Julia Cajal-Grossi, Rocco Macchiavello, Guillermo Noguera
We study differences in markups earned by Bangladeshi garment exporters across buyers with different sourcing strategies and make three contributions. First, we distinguish buyers with a relational versus a spot sourcing strategy and show that a buyer’s sourcing strategy is correlated across products and origins. Buyer fixed effects explain most of the variation in sourcing strategies, suggesting that these depend on organizational capabilities. Second, we use novel data that match quantities and prices of the two main variable inputs in the production of garments (fabric and labor on sewing lines) to specific export orders. We derive conditions under which these data allow measurement of within exporter–product–time differences in markups across orders produced for different buyers. Third, we show that exporters earn higher markups on otherwise identical orders produced for relational, as opposed to spot, buyers. A sourcing model with imperfect contract enforcement, idiosyncratic shocks to exporters, and buyers that adopt different sourcing strategies trading off higher prices and reliable supply rationalizes this and other observed facts in the industry. We discuss alternative explanations and policy implications.
{"title":"Buyers’ Sourcing Strategies and Suppliers’ Markups in Bangladeshi Garments","authors":"Julia Cajal-Grossi, Rocco Macchiavello, Guillermo Noguera","doi":"10.1093/qje/qjad026","DOIUrl":"https://doi.org/10.1093/qje/qjad026","url":null,"abstract":"We study differences in markups earned by Bangladeshi garment exporters across buyers with different sourcing strategies and make three contributions. First, we distinguish buyers with a relational versus a spot sourcing strategy and show that a buyer’s sourcing strategy is correlated across products and origins. Buyer fixed effects explain most of the variation in sourcing strategies, suggesting that these depend on organizational capabilities. Second, we use novel data that match quantities and prices of the two main variable inputs in the production of garments (fabric and labor on sewing lines) to specific export orders. We derive conditions under which these data allow measurement of within exporter–product–time differences in markups across orders produced for different buyers. Third, we show that exporters earn higher markups on otherwise identical orders produced for relational, as opposed to spot, buyers. A sourcing model with imperfect contract enforcement, idiosyncratic shocks to exporters, and buyers that adopt different sourcing strategies trading off higher prices and reliable supply rationalizes this and other observed facts in the industry. We discuss alternative explanations and policy implications.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-06-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167828","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
By constraining an individual’s choice during a search, housing discrimination distorts sorting decisions away from true preferences and results in a ceteris paribus reduction in welfare. This study combines a large-scale field experiment with a residential sorting model to derive utility-theoretic measures of renter welfare loss associated with the constraints imposed by discrimination in the rental housing market. Results from experiments conducted in five cities show that key neighborhood amenities are associated with higher levels of discrimination. Counterfactual simulations based on the sorting model suggest that discrimination imposes damages equivalent to 4.4% and 3.5% of the annual incomes for African American and Hispanic/Latinx renters, respectively. Damages are increasing in income for African American renters, such that impacts become stronger for economically mobile households. Renters of color must make substantial investments in additional search to mitigate the costs of these constraints. We find that a naive model ignoring discrimination constraints yields biased estimates of willingness to pay for key neighborhood amenities.
