DOCSLIB.ORG

Economic Perspectives

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text

Load more

The Journal of The Journal of Economic Perspectives Economic Perspectives The Journal of Spring 2017, Volume 31, Number 2 Economic Perspectives Symposia Recent Ideas in Econometrics Susan Athey and Guido W. Imbens, “The State of Applied Econometrics: Causality and Policy Evaluation” Hamish Low and Costas Meghir, “The Use of Structural Models in Econometrics” James H. Stock and Mark W. Watson, “Twenty Years of Time Series Econometrics in Ten Pictures” Sendhil Mullainathan and Jann Spiess, “Machine Learning: An Applied Econometric Approach” James L. Powell, “Identication and Asymptotic Approximations: A journal of the Three Examples of Progress in Econometric Theory” American Economic Association Joshua D. Angrist and Jörn-Steffen Pischke, “Undergraduate Econometrics Instruction: Through Our Classes, Darkly” Spring 2017 Volume 31, Number 2 Spring 2017 Volume Are Measures of Economic Growth Biased? Martin Feldstein, “Underestimating the Real Growth of GDP, Personal Income, and Productivity” Chad Syverson, “Challenges to Mismeasurement Explanations for the US Productivity Slowdown” Erica L. Groshen, Brian C. Moyer, Ana M. Aizcorbe, Ralph Bradley, and David Friedman, “How Government Statistics Adjust for Potential Biases from Quality Change and New Goods in an Age of Digital Technologies: A View from the Trenches” Articles Hunt Allcott and Matthew Gentzkow, “Social Media and Fake News in the 2016 Election” Susan Athey and Andrzej Skrzypacz, “Yuliy Sannikov: Winner of the 2016 Clark Medal” Recommendations for Further Reading Spring 2017 The American Economic Association The Journal of Correspondence relating to advertising, busi- Founded in 1885 ness matters, permission to quote, or change Economic Perspectives of address should be sent to the AEA business EXECUTIVE COMMITTEE office: [email protected]. Street ad- Elected Officers and Members A journal of the American Economic Association dress: American Economic Association, 2014 Broadway, Suite 305, Nashville, TN 37203. President For membership, subscriptions, or compli- ALVIN E. ROTH, Stanford University Editor mentary JEP for your e-reader, go to the AEA President-elect website: http://www.aeaweb.org. Annual Enrico Moretti, University of California at Berkeley OLIVIER BLANCHARD, Peterson Institute for dues for regular membership are $20.00, $30.00, or $40.00, depending on income; for International Economics Coeditors an additional fee, you can receive this jour- Vice Presidents Gordon Hanson, University of California at San Diego nal, or any of the Association’s journals, in ALAN B. KRUEGER, Princeton University Mark Gertler, New York University print. Change of address notice must be re- VALERIE A. RAMEY, University of California at San Diego ceived at least six weeks prior to the publica- tion month. Members Associate Editors DAVID H. AUTOR, Massachusetts Institute of Technology Anat Admati, Stanford University Copyright © 2017 by the American Eco nomic RACHEL E. KRANTON, Duke University Association. Permission to make dig ital or JOHN Y. CAMPBELL, Harvard University Nicholas Bloom, Stanford University hard copies of part or all of this work for per- HILARY HOYNES, University of California at Berkeley Dora Costa, University of California at Los Angeles sonal or classroom use is granted without fee Amy Finkelstein, Massachusetts Institute of Technology provided that copies are not made or distrib- NICHOLAS BLOOM, Stanford University ERICA FIELD, Duke University Seema Jayachandran, Northwestern University uted for profit or direct commercial advan- tage and that copies show this notice on the Ex Officio Members Guido Lorenzoni, Northwestern University first page or initial screen of a display along RICHARD H. THALER, University of Chicago with the full citation, including the name of Emi Nakamura, Columbia University ROBERT J. SHILLER, Yale University Valerie Ramey, University of California at San Diego the author. Copyrights for components of this work owned by others than AEA must be Appointed Members Scott Stern, Massachusetts Institute of Technology honored. Abstracting with credit is permit- Betsey Stevenson, University of Michigan ted. The author has the right to republish, Editor, The American Economic Review ESTHER DUFLO, Massachusetts Institute of Technology Ebonya Washington, Yale University post on servers, redistribute to lists, and use any component of this work in other works. Editor, The Journal of Economic Literature Catherine Wolfram, University of California For others to do so requires prior specific per- STEVEN N. DURLAUF, University of Wisconsin mission and/or a fee. Per missions may be re- Editor, The Journal of Economic Perspectives Managing Editor quested from the American Economic Asso- ciation, 2014 Broadway, Suite 