Ten Years of Relational Power: The Long-Run Effects of Teaching Negotiation Skills to Adolescent Girls (Forthcoming Article) - We evaluate the effects of teaching negotiation skills to adolescent girls in economically vulnerable communities in Lusaka, Zambia ten years later. Treated participants complete 0.23 more years of education. Consistent with greater relational empowerment, they also begin sexual activity later, have smaller age gaps with their husbands, and express less traditional gender attitudes. Using a surrogate approach, social benefits and costs from increased education alone suggest the intervention generated 7.6 dollars for every dollar spent and had a very high marginal value of public funds of 10.5.

Forthcoming in AER: Insights: "Ten Years of Relational Power: The Long-Run Effects of Teaching Negotiation Skills to Adolescent Girls" by Nava Ashraf, Natalie Bau, Corinne Low, and Xiaoyue Shan.

Professional Motivations in the Public Sector: Evidence from Police Officers (Forthcoming Article) - We study how public sector workers balance their professional motivations with private economic concerns, focusing on police arrests. Arrests made near the end of an officer's shift typically require overtime work, and officers respond by reducing arrest frequency but increasing arrest quality. Days in which an officer works a second job after their police shift have higher opportunity cost, also reducing late-shift arrests. Combining our estimates in a dynamic model identifies officer preferences over workplace activity and overtime work. Our results indicate that officers' private costs of arrests have a first-order impact on the quantity and quality of enforcement.

Forthcoming in the AER: "Professional Motivations in the Public Sector: Evidence from Police Officers" by Aaron Chalfin and Felipe Goncalves.

Long-Distance Trade and Long-Term Persistence (Forthcoming Article) - Do changes in the location of trading opportunities cause changes in the location of economic activity? I explore this question using a lifting of restrictions on trade across the Spanish Empire in the 18th century. I combine a difference-in-differences approach with a dynamic spatial model to examine this issue. I find that the reform improved market integration and induced urban growth, but had a smaller effect in locations with larger internal markets. The findings suggest that the location of economic activity adapts to changes in the location of trading opportunities, but persists when these changes are preceded by urban growth.

Forthcoming in AEJ: Macroeconomics: "Long-Distance Trade and Long-Term Persistence" by Sebastian Ellingsen.

Navigating the "Problem from Hell": A Guide to Climate Damages (Forthcoming Article) - Multiple lines of research aim to quantify the economic impacts of climate change. We show that the effects of climate change on economic activity depend on how climate change alters weather across time and space. Changes in contemporary weather have direct effects on output; changes in past weather and in expectations of future weather induce adaptation; and changes in weather elsewhere around the globe introduce a general equilibrium effect. Using this framework, we argue that estimation of climate impacts faces a trilemma. A methodology can have at most two of: (i) robustness to a particular economic model’s structure, (ii) interpretation as effects of persistent, widespread, anticipated climate change, and (iii) quasi-experimental identification. We summarize the literature on climate damages in light of the trilemma. A solid body of knowledge has developed around direct effects, and recent work has made substantial progress towards understanding adaptation and spatial spillovers.

Forthcoming in the JEL: "Navigating the 'Problem from Hell': A Guide to Climate Damages" by Derek Lemoine, Catherine Hausman, and Jeffrey G. Shrader.

Learning in the Marriage Market: The Economics of Dating (Forthcoming Article) - This paper develops a search-and-matching model where potential partners can learn about their compatibility as a couple by spending time together (interpreted as dating). We show that a steady-state equilibrium exists and characterize its induced dating patterns. In equilibrium, highly attractive individuals are more selective. We derive conditions under which equilibria induce positive assortative matching, and show that even when these conditions hold, the socially optimal outcome can exhibit negative assortative matching. Finally, the framework is applied to study the effect of recent advances in search technologies on dating patterns and the connection between dating and interracial segregation.

Forthcoming in AEJ: Microeconomics: "Learning in the Marriage Market: The Economics of Dating" by Yair Antler, Daniel Bird, and Daniel Fershtman.

Wage Adjustment in Efficient Long-Term Employment Relationships (Forthcoming Article) - We present a model in which efficient long-term employment relationships are sustained by wage adjustments prompted by productivity shocks and outside job offers. These wage adjustments occur only sporadically, due to the presence of renegotiation costs. The model is amenable to analytical solution, yielding new insights for several labor market phenomena, including: (1) key features of empirical distributions of changes in pay among job stayers; (2) a near-“memorylessness” property in wage dynamics whereby hiring wages have only limited influence on later wages and allocation decisions; and (3) a crucial role for recruitment and retention bonuses in sustaining efficient employment relationships.

