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The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
US households report spending approximately 40 percent of their stimulus checks, on average, with about 30 percent saved and another 30 percent used to pay down debt. The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted on March 27, 2020, was designed to bolster household incomes and support consumer spending. It achieved the first goal, but had only a modest impact on consumer spending. Survey data on household behavior suggest that nearly 60...

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After lockdown, staff and contract workers were the only nonresidents allowed into nursing homes. Those who worked in multiple facilities inadvertently enabled the virus to spread. Nursing homes with staff who work at multiple facilities were more likely to experience outbreaks of COVID-19 than those without such links. Eliminating staff overlap among nursing homes could have reduced coronavirus cases in nursing homes by 44 percent, according to Nursing Home Staff...
Data on 5,917 hedge funds over 22 years suggest that after incentive fees and management fees are assessed, investors received only 36 cents of every dollar earned on invested capital. The hedge fund industry prides itself on its incentive compensation structure, which provides tight alignment of fund managers’ and investors’ incentives. Specifically, managers should receive performance fees only when investors make money. Accordingly, managers’ compensation is...
Job-finding rates and wages fell for new graduates entering the labor market in 2009 and 2010, but poorer prospects for young workers actually began before the recession and continued through the recovery. There has been a substantial deterioration in the employment prospects of recent college graduates, Jesse Rothstein finds in The Lost Generation? Labor Market Outcomes for Post Great Recession Entrants (NBER Working Paper 27516). Cohorts that graduated during...
After the SEC’s EDGAR system expanded access to firms’ financial data, the role of expert analysis in moving stock prices declined, and firm investment became less sensitive to market price swings. Modern information technology has democratized corporate disclosures, making them broadly available and easy and inexpensive to access. In theory, the timely spread of key data about firms should enable investors to stay informed about company prospects, thereby...
Disadvantaged youths who participated in government-run Civilian Conservation Corps activities between 1937 and 1942 lived longer and earned more than their Depression-era peers. Most government-run job training program evaluations focus on short- and medium-term outcomes. In Do Youth Employment Programs Work? Evidence from the New Deal (NBER Working Paper 27103), Anna Aizer, Shari Eli, Adriana Lleras-Muney, and Keyoung Lee show that just under 10 months’...
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