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Articles 421 - 450 of 2930
Full-Text Articles in Social and Behavioral Sciences
Business Cycle During Structural Change: Arthur Lewis' Theory From A Neoclassical Perspective, Kjetil Storesletten, Bo Zhao, Fabrizio Zilibotti
Business Cycle During Structural Change: Arthur Lewis' Theory From A Neoclassical Perspective, Kjetil Storesletten, Bo Zhao, Fabrizio Zilibotti
Cowles Foundation Discussion Papers
We document that the nature of business cycles evolves over the process of development and structural change. In countries with large declining agricultural sectors, aggregate employment is uncorrelated with GDP. During booms, employment in agriculture declines while labor productivity increases in agriculture more than in other sectors. We construct a unified theory of business cycles and structural change consistent with the stylized facts. The focal point of the theory is the simultaneous decline and modernization of agriculture. As capital accumulates, agriculture becomes increasingly capital intensive as modern agriculture crowds out traditional agriculture. Structural change accelerates in booms and slows down …
Progressive Participation, Dirk Bergemann, Philipp Strack
Progressive Participation, Dirk Bergemann, Philipp Strack
Cowles Foundation Discussion Papers
A single seller faces a sequence of buyers with unit demand. The buyers are forward-looking and long-lived but vanish (and are replaced) at a constant rate. The arrival time and the valuation is private information of each buyer and unobservable to the seller. Any incentive compatible mechanism has to induce truth-telling about the arrival time and the evolution of the valuation. We derive the optimal stationary mechanism, characterize its qualitative structure, and derive a closed-form solution. As the arrival time is private information, the buyer can choose the time at which he reports his arrival. The truth-telling constraint regarding the …
Progressive Participation, Dirk Bergemann, Philipp Strack
Progressive Participation, Dirk Bergemann, Philipp Strack
Cowles Foundation Discussion Papers
A single seller faces a sequence of buyers with unit demand. The buyers are forwardlooking and long-lived but vanish (and are replaced) at a constant rate. The arrival time and the valuation is private information of each buyer and unobservable to the seller. Any incentive compatible mechanism has to induce truth-telling about the arrival time and the evolution of the valuation. We derive the optimal stationary mechanism in closed form and characterize its qualitative structure. As the arrival time is private information, the buyer can choose the time at which he reports his arrival. The truth-telling constraint regarding the arrival …
Progressive Participation, Dirk Bergemann, Philipp Strack
Progressive Participation, Dirk Bergemann, Philipp Strack
Cowles Foundation Discussion Papers
A single seller faces a sequence of buyers with unit demand. The buyers are forward-looking and long-lived. The arrival time and the valuation is private information of each buyer. Any incentive compatible mechanism has to induce truth-telling about the arrival time and the evolution of the valuation. We derive the optimal stationary mechanism in closed form and characterize its qualitative structure. As the arrival time is private information, the buyer can choose the time at which he reports his arrival. The truth-telling constraint regarding the arrival time can be represented as an optimal stopping problem. The stopping time determines the …
Progressive Participation, Dirk Bergemann, Philipp Strack
Progressive Participation, Dirk Bergemann, Philipp Strack
Cowles Foundation Discussion Papers
A single seller faces a sequence of buyers with unit demand. The buyers are forward-looking and long-lived. Each buyer has private information about his arrival time and valuation where the latter evolves according to a geometric Brownian motion. Any incentive-compatible mechanism has to induce truth-telling about the arrival time and the evolution of the valuation. We establish that the optimal stationary allocation policy can be implemented by a simple posted price. The truth-telling constraint regarding the arrival time can be represented as an optimal stopping problem which determines the first time at which the buyer participates in the mechanism. The …
On The Existence Of Equilibrium In Bayesian Games Without Complementarities, Idione Meneghel, Rabee Tourky
On The Existence Of Equilibrium In Bayesian Games Without Complementarities, Idione Meneghel, Rabee Tourky
Cowles Foundation Discussion Papers
In a recent paper, Reny (2011) generalized the results of Athey (2001) and McAdams (2003) on the existence of monotone strategy equilibrium in Bayesian games. Though the generalization is subtle, Reny introduces far-reaching new techniques applying the fixed point theorem of Eilenberg and Montgomery (1946, Theorem 5). This is done by showing that with atomless type spaces the set of monotone functions is an absolute retract and when the values of the best response correspondence are non-empty sub-semilattices of monotone functions, they too are absolute retracts. In this paper, we provide an extensive generalization of Reny (2011), McAdams (2003), and …
On The Existence Of Equilibrium In Bayesian Games Without Complementarities, Idione Meneghel, Rabee Tourky
On The Existence Of Equilibrium In Bayesian Games Without Complementarities, Idione Meneghel, Rabee Tourky
Cowles Foundation Discussion Papers
This paper presents new results on the existence of pure-strategy Bayesian equilibria in specified functional forms. These results broaden the scope of methods developed by Reny (2011) well beyond monotone pure strategies. Applications include natural models of first-price and all-pay auctions not covered by previous existence results. To illustrate the scope of our results, we provide an analysis of three auctions: (i) a first-price auction of objects that are heterogeneous and imperfect substitutes; (ii) a first-price auction in which bidders’ payoffs have a very general interdependence structure; and (iii) an all-pay auction with non-monotone equilibrium.
