We exploit the variation in admission cutoffs across colleges at a leading Indian university to estimate the causal effects of enrolling in a selective college on cognitive attainment, economic preferences, and Big Five personality traits. Using a regression discontinuity design, we find that enrolling in a selective college improves university exam scores of the marginally admitted females, and makes

We evaluate alternative indicators of global economic activity and other market funda-mentals in terms of their usefulness for forecasting real oil prices and global petroleum consumption. World industrial production is one of the most useful indicators. However, by combining measures from several different sources we can do even better. Our analysis results in a new index of global economic conditions

Sectoral heterogeneity matters for monetary policy. Using CPI microdata, we estimate for 227 products a time–varying menu-cost model to investigate the quantitative relevance of this heterogeneity. We find a substantial degree of cross-sectoral heterogeneity in all structural parameters. Heterogeneity in the Calvo component of the pricing friction is however the main source of heterogeneity in price

While episodes of financial distress are followed by large and persistent drops in economic activity, structural time series analyses point to relatively mild and transitory effects of financial market disruptions. We argue that these seemingly contradictory findings are due to the asymmetric effects of financial shocks, which have been predicted theoretically but not taken into account empirically

It is surprisingly difficult to find economic variables that strongly co-move with exchange rates, a phenomenon codified in a large literature on “exchange rate disconnect.” We demonstrate that a variety of common proxies for global risk appetite, which did not co-move with exchange rates prior to 2007, have provided significant in-sample explanatory power for currencies since then. Furthermore, during

This paper develops and estimates a new Keynesian (NK) model with endogenous technology. It shows that introducing endogenous technology can solve three important puzzles faced by conventional NK models: the “inflation persistence”, “disinflationary news shock”, and “zero lower bound (ZLB) supply shock” puzzles. First, the observed persistence in inflation is explained without relying on the conventional

We use exogenously-assigned general practitioners to study the effects of female role models on educational outcomes of girls. Girls who are exposed to female GPs are more likely to sort into male-dominated education programs in high school, most notably STEMM. These effects persist as females enter college and select majors. The effects are larger for high-ability girls with low educated mothers,

In 1978, California adopted building codes designed to reduce the energy used for temperature control. Using a rich dataset of hourly electricity consumption for 158, 112 houses in Sacramento, we estimate that the average house built just after 1978 uses 8% to 13% less electricity for cooling than a similar house built just before 1978. Comparing the estimated savings to the policy's projected cost

This paper evaluates the effects of encouraging the selection of local politicians in India via community consensus, as opposed to a secret ballot election. Using village-level data on candidates, elected politicians, government budgets, and workfare employment, I show that incentives for consensus elections lead to politicians that are more educated but less likely to be drawn from historically marginalized

We develop a medium-size semi-structural time series model of inflation dynamics that is consistent with the view – often expressed by central banks – that three components are important: a trend anchored by long-run expectations, a Phillips curve and temporary fluctuations in energy prices. We find that a stable long-term inflation trend and a well identified steep Phillips curve are consistent with

Most criminal defendants cannot afford to hire an attorney. To provide constitutionally mandated legal services, states commonly use either private court-appointed attorneys or a public defender organization. This paper investigates the relative efficacy of these two modes of indigent defense by comparing outcomes of co-defendants assigned to different types of attorneys within the same case. Using

This paper shows the causal relationship between mutual religious association and the formation of social ties. We analyze dyadic relationships and show that joint attendance at a religious institution (RI) increases the probability of sharing information with and trusting a peer. We use a novel spatial instrumental variable strategy that combines insights from homestead inheritance institutions with

In this study, we conduct a stated-choice experiment to analyze the decision to contribute to either a front- or back-loaded tax-preferred retirement savings account. Our experimental design includes a randomized financial education intervention that provides information on the tax implications of both types of account. Respondents who were exposed to the intervention have greater knowledge of these

We study the effects of prenatal exposure to violent crime on infant health, using New York City crime records linked to mothers' addresses in birth records data. We address endogeneity of assault exposure with three strategies and find that in utero assault exposure significantly increases the incidence of adverse birth outcomes. We calculate that the annual social cost of assault during pregnancy

Job insecurity can have wide-ranging consequences outside of the labour market. A 1999 rise in the French layoff tax paid by large private firms when they laid off older workers made younger workers less secure; this insecurity reduced their fertility by 3.7 percentage points (with a 95% confidence interval between 0.7 and 6.6 percentage points). Reduced fertility is only found at the intensive margin:

Identification via heteroskedasticity exploits variance changes between regimes to identify parameters in simultaneous equations. Weak identification occurs when shock variances change very little or multiple variances change close-toproportionally, making standard inference unreliable. I propose an F-test for weak identification in a common simple version of the model. More generally, I establish

