AbstractDespite decades of research on heuristics and biases, evidence on the effect of large incentives on cognitive biases is scant. We test the effect of incentives on four widely documented biases: base-rate neglect, anchoring, failure of contingen…
AbstractHow unequal are the gains from trade? This paper develops a structural framework to quantify the consequences of international trade on welfare of consumers across the income distribution, allowing for nonhomothetic demand and endogenous qualit…
AbstractWe show how to use commuting flows to infer the spatial distribution of income within a city. A simple workplace choice model predicts a gravity equation for commuting flows whose destination fixed effects correspond to wages. We implement this…
AbstractWe link the county-level rollout of stay-at-home orders during the COVID-19 pandemic to anonymized cell phone records and consumer spending data. We document three patterns. First, stay-at-home orders caused people to stay home: county-level me…
AbstractThis paper develops a New Keynesian model featuring financial intermediation, short- and long-term bonds, credit shocks, and scope for unconventional monetary policy. The log-linearized model reduces to four equations: Phillips and IS curves, a…
AbstractWe show that New Keynesian models with frictionless labor supply face a challenge: given standard parameters, they cannot simultaneously match plausible estimates of marginal propensities to consume (MPCs), marginal propensities to earn (MPEs),…
AbstractWe investigate underlying sources of the US entrepreneurial ecosystem’s advantage compared to other innovative economies by assessing the benefits that Israeli startups derive from migrating to the United States. Addressing positive sorting int…
AbstractA headline result from the Oregon Health Insurance Experiment is that emergency room (ER) utilization increased. A seemingly contradictory result from the Massachusetts health reform is that ER utilization decreased. I reconcile both results by…
AbstractWe study the sources of high end-of-life spending for cancer patients. Even among patients with similar initial prognoses, spending in the year postdiagnosis is over twice as high for those who die within the year than those who survive. Elevat…
AbstractChanges in product characteristics on the extensive margin (the addition of new features and the removal of old ones) are an important and hitherto neglected dimension of quality change. Standard techniques for adjusting price indices for new g…