305, Nashville, ENRICO MORETTI, University of California at Berkeley Timothy Taylor TN 37203; e-mail: [email protected]. Editor, American Economic Journal: Applied Economics Assistant Editor ALEXANDRE MAS, Princeton University Ann Norman Editor, American Economic Journal: Economic Policy MATTHEW D. SHAPIRO, University of Michigan Editor, American Economic Journal: Macroeconomics Editorial offices: RICHARD ROGERSON, Princeton University Journal of Economic Perspectives Editor, American Economic Journal: Microeconomics American Economic Association Publications JOHANNES HÖRNER, Yale University 2403 Sidney St., #260 Secretary-Treasurer Pittsburgh, PA 15203 PETER L. ROUSSEAU, Vanderbilt University email: [email protected] OTHER OFFICERS Editor, Resources for Economists The Journal of Economic Perspectives gratefully acknowledges the support of Macalester College. WILLIAM GOFFE, Pennsylvania State University Registered in the US Patent and Trademark Office (®). Director of AEA Publication Services Copyright © 2017 by the American Economic Association; All Rights Reserved. JANE EMILY VOROS, Pittsburgh Composed by American Economic Association Publications, Pittsburgh, Pennsylvania, USA. Managing Director of EconLit Product Design and Content Printed by LSC Communications, Owensville, Missouri, 65066, USA. STEVEN L. HUSTED, University of Pittsburgh No responsibility for the views expressed by the authors in this journal is assumed by the editors or by the American Economic Association. Counsel THE JOURNAL OF ECONOMIC PERSPECTIVES (ISSN 0895-3309), Spring 2017, Vol. 31, No. 2. The JEP TERRY CALVANI, Freshfields Bruckhaus Deringer LLP is published quarterly (February, May, August, November) by the American Economic Association, 2014 Washington, DC Broadway, Suite 305, Nashville, TN 37203-2418. Annual dues for regular membership are $20.00, $30.00, or $40.00 depending on income; for an additional $15.00, you can receive this journal in print. E-reader ADMINISTRATORS versions are free. For details and further information on the AEA go to https://www.aeaweb.org/. Director of Finance and Administration Periodicals postage paid at Nashville, TN, and at additional mailing offices. BARBARA H. FISER POSTMASTER: Send address changes to the Journal of Economic Perspectives, 2014 Broadway, Suite 305, Convention Manager Nashville, TN 37203. Printed in the U.S.A. GWYN LOFTIS The Journal of Economic Perspectives Contents Volume 31 • Number 2 • Spring 2017 Symposia Recent Ideas in Econometrics Susan Athey and Guido W. Imbens, “The State of Applied Econometrics: Causality and Policy Evaluation” ................................3 Hamish Low and Costas Meghir, “The Use of Structural Models in Econometrics” ..............................................33 James H. Stock and Mark W. Watson, “Twenty Years of Time Series Econometrics in Ten Pictures” .............................................59 Sendhil Mullainathan and Jann Spiess, “Machine Learning: An Applied Econometric Approach”. .87 James L. Powell, “Identification and Asymptotic Approximations: Three Examples of Progress in Econometric Theory” .................. 107 Joshua D. Angrist and Jörn-Steffen Pischke, “Undergraduate Econometrics Instruction: Through Our Classes, Darkly” ..................... 125 Are Measures of Economic Growth Biased? Martin Feldstein, “Underestimating the Real Growth of GDP, Personal Income, and Productivity” ........................................... 145 Chad Syverson, “Challenges to Mismeasurement Explanations for the US Productivity Slowdown” ...................................... 165 Erica L. Groshen, Brian C. Moyer, Ana M. Aizcorbe, Ralph Bradley, and David M. Friedman, “How Government Statistics Adjust for Potential Biases from Quality Change and New Goods in an Age of Digital Technologies: A View from the Trenches” ....................... 187 Articles Hunt Allcott and Matthew Gentzkow, “Social Media and Fake News in the 2016 Election” ............................................. 211 Susan Athey and Andrzej Skrzypacz, “Yuliy Sannikov: Winner of the 2016 Clark Medal” .............................................. 237 Features Timothy Taylor, “Recommendations for Further Reading” ................... 257 Statement of Purpose The Journal of Economic Perspectives attempts to fill a gap between the general interest press and most other academic economics journals. The journal aims to publish articles that will serve several goals: to synthesize and integrate lessons learned from active lines of economic research; to provide economic analysis of public policy issues; to encourage cross-fertilization of ideas among the fields of economics; to offer readers an accessible source for state-of-the-art economic thinking; to suggest directions for future research; to provide
Recommended publications
  • Artificial Intelligence, Automation, and Work