{"title":"The Damages and Distortions from Discrimination in the Rental Housing Market","authors":"Peter Christensen, Christopher Timmins","doi":"10.1093/qje/qjad029","DOIUrl":"https://doi.org/10.1093/qje/qjad029","url":null,"abstract":"By constraining an individual’s choice during a search, housing discrimination distorts sorting decisions away from true preferences and results in a ceteris paribus reduction in welfare. This study combines a large-scale field experiment with a residential sorting model to derive utility-theoretic measures of renter welfare loss associated with the constraints imposed by discrimination in the rental housing market. Results from experiments conducted in five cities show that key neighborhood amenities are associated with higher levels of discrimination. Counterfactual simulations based on the sorting model suggest that discrimination imposes damages equivalent to 4.4% and 3.5% of the annual incomes for African American and Hispanic/Latinx renters, respectively. Damages are increasing in income for African American renters, such that impacts become stronger for economically mobile households. Renters of color must make substantial investments in additional search to mitigate the costs of these constraints. We find that a naive model ignoring discrimination constraints yields biased estimates of willingness to pay for key neighborhood amenities.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-06-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167806","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Mohammad Akbarpour, Eric Budish, Piotr Dworczak, Scott Duke Kominers
Abstract We propose an economic framework for determining the optimal allocation of a scarce supply of vaccines that become gradually available during a public health crisis, such as the COVID-19 pandemic. Agents differ in observable and unobservable characteristics, and the designer maximizes a social-welfare function over all feasible mechanisms—accounting for agents’ characteristics, as well as their endogenous behavior in the face of the pandemic. The framework emphasizes the role of externalities and incorporates equity as well as efficiency concerns. Our results provide an economic justification for providing vaccines immediately and for free to some groups of agents, while at the same time showing that a carefully constructed pricing mechanism can improve outcomes by screening for individuals with the highest private and social benefits of receiving the vaccine. The solution casts light on the classic question of whether prices or priorities should be used to allocate scarce public resources under externalities and equity concerns.
{"title":"An Economic Framework for Vaccine Prioritization","authors":"Mohammad Akbarpour, Eric Budish, Piotr Dworczak, Scott Duke Kominers","doi":"10.1093/qje/qjad022","DOIUrl":"https://doi.org/10.1093/qje/qjad022","url":null,"abstract":"Abstract We propose an economic framework for determining the optimal allocation of a scarce supply of vaccines that become gradually available during a public health crisis, such as the COVID-19 pandemic. Agents differ in observable and unobservable characteristics, and the designer maximizes a social-welfare function over all feasible mechanisms—accounting for agents’ characteristics, as well as their endogenous behavior in the face of the pandemic. The framework emphasizes the role of externalities and incorporates equity as well as efficiency concerns. Our results provide an economic justification for providing vaccines immediately and for free to some groups of agents, while at the same time showing that a carefully constructed pricing mechanism can improve outcomes by screening for individuals with the highest private and social benefits of receiving the vaccine. The solution casts light on the classic question of whether prices or priorities should be used to allocate scarce public resources under externalities and equity concerns.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-06-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136221922","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Keith Finlay, Michael Mueller-Smith, Brittany Street
Children’s indirect exposure to the justice system through biological parents or coresident adults is both a marker of their own vulnerability and a measure of the justice system’s expansive reach in society. Estimating the size of this population for the United States has historically been hampered by inadequate data resources, including the inability to (1) observe nonincarceration events, (2) follow children throughout their childhood, and (3) measure adult nonbiological parent cohabitants. To overcome these challenges, we leverage billions of restricted administrative and survey records linked with Criminal Justice Administrative Records System data, and find substantially larger exposure rates than previously reported: prison, 9% of children born between 1999–2005; felony conviction, 18%; and any criminal charge, 39%. Charge exposure rates exceed 60% for Black, American Indian, and low-income children. While broader definitions reach a more expansive population, strong and consistently negative correlations with childhood well-being suggest these remain valuable predictors of vulnerability. Finally, we document substantial geographic variation in exposure, which we leverage in a movers design to estimate the effect of living in a high-exposure county during childhood. We find that children moving into high-exposure counties are more likely to experience postmove exposure events and exhibit significantly worse outcomes by age 26 on multiple dimensions (earnings, criminal activity, teen parenthood, mortality); impacts are strongest for those who moved at earlier ages.
