Economic Inquiry

Articles from Vol. 53, No. 2, April

A Few Goodmen: Surname-Sharing Economist Coauthors
I. THE PHENOMENON OF COAUTHORSHIP The phenomenon of coauthorship in the economics profession has been widely explored. Card and DellaVigna (2013), for example, document the fact that the number of authors per economics paper has been steadily growing...
Alliances in the Shadow of Conflict
I. INTRODUCTION Members of alliances who have jointly defeated an opponent must decide how to divide the prize of victory. Such distributional conflict may be resolved peacefully or may involve resource-wasteful fighting. This article studies how...
Analyzing Comovements in Housing Prices Using Vine Copulas
I. INTRODUCTION When housing prices were rapidly appreciating from 1999 to 2006, investment firms created structured securities by combining mortgages from houses located in different parts of the country, and then traders bought and sold those...
A Primer on Cardinal versus Ordinal Tournaments
I. INTRODUCTION The tournament literature has considered primarily two relative performance evaluation schemes that are consistent with what we observe in practice. The rationale behind each of these incentive schemes is that relative performance...
Are Sunk Costs Irrelevant? Evidence from Playing Time in the National Basketball Association
I. INTRODUCTION "Sunk costs are irrelevant," is a common mantra of price theory, but our students seldom believe this claim--and for good reason. Political and corporate leaders alike appeal to sunk costs to justify future policies. The "escalation...
Are Winners Promoted Too Often? Evidence from the NFL Draft 1999-2012
I. INTRODUCTION Recruiting new employees is a costly activity for firms. Firms must advertise the position, review resumes, interview job candidates, and ultimately make hiring decisions. Given the costs associated with the search, firms may seek...
Astronomics in Action: The Graduate Earnings Premium and the Dragon Effect in Singapore
White U.S. and Latin American currencies portray images of national independence heroes, Singapore's 2-dollar bill--the most widely circulated since there is no smaller denomination--shows students in a classroom listening to a professor, with a university...
Behavioral Patterns in Social Networks
I. INTRODUCTION Individual strategies for network formation can be extremely complex. The main reason for this is that a network differs from a series of bilateral relationships because of the value of indirect connections: any two economic agents...
Beyond Education and Fairness: A Labor Market Taxation Model for the Great Gatsby Curve
I. INTRODUCTION An intergenerational income elasticity (HE) for a particular country can be thought of as the fraction of a 1% permanent income increase given to a parent that is observed, on average, in the permanent income of a child. Thus, estimates...
Capacity Constraints and Information Revelation in Procurement Auctions
I. INTRODUCTION Procurement auctions are one of the most widely used mechanisms in modern economies to disburse funds for public works projects. A substantial portion of these funds are spent on the construction and maintenance of roads and highways,...
Does Beauty Matter in Undergraduate Education?
I. INTRODUCTION In most settings, discrimination based on characteristics such as gender, age, race, and national origin is illegal. Appearance-based discrimination, while not currently unlawful, has been the subject of several lawsuits in recent...
Dubious and Dubiouser: Contingent Valuation and the Time of Day
I. INTRODUCTION The contingent valuation method (CVM) is a stated preference approach to the valuation of public goods (Carson 2012a, 2012b). Preferences are "stated" in the sense that survey respondents are asked hypothetical behavior questions...
Education's Gambling Problem: Earmarked Lottery Revenues and Charitable Donations to Education
I. INTRODUCTION Over the past several decades, state governments in the United States have come to embrace lotteries as an alternative source of revenue. Lotteries have proven to be successful in raising revenue; on average, lotteries add nearly...
Employment Dynamics of Immigrants versus Natives: Evidence from the Boom-Bust Period in Spain, 2000-2011
I. INTRODUCTION The economic literature concerning immigration has shown that there are relevant differences between the labor market performance of native and foreign-born individuals. Several papers have investigated how employment and unemployment...
Expert Opinion and Product Quality: Evidence from New York City Restaurants
I. INTRODUCTION In the presence of information asymmetries consumers often rely on expert opinion to guide their purchase decision. An increasing body of economic literature analyzes the effect of critical assessments on prices and quantity consumed...
Fear of Novelty: A Model of Scientific Discovery with Strategic Uncertainty
I. INTRODUCTION Fundamental research frequently progresses in a discontinuous manner, with structural breaks driven by major innovations that are followed by long periods of exploitation of the results of such structural breaks (Bramoulle and Saint-Paul...
Inflation Expectations and Consumer Spending at the Zero Bound: Micro Evidence
I. INTRODUCTION Many theoretical studies suggest that policy-makers can generate greater current spending by making people believe in higher future inflation when nominal interest rates are stuck at the zero lower bound (ZLB). Krugman (1998), using...