    Artificial Intelligence, Automation, and Work

    Artificial Intelligence, Automation, and Work The Economics of Artifi cial Intelligence National Bureau of Economic Research Conference Report The Economics of Artifi cial Intelligence: An Agenda Edited by Ajay Agrawal, Joshua Gans, and Avi Goldfarb The University of Chicago Press Chicago and London The University of Chicago Press, Chicago 60637 The University of Chicago Press, Ltd., London © 2019 by the National Bureau of Economic Research, Inc. All rights reserved. No part of this book may be used or reproduced in any manner whatsoever without written permission, except in the case of brief quotations in critical articles and reviews. For more information, contact the University of Chicago Press, 1427 E. 60th St., Chicago, IL 60637. Published 2019 Printed in the United States of America 28 27 26 25 24 23 22 21 20 19 1 2 3 4 5 ISBN-13: 978-0-226-61333-8 (cloth) ISBN-13: 978-0-226-61347-5 (e-book) DOI: https:// doi .org / 10 .7208 / chicago / 9780226613475 .001 .0001 Library of Congress Cataloging-in-Publication Data Names: Agrawal, Ajay, editor. | Gans, Joshua, 1968– editor. | Goldfarb, Avi, editor. Title: The economics of artifi cial intelligence : an agenda / Ajay Agrawal, Joshua Gans, and Avi Goldfarb, editors. Other titles: National Bureau of Economic Research conference report. Description: Chicago ; London : The University of Chicago Press, 2019. | Series: National Bureau of Economic Research conference report | Includes bibliographical references and index. Identifi ers: LCCN 2018037552 | ISBN 9780226613338 (cloth : alk. paper) | ISBN 9780226613475 (ebook) Subjects: LCSH: Artifi cial intelligence—Economic aspects. Classifi cation: LCC TA347.A78 E365 2019 | DDC 338.4/ 70063—dc23 LC record available at https:// lccn .loc .gov / 2018037552 ♾ This paper meets the requirements of ANSI/ NISO Z39.48-1992 (Permanence of Paper).
  • Historical Evidence from US Newspapers Matthew Gentzkow, Jesse M

    Historical Evidence from US Newspapers Matthew Gentzkow, Jesse M

    NBER WORKING PAPER SERIES COMPETITION AND IDEOLOGICAL DIVERSITY: HISTORICAL EVIDENCE FROM US NEWSPAPERS Matthew Gentzkow Jesse M. Shapiro Michael Sinkinson Working Paper 18234 http://www.nber.org/papers/w18234 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 July 2012 We are grateful to Alan Bester, Ambarish Chandra, Tim Conley, Christian Hansen, Igal Hendel, Caroline Hoxby, Jon Levin, Kevin Murphy, Andrei Shleifer, E. Glen Weyl, and numerous seminar participants for advice and suggestions, and to our dedicated research assistants for important contributions to this project. This research was funded in part by the Initiative on Global Markets, the George J. Stigler Center for the Study of the Economy and the State, the Ewing Marion Kauffman Foundation, the Centel Foundation/Robert P. Reuss Faculty Research Fund, the Neubauer Family Foundation and the Kathryn C. Gould Research Fund, all at the University of Chicago Booth School of Business, the Social Sciences and Humanities Research Council of Canada, and the National Science Foundation. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer- reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2012 by Matthew Gentzkow, Jesse M. Shapiro, and Michael Sinkinson. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. Competition and Ideological Diversity: Historical Evidence from US Newspapers Matthew Gentzkow, Jesse M.
  • Fintech, Racial Equity, and an Inclusive Financial System