Forthcoming in AEJ: Macroeconomics: "Wage Adjustment in Efficient Long-Term Employment Relationships" by Michael W. L. Elsby, Axel Gottfries, Pawel Krolikowski, and Gary Solon.

An Introduction to Double/Debiased Machine Learning (Forthcoming Article) - This paper provides an introduction to Double/Debiased Machine Learning (DML). DML is a general approach to performing inference about a target parameter in the presence of nuisance functions: objects that are needed to identify the target parameter but are not of primary interest. Nuisance functions arise naturally in many settings, such as when controlling for confounding variables or leveraging instruments. The paper describes two biases that arise from nuisance function estimation and explains how DML alleviates these biases. Consequently, DML allows the use of flexible methods, including machine learning tools, for estimating nuisance functions, reducing the dependence on auxiliary functional form assumptions and enabling the use of complex non-tabular data, such as text or images. We illustrate the application of DML through simulations and empirical examples. We conclude with a discussion of recommended practices. A companion website includes additional examples and references to other resources.

Forthcoming in the JEL: "An Introduction to Double/Debiased Machine Learning" by Achim Ahrens, Victor Chernozhukov, Christian Hansen, Damian Kozbur, Mark E. Schaffer, and Thomas Wiemann.

Strategic Limit Orders and Intertemporal Price Dispersion (Forthcoming Article) - We study a two-period commodity market with competitive consumers and Cournot sellers. Without speculation, equilibrium is stationary. A storage-capable, strategically large speculator can profitably create deterministic intertemporal price dispersion using standard order types. A period-1 limit buy order flattens residual demand, induces higher output, and yields a low purchase price. With mandatory liquidation, resale remains below the no-speculation price but above the purchase price, so the speculator profits; consumers gain and sellers lose. With free disposal and a stop-loss, the period-2 price can exceed the benchmark, benefiting sellers but harming consumers.

Forthcoming in AEJ: Microeconomics: "Strategic Limit Orders and Intertemporal Price Dispersion" by Suman Banerjee, Ravi Jagannathan, and Kai Wang.

Reputation and Competitive Selection (Forthcoming Article) - We demonstrate how selection in competitive markets can impede longrun reputational incentives. In our model, competent firms can exert costly effort to improve expected product quality, but inept firms cannot. With low entry barriers, we show competent firms cannot persistently exert effort, despite bounded memory. Such effort would cause consumers to select firms based on reputations for competence, eventually selecting a monopolist with arbitrarily high reputation, which has no incentive for effort. More generally, reputation-based selection rules out long-run effort, which then undermines the basis for such selection. Intermediate entry barriers provide stronger reputational incentives than low or high barriers.

Forthcoming in AEJ: Microeconomics: "Reputation and Competitive Selection" by Joyee Deb and Jack Fanning.

Bonus Question: How Does Flexible Incentive Pay Affect Unemployment Dynamics? (Forthcoming Article) - We introduce dynamic incentive contracts into a model of unemployment fluctuations. Our main result is that wage cyclicality from incentives does not affect the response of unemployment to productivity shocks. The response of unemployment is the same, to a first-order, in two economies: one with flexible incentive pay, and another with exogenously fixed wages. This equivalence is due to movements in effort. Under the optimal incentive contract, firms’ profits do not change when wages fall, because the effort of the worker falls too.

Forthcoming in AER: Insights: "Bonus Question: How Does Flexible Incentive Pay Affect Unemployment Dynamics?" by Meghana Gaur, John Grigsby, Jonathon Hazell, and Abdoulaye Ndiaye.

Competing Diffusions in a Social Network (Forthcoming Article) - We develop a model of competing diffusions of goods on a social network. There are two types of goods and individuals: mass-market and niche-market. We find that there is a unique stable steady state and show that the adoption of a massmarket good is greater than its population share. Furthermore, greater connectivity and homophily in the social network will concurrently increase the prevalence of niche-market goods. If there is a strategic agent who wants to promote a niche good, she will invest more in influencing activities than one promoting mass-market goods. When individuals choose their degree of homophily, we show that niche-market individuals exhibit greater homophily than mass-market ones.