Estimated Costs Of Injuries In College And High School Female Sports, Ray C. Fair, Christopher Champa
Estimated Costs Of Injuries In College And High School Female Sports, Ray C. Fair, Christopher Champa
Cowles Foundation Discussion Papers
Injury rates in thirteen U.S. women’s college sports and four U.S. girls’ high school sports are examined in this paper. The sports are categorized as high injury (H) or low injury (L) and differences in injury rates between the two are examined. Estimates are presented of the injury savings that would result if the H sports were changed to have injury rates similar to those in the L sports. The estimated college savings are 13,610 fewer injuries per year and 2,020 fewer healthy years lost-to-injury per year. The estimated high school savings are 143,900 fewer injuries per year and 24,300 …
U.S. Infrastructure: 1929-2017, Ray C. Fair
U.S. Infrastructure: 1929-2017, Ray C. Fair
Cowles Foundation Discussion Papers
This paper examines the history of U.S. infrastructure since 1929 and in the process reports an interesting fact about the U.S. economy. Infrastructure as a percent of GDP began a steady decline around 1970, and the government budget deficit became positive and large at roughly the same time. The infrastructure pattern in other countries does not mirror that in the United States, so the United States appears to be a special case. The overall results suggest that the United States became less future oriented beginning around 1970. This change has persisted. This is the interesting fact. Whether it can be …
Progressive Participation, Dirk Bergemann, Philipp Strack
Progressive Participation, Dirk Bergemann, Philipp Strack
Cowles Foundation Discussion Papers
A single seller faces a sequence of buyers with unit demand. The buyers are forward-looking and long-lived but vanish (and are replaced) at a constant rate. The arrival time and the valuation is private information of each buyer and unobservable to the seller. Any incentive-compatible mechanism has to induce truth-telling about the arrival time and the evolution of the valuation. We derive the optimal stationary mechanism, characterize its qualitative structure and derive a closed-form solution. As the arrival time is private information, the agent can choose the time at which he reports his arrival. The truth-telling constraint regarding the arrival …
On The Existence Of Equilibrium In Bayesian Games Without Complementarities, Idione Meneghel, Rabee Tourky
On The Existence Of Equilibrium In Bayesian Games Without Complementarities, Idione Meneghel, Rabee Tourky
Cowles Foundation Discussion Papers
This paper presents new results on the existence of pure-strategy Bayesian equilibria in specified functional forms. These results broaden the scope of methods developed by Reny (2011) well beyond monotone pure strategies. Applications include natural models of first-price and all-pay auctions not covered by previous existence results. To illustrate the scope of our results, we provide an analysis of three auctions: (i) a first-price auction of objects that are heterogeneous and imperfect substitutes; (ii) a first-price auction in which bidders’ payoffs have a very general interdependence structure; and (iii) an all-pay auction with non-monotone equilibrium.
Migration And Informal Insurance, Costas Meghir, Ahmed Mushfiq Mobarak, Corina Mommaerts, Melanie Morten
Migration And Informal Insurance, Costas Meghir, Ahmed Mushfiq Mobarak, Corina Mommaerts, Melanie Morten
Cowles Foundation Discussion Papers
Do new migration opportunities for rural households change the nature and extent of informal risk sharing? We experimentally document that randomly offering poor rural households subsidies to migrate leads to a 40% improvement in risk sharing in their villages. Our model of endogenous migration and risk sharing shows that risky and temporary migration opportunities can induce an improvement in risk sharing enabling profitable migration. Accounting for improved risk sharing, the migration experiment increased welfare by 12.9%. However, permanent declines in migration costs improve outside options for households and can lead to reductions in risk sharing. The short-run experimental results for …
Migration And Informal Insurance, Costas Meghir, Ahmed Mushfiq Mobarak, Corina Mommaerts, Melanie Morten
Migration And Informal Insurance, Costas Meghir, Ahmed Mushfiq Mobarak, Corina Mommaerts, Melanie Morten
Cowles Foundation Discussion Papers
We document that an experimental intervention offering transport subsidies for poor rural households to migrate seasonally in Bangladesh improved risk sharing. A theoretical model of endogenous migration and risk sharing shows that the effect of subsidizing migration depends on the underlying economic environment. If migration is risky, a temporary subsidy can induce an improvement in risk sharing and enable profitable migration. We estimate the model and find that the migration experiment increased welfare by 12.9%. Counterfactual analysis suggests that a permanent, rather than temporary, decline in migration costs in the same environment would result in a reduction in risk sharing.