    Fintech, Racial Equity, and an Inclusive Financial System

    Volume 15 , Issue 2, Summer 2021 Community Development INNOVATION REVIEW Fintech, Racial Equity, and an Inclusive Financial System Community Development INNOVATION REVIEW The Community Development Innovation Review focuses on bridging the gap between theory and practice, from as many viewpoints as possible. The goal of this journal is to promote cross-sector dialogue around a range of emerging issues and related investments that advance economic resilience and mobility for low- and moderate-income communities. For submission guidelines and themes of upcoming issues, or other inquiries and subscription requests, contact [email protected]. The material herein may not represent the views of the Federal Reserve Bank of San Francisco or the Federal Reserve System. Community Development Innovation Review Issue Editorial Team Bina Patel Shrimali Co-Editor Rocio Sanchez-Moyano Co-Editor Kaitlin Asrow Guest Issue Editor Sean Creehan Guest Issue Editor Genevieve Melford Guest Issue Editor Tim Shaw Guest Issue Editor Mackenzie Wallace Guest Issue Editor Federal Reserve Bank of San Francisco. 2021. “Fintech, Racial Equity, and an Inclusive Financial System,” Federal Reserve Bank of San Francisco Community Development Innovation Review 2021-2. Available at https://doi.org/10.24148/cdir2021-02 Table of Contents Foreword ...........................................................................................................................................................5 Laura Choi, Federal Reserve Bank of San Francisco Ida
  • Nber Working Paper Series Accounting for Incomplete

    Nber Working Paper Series Accounting for Incomplete

    NBER WORKING PAPER SERIES ACCOUNTING FOR INCOMPLETE PASS-THROUGH Emi Nakamura Dawit Zerom Working Paper 15255 http://www.nber.org/papers/w15255 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 August 2009 We would like to thank Ariel Pakes and Kenneth Rogoff for invaluable advice and encouragement. We are grateful to Dan Ackerberg, Hafedh Bouakez, Ariel Burstein, Ulrich Dorazelski, Tim Erickson, Gita Gopinath, Penny Goldberg, Joseph Harrington, Rebecca Hellerstein, Elhanan Helpman, David Laibson, Ephraim Leibtag, Julie Mortimer, Alice Nakamura, Serena Ng, Roberto Rigobon, Julio Rotemberg, Jón Steinsson, Martin Uribe and seminar participants at various institutions for helpful comments and suggestions. This paper draws heavily on Chapter 2 of Nakamura's Harvard University Ph.D. thesis. This research was funded in part by a collaborative research grant from the US Department of Agriculture and the computational methods in this paper also draw on a working paper by Nakamura and Zerom entitled "Price Rigidity, Price Adjustment and Demand in the Coffee Industry.'' Corresponding author: Emi Nakamura at [email protected]. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer- reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2009 by Emi Nakamura and Dawit Zerom. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source.
  • Emi Nakamura Recipient of the 2014 Elaine Bennett Research Prize

    Emi Nakamura Recipient of the 2014 Elaine Bennett Research Prize

    Emi Nakamura Recipient of the 2014 Elaine Bennett Research Prize EMI NAKAMURA, Associate Professor of Business and Economics at Columbia University, is the recipient of the 2014 Elaine Bennett Research Prize. Established in 1998 by the American Economic Association’s (AEA) Committee on the Status of Women in the Economics Profession (CSWEP), the Elaine Bennett Research Prize recognizes and honors outstanding research in any field of economics by a woman not more than seven years beyond her Ph.D. Professor Nakamura will formally accept the Bennett Prize at the CSWEP Business Meeting and Luncheon held during the 2015 AEA Meeting in Boston, MA. The event is scheduled for 12:30-2:15PM on January 3, 2015 at the Sheraton Boston. Emi Nakamura’s distinctive approach tackles important research questions with serious and painstaking data work. Her groundbreaking paper “Five Facts about Prices: A Reevaluation of Menu Cost Models” (Steinsson, Jón and Emi Nakamura. 2008. Quarterly Journal of Economics, 123:4, 1415-1464) is based on extensive analysis of individual price data. She finds that, once temporary sales are properly taken into account, prices exhibit a high degree of rigidity consistent with Keynesian theories of business cycles and that prior evidence overstated the degree of price flexibility in the economy. Dr. Nakamura’s work on fiscal stimulus combines a novel cross-section approach to identifying parameters with a careful interpretation of business cycle theory to shed new light on crucial questions in macroeconomics. Her findings imply that government spending can provide a powerful stimulus to the economy at times when monetary policy is unresponsive, e.g.
  • Econ 244: Market Failures and Public Policy