Forthcoming in AEJ: Microeconomics: "Competing Diffusions in a Social Network" by Arthur Campbell, C. Matthew Leister, Philip Ushchev, and Yves Zenou.

Symmetric Equilibrium in Pre-Auction Investment (Forthcoming Article) - We characterize the symmetric equilibria of a pre-auction game of investment in an internet ad auction environment. For a wide class of auction formats, we show a symmetric equilibrium exists for the pre-auction investment game, is essentially unique, and is the same for all auction formats in the class; we give sufficient conditions for the symmetric equilibrium to be in pure strategies, and to achieve the efficient level of investment. Finally, we show comparative statics results with respect to a variety of parameters.

Forthcoming in AEJ: Microeconomics: "Symmetric Equilibrium in Pre-Auction Investment" by Daniel Quint and Fuhito Kojima.

Starting later, finishing stronger In developing countries, delayed school entry may lead to long-term gains.

In developing countries, where class sizes are large and educational bottlenecks are severe, the gains from starting school at an older age outweigh the costs, say researchers at San Diego State University, @pepnetwork.bsky.social, and @bostonu.bsky.social. #econsky www.aeaweb.org/research/cha...

Central Bank Digital Currency and Monetary Architecture (Forthcoming Article) - We provide a guide to the macroeconomic literature on retail central bank digital currency (CBDC), organizing the discussion around a CBDC-irrelevance result. We identify both fundamental and policy-related sources of relevance, or departures from neutrality. Bank disintermediation—the crowding out of deposits—does not, by itself, constitute such a source. We argue that the literature has primarily focused on policy-related sources of non-neutrality, often without making this focus explicit. From a macroeconomic perspective, CBDC is, at its core, a matter of monetary architecture, and political economy considerations are central to understanding CBDC policy design.

Forthcoming in the JEL: "Central Bank Digital Currency and Monetary Architecture" by Dirk Niepelt.

Understanding High-Wage Firms: Monopoly, Monopsony, and Bargaining Power (Forthcoming Article) - I study how firm market power and worker bargaining power shape wages and welfare. Using French micro-data, I document patterns linking wages and firm market power that existing models cannot explain. A model in which firms produce vertically differentiated goods and share profits with workers explains those patterns. The model (a) reveals new challenges in estimating monopsony and bargaining power, proposing an alternative approach; (b) shows that the passthrough of firm-specific shocks to wages depends on the type of shock; (c) explains how markups shape firm wage premia; and (d) formalizes how strengthening worker bargaining power affects wages and welfare.

Forthcoming in the AER: "Understanding High-Wage Firms: Monopoly, Monopsony, and Bargaining Power" by Horng Chern Wong.

Self-Fulfilling Fluctuations in HANK Economies (Forthcoming Article) - We show that in Heterogeneous-Agent New-Keynesian (HANK) economies with countercyclical risk the natural interest rate is endogenous and co-moves with output, leaving the economy susceptible to self-fulfilling fluctuations. Unlike in Representative-Agent New-Keynesian models, the Taylor principle is not sufficient to guarantee uniqueness of equilibrium in HANK if risk is even mildly countercyclical: multiple bounded-equilibria exist, no matter how strongly monetary policy responds to changes in inflation. For an active-monetary policy to eliminate self-fulfilling fluctuations, it must stabilize the endogenous natural rate fluctuations. Alternatively, a passive-monetary and active-fiscal regime can also eliminate equilibrium multiplicity.

Forthcoming in the AER: "Self-Fulfilling Fluctuations in HANK Economies" by Sushant Acharya and Jess Benhabib.

The Highest Exam: How the Gaokao Shapes China by Ruixue Jia and Hongbin Li (Forthcoming Article)

Forthcoming book review in the JEL: "The Highest Exam: How the Gaokao Shapes China by Ruixue Jia and Hongbin Li" by Ofer Malamud.

Landing on Water: Air Interdiction, Drug-Trafficking Displacement, and Violence in the Brazilian Amazon (Forthcoming Article) - We study a Force-down/Shoot-down intervention in Brazil that led cocaine traffickers to shift from air to river routes. Using data on cocaine production, homicides, and the network of rivers in the Amazon, we provide evidence that violence increased in municipalities along river routes originating from Andean producing countries after the policy. We also show that, during the same period, violence in these municipalities became more responsive to cocaine production in origin countries. We document an instance of crime displacement over the three-dimensional space, involving sophisticated adaptations from criminals regarding transportation technologies, with dramatic side-effects for local populations.

