This Introduction provides an overview of the EER Special Issue on macroeconomic regime changes: Theory, evidence, and policy challenges ahead. The contributions are organized around four key thematic areas: (1) the dynamics and properties of inflation, (2) sectoral vulnerability to supply-chain disruptions and energy price shocks, (3) structural divergence and the economic impacts of climate change, and (4) the design and effectiveness of economic policies in times of crisis.
{"title":"Introduction to the special issue on macroeconomic regime changes: Theory, evidence, and policy challenges ahead","authors":"Pierpaolo Benigno , Claudio Morana , Patrizio Tirelli","doi":"10.1016/j.euroecorev.2025.105164","DOIUrl":"10.1016/j.euroecorev.2025.105164","url":null,"abstract":"<div><div>This Introduction provides an overview of the EER Special Issue on macroeconomic regime changes: Theory, evidence, and policy challenges ahead. The contributions are organized around four key thematic areas: (1) the dynamics and properties of inflation, (2) sectoral vulnerability to supply-chain disruptions and energy price shocks, (3) structural divergence and the economic impacts of climate change, and (4) the design and effectiveness of economic policies in times of crisis.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105164"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145270094","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-10-03DOI: 10.1016/j.euroecorev.2025.105162
Paul Hufe , Martyna Kobus , Andreas Peichl , Paul Schüle
Is the United States still a land of opportunity? We provide new insights on this question by leveraging a novel approach that allows us to measure inequality of opportunity in the joint distribution of income and wealth. We show that inequality of opportunity in the US has increased by 58% from the cohort born in 1935 to the cohort of 1980. Increases are driven by a less opportunity-egalitarian income distribution for birth cohorts after 1950 and a less opportunity-egalitarian wealth distribution after 1960. Our findings suggest that the United States has consistently moved further away from a level playing field in recent decades.
{"title":"Multidimensional equality of opportunity in the United States","authors":"Paul Hufe , Martyna Kobus , Andreas Peichl , Paul Schüle","doi":"10.1016/j.euroecorev.2025.105162","DOIUrl":"10.1016/j.euroecorev.2025.105162","url":null,"abstract":"<div><div>Is the United States still a land of opportunity? We provide new insights on this question by leveraging a novel approach that allows us to measure inequality of opportunity in the joint distribution of income and wealth. We show that inequality of opportunity in the US has increased by 58% from the cohort born in 1935 to the cohort of 1980. Increases are driven by a less opportunity-egalitarian income distribution for birth cohorts after 1950 and a less opportunity-egalitarian wealth distribution after 1960. Our findings suggest that the United States has consistently moved further away from a level playing field in recent decades.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105162"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145270095","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-10-21DOI: 10.1016/j.euroecorev.2025.105187
Carlos J. Charotti , Nuno Palma , João Pereira dos Santos
Spain was one of the world’s richest countries around 1500. Two centuries later it was a backwater. We rely on a synthetic control methodology to study the long-run impact of the influx of silver from the New World since 1500 for the economic development of Spain. Compared with a synthetic counterfactual, the price level increased by up to 200% by the mid-seventeenth century. Spain’s GDP per capita outperformed other European nations for around a century, but by 1750, GDP per capita was around 40% lower than it would have been if Spain had not been the first-stage receiver of the American treasure.
{"title":"American treasure and the decline of Spain","authors":"Carlos J. Charotti , Nuno Palma , João Pereira dos Santos","doi":"10.1016/j.euroecorev.2025.105187","DOIUrl":"10.1016/j.euroecorev.2025.105187","url":null,"abstract":"<div><div>Spain was one of the world’s richest countries around 1500. Two centuries later it was a backwater. We rely on a synthetic control methodology to study the long-run impact of the influx of silver from the New World since 1500 for the economic development of Spain. Compared with a synthetic counterfactual, the price level increased by up to 200% by the mid-seventeenth century. Spain’s GDP per capita outperformed other European nations for around a century, but by 1750, GDP per capita was around 40% lower than it would have been if Spain had not been the first-stage receiver of the American treasure.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105187"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145364197","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-10-17DOI: 10.1016/j.euroecorev.2025.105183
Giovanni Andreottola , Barton E. Lee
Legislative hostage-taking — whereby the minority party refuses to pass a bipartisan policy unless another divisive or contentious policy also passes — has become a frequent occurrence, especially in American politics. We develop a dynamic model of legislative bargaining and electoral politics to provide insights into why hostage-taking occurs, which policies are held hostage, and which policies are demanded as ransom. Our key insight is that (credible) hostage-taking can only occur if the divisive policy benefits the voter. Furthermore, when hostage-taking occurs, it benefits the voter. However, these benefits are potentially tempered if parties can engage in policy design. In particular, hostage-taking can generate a perverse incentive for the majority party to engage in money burning to shield themself from the minority party’s hostage-taking.