Legalizing Bribe Giving
I. INTRODUCTION Corruption remains an endemic problem in the developing world and has become a central political issue in many countries. Empirical work has considerably advanced our understanding of how widespread corruption is and how it can cause...
Locus of Control and Job Turnover
I. INTRODUCTION Economists have recently begun to actively explore and confirm the role of psychological factors, such as personality and motivation, in determining various education and labor market outcomes. (1) Along with the direct effects of...
Market Structure and Media Diversity
I. INTRODUCTION Information on news and current affairs can raise political awareness and promote a range of ideas. Under the assumption that unregulated media markets supply too little variety, many societies have charged regulators with ensuring...
Media and Human Capital Development: Can Video Game Playing Make You Smarter?
I. INTRODUCTION An individual's cognitive skills are linked to a number of important outcomes. Individuals with higher cognitive abilities have higher educational attainment. Controlling for education, cognitive skills are positively related to...
Monetary Neutrality under Evolutionary Dominance of Bounded Rationality
I. INTRODUCTION A key property of the dynamic relationship between money and output is that due to price stickiness monetary shocks have persistent, although not permanent, impacts on the real output (see, e.g., Christiano, Eichenbaum, and Evans...
Monitoring of Workers and Product Market Competition: The Role of Works Councils
I. INTRODUCTION Technological advancement allows firms to closely monitor their workers' actions more than ever before. For instance, firms can acquire worker monitoring software to monitor activities on computers or cell phones. Such software enables...
Norms of Punishment: Experiments with Students and the General Population
I. INTRODUCTION The issue of external validity of laboratory experiments has received increasing attention in the last decades. While the vast majority of experiments are conducted with a fitting sample of college students, it remains an open question...
On the External Validity of Laboratory Tax Compliance Experiments
I. INTRODUCTION Laboratory methods are now widely accepted as a methodological approach in economics and, increasingly, they have been used to examine specific public policy issues. There is much to be gained from careful laboratory experiments....
On the Internal Revenue Service's Service and Enforcement
I. INTRODUCTION The Internal Revenue Service (IRS) services as well as audits taxpayers. The IRS provides taxpayer service through a variety of channels, including its website, toll-free telephone lines, and the Taxpayer Assistance Center. For FY...
Own-Nationality Bias: Evidence from UEFA Champions League Football Referees
I. INTRODUCTION Athletes continually search for ways to obtain even the slightest advantage over their opponents. It is often these slim margins that make the difference in competitive games and leagues. League officials have the responsibility...
Product Diversity, Demand Structures, and Optimal Taxation
I. INTRODUCTION How should taxes be set to obtain an optimal number of firms and products? This article sheds light on the role of different demand structures for product diversity and the resulting implications for optimal taxation. We use the...
Profit-Maximizing Gate Revenue Sharing in Sports Leagues
I. INTRODUCTION The professional team sports industry is one of the scarce industries in which coordination between competing firms (clubs) is widely accepted. Clubs in almost all sports have organized themselves in legal cartels (leagues). It seems...
Religious Homophily in a Secular Country: Evidence from a Voting Game in France
I. INTRODUCTION Homophily--or the concept that individuals who are similar tend to come together--has long been recognized as a powerful determinant of social networks. (1) Our friends tend to be our coethnics (2) (Currarini, Jackson, and Pin 2009;...
Sequential Judgment Effects in the Workplace: Evidence from the National Basketball Association
I. INTRODUCTION Many areas of economic activity involve an evaluator who must make subjective judgments. Often these judgments are made sequentially toward different individuals, with the intent that each judgment be made independently. Business...
Strategic or Nonstrategic: The Role of Financial Benefit in Bankruptcy
I. INTRODUCTION Personal bankruptcy rates have increased at an annual rate of 3.9% since 1990, from about 718 thousand (non-business) bankruptcies in 1990 to about 1.5 million in 2010. Partly as a response to this increase, the Congress passed the...
Structural Estimation of Sequential Games of Complete Information
I. INTRODUCTION There has been much recent work on identification and estimation of static models of strategic interaction. Static models can be classified according to the timing of players' moves, which can either be simultaneous or sequential,...
Tax Policy and Income Inequality in the United States, 1979-2007
I. INTRODUCTION Over the past decades, incomes have become more unequally distributed in most Organisation for Economic Co-operation and Development (OECD) countries and especially in the United States (OECD 2011). In particular, the increase of...
The Economics of Emergency Meetings
I. INTRODUCTION Meetings are critical to the success of organizations. Meetings allow organizations to coordinate information, discuss strategies, and realign policies to meet their objectives. For example, firms schedule regular meetings to assess...
Vertical Separation Increases Gasoline Prices
I. INTRODUCTION The choice and implications of firm structure remain central questions in industrial economics, and for good reason. Analysis of recent U.S. Census data suggests that within firm transactions now create the same amount of value as...
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