AN NBER PUBLICATION ISSUE: No. 6, June 2020

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
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Simulations suggest substantial reductions in the economic cost of pandemic response from targeting seniors for restrictions on personal mobility and interpersonal interactions. An age-based, targeted policy of lockdowns could substantially reduce the economic cost of pandemic response, according to research reported in A Multi-Risk SIR Model with Optimally Targeted Lockdown (NBER Working Paper 27102). Daron Acemoglu, Victor Chernozhukov, Iván Werning, and Michael...

Also in This Issue

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Article
Ignoring price rebates negotiated by insurance companies and benefits managers may significantly overstate estimates of drug price inflation. From 2012 to 2017, the average rebate as a share of prescription drug list prices rose from 32 to 48 percent, according to analysis of novel data on drug sales by Pragya Kakani, Michael Chernew, and Amitabh Chandra. In Rebates in the Pharmaceutical Industry: Evidence from Medicines Sold in Retail Pharmacies in the US (NBER...
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Since the mid-1990s, negative stock returns comove with downgrades to the Fed’s growth expectations and predict policy accommodations. The “Fed put” is the expectation on the part of many investors that if financial markets decline sharply, the Federal Reserve will intervene and ease policy. The basis for this belief can be found in the history of monetary policy easing following many recent market downturns, including those associated with the 1998 collapse of...
Article
Residents of Tianjin, China, who opted to shift from flat-rate to metered, use-based heating pricing saved money and conserved heat. All residents benefited from related reductions in air pollution. Adopting use-based pricing for household heating in developing countries can save energy, benefit consumers, and help the environment. That’s what happened in Tianjin, China, when authorities replaced a fixed-priced system of charges for heating with a metered, use-...
Article
Texas’s Top 10 Percent rule raised college attendance, graduation, and earnings for students from underrepresented high schools who gained access to UT Austin but did not reduce these metrics for those who were crowded out. Selective college admissions are fundamentally a question of tradeoffs: given capacity, admitting one student means rejecting another. However, despite numerous changes in admissions policies, including changes in the ability of states to use...
Article
Firms in automobile-related businesses whose consumers are environmentally focused are more inclined to develop sustainable technologies, particularly in markets defined by higher levels of competition. Consumers’ environmental preferences, in conjunction with the level of market competition, affect firms’ decisions to invest in environmentally friendly innovations, according to findings reported in Environmental Preferences and Technological Choices: Is Market...
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