{"title":"Children’s Indirect Exposure to the U.S. Justice System: Evidence from Longitudinal Links Between Survey and Administrative Data","authors":"Keith Finlay, Michael Mueller-Smith, Brittany Street","doi":"10.1093/qje/qjad021","DOIUrl":"https://doi.org/10.1093/qje/qjad021","url":null,"abstract":"Children’s indirect exposure to the justice system through biological parents or coresident adults is both a marker of their own vulnerability and a measure of the justice system’s expansive reach in society. Estimating the size of this population for the United States has historically been hampered by inadequate data resources, including the inability to (1) observe nonincarceration events, (2) follow children throughout their childhood, and (3) measure adult nonbiological parent cohabitants. To overcome these challenges, we leverage billions of restricted administrative and survey records linked with Criminal Justice Administrative Records System data, and find substantially larger exposure rates than previously reported: prison, 9% of children born between 1999–2005; felony conviction, 18%; and any criminal charge, 39%. Charge exposure rates exceed 60% for Black, American Indian, and low-income children. While broader definitions reach a more expansive population, strong and consistently negative correlations with childhood well-being suggest these remain valuable predictors of vulnerability. Finally, we document substantial geographic variation in exposure, which we leverage in a movers design to estimate the effect of living in a high-exposure county during childhood. We find that children moving into high-exposure counties are more likely to experience postmove exposure events and exhibit significantly worse outcomes by age 26 on multiple dimensions (earnings, criminal activity, teen parenthood, mortality); impacts are strongest for those who moved at earlier ages.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-06-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167845","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract We provide new evidence on how labor market dynamics vary with development. We build a new data set consisting of harmonized microdata from rotating panel labor force surveys covering 80 million people from 49 countries. Labor market flows, such as the job-finding or employment exit rate, are higher in developing economies. These higher flows largely reflect a slippery job ladder: workers transition frequently to and from marginal employment without climbing to or persisting in better-paying jobs. Subsistence self-employment and different patterns of selection for wage workers each play a role in our findings and are useful avenues for future theories of labor market frictions.
{"title":"Labor Market Dynamics and Development","authors":"Kevin Donovan, Will Jianyu Lu, Todd Schoellman","doi":"10.1093/qje/qjad019","DOIUrl":"https://doi.org/10.1093/qje/qjad019","url":null,"abstract":"Abstract We provide new evidence on how labor market dynamics vary with development. We build a new data set consisting of harmonized microdata from rotating panel labor force surveys covering 80 million people from 49 countries. Labor market flows, such as the job-finding or employment exit rate, are higher in developing economies. These higher flows largely reflect a slippery job ladder: workers transition frequently to and from marginal employment without climbing to or persisting in better-paying jobs. Subsistence self-employment and different patterns of selection for wage workers each play a role in our findings and are useful avenues for future theories of labor market frictions.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-05-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135897584","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Robin Greenwood, Samuel Hanson, Jeremy C Stein, Adi Sunderam
We develop a model in which specialized bond investors must absorb shocks to the supply and demand for long-term bonds in two currencies. Since long-term bonds and foreign exchange are both exposed to unexpected movements in short-term interest rates, a shift in the supply of long-term bonds in one currency influences the foreign exchange rate between the two currencies, as well as bond term premia in both currencies. Our model matches several important empirical patterns, including the comovement between exchange rates and term premia, as well as the finding that central banks’ quantitative-easing policies impact exchange rates. An extension of our model links spot exchange rates to the persistent deviations from covered interest rate parity that have emerged since 2008.
{"title":"A Quantity-Driven Theory of Term Premia and Exchange Rates","authors":"Robin Greenwood, Samuel Hanson, Jeremy C Stein, Adi Sunderam","doi":"10.1093/qje/qjad024","DOIUrl":"https://doi.org/10.1093/qje/qjad024","url":null,"abstract":"We develop a model in which specialized bond investors must absorb shocks to the supply and demand for long-term bonds in two currencies. Since long-term bonds and foreign exchange are both exposed to unexpected movements in short-term interest rates, a shift in the supply of long-term bonds in one currency influences the foreign exchange rate between the two currencies, as well as bond term premia in both currencies. Our model matches several important empirical patterns, including the comovement between exchange rates and term premia, as well as the finding that central banks’ quantitative-easing policies impact exchange rates. An extension of our model links spot exchange rates to the persistent deviations from covered interest rate parity that have emerged since 2008.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-05-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167991","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We provide evidence for a bias that we call “representative signal distortion” (RSD) which is particularly relevant to settings of statistical discrimination. Experimental subjects distort their evaluation of new evidence on individual group members and interpret such information to be more representative of the group to which the individual belongs (relative to a reference group) than it really is. This produces a discriminatory gap in the evaluation of members of the two groups. Because it is driven by representativeness, the bias (and the discriminatory gap) disappears when subjects are prevented from contrasting different groups; because it is a bias in the interpretation of information, it disappears when subjects receive information before learning of the individual’s group. We show that this bias can be easily estimated from appropriately constructed datasets and can be distinguished from previously documented inferential biases in the literature. Importantly, we document how removing the bias produces a kind of free lunch in reducing discrimination, making it possible to significantly reduce discrimination without lowering accuracy of inferences.