    Econ 244: Market Failures and Public Policy

    Econ 244: Market Failures and Public Policy Liran Einav and Heidi Williams Winter 2021 Mondays and Wednesdays, 11:30 AM{1:20 PM Course overview. This course will cover selected topics in applied microeconomics, namely insurance and credit markets (aka \selection markets"), markets for innovation, and healthcare markets. The common theme (as the course name suggests) is that in all three contexts there are good a priori reasons to be concerned about potential market failures, suggesting that some type of government intervention or regulation may be critical for achieving efficient market outcomes. These three markets are also particularly useful in illustrating the connection and interplay between economic research and public policy. The focus of the course will be on topics, not methods, and will therefore cater to a broad set of students { especially those with interests in applied microeconomics, broadly defined. While, formally, this class is not attached to any of the second-year sequences, it should be particularly complementary to the second-year sequences in IO and public economics. In addition to discussing existing work and bringing students closer to the research frontier, the course will emphasize areas of inquiry where additional research is feasible and warranted, thus hopefully generating possible leads for second-year research papers. Course logistics. The class meets regularly on Mondays and Wednesdays, 11:30am{1:20pm. There is no class on January 18 (MLK Jr. Day) nor February 15 (Presidents' Day). We will be using Canvas to post material and send announcements. A tentative list of lectures is below. Starred papers on the reading list are those we expect to discuss in detail in class.
  • The Open Chromatin Landscape of Non–Small Cell Lung Carcinoma

    The Open Chromatin Landscape of Non–Small Cell Lung Carcinoma

    Published OnlineFirst June 17, 2019; DOI: 10.1158/0008-5472.CAN-18-3663 Cancer Genome and Epigenome Research The Open Chromatin Landscape of Non–Small Cell Lung Carcinoma Zhoufeng Wang1, Kailing Tu2, Lin Xia2, Kai Luo2,Wenxin Luo1, Jie Tang2, Keying Lu2, Xinlei Hu2, Yijing He2, Wenliang Qiao3, Yongzhao Zhou1, Jun Zhang2, Feng Cao2, Shuiping Dai1, Panwen Tian1, Ye Wang1, Lunxu Liu4, Guowei Che4, Qinghua Zhou3, Dan Xie2, and Weimin Li1 Abstract Non–small cell lung carcinoma (NSCLC) is a major cancer identified 21 joint-quantitative trait loci (joint-QTL) that type whose epigenetic alteration remains unclear. We ana- correlated to both assay for transposase accessible chroma- lyzed open chromatin data with matched whole-genome tin sequencing peak intensity and gene expression levels. sequencing and RNA-seq data of 50 primary NSCLC cases. Finally, we identified 87 regulatory risk loci associated with We observed high interpatient heterogeneity of open chro- lung cancer–related phenotypes by intersecting the QTLs matin profiles and the degree of heterogeneity correlated to with genome-wide association study significant loci. In several clinical parameters. Lung adenocarcinoma and lung summary, this compendium of multiomics data provides squamous cell carcinoma (LUSC) exhibited distinct open valuable insights and a resource to understand the land- chromatin patterns. Beyond this, we uncovered that the scape of open chromatin features and regulatory networks broadest open chromatin peaks indicated key NSCLC genes in NSCLC. and led to less stable expression. Furthermore, we found that the open chromatin peaks were gained or lost together Significance: This study utilizes state of the art genomic with somatic copy number alterations and affected the methods to differentiate lung cancer subtypes.
  • Preschool Television Viewing and Adolescent Test Scores: Historical Evidence from the Coleman Study

    Preschool Television Viewing and Adolescent Test Scores: Historical Evidence from the Coleman Study

