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Job Market Papers

JMP Vox presents columns based on the "Job Market Papers" of leading young scholars - the economists who are currently in contention for the world's most prestigious assistant professorships, post-doctoral posts, and entry-level research positions in the public sector.

Commentaries

  • High-income consumers and quality specialisation

    Jonathan Dingel, 21 December 2013

    The well-known Linder hypothesis (1961) posits that profitably exporting a product requires robust demand for that product in the exporter's home market. Since higher-income consumers tend to purchase higher-quality products, Linder conjectured that demand by local consumers causes high-income countries to produce and export high-quality products. In contrast, the canonical factor-abundance...

  • Migration and wage dynamics

    Joan Monras, 22 December 2013

    Despite the large inflows of immigrants experienced in a number of OECD countries, there is no consensus among economists about the causal effect of low-skilled immigration on native labour market outcomes. The reason is simple. Migrants decide when and where to go, and the implied changes in labour market outcomes determines how natives respond to immigration inflows. Overcoming this reverse...

  • Aggregate fluctuations and industry-specific shocks

    Enghin Atalay, 30 December 2013

    Most analyses of business cycles, particularly since Kydland and Prescott (1982), rely on economy-wide shocks to preferences and technologies to engender business cycle fluctuations in aggregate economic activity. Whether these economy-wide shocks have origins at a more micro level – at individual firms or industries – is a key unresolved issue in macroeconomics. Quantifying two...

  • Who benefits from corporate tax cuts?

    Owen Zidar, 30 December 2013

    State and local governments have been increasing business location incentives and cutting corporate taxes to attract businesses to their jurisdictions. For instance, Jay Inslee, the Gov. of Washington, recently passed a $9 billion corporate tax package for Boeing to retain its manufacturing base near Seattle. It is the largest corporate tax break any state has ever granted a company. The rising...

  • The geography of international financial contagion

    Damien Puy, 30 December 2013

    International financial contagion implies that countries can be affected by similar economic shocks even in the absence of common fundamentals. Since the Asian financial crisis, academics and policymakers have been eager to better understand the role played by financial intermediaries in propagating shocks across borders. Along with banks, the fund industry has attracted particular attention...

  • Management quality and the gains from trade

    Cheng Chen, 2 January 2014

    Management quality varies widely across countries and has important effects on firm performance (Bloom and Van Reenen 2007, 2010). Cross-nation differences in management quality are also associated with differences in the firm-size distribution, internal structure of firms, and aggregate productivity (Bloom et al. 2012, Hsieh and Klenow 2009, 2012). For example, firms are smaller, less...

  • Social incentives and campaign contributions

    Ricardo Perez-Truglia, 3 January 2014

    Why do individuals give to charity, vote, or contribute to political campaigns? If individuals cared only about the final outcome (e.g. the election outcome), then they should free-ride on the effort of others (Andreoni 1989). For example, a single individual should not expect that her $200 contribution would have a significant effect on a US presidential race that involves billions of dollars....

  • Transaction tax cuts as effective fiscal stimulus

    Michael Best, Henrik Kleven, 6 January 2014

    Housing wealth represents the bulk of homeowners' portfolios. Moreover the housing market is important at a macroeconomic scale, and is seen as a key link between the financial economy and the real economy. Previous work on the determinants of prices and demand in the housing market has focused primarily on the role of interest rates and other credit market conditions (Himmelberg et al. 2005,...

  • Why services exports seem crisis-proof

    Andrea Ariu, 16 January 2014

    Following the failure of Lehman Brothers in September 2008, international trade in goods collapsed by 30%. This dramatic collapse was highly synchronised across countries and mostly concentrated in the category of durable goods (Baldwin 2009). Surprisingly, international trade in services barely reacted to the crisis. Many service industries continued to grow at a brisk pace, with the only...

  • Medicaid and child mortality: New evidence

    Andrew Goodman-Bacon, 29 January 2014

    In 2011, Medicaid covered one quarter of all children and was the most common way that poor families paid for medical care (Kaiser Family Foundation 2013). Yet, almost 50 years after its implementation, evidence on Medicaid’s health effects is sparse, especially for its core population of disadvantaged children. Estimates for adults vary (Finkelstein et al. 2012, Sommers et al. 2012), but...

  • Information frictions and international trade

    Claudia Steinwender, 31 January 2014

    When it comes to global trade flows, the world is still far from flat. What kind of trade barriers explain the “missing trade” (Trefler 1995)? Economists have recognised that indirect barriers are more important than direct trade barriers (e.g. tariffs), but the precise nature of these barriers is still poorly understood (Anderson and van Wincoop 2004, Head and Mayer 2013). Recent...

  • Household debt and consumption behaviour

    Scott Ross Baker, 3 February 2014

    The presence of substantial amounts of household debt in 2007 has prompted many economists and policymakers to link debt to the depth of the recession in the following years. The possibility that higher levels of household debt induce deeper or longer recessions has important implications for both financial regulation and the size of the social safety net. More broadly, a better understanding of...

  • The illiquidity of water markets

    José-Antonio Espín-Sánchez, Javier Donna, 18 February 2014

    Seventy per cent of fresh water consumption worldwide is used for irrigation, and water is becoming increasingly scarce in regions such as India, Latin America and, more recently, the US (Barnett et al. 2005). Water markets are emerging as a solution to this scarcity (Grafton et al. 2011). Markets are generally thought to increase efficiency because there are gains from trade when users are...

  • The limits to partial banking unions

    Octavia Foarta, 19 February 2014

    A key concern of policymakers following the Eurozone banking crises has been how to design common rules for public interventions in the banking sector. Recent proposals aim at creating a banking union to complement the Eurozone monetary union, and reduce the risk of contagion generated by cross-border spillovers from bank failures (Bolton and Jeanne 2013). The presence of spillovers suggests that...

  • Switching costs and competition

    Fernando Luco, 28 February 2014

    Switching costs deter consumers from switching to alternative products and often result in high prices. As a result, they have become a concern for policymakers who worry about how well markets perform. Examples of markets in which switching costs play a significant role include health insurance (Handel 2013, Nosal 2012) and pay TV (Shcherbakov 2013). In practice, it is difficult to implement...