7 December 2017

How Offshoring by U.S. Multinationals
Affects Domestic Employment

Offshore activities by multinational U.S. firms have modest positive effects on domestic employment, according to research by Brian K. Kovak, Lindsay Oldenski, and Nicholas Sly. A 10 percent increase in offshore affiliate employment induced by a bilateral tax treaty is associated with a 1.8 percent increase in employment at the U.S. parent firm, with smaller effects at the industry and regional levels.

6 December 2017

Advertising Spending and Media Bias:
Evidence from Coverage of Car Safety Recalls

Newspapers provide less coverage of automobile recalls by their advertisers, especially of more-severe recalls, Graham Beattie, Ruben Durante, Brian Knight, and Ananya Sen find. Competition for readers from other newspapers mitigates bias, while competition for advertising by online platforms exacerbates it. The study suggests that lower coverage increases auto fatalities.

5 December 2017

Reallocation of Resources and the Rise
of Secularization in the Protestant Reformation

Secular authorities acquired enormous amounts of wealth from monasteries closed during the Protestant Reformation. Davide Cantoni, Jeremiah Dittmar, and Noam Yuchtman find that, as a result, graduates of Protestant universities increasingly studied secular subjects and entered secular, especially administrative, occupations. New construction shifted from religious toward secular purposes, especially the building of palaces and administrative buildings that reflected the increased wealth and power of secular lords.

4 December 2017

Macroeconomic Policy after Financial Crises

Christina D. Romer and David H. Romer examine episodes of financial distress in 24 countries to assess the role of macroeconomic policy. They find that output decline following a crisis is less than 1 percent when a country’s pre-crisis policy interest rate is above the zero lower bound and its debt-to-GDP ratio is relatively low, but almost 10 percent when neither of these conditions exists.

1 December 2017

Effects of Episode-Based Payment
on Health Care Spending and Utilization

Studying an Arkansas initiative on perinatal care that rewards physicians for efficient use of their own services and efficient management of other health care inputs, Caitlin Carroll, Michael Chernew, A. Mark Fendrick, Joe Thompson, and Sherri Rose find that spending decreased after the introduction of the program and there was an improvement in quality of care.

30 November 2017

Food vs. Fuel? Impacts
of Petroleum Shipments on Agricultural Prices

Increased crude oil shipments are associated with substantially larger spreads between wheat prices at regional elevators and in Minneapolis, the market hub, research by James B. Bushnell, Jonathan E. Hughes, and Aaron Smith indicates. The effect on corn and soybean spreads is an order of magnitude smaller. Increased oil traffic is associated with small increases in rail rates but large increases in rail car auction prices.

29 November 2017

Educational Choice, Rural-Urban Migration,
and Economic Development in China

Although education-based migration in China is just one-fifth that of work-based migration, its contribution to the enhancement of per capita output is larger than that of work-based migration, Pei-Ju Liao, Ping Wang, Yin-Chi Wang, and Chong Kee Yip find. Increased college admission selectivity for rural students has reduced China's development, lowering per capita output and worsening the high-skilled employment share in urban areas.

28 November 2017

Rent Control and Property Crime

The sudden end of rent control in Cambridge, Massachusetts, in 1995 was associated with a decline in overall crime of 16 percent, with the majority of the effect accruing through reduced property crime, according to a study by David H. Autor, Christopher J. Palmer, and Parag A. Pathak. This crime reduction accounts for 15 percent of the contemporaneous growth in Cambridge residential property values attributable to rent decontrol.

27 November 2017

Are There Too Many Farms in the World?

Labor market transaction costs can explain why the smallest farms are most efficient, slightly larger farms least efficient, and larger farms as efficient as the smallest farms, research by Andrew D. Foster and Mark R. Rosenzweig shows. Focusing on India, they find that there are too many farms at scales insufficient to exploit locally available equipment-capacity scale-economies.

22 November 2017

Labor Supply and the Value of Non-Work Time

Individual labor supply is highly elastic at low hours and becomes more inelastic at higher hours, according to a field experiment by Alexandre Mas and Amanda Pallais in which applicants for phone survey and data entry positions were randomly offered alternative wage-hour bundles. For unemployed applicants, the opportunity cost of a full-time job is approximately 60 percent of the estimated market wage.
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