Political Scandal: A Theory
Imagine a scenario where Politician A is reported to have said something politically damaging in a closed-door meeting. However, the news of this indiscretion is reported by members of the opposition party, with the members of Politician A’s party vehemently denying the accusation. Who would you believe? Would you lose faith in the politician, or would you blame extreme polarization for the political theater that you just witnessed?
Age of Marriage, Weather Shocks, and the Direction of Marriage Payments
Imagine that you are a parent of a young daughter in a country that provides a dowry to the groom’s family when your daughter is married. On the one hand, you want your daughter to marry and are willing to pay a dowry to ensure that she joins a good family. On the other hand, your resources are limited and you can only afford to contribute so much to a dowry.
Forward Guidance and Household Expectations • Gender Roles and the Gender Expectations Gap
Policymakers make economic policies based, in part, on their assumptions about how households and businesses will react to a given change in policy. This is especially true of monetary policy, where central banks work to set interest rates that both encourage or discourage economic activity, while keeping inflation at bay.
Topics: Monetary Policy
Boards of a Feather: Homophily in Foreign Director Appointments Around the World
Diversity in boardrooms is a watchword among corporations these days, with companies striving to add members that better reflect the gender and racial make-up of their markets. In some cases, this diversity movement is driven by government fiat, as states such as California and countries like Norway, for example, have passed laws requiring certain levels of female representation.
Product Innovation, Product Diversification, and Firm Growth: Evidence from Japan’s Early Industrialization
Most manufacturers, if they expect to grow and flourish, not only need to expand their existing product line but must also innovate and otherwise add to their product mix, whether that means adding entirely new items or improving the quality of existing goods. In other words, producing the same thing over and over, without any modifications or without branching out into other product lines, is not a typical recipe for long-term success.
Topics: Industrial Organization
Railroads, Reallocation, and the Rise of American Manufacturing
Of these two workers, who is more productive? Amy works for one minute every afternoon and produces 11 minutes’ worth of goods, for a net gain of 10 minutes’ worth of goods for her employer. Sally works for five hours and produces six hours’ worth of goods, for a net gain of 60 minutes.
Markups, Labor Market Inequality and the Nature of Work
Odds are, when you think of workers in a modern industrialized economy, you imagine all kinds of jobs, from those on factory floors and farms, to those in sales, marketing, and business development. You might also imagine that, over time, the percentage of people working in so-called blue-collar jobs, while still the majority, has decreased relative to white-collar workers.
Topics: Employment & Wages
A Global View of Creative Destruction
Trade policy has recently been in the news, with the focus on the costs to firms from higher prices due to trade tariffs. However, the focus on the effect of tariffs on prices misses perhaps the most important benefit from international trade: the transmission of ideas.
Topics: Industrial Organization, Technology & Innovation