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The Journal of The Journal of Economic Perspectives Economic Perspectives The Journal of Winter 2021, Volume 35, Number 1 Economic Perspectives Symposia Minimum Wage Alan Manning, “The Elusive Employment Effect of the Minimum Wage” Arindrajit Dube and Attila Lindner, “City Limits: What Do Local-Area Minimum Wages Do?” Jeffrey Clemens, “How Do Firms Respond to Minimum Wage Increases? Understanding the Relevance of Non-Employment Margins” Price V. Fishback and Andrew J. Seltzer, “The Rise of American Minimum Wages, 1912–1968” A journal of the Polarization in Courts American Economic Association Adam Bonica and Maya Sen, “Estimating Judicial Ideology” Daniel Hemel, “Can Structural Changes Fix the Supreme Court?” Economics of Higher Education 35, Number 1 Winter 2021 Volume David Figlio and Morton Schapiro, “Stafng the Higher Education Classroom” John Bound, Breno Braga, Gaurav Khanna, and Sarah Turner, “The Globalization of Postsecondary Education: The Role of International Students in the US Higher Education System” W. Bentley MacLeod and Miguel Urquiola, “Why Does the United States Have the Best Research Universities? Incentives, Resources, and Virtuous Circles” Articles Florian Scheuer and Joel Slemrod, “Taxing Our Wealth” Daron Acemoglu, “Melissa Dell: Winner of the 2020 Clark Medal” Recommendations for Further Reading Winter 2021 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. For President membership, subscriptions, or complimentary DAVID CARD, University of California, Berkeley Editor access to JEP articles, go to the AEA website: President-elect Heidi Williams, Stanford University http://www.aeaweb.org. Annual dues for regu- lar membership are $24.00, $34.00, or $44.00, CHRISTINA D. ROMER, University of California, Berkeley Coeditors depending on income; for an additional fee, you Vice Presidents can receive this journal, or any of the Associa- KERWIN KOFI CHARLES, Yale University Erik Hurst, University of Chicago tion’s journals, in print. Change of address no- Nina Pavcnik, Dartmouth College tice must be received at least six weeks prior to SHELLY LUNDBERG, University of California, Santa Barbara the publication month. Members Associate Editors MARTHA BAILEY, University of California, Los Angeles Copyright © 2021 by the American Eco nomic Gabriel Chodorow-Reich, Harvard University Association. Permission to make dig ital or hard SUSANTO BASU, Boston College Dora Costa, University of California, Los Angeles copies of part or all of this work for personal or SANDRA E. BLACK, Columbia University classroom use is granted without fee provided Janice Eberly, Northwestern University LISA D. COOK, Michigan State University that copies are not made or distributed for profit David Figlio, Northwestern University or direct commercial advantage and that cop- MELISSA S. KEARNEY, University of Maryland Shawn Kantor, Florida State University ies show this notice on the first page or initial EMI NAKAMURA, University of California, Berkeley screen of a display along with the full citation, in- Eliana La Ferrara, Bocconi University Ex Officio Members cluding the name of the author. Copyrights for Camille Landais, London School of Economics components of this work owned by others than BEN S. BERNANKE, The Brookings Institution Amanda Pallais, Harvard University AEA must be honored. Abstracting with credit JANET YELLEN, The Brookings Institution Nancy Rose, Massachusetts Institute of Technology is permitted. The author has the right to repub- lish, post on servers, redistribute to lists, and use Appointed Members Charlie Sprenger, University of California, San Diego any component of this work in other works. For Editor, The American Economic Review Francesco Trebbi, University of California, Berkeley others to do so requires prior specific permis- ESTHER DUFLO, Massachusetts Institute of Technology Gianluca Violante, Princeton University sion and/or a fee. Per missions may be requested from the American Economic Association, Editor, The American Economic Review: Insights Ebonya Washington, Yale University 2014 Broadway, Suite 305, Nashville, TN 37203; AMY FINKELSTEIN, Massachusetts