{"title":"Seeing What is Representative","authors":"Ignacio Esponda, Ryan Oprea, Sevgi Yuksel","doi":"10.1093/qje/qjad020","DOIUrl":"https://doi.org/10.1093/qje/qjad020","url":null,"abstract":"We provide evidence for a bias that we call “representative signal distortion” (RSD) which is particularly relevant to settings of statistical discrimination. Experimental subjects distort their evaluation of new evidence on individual group members and interpret such information to be more representative of the group to which the individual belongs (relative to a reference group) than it really is. This produces a discriminatory gap in the evaluation of members of the two groups. Because it is driven by representativeness, the bias (and the discriminatory gap) disappears when subjects are prevented from contrasting different groups; because it is a bias in the interpretation of information, it disappears when subjects receive information before learning of the individual’s group. We show that this bias can be easily estimated from appropriately constructed datasets and can be distinguished from previously documented inferential biases in the literature. Importantly, we document how removing the bias produces a kind of free lunch in reducing discrimination, making it possible to significantly reduce discrimination without lowering accuracy of inferences.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-05-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167993","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Francesco Bianchi, Renato Faccini, Leonardo Melosi
We develop a new class of general-equilibrium models with partially unfunded debt to propose a fiscal theory of persistent inflation. In response to business cycle shocks, the monetary authority controls inflation and the fiscal authority stabilizes debt. However, the central bank accommodates unfunded fiscal shocks, causing persistent movements in inflation, output, and real interest rates. In an estimated quantitative model, fiscal inflation accounts for the bulk of inflation dynamics. In the aftermath of the pandemic, unfunded fiscal shocks sustain the recovery, but also cause a persistent increase in inflation. The model is able to predict the inflationary effects of the American Rescue Plan Act (ARPA) fiscal stimulus out of sample and with real time data.
{"title":"A Fiscal Theory of Persistent Inflation","authors":"Francesco Bianchi, Renato Faccini, Leonardo Melosi","doi":"10.1093/qje/qjad027","DOIUrl":"https://doi.org/10.1093/qje/qjad027","url":null,"abstract":"We develop a new class of general-equilibrium models with partially unfunded debt to propose a fiscal theory of persistent inflation. In response to business cycle shocks, the monetary authority controls inflation and the fiscal authority stabilizes debt. However, the central bank accommodates unfunded fiscal shocks, causing persistent movements in inflation, output, and real interest rates. In an estimated quantitative model, fiscal inflation accounts for the bulk of inflation dynamics. In the aftermath of the pandemic, unfunded fiscal shocks sustain the recovery, but also cause a persistent increase in inflation. The model is able to predict the inflationary effects of the American Rescue Plan Act (ARPA) fiscal stimulus out of sample and with real time data.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-05-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167992","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Close-kin marriage, by sustaining tightly knit family structures, may impede development. We find support for this hypothesis using U.S. state bans on cousin marriage. Our measure of cousin marriage comes from the excess frequency of same-surname marriages, a method borrowed from population genetics that we apply to millions of marriage records from the eighteenth to the twentieth century. Using census data, we first show that married cousins are more rural and have lower-paying occupations. We then turn to an event study analysis to understand how cousin marriage bans affected outcomes for treated birth cohorts. We find that these bans led individuals from families with high rates of cousin marriage to migrate off farms and into urban areas. They also gradually shift to higher-paying occupations. We also observe increased dispersion, with individuals from these families living in a wider range of locations and adopting more diverse occupations. Our findings suggest that these changes were driven by the social and cultural effects of dispersed family ties rather than genetics. Notably, the bans also caused more people to live in institutional settings for the elderly, infirm, or destitute, suggesting weaker support from kin.