Inference In Moment Inequality Models That Is Robust To Spurious Precision Under Model Misspecification, Donald W.K. Andrews, Soonwoo Kwon
Inference In Moment Inequality Models That Is Robust To Spurious Precision Under Model Misspecification, Donald W.K. Andrews, Soonwoo Kwon
Cowles Foundation Discussion Papers
Standard tests and confidence sets in the moment inequality literature are not robust to model misspecification in the sense that they exhibit spurious precision when the identified set is empty. This paper introduces tests and confidence sets that provide correct asymptotic inference for a pseudo-true parameter in such scenarios, and hence, do not suffer from spurious precision.
Inference In Moment Inequality Models That Is Robust To Spurious Precision Under Model Misspecification, Donald W.K. Andrews, Soonwoo Kwon
Inference In Moment Inequality Models That Is Robust To Spurious Precision Under Model Misspecification, Donald W.K. Andrews, Soonwoo Kwon
Cowles Foundation Discussion Papers
Standard tests and confidence sets in the moment inequality literature are not robust to model misspecification in the sense that they exhibit spurious precision when the identified set is empty. This paper introduces tests and confidence sets that provide correct asymptotic inference for a pseudo-true parameter in such scenarios, and hence, do not suffer from spurious precision.
Does Eviction Cause Poverty? Quasi-Experimental Evidence From Cook County, Il, John Eric Humphries, Nicholas Mader, Daniel Tannenbaum, Winnie Van Dijk
Does Eviction Cause Poverty? Quasi-Experimental Evidence From Cook County, Il, John Eric Humphries, Nicholas Mader, Daniel Tannenbaum, Winnie Van Dijk
Cowles Foundation Discussion Papers
Each year, more than two million U.S. households have an eviction case filed against them. Many cities have recently implemented policies aimed at reducing the number of evictions, motivated by research showing strong associations between being evicted and subsequent adverse economic outcomes. Yet it is difficult to determine to what extent those associations represent causal relationships, because eviction itself is likely to be a consequence of adverse life events. This paper addresses that challenge and offers new causal evidence on how eviction affects financial distress, residential mobility, and neighborhood quality. We collect the near-universe of Cook County court records over …
Misspecified Moment Inequality Models: Inference And Diagnostics, Donald W.K. Andrews, Soonwoo Kwon
Misspecified Moment Inequality Models: Inference And Diagnostics, Donald W.K. Andrews, Soonwoo Kwon
Cowles Foundation Discussion Papers
This paper is concerned with possible model misspecification in moment inequality models. Two issues are addressed. First, standard tests and confidence sets for the true parameter in the moment inequality literature are not robust to model misspecification in the sense that they exhibit spurious precision when the identified set is empty. This paper introduces tests and confidence sets that provide correct asymptotic inference for a pseudo-true parameter in such scenarios, and hence, do not suffer from spurious precision. Second, specification tests have relatively low power against a range of misspecified models. Thus, failure to reject the null of correct specification …
Migration And Informal Insurance, Costas Meghir, Ahmed Mushfiq Mobarak, Corina Mommaerts, Melanie Morten
Migration And Informal Insurance, Costas Meghir, Ahmed Mushfiq Mobarak, Corina Mommaerts, Melanie Morten
Cowles Foundation Discussion Papers
Do new migration opportunities for rural households change the nature and extent of informal risk sharing? We experimentally document that randomly offering poor rural households subsidies to migrate leads to a 40% improvement in risk sharing in their villages. We explain this finding using a model of endogenous migration and risk sharing. When migration is risky, the network can facilitate migration by insuring that risk, which in turn crowds-in risk sharing when new migration opportunities arise. We estimate the model and find that welfare gains from migration subsidies are 42% larger, compared with the welfare gains without spillovers, once we …
Dual-Self Representations Of Ambiguity Preferences, Madhav Chandrasekher, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Dual-Self Representations Of Ambiguity Preferences, Madhav Chandrasekher, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Cowles Foundation Discussion Papers
We propose a class of multiple-prior representations of preferences under ambiguity, where the belief the decision-maker (DM) uses to evaluate an uncertain prospect is the outcome of a game played by two conflicting forces, Pessimism and Optimism. The model does not restrict the sign of the DM’s ambiguity attitude, and we show that it provides a unified framework through which to characterize different degrees of ambiguity aversion, and to represent the co-existence of negative and positive ambiguity attitudes within individuals as documented in experiments. We prove that our baseline representation, dual-self expected utility (DSEU), yields a novel representation of the …
