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AN NBER PUBLICATION ISSUE: No. 7, July 2012

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
[The] groups [that] experienced the greatest employment losses in the Great Recession [were] ... the same groups who lost in the recessions of the 1980s. In Who Suffers During Recessions? (NBER Working Paper No. 17951), co-authors Hilary Hoynes, Douglas Miller, and Jessamyn Schaller find that the impacts of the Great Recession (December 2007 to June 2009) have been greater for men, for black and Hispanic workers, for young workers, and for less educated workers than...

Research Summaries

Article
Paying eleventh- and twelfth-grade students and teachers for passing AP scores ... makes employment more likely, and is associated with higher earnings. The Advanced Placement Incentive Program (APIP) is one of a number of initiatives designed to encourage U.S. high school students in inner-city schools to take more difficult AP courses. APIP provides cash incentives for passing grades on AP tests in selected Texas school districts: the APIP students receive between $...
Article
Each dollar invested in the average [private equity] fund returned at least 20 percent more than a dollar invested in the S&P 500. This works out to an outperformance of at least 3 percent per year. Despite the large increase in investments in private equity funds, and the concomitant increase in academic and practitioner scrutiny of them, the historical performance of private equity (PE) remains uncertain. Up until now, there has been uneven disclosure of private...
Article
A decrease in the marginal tax rate that raised the after-tax share of income by 1 percent raised reported taxable income by 0.2 percent. Marginal income tax rates in the United States changed frequently and substantially in the 1920s and 1930s, and those changes varied greatly across income groups at the top of the income distribution. In The Incentive Effects of Marginal Tax Rates: Evidence from the Interwar Era (NBER Working Paper No. 17860), Christina Romer and...
Article
Even if the benefit adjustment for delaying benefits is fair on average from an actuarial point of view ... the adjustment won't be actuarially fair for everyone. For a large subset of Americans, there may be substantial financial benefits to delaying filing for Social Security benefits. Benefits can be claimed as early as age 62 or as late as age 70. Delay means a larger monthly payment once payments begin, and for people of average life expectancy, that larger...
Article
If anything, unexpected performance in the MM tournament deserves more weight than it gets in the draft decisions. In Does March Madness Lead to Irrational Exuberance in the NBA Draft? High-Value Employee Selection Decisions and Decision-Making Bias (NBER Working Paper No. 17928), authors Casey Ichniowski and Anne Preston assemble an extensive and detailed dataset on the performance of collegiate and professional basketball players over the years 1997-2010 to answer...

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