Forthcoming in AEJ: Applied Economics: "Landing on Water: Air Interdiction, Drug-Trafficking Displacement, and Violence in the Brazilian Amazon" by Leila Pereira, Rafael Pucci, and Rodrigo R. Soares.

Ideological Alignment and Evidence-Based Policy Adoption (Forthcoming Article) - The implementation of evidence-based policies hinges on the dissemination of evidence to policymakers, a process influenced by the attributes of the sender. We conducted a nationwide RCT with ideologically opposite think tanks, major newspapers, and a research institution with nonsalient ideology to communicate a non-ideological, cost-effective policy to local policymakers. Results show a 65% increase in policy adoption when informing institutions align ideologically with policymakers. We also compare the impact of think tanks versus media outlets on implementation, finding both equally effective when ideologically aligned. We propose and test a three-stage policy adoption framework: information exposure, belief updating, and implementation.

Forthcoming in the AER: "Ideological Alignment and Evidence-Based Policy Adoption" by Jorge García-Hombrados, Marcel Jansen, Angel Martínez, Berkay Özcan, Pedro Rey-Biel, and Antonio Roldán-Monés.

Energy Transitions in Regulated Markets (Forthcoming Article) - Natural gas has replaced coal as the dominant fuel for U.S. electricity generation. However, utilities in regulated U.S. states have retired coal more slowly than others. We build a structural model of rate-of-return regulation during an energy transition where utilities face tradeoffs between lowering costs and maintaining and using legacy capacity. A regulated utility facing carbon taxes lowers short-run coal generation 48% as much as a cost minimizer would. Thirty years after a sudden energy transition, a cost minimizer has retired 71% more coal capacity than the regulated utility. Alternative regulations may jeopardize affordability and reliability goals during energy transitions.

Forthcoming in the AER: "Energy Transitions in Regulated Markets" by Gautam Gowrisankaran, Ashley Langer, and Mar Reguant.

Prior research has underestimated how much poor households in developing countries value clean water. We spoke with Fiona Burlig of @harrispolicy.bsky.social about her experiment that delivered clean water directly to people's doors. #econsky www.aeaweb.org/research/cle...

Market Opacity and Fragility: Why Liquidity Evaporates When It Is Most Needed (Forthcoming Article) - Lack of market transparency can impair the liquidity provision of non-standard liquidity suppliers and make liquidity demand increasing in illiquidity. This can yield strategic complementarities and induce multiple equilibria. Then an initial dearth of liquidity may degenerate into a liquidity rout (as in a “flash crash”) and traders faced with the largest cost of trading are those trading more intensely at equilibrium. An increase in order flow transparency and/or in the mass of dealers who are in the market at all times has a positive impact on total welfare. Keywords: Liquidity fragility, flash crash, strategic complementarity, order flow transparency.

Forthcoming in the AER: "Market Opacity and Fragility: Why Liquidity Evaporates When It Is Most Needed" by Giovanni Cespa and Xavier Vives.

Identifying Preference for Early Resolution from Asset Prices (Forthcoming Article) - This paper develops an asset market based test for preference for the timing of resolution of uncertainty. Our main theorem provides a characterization of preference for early resolution of uncertainty in terms of the risk premium realized during the period when the informativeness of macroeconomic announcements is resolved. Empirically, we find support for preference for early resolution of uncertainty based on evidence on the dynamics of the implied volatility of S&P 500 index options before FOMC announcements.

Forthcoming in the AER: "Identifying Preference for Early Resolution from Asset Prices" by Hengjie Ai, Ravi Bansal, Hongye Guo, and Amir Yaron.

Forward-Looking Labor Supply Responses to Changes in Pension Wealth: Evidence from Germany (Forthcoming Article) - We provide new evidence of forward-looking labor supply responses to changes in pension wealth. We exploit a 2014 German reform that increased pension wealth for mothers by an average of 4.4% per child born before January 1, 1992. Using administrative data on the universe of working histories, we implement a difference-in-differences design comparing women who had their first child before versus after January 1, 1992. We document significant reductions in labor earnings, driven by intensive margin responses. Our estimates imply that, on average, an extra euro of pension wealth reduces unconditional labor earnings by 54 cents.