Dual-Self Representations Of Ambiguity Preferences, Madhav Chandrasekher, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Dual-Self Representations Of Ambiguity Preferences, Madhav Chandrasekher, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Cowles Foundation Discussion Papers
We propose a class of multiple-prior representations of preferences under ambiguity, where the belief the decision-maker (DM) uses to evaluate an uncertain prospect is the outcome of a game played by two conflicting forces, Pessimism and Optimism. The model does not restrict the sign of the DM’s ambiguity attitude, and we show that it provides a unified framework through which to characterize different degrees of ambiguity aversion, and to represent the co-existence of negative and positive ambiguity attitudes within individuals as documented in experiments. We prove that our baseline representation, dual-self expected utility (DSEU), yields a novel representation of the …
Greedy Or Grateful? Asking For More When Thanking Donors, K. Sudhir, Hortense Fong, Subroto Roy
Greedy Or Grateful? Asking For More When Thanking Donors, K. Sudhir, Hortense Fong, Subroto Roy
Cowles Foundation Discussion Papers
Charities routinely send “thank you letters” and small gifts to express gratitude to donors but seek to defray these costs by making additional asks for donations and/or engagement. But the “ask for more” can backfire if potential donors perceive persuasive intent in the expression of gratitude, inducing reactance. We hypothesize that such reactance and its impact on giving will vary by donor loyalty. Loyal donors are more likely to experience reactance to additional asks, muting the feeling of reciprocity aroused by the expression of gratitude to suppress giving. In contrast, non-loyal donors are less likely to experience reactance, and therefore …
Boolean Expected Utility, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Boolean Expected Utility, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Cowles Foundation Discussion Papers
We propose a multiple-prior model of preferences under ambiguity that provides a unified lens through which to understand different formalizations of ambiguity aversion, as well as context-dependent negative and positive ambiguity attitudes documented in experiments. This model, Boolean expected utility (BEU), represents the belief the decision-maker uses to evaluate any uncertain prospect as the outcome of a game between two conflicting forces, Pessimism and Optimism. We prove, first, that BEU provides a novel representation of the class of invariant biseparable preferences (Ghirardato, Maccheroni, and Marinacci, 2004). Second, BEU accommodates rich patterns of ambiguity attitudes, which we characterize in terms of …
Aggregation Of Diverse Information With Double Auction Trading Among Minimally-Intelligent Algorithmic Agents, Karim Jamal, Michael Maier, Shyam Sunder
Aggregation Of Diverse Information With Double Auction Trading Among Minimally-Intelligent Algorithmic Agents, Karim Jamal, Michael Maier, Shyam Sunder
Cowles Foundation Discussion Papers
Information dissemination and aggregation are key economic functions of financial markets. How intelligent do traders have to be for the complex task of aggregating diverse information (i.e., approximate the predictions of the rational expectations equilibrium) in a competitive double auction market? An apparent ex-ante answer is: intelligent enough to perform the bootstrap operation necessary for the task—to somehow arrive at prices that are needed to generate those very prices. Constructing a path to such equilibrium through rational behavior has remained beyond what we know of human cognitive abilities. Yet, laboratory experiments report that profit motivated human traders are able to …
Greedy Or Grateful? Asking For More When Thanking Donors, K. Sudhir, Hortense Fong, Subroto Roy
Greedy Or Grateful? Asking For More When Thanking Donors, K. Sudhir, Hortense Fong, Subroto Roy
Cowles Foundation Discussion Papers
Charities often send annual “thank you letters” to express gratitude to donors, but seek to defray these costs by inviting additional donations or engagement. However, the additional asks may backfire if potential donors see the thank you message as “insincere” or “manipulative.” We test this trade-off by conducting a field experiment in cooperation with a leading charity in India. We find that an explicit ask for additional donations or even a request to follow the organization on Facebook reduces giving. However, these effects are not only heterogeneous, but asymmetric by past giving behavior. Recent, frequent, and higher monetary value donors …
Education Quality And Teaching Practices, Marina Bassi, Costas Meghir, Ana Reynoso
Education Quality And Teaching Practices, Marina Bassi, Costas Meghir, Ana Reynoso
Cowles Foundation Discussion Papers
