than $260 million worth of counterfeit goods, with counterfeit footwear accounting for 40 percent of the total seizures. Counterfeit footwear has topped the seizure list of the customs service for four years. How does the existence of such counterfeits affect the sales...
Article
If their population age structure between 1960 and 2005 had been what projections suggest it will be for the 2005 to 2050 period, the OECD countries would have grown by 2.1 percent per year rather than by 2.8 percent per year. The share of the population aged 60 and over is projected to increase in nearly every country in the world between today and 2050. An aging population tends to lower labor-force participation and savings rates, and may slow economic growth. In...
Article
Support programs for low-income households and infrastructure spending were highly expansionary, while grants to states for education do not appear to have created many additional jobs. In Did the Stimulus Stimulate? Real Time Estimates of the Effects of the American Recovery and Reinvestment Act (NBER Working Paper No. 16759), James Feyrer and Bruce Sacerdote find that support programs for low-income households and infrastructure spending were highly expansionary,...

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