{"title":"Legislative hostage-taking","authors":"Giovanni Andreottola , Barton E. Lee","doi":"10.1016/j.euroecorev.2025.105183","DOIUrl":"10.1016/j.euroecorev.2025.105183","url":null,"abstract":"<div><div>Legislative hostage-taking — whereby the minority party refuses to pass a bipartisan policy unless another divisive or contentious policy also passes — has become a frequent occurrence, especially in American politics. We develop a dynamic model of legislative bargaining and electoral politics to provide insights into why hostage-taking occurs, which policies are held hostage, and which policies are demanded as ransom. Our key insight is that (credible) hostage-taking can only occur if the divisive policy benefits the voter. Furthermore, when hostage-taking occurs, it benefits the voter. However, these benefits are potentially tempered if parties can engage in policy design. In particular, hostage-taking can generate a perverse incentive for the majority party to engage in money burning to shield themself from the minority party’s hostage-taking.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105183"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145364198","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Income redistribution differs widely across countries. Several theories have been developed to account for such differences. However, we know little about their relative importance. This paper fills this gap, contrasting the main theories of preferences for redistribution in a unified empirical framework. We implement standardized hypothetical choices of income redistribution in nationally representative samples of Germany, Italy, Japan, Slovenia, the UK, and the US. We find that the beliefs in fair opportunities for upward mobility are the strongest predictor of demand for redistribution. Surprisingly, higher trust in government correlates with a lower demand. The perception of immigrants as a threat to society also significantly reduces preferences for redistribution, whereas other factors, such as self-interest, social capital, and incentivized measures of pro-sociality, play lesser roles. We uncover significant cross-country heterogeneity; for instance, beliefs in fair opportunities strongly influence redistribution preferences in the US, UK, and Germany, but are less impactful elsewhere. Our findings reveal limited variability in how theoretical factors relate to redistribution preferences across socio-demographic groups, with notable exceptions. Attitudes towards immigrants have a stronger influence on redistribution preferences among non-right-wing respondents in the US and Germany. Contrary to previous research, beliefs in fair opportunities show no significant differences by political orientation, indicating a widely accepted, ideologically neutral view of fairness.
{"title":"What explains preferences for redistribution? Evidence from an international survey","authors":"Julien Bonnet , Emanuele Ciani , Gianluca Grimalda , Fabrice Murtin , David Pipke","doi":"10.1016/j.euroecorev.2025.105150","DOIUrl":"10.1016/j.euroecorev.2025.105150","url":null,"abstract":"<div><div>Income redistribution differs widely across countries. Several theories have been developed to account for such differences. However, we know little about their relative importance. This paper fills this gap, contrasting the main theories of preferences for redistribution in a unified empirical framework. We implement standardized hypothetical choices of income redistribution in nationally representative samples of Germany, Italy, Japan, Slovenia, the UK, and the US. We find that the beliefs in fair opportunities for upward mobility are the strongest predictor of demand for redistribution. Surprisingly, higher trust in government correlates with a lower demand. The perception of immigrants as a threat to society also significantly reduces preferences for redistribution, whereas other factors, such as self-interest, social capital, and incentivized measures of pro-sociality, play lesser roles. We uncover significant cross-country heterogeneity; for instance, beliefs in fair opportunities strongly influence redistribution preferences in the US, UK, and Germany, but are less impactful elsewhere. Our findings reveal limited variability in how theoretical factors relate to redistribution preferences across socio-demographic groups, with notable exceptions. Attitudes towards immigrants have a stronger influence on redistribution preferences among non-right-wing respondents in the US and Germany. Contrary to previous research, beliefs in fair opportunities show no significant differences by political orientation, indicating a widely accepted, ideologically neutral view of fairness.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105150"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145222893","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We report the results of an experiment that examines the impact of centralized trading institutions on the formation of bubbles and crashes in laboratory asset markets. We employ three trading institutions: Call Market, Double Auction, and Tâtonnement. The results show that bubbles are significantly smaller in uniform-price institutions than in Double Auction. We reproduce this and other critical patterns of the data by calibrating a parsimonious model with heterogeneous agents with different levels of sophistication, featuring fundamental and myopic traders. The model matches untargeted data moments and produces larger bubbles under Double Auction, consistent with the experimental data. This is because multiple trades occur within a period under this institution, amplifying the impact of myopic traders with a positive bias on transaction prices.