Institute of Technology email: [email protected]. Managing Editor Editor, The Journal of Economic Literature Timothy Taylor STEVEN N. DURLAUF, University of Chicago Editor, The Journal of Economic Perspectives Assistant Managing Editor HEIDI WILLIAMS, Stanford University Alexandra Szczupak Editor, American Economic Journal: Applied Economics BENJAMIN OLKEN, Massachusetts Institute of Technology Editorial offices: Editor, American Economic Journal: Economic Policy Journal of Economic Perspectives ERZO F.P. LUTTMER, Dartmouth College American Economic Association Publications Editor, American Economic Journal: Macroeconomics 2403 Sidney St., #260 SIMON GILCHRIST, New York University Pittsburgh, PA 15203 Editor, American Economic Journal: Microeconomics email: [email protected] LEEAT YARIV, Princeton University Secretary-Treasurer The Journal of Economic Perspectives gratefully acknowledges the support of Macalester College. PETER L. ROUSSEAU, Vanderbilt University ® Registered in the US Patent and Trademark Office ( ). OTHER OFFICERS Copyright © 2021 by the American Economic Association; All Rights Reserved. Composed by American Economic Association Publications, Pittsburgh, Pennsylvania, USA. Director of AEA Publication Services Printed by LSC Communications, Owensville, Missouri, 65066, USA. ELIZABETH R. BRAUNSTEIN No responsibility for the views expressed by the authors in this journal is assumed by the editors or by Counsel the American Economic Association. LAUREN M. GAFFNEY, Bass, Berry & Sims PLC THE JOURNAL OF ECONOMIC PERSPECTIVES (ISSN 0895-3309), Winter 2021, Vol. 35, No. 1. The JEP is published quarterly (February, May, August, November) by the American Economic Association, 2014 Nashville, TN Broadway, Suite 305, Nashville, TN 37203-2418. Annual dues for regular membership are $24.00, $34.00, ADMINISTRATORS or $44.00 depending on income; for an additional $15.00, you can receive this journal in print. The journal is freely available online. 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 35 • Number 1 • Winter 2021 Symposia Minimum Wage Alan Manning, “The Elusive Employment Effect of the Minimum Wage” . 3 Arindrajit Dube and Attila Lindner, “City Limits: What Do Local-Area Minimum Wages Do?” . 27 Jeffrey Clemens, “How Do Firms Respond to Minimum Wage Increases? Understanding the Relevance of Non-Employment Margins” . 51 Price V . Fishback and Andrew J . Seltzer, “The Rise of American Minimum Wages, 1912–1968” . 73 Polarization in Courts Adam Bonica and Maya Sen, “Estimating Judicial Ideology” . 97 Daniel Hemel, “Can Structural Changes Fix the Supreme Court?” . 119 Economics of Higher Education David Figlio and Morton Schapiro, “Staffing the Higher Education Classroom” . 143 John Bound, Breno Braga, Gaurav Khanna, and Sarah Turner, “The Globalization of Postsecondary Education: The Role of International Students in the US Higher Education System” . 163 W . Bentley MacLeod and Miguel Urquiola, “Why Does the United States Have the Best Research Universities? Incentives, Resources, and Virtuous Circles” . 185 Articles Florian Scheuer and Joel Slemrod, “Taxing Our Wealth” . 207 Daron Acemoglu, “Melissa Dell: Winner of the 2020 Clark Medal” . 231 Feature Timothy Taylor, “Recommendations for Further Reading” . 249 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 insights and read- ings for classroom use; and to address issues relating to the economics profession . Articles appearing in the journal are normally solicited by the editors and associate editors . Proposals for topics and authors should be directed to the journal office, at the address inside the front cover . Policy on Data Availability It is the policy of the Journal of Economic Perspectives to publish papers only if the data used in the analysis are clearly and precisely documented and are readily available to any researcher for purposes of replication . Details of the computations sufficient to permit replication must be provided . The Editor should be notified at the time of submission if the data used in a paper are proprietary or if, for some other reason, the above requirements cannot be
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