Frontiers of economic research

[field_auth], 26 July 2016

Today, VoxEU.org introduces a new feature – “VoxAccounts” – which is the first step towards building a more interactive community of economists interested in research-based policy analysis and commentary. The aim is to allow Vox community members to customise their interactions with the site. You join by creating a VoxAccount. Creating a VoxAccount is free, and indeed all content on VoxEU.org will remain free of charge, but we will gradually introduce features that require readers to be logged in to their VoxAccounts.

[field_auth], 22 July 2016

Econophysics is an emerging field applying theories and methods from physics to economic problems and data. This column explores the collective motions of trade and the effects of trade liberalisation, using global data from the past two decades. Econophysics methods reveal how business cycles synchronise, and how economic risk propagates throughout the global economic network. The results also highlight inherent problems of structural controllability that are induced during economic crises.

[field_auth], 21 July 2016

Ethnic favouritism is widely regarded as an African phenomenon, or at most a problem of poor and weakly institutionalised countries. This column uses data on night-time light intensity to challenge these preconceptions. Ethnic favouritism is found to be as prevalent outside of Africa as it is within, and not restricted to poor or autocratic nations either. Rather, re-election concerns appear to be an important driver of the practice.

[field_auth], 17 July 2016

Evidence of the ‘endowment effect’ – ownership of an asset changing one’s valuation of it – runs counter to standard microeconomic theory. This column uses evidence from the Indian stock market’s random allocation of shares in IPOs to show that endowment effects do occur in even outside of controlled experiments, and correlate highly with measures of market experience. This evidence suggests that agents’ inertial behaviour explains endowment effects better than standard explanations.

[field_auth], 16 July 2016

Scientific research is increasingly the product of collaborations between researchers. One driver of this trend over the last half century has been falling communication costs. This column uses data on faculty members of chemistry departments in the US to explore whether the reduction in air travel costs over the last three decades has had a similar effect on scientific collaboration. The introduction of a low-cost carrier route is associated with a 50% increase in collaborations between researchers.

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