{"title":"Trading institutions in experimental asset markets: Theory and Evidence","authors":"Bulent Guler , Volodymyr Lugovskyy , Daniela Puzzello , Steven Tucker","doi":"10.1016/j.euroecorev.2025.105148","DOIUrl":"10.1016/j.euroecorev.2025.105148","url":null,"abstract":"<div><div>We report the results of an experiment that examines the impact of centralized trading institutions on the formation of bubbles and crashes in laboratory asset markets. We employ three trading institutions: Call Market, Double Auction, and Tâtonnement. The results show that bubbles are significantly smaller in uniform-price institutions than in Double Auction. We reproduce this and other critical patterns of the data by calibrating a parsimonious model with heterogeneous agents with different levels of sophistication, featuring fundamental and myopic traders. The model matches untargeted data moments and produces larger bubbles under Double Auction, consistent with the experimental data. This is because multiple trades occur within a period under this institution, amplifying the impact of myopic traders with a positive bias on transaction prices.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105148"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145325967","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-10-03DOI: 10.1016/j.euroecorev.2025.105156
Renaud Foucart , Jonathan H.W. Tan , Zichen Zhao
We study the role of incentives in determining how individuals with high and low ability endogenously form teams with homogeneous or heterogeneous abilities. Standard incentives that reward the best-performing team (team incentives) or the best member of each team (individual incentives) consistently lead to the formation of homogeneous teams, even when socially inefficient. Conversely, equal sharing rules, which offer all members an identical share of total production, elicit optimal matching but are vulnerable to moral hazard. We show that hybrid incentives, which combine team and individual incentives, elicit optimal matching and are robust to moral hazard. We conduct two experimental studies showing that hybrid incentives produce significantly more optimal teams than standard incentives, though fewer than under equal sharing.
{"title":"Endogenous formation of optimal teams","authors":"Renaud Foucart , Jonathan H.W. Tan , Zichen Zhao","doi":"10.1016/j.euroecorev.2025.105156","DOIUrl":"10.1016/j.euroecorev.2025.105156","url":null,"abstract":"<div><div>We study the role of incentives in determining how individuals with high and low ability endogenously form teams with homogeneous or heterogeneous abilities. Standard incentives that reward the best-performing team (<em>team incentives</em>) or the best member of each team (<em>individual incentives</em>) consistently lead to the formation of homogeneous teams, even when socially inefficient. Conversely, <em>equal sharing</em> rules, which offer all members an identical share of total production, elicit optimal matching but are vulnerable to moral hazard. We show that <em>hybrid incentives</em>, which combine team and individual incentives, elicit optimal matching and are robust to moral hazard. We conduct two experimental studies showing that hybrid incentives produce significantly more optimal teams than standard incentives, though fewer than under equal sharing.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105156"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145270092","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-10-15DOI: 10.1016/j.euroecorev.2025.105175
Fangzhi Wang , Hua Liao , Richard S.J. Tol
We investigate optimal carbon abatement in a dynamic general equilibrium climate-economy model with endogenous structural change. By differentiating the production of investment from consumption, we show that social cost of carbon can be conceived as a reduction in physical capital. In addition, we distinguish two final sectors in terms of productivity growth and climate vulnerability. We theoretically show that heterogeneous climate vulnerability results in a climate-induced version of Baumol’s cost disease. Further, if climate-vulnerable sectors have high (low) productivity growth, climate impact can ameliorate (aggravate) the Baumol’s cost disease, call for less (more) stringent climate policy. We conclude that carbon abatement should not only factor in unpriced climate capital, but also be tailored to Baumol’s cost and climate diseases.