Improving school quality with limited resources is a key issue of policy. It has been suggested that instructing teachers to follow specific practices together with tight monitoring of their activities may help improve outcomes in under-performing schools that usually serve poor populations. This paper uses an RCT to estimate the effectiveness of guided instruction methods as implemented in under-performing schools in Chile. The intervention improved performance substantially and by equal amounts for boys and girls. However, the effect is mainly accounted for by children from relatively higher income backgrounds and not for the most deprived. Based on the CLASS instrument …
Boolean Representations Of Preferences Under Ambiguity, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Boolean Representations Of Preferences Under Ambiguity, Mira Frick, Ryota Iijima, Yves Le Yaouanq
Cowles Foundation Discussion Papers
We propose a class of multiple-prior representations of preferences under ambiguity where the belief the decision-maker (DM) uses to evaluate an uncertain prospect is the outcome of a game played by two conflicting forces, Pessimism and Optimism. The model does not restrict the sign of the DM’s ambiguity attitude, and we show that it provides a unified framework through which to characterize different degrees of ambiguity aversion, as well as to represent context-dependent negative and positive ambiguity attitudes documented in experiments. We prove that our baseline representation, Boolean expected utility (BEU), yields a novel representation of the class of invariant …
Attribute Sentiment Scoring With Online Text Reviews: Accounting For Language Structure And Missing Attributes, Ishita Chakraborty, Minkyung Kim, K. Sudhir
Attribute Sentiment Scoring With Online Text Reviews: Accounting For Language Structure And Missing Attributes, Ishita Chakraborty, Minkyung Kim, K. Sudhir
Cowles Foundation Discussion Papers
The authors address two significant challenges in using online text reviews to obtain fine-grained attribute level sentiment ratings. First, they develop a deep learning convolutional-LSTM hybrid model to account for language structure, in contrast to methods that rely on word frequency. The convolutional layer accounts for the spatial structure (adjacent word groups or phrases) and LSTM accounts for the sequential structure of language (sentiment distributed and modified across non-adjacent phrases). Second, they address the problem of missing attributes in text in construct-ing attribute sentiment scores—as reviewers write only about a subset of attributes and remain silent on others. They develop …
Can Friends Seed More Buzz And Adoption?, Vineet Kumar, K. Sudhir
Can Friends Seed More Buzz And Adoption?, Vineet Kumar, K. Sudhir
Cowles Foundation Discussion Papers
A critical element of word of mouth (WOM) or buzz marketing is to identify seeds, often central actors with high degree in the social network. Seed identification typically requires data on the full network structure, which is often unavailable. We therefore examine the impact of WOM seeding strategies motivated by the friendship paradox to obtain more central nodes without knowing network structure. But higher-degree nodes may communicate less with neighbors; therefore whether friendship paradox motivated seeding strategies increase or reduce WOM and adoption remains an empirical question. We develop and estimate a model of WOM and adoption using data on …
Attribute Sentiment Scoring With Online Text Reviews: Accounting For Language Structure And Missing Attributes, Ishita Chakraborty, Minkyung Kim, K. Sudhir
Attribute Sentiment Scoring With Online Text Reviews: Accounting For Language Structure And Missing Attributes, Ishita Chakraborty, Minkyung Kim, K. Sudhir
Cowles Foundation Discussion Papers
The authors address two significant challenges in using online text reviews to obtain finegrained attribute level sentiment ratings. First, in contrast to methods that rely on word frequency, they develop a deep learning convolutional-LSTM hybrid model to account for language structure. The convolutional layer accounts for spatial structure (adjacent word groups or phrases) and LSTM accounts for sequential structure of language (sentiment distributed and modified across non-adjacent phrases). Second, they address the problem of missing attributes in text in constructing attribute sentiment scores—as reviewers write only about a subset of attributes and remain silent on others. They develop a model-based …
Can Random Friends Seed More Buzz And Adoption? Leveraging The Friendship Paradox, Vineet Kumar, K. Sudhir
Can Random Friends Seed More Buzz And Adoption? Leveraging The Friendship Paradox, Vineet Kumar, K. Sudhir
Cowles Foundation Discussion Papers
A critical element of word of mouth (WOM) or buzz marketing is to identify seeds, often central actors with high degree in the social network. Seed identification typically requires data on the full network structure, which is often unavailable. We therefore examine the impact of WOM seeding strategies motivated by the friendship paradox to obtain more central nodes without knowing network structure on adoption. Higher-degree nodes may be less effective as seeds if these nodes communicate less with neighbors or are less persuasive when they communicate; therefore whether friendship paradox motivated seeding strategies increase or reduce WOM and adoption remains …