    PRESCHOOL TELEVISION VIEWING AND ADOLESCENT TEST SCORES: HISTORICAL EVIDENCE FROM THE COLEMAN STUDY MATTHEW GENTZKOW AND JESSE M. SHAPIRO We use heterogeneity in the timing of television’s introduction to different local markets to identify the effect of preschool television exposure on standardized test scores during adolescence. Our preferred point estimate indicates that an additional year of preschool television exposure raises average adolescent test scores by about 0.02 standard deviations. We are able to reject negative effects larger than about 0.03 standard deviations per year of television exposure. For reading and general knowledge scores, the positive effects we find are marginally statistically significant, and these effects are largest for children from households where English is not the primary language, for children whose mothers have less than a high school education, and for nonwhite children. I. INTRODUCTION Television has attracted young viewers since broadcasting be- gan in the 1940s. Concerns about its effects on the cognitive devel- opment of young children emerged almost immediately and have been fueled by academic research showing a negative association between early-childhood television viewing and later academic achievement.1 These findings have contributed to a belief among the vast majority of pediatricians that television has “negative effects on brain development” of children below age five (Gentile et al. 2004). They have also provided partial motivation for re- cent recommendations that preschool children’s television view- ing time be severely restricted (American Academy of Pediatrics 2001). According to a widely cited report on media use by young * We are grateful to Dominic Brewer, John Collins, Ronald Ehrenberg, Eric Hanushek, and Mary Morris (at ICPSR) for assistance with Coleman study data, and to Christopher Berry for supplying data on school quality.
  • Fan Chart – a Tool for NBP’S Monetary Policy Making

    Fan Chart – a Tool for NBP’S Monetary Policy Making

    NBP Working Paper No. 241 Fan chart – a tool for NBP’s monetary policy making Paweł Pońsko, Bartosz Rybaczyk NBP Working Paper No. 241 Fan chart – a tool for NBP’s monetary policy making Paweł Pońsko, Bartosz Rybaczyk Economic Institute Warsaw, 2016 Paweł Pońsko – Economic Institute, NBP and Warsaw School of Economics; [email protected] Bartosz Rybaczyk – Economic Institute, NBP; [email protected] Published by: Narodowy Bank Polski Education & Publishing Department ul. Świętokrzyska 11/21 00-919 Warszawa, Poland phone +48 22 185 23 35 www.nbp.pl ISSN 2084-624X © Copyright Narodowy Bank Polski, 2016 Contents Introduction 5 The process 9 The choice of probability distribution 11 The central path of projection 14 Prediction uncertainty 15 Prediction asymmetry 17 Probability intervals 18 Yearly data 20 The fan chart procedure 21 An illustration 23 10.1 Scaling Factors 25 10.2 Ex-post forecasting errors of the endogenous variables 25 10.3 Corrected exogenous errors 26 10.4 Pure forecasting error 26 10.5 The asymmetry of the fan chart 27 Fan chart decomposition 30 References 32 Appendix A. The two-piece normal distribution and its properties 34 Appendix B. Determining the triple 36 Appendix C. Highest probability density regions 37 Appendix D. Variance estimations 38 NBP Working Paper No. 241 3 Abstract Abstract Introduction In this note we describe, in substantial detail, the methodology behind the Narodowy Bank Polski (NBP) is, by its mandate, an inflation-targeting central construction of NBP’s fan chart. This note is meant to help the readers interpret bank. However, monetary policy decisions rest on the shoulders of the Monetary information contained in the mid-term projection, understand the differences in the Policy Council (MPC) members, who make up an independent body of experts.1 predicted uncertainty between the projection rounds, and the usefulness of the Hence, the NBP staff role is to support the MPC with expertise without influencing projection for the monetary policy conduct.
  • Estimating Welfare in Insurance Markets Using Variation in Prices∗

    Estimating Welfare in Insurance Markets Using Variation in Prices∗

    THE QUARTERLY JOURNAL OF ECONOMICS Vol. CXXV August 2010 Issue 3 ESTIMATING WELFARE IN INSURANCE MARKETS USING VARIATION IN PRICES∗ LIRAN EINAV AMY FINKELSTEIN MARK R. CULLEN We provide a graphical illustration of how standard consumer and producer theory can be used to quantify the welfare loss associated with inefficient pricing in insurance markets with selection. We then show how this welfare loss can be estimated empirically using identifying variation in the price of insurance. Such variation, together with quantity data, allows us to estimate the demand for insurance. The same variation, together with cost data, allows us to estimate how insurers’ costs vary as market participants endogenously respond to price. The slope of this estimated cost curve provides a direct test for both the existence and the nature of selection, and the combination of demand and cost curves can be used to estimate welfare. We illustrate our approach by applying it to data on employer- provided health insurance from one specific company. We detect adverse selection but estimate that the quantitative welfare implications associated with inefficient pricing in our particular application are small, in both absolute and relative terms. ∗We are grateful to Felicia Bayer, Brenda Barlek, Chance Cassidy, Fran Filpovits, Frank Patrick, and Mike Williams for innumerable conversations ex- plaining the institutional environment of Alcoa, to Colleen Barry, Susan Busch, Linda Cantley, Deron Galusha, James Hill, Sally Vegso, and especially Marty Slade for providing and explaining the data, to Tatyana Deryugina, Sean Klein, Dan Sacks, and James Wang for outstanding research assistance, and to Larry Katz (the Editor), three anonymous referees, Kate Bundorf, Raj Chetty, Peter Dia- mond, Hanming Fang, David Laibson, Jonathan Levin, Erzo Luttmer, Jim Poterba, Dan Silverman, Jonathan Skinner, and numerous seminar participants for help- ful comments.
  • Chi-Squared Tests of Interval and Density Forecasts, and the Bank of England’S Fan Charts