Forthcoming in AEJ: Applied Economics: "Forward-Looking Labor Supply Responses to Changes in Pension Wealth: Evidence from Germany" by Elisabeth Artmann, Nicola Fuchs-Schündeln, and Giulia Giupponi.

Disastrous Displacement: The Long-Run Impacts of Landslides (Forthcoming Article) - Natural disasters displace millions of people a year, but their economic impacts are difficult to study when the affected population becomes dispersed. This paper estimates the longrun impacts of six landslides in Uganda on nearly the full affected population. The analysis exploits the sharp boundaries between households residing in a landslide path and those on the same slopes but outside the path. Years after the landslides, affected households earn 50% less income and are 18 percentage points less likely to report being satisfied with their lives. Further analysis points to social capital as a determinant of successful post-disaster recovery.

Forthcoming in AEJ: Applied Economics: "Disastrous Displacement: The Long-Run Impacts of Landslides" by Travis Baseler and Jakob Hennig.

Germs in the Family: The Short- and Long-Term Consequences of Intra-Household Disease Spread (Forthcoming Article) - Preschool-aged children get sick frequently and spread disease to other family members. Despite the universality of this experience, there is limited causal evidence on the magnitudes and consequences of these externalities, especially for infant siblings with developing immune systems and brains. We use Danish administrative data to document that, before age one, younger siblings have 2-3 times higher hospitalization rates for respiratory conditions than older siblings. We combine birth order and within-municipality variation in respiratory disease prevalence among young children, and find lasting differential impacts of early-life respiratory disease exposure on younger siblings’ earnings, educational attainment, chronic respiratory health and mental health-related outcomes.

Forthcoming in the AER: "Germs in the Family: The Short- and Long-Term Consequences of Intra-Household Disease Spread" by N. Meltem Daysal, Hui Ding, Maya Rossin-Slater, and Hannes Schwandt.

The Geography of Child Penalties and Gender Norms: A Pseudo-Event Study Approach (Forthcoming Article) - This paper develops a pseudo-event study approach for estimating child penalties using cross-sectional data. The approach produces estimates that align closely with those obtained from true event studies using panel data and is statistically more precise. This allows for providing more granular evidence and study mechanisms. The paper presents a detailed investigation of the variation in child penalties across time, geography, and demographic/cultural groups in the US. There is large variation in these dimensions. Using a variety of approaches—including epidemiological studies of movers and immigrants—the paper finds that gender norms have sizable effects on child penalties.

Forthcoming in AEJ: Applied Economics: "The Geography of Child Penalties and Gender Norms: A Pseudo-Event Study Approach" by Henrik Kleven.

Friendship Networks and Political Opinions (Forthcoming Article) - We examine how social interactions and friendships shape students' political opinions in a natural experiment at Sciences Po, a leading French university specializing in social and political sciences. The quasi-random assignment of students into short-term integration groups before their academic curriculum reduces political opinion gaps and fosters friendship formation. Using same-group membership as an instrumental variable for friendship, we find that friendship reduces opinion differences by 40% of a standard deviation in the opinion gap. Our evidence supports a homophily-enforced mechanism: friendships form among initially politically similar students, leading them to join political associations together, reinforcing their similarity.

Forthcoming in the AER: "Friendship Networks and Political Opinions" by Yann Algan, Nicolò Dalvit, Quoc-Anh Do, Alexis Le Chapelain, and Yves Zenou.

The Missing Poor (Forthcoming Article) - Population censuses constitute the basis of public resource allocation and political representation globally. This paper shows that census forms commonly generate incentives for enumerators to disproportionately omit members of larger households. Using microdata from 254 censuses, we estimate that this leads to undercounting in at least 60% of censuses. Omission is concentrated in poor countries where 0.6% of the population is missing. Within countries, poor households are missing three times as many members as rich ones, leading to larger undercounts in poorer regions. We illustrate how this translates into systematic underfunding of public services and political underrepresentation in poor regions.

Forthcoming in AER: Insights: "The Missing Poor" by Torsten Figueiredo Walter, Niclas Moneke, and Ana Radu.

Rules versus Discretion without Common Knowledge (Forthcoming Article)

Forthcoming in AER: Insights: "Rules versus Discretion without Common Knowledge" by Zhen Huo and Fei Zhou.