We study a dynamic game in which players compete for a prize. In a waiting game with two-sided private information about strength levels, players choose between fighting, fleeing, or waiting. Players earn a “deterrence value” on top of the prize if their opponent escapes without a battle. We show that this value is a key determinant of the type of equilibrium. For intermediate values, sorting takes

Since the Great Recession in 2007-09, U.S. real GDP has failed to return to its previously projected path, a phenomenon widely associated with secular stagnation. We investigate whether this stagnation was due to hysteresis effects from the Great Recession, a persistent negative output gap following the recession, or slower trend growth for other reasons. To do so, we develop a new Markov-switching

We introduce a new mobile money interface that permits Sri Lankans to deposit mobile airtime balances directly into a formal bank account. Randomizing access and prices, we find a small increase in savings deposits with the partner institution and formal banks more generally, but no change in overall savings. When the deposit transaction costs are completely removed, only 26 percent use the mobile

We evaluate electronic monitoring as an alternative to prison for non-violent offenses. Leveraging plausibly exogenous variation in sentencing outcomes generated by quasirandom assignment of judges, we find electronic monitoring reduces reoffending at both extensive and intensive margins. Compared with prison, electronic monitoring is estimated to reduce the probability of reoffending by 22 percentage

Applied work often studies the effect of a binary variable (“treatment”) using linear models with additive effects. I study the interpretation of the OLS estimands in such models when treatment effects are heterogeneous. I show that the treatment coefficient is a convex combination of two parameters, which under certain conditions can be interpreted as the average treatment effects on the treated and

This paper estimates the effect on innovation of increased market access facilitated by trade liberalization. We use a novel empirical design that exploits tariffcuts during the 1990s, along with detailed data on innovation among firms from 65 different countries. Our results reveal a large effect of tariff cuts on innovation as measured by patent data, suggesting that multilateral liberalization has

We present experimental evidence on the impact of the use of double-fortified salt in school-meals on anemia, cognition, and the learning outcomes of primary school children in rural Bihar, one of the poorest regions of India. We find that year-long intervention had statistically significant positive impacts on hemoglobin levels and reduced anemia by 20%, but these health gains did not translate into

This paper proposes a two-step procedure in order to identify belief shocks—shocks to expectations about the current state of the economy. First, we use the Survey of Professional Forecasters to measure nowcast errors about contemporaneous output growth. Second, we extract belief shocks from nowcast errors, once by regressing them on existing measures of structural shocks, and once by imposing sign

This paper introduces a structural model for the coevolution of networks and behavior. We characterize the equilibrium of the underlying game and adopt the Bayesian Double Metropolis-Hastings algorithm to estimate the model. We further extend the model to incorporate unobserved heterogeneity and show that ignoring unobserved heterogeneity can lead to biased estimates in simulation experiments. We apply

We document measurable, lasting gains in student achievement caused by a change in teachers' evaluation incentives. A short-lived rule created a discontinuity in teachers' incentives when allocating effort across their assigned students: students who failed an initial end-of-year test were retested a few weeks later, and then only the higher of the two scores was used when calculating the teacher's

Economists have long been intrigued by an influential literature in psychology positing that monetary pay lowers performance on enjoyable tasks by crowding out agents' intrinsic interest in them. But typical experiments in this literature do not report a full set of performance metrics, which might reveal conflicting evidence on crowding out. Further, they may suffer from confounds. To evaluate these

I leverage the staggered roll out of VAT in Pakistan to document the role of withholding mechanism in the self-enforcement of a VAT. Focusing on firms already in the tax net, I see how their outcomes respond when the tax is extended upward to intermediates used by them. I find that the upward extension of VAT, which triggers the withholding mechanism, causes an immediate and large (more than 40 log-points)

In light of the debate over inclusive education, this paper evaluates the impact of exposure to special needs (SN) peers. More classroom peers with SN lower performance, the probability of entering post-compulsory education, and income at ages 17-25. SN students and students at the lower end of the achievement distribution suffer most from higher inclusion. We analyze the effects of reallocation policies

We explore how team gender composition affects willingness to lead by randomly assigning participants in an experiment to male- or female-majority teams. Irrespective of team gender composition, men are substantially more willing than women to lead their team. The pooled sample, and women separately, are more willing to lead female- than male-majority teams. An analysis of mechanisms reveals that a

We document how demand shocks in export markets lead French multi-product exporters to re-allocate the mix of products sold in those destinations. In response to positive demand shocks, French firms skew their export sales towards their bestperforming products. We develop a theoretical model of multi-product firms and derive the specific demand conditions (with endogenous price elasticities) needed

This study assesses a new mechanism — the deposit channel — in the transmission of interest rate shock to household consumption using an administrative panel dataset of financial transactions for Turkey. Our empirical strategy exploits variation in consumer's adherence to the Muslim laws that forbid earning interest and employs a standard difference-in-difference design. Following an unanticipated