    Chi-Squared Tests of Interval and Density Forecasts, and the Bank of England’S Fan Charts

    EUROPEAN CENTRAL BANK WORKING PAPER SERIES ECB EZB EKT BCE EKP WORKING PAPER NO. 83 CHI-SQUARED TESTS OF INTERVAL AND DENSITY FORECASTS, AND THE BANK OF ENGLAND’S FAN CHARTS BY KENNETH F. WALLIS November 2001 EUROPEAN CENTRAL BANK WORKING PAPER SERIES WORKING PAPER NO. 83 CHI-SQUARED TESTS OF INTERVAL AND DENSITY FORECASTS, AND THE BANK OF ENGLAND’S FAN CHARTS BY KENNETH F. WALLIS* November 2001 * Acknowledgement The first version of this paper was written during a period of study leave granted by the University of Warwick and spent at the Economic Research Department, Reserve Bank of Australia and the Economics Program RSSS, Australian National University; the support of these institutions is gratefully acknowledged. This paper has been presented at the ECB workshop on ‘Forecasting Techniques’, September 2001. © European Central Bank, 2001 Address Kaiserstrasse 29 D-60311 Frankfurt am Main Germany Postal address Postfach 16 03 19 D-60066 Frankfurt am Main Germany Telephone +49 69 1344 0 Internet http://www.ecb.int Fax +49 69 1344 6000 Telex 411 144 ecb d All rights reserved. Reproduction for educational and non-commercial purposes is permitted provided that the source is acknowledged. The views expressed in this paper are those of the authors and do not necessarily reflect those of the European Central Bank. ISSN 1561-0810 Contents Abstract 4 1 Introduction 5 2 Unconditional coverage and goodness-of-fit tests 8 3 Tests of independence 10 4 Joint tests of coverage and independence 14 5 Bank of England fan chart forecasts 15 6 Conclusion 19 References 21 Tables and Figures 22 European Central Bank Working Paper Series 27 ECB • Working Paper No 83 • November 2001 3 Abstract This paper reviews recently proposed likelihood ratio tests of goodness-of-fit and independence of interval forecasts.
  • A Dozen MIT Faculty and Alumni Who Are Shaping the Future of Economics

    A Dozen MIT Faculty and Alumni Who Are Shaping the Future of Economics

    24/9/2014 MIT Spectrum | Continuum | A Dozen MIT Faculty and Alumni Who Are Shaping the Future of Economics A DOZEN MIT FACULTY AND ALUMNI WHO ARE SHAPING THE FUTURE OF ECONOMICS September 23rd, 2014 MIT Sloan professor Kristin Forbes PhD ’98 is one of three economists on the IMF’s “Generation Next” list to be both MIT alumnus and faculty member. The International Monetary Fund (IMF) has populated nearly half its “Generation Next” list—which celebrates 25 economists under the age of 45—with MIT faculty and alumni. In some cases, the featured economists are both: Esther Duflo PhD ’99, Amy Finkelstein PhD ’01, and Kristin Forbes PhD ’98 all hold endowed chairs in MIT’s Department of Economics. The 12 scholars listed below study poverty and health care, education and real estate, crime and taxes. What they have in common is that the international finance community deems them “economists to keep an eye on” for the way they are shaping global thought—and that they’ve spent time honing their ideas on MIT’s campus. Melissa Dell PhD ’12, a Harvard assistant professor who at age 31 ties as the youngest on the IMF’s list, has studied how government crackdowns on drug violence can influence economic outcomes. Her most recent publication, whose coauthors include MIT’s Benjamin Olken, looks at the economic effects of climate. Esther Duflo PhD ’99 is MIT’s Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics, and a founder and director of the Abdul Latif Jameel Poverty Action Lab (J-PAL).