{"title":"Baumol’s climate disease","authors":"Fangzhi Wang , Hua Liao , Richard S.J. Tol","doi":"10.1016/j.euroecorev.2025.105175","DOIUrl":"10.1016/j.euroecorev.2025.105175","url":null,"abstract":"<div><div>We investigate optimal carbon abatement in a dynamic general equilibrium climate-economy model with endogenous structural change. By differentiating the production of investment from consumption, we show that social cost of carbon can be conceived as a reduction in physical capital. In addition, we distinguish two final sectors in terms of productivity growth and climate vulnerability. We theoretically show that heterogeneous climate vulnerability results in a climate-induced version of Baumol’s cost disease. Further, if climate-vulnerable sectors have high (low) productivity growth, climate impact can ameliorate (aggravate) the Baumol’s cost disease, call for less (more) stringent climate policy. We conclude that carbon abatement should not only factor in unpriced climate capital, but also be tailored to Baumol’s cost and climate diseases.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105175"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145364199","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-09-20DOI: 10.1016/j.euroecorev.2025.105145
Ainoa Aparicio Fenoll , Nadia Campaniello , Ignacio Monzón
Do parents take into account their children’s ability when deciding on their education? If so, are parents’ perceptions accurate? We study this by analyzing a key educational decision. Parents choose whether their children start elementary school one year early. Do they select high-ability children to start early? We propose a novel methodology to identify the sign and strength of selection into early starting. We find robust evidence of positive selection. Had they started regularly, early starters would have obtained test scores 0.2 standard deviations higher than the average student. We also estimate the effect of early starting on test scores and find that the effect is heterogeneous.
{"title":"Parental love is not blind: Identifying selection into early school start","authors":"Ainoa Aparicio Fenoll , Nadia Campaniello , Ignacio Monzón","doi":"10.1016/j.euroecorev.2025.105145","DOIUrl":"10.1016/j.euroecorev.2025.105145","url":null,"abstract":"<div><div>Do parents take into account their children’s ability when deciding on their education? If so, are parents’ perceptions accurate? We study this by analyzing a key educational decision. Parents choose whether their children start elementary school one year early. Do they select high-ability children to start early? We propose a novel methodology to identify the sign and strength of selection into early starting. We find robust evidence of positive selection. Had they started regularly, early starters would have obtained test scores 0.2 standard deviations higher than the average student. We also estimate the effect of early starting on test scores and find that the effect is heterogeneous.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105145"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145120265","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-01Epub Date: 2025-09-27DOI: 10.1016/j.euroecorev.2025.105146
Pierre Deschamps , Guillaume Wilemme
Local labor market conditions are strongly persistent. Using a search-and-matching model with agglomeration effects and worker and firm migration, we study the transitional dynamics of a regional economy. The model is fitted to mimic local labor market dynamics using state-level U.S. time series. Agglomeration economies generate strong persistence in the employment level response to a labor demand shock, while agglomeration diseconomies dampen the shock. The amplification of the local unemployment rate response critically depends on wage rigidity. Short-term place-based policies can help the region since they dampen the impact of the shock on the employment level.
{"title":"Local labor market dynamics and agglomeration effects","authors":"Pierre Deschamps , Guillaume Wilemme","doi":"10.1016/j.euroecorev.2025.105146","DOIUrl":"10.1016/j.euroecorev.2025.105146","url":null,"abstract":"<div><div>Local labor market conditions are strongly persistent. Using a search-and-matching model with agglomeration effects and worker and firm migration, we study the transitional dynamics of a regional economy. The model is fitted to mimic local labor market dynamics using state-level U.S. time series. Agglomeration economies generate strong persistence in the employment level response to a labor demand shock, while agglomeration diseconomies dampen the shock. The amplification of the local unemployment rate response critically depends on wage rigidity. Short-term place-based policies can help the region since they dampen the impact of the shock on the employment level.</div></div>","PeriodicalId":48389,"journal":{"name":"European Economic Review","volume":"180 ","pages":"Article 105146"},"PeriodicalIF":2.4,"publicationDate":"2025-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145222385","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
扫码关注我们
求助内容：
应助结果提醒方式：
京公网安备 11010802042870号