{"title":"Economic Consequences of Kinship: Evidence From U.S. Bans on Cousin Marriage","authors":"Arkadev Ghosh, Sam Il Myoung Hwang, Munir Squires","doi":"10.1093/qje/qjad018","DOIUrl":"https://doi.org/10.1093/qje/qjad018","url":null,"abstract":"Close-kin marriage, by sustaining tightly knit family structures, may impede development. We find support for this hypothesis using U.S. state bans on cousin marriage. Our measure of cousin marriage comes from the excess frequency of same-surname marriages, a method borrowed from population genetics that we apply to millions of marriage records from the eighteenth to the twentieth century. Using census data, we first show that married cousins are more rural and have lower-paying occupations. We then turn to an event study analysis to understand how cousin marriage bans affected outcomes for treated birth cohorts. We find that these bans led individuals from families with high rates of cousin marriage to migrate off farms and into urban areas. They also gradually shift to higher-paying occupations. We also observe increased dispersion, with individuals from these families living in a wider range of locations and adopting more diverse occupations. Our findings suggest that these changes were driven by the social and cultural effects of dispersed family ties rather than genetics. Notably, the bans also caused more people to live in institutional settings for the elderly, infirm, or destitute, suggesting weaker support from kin.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":13.7,"publicationDate":"2023-05-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50167994","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract This article documents the economic relevance of measuring cognitive uncertainty: people’s subjective uncertainty over their ex ante utility-maximizing decision. In a series of experiments on choice under risk, the formation of beliefs, and forecasts of economic variables, we show that cognitive uncertainty predicts various systematic biases in economic decisions. When people are cognitively uncertain—either endogenously or because the problem is designed to be complex—their decisions are heavily attenuated functions of objective probabilities, which gives rise to average behavior that is regressive to an intermediate option. This insight ties together a wide range of empirical regularities in behavioral economics that are typically viewed as distinct phenomena or even as reflecting preferences, including the probability weighting function in choice under risk; base rate insensitivity, conservatism, and sample size effects in belief updating; and predictable overoptimism and -pessimism in forecasts of economic variables. Our results offer a blueprint for how a simple measurement of cognitive uncertainty generates novel insights about what people find complex and how they respond to it.
{"title":"Cognitive Uncertainty","authors":"Benjamin Enke, Thomas Graeber","doi":"10.1093/qje/qjad025","DOIUrl":"https://doi.org/10.1093/qje/qjad025","url":null,"abstract":"Abstract This article documents the economic relevance of measuring cognitive uncertainty: people’s subjective uncertainty over their ex ante utility-maximizing decision. In a series of experiments on choice under risk, the formation of beliefs, and forecasts of economic variables, we show that cognitive uncertainty predicts various systematic biases in economic decisions. When people are cognitively uncertain—either endogenously or because the problem is designed to be complex—their decisions are heavily attenuated functions of objective probabilities, which gives rise to average behavior that is regressive to an intermediate option. This insight ties together a wide range of empirical regularities in behavioral economics that are typically viewed as distinct phenomena or even as reflecting preferences, including the probability weighting function in choice under risk; base rate insensitivity, conservatism, and sample size effects in belief updating; and predictable overoptimism and -pessimism in forecasts of economic variables. Our results offer a blueprint for how a simple measurement of cognitive uncertainty generates novel insights about what people find complex and how they respond to it.","PeriodicalId":48470,"journal":{"name":"Quarterly Journal of Economics","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-05-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135945399","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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