Economic Inquiry最新文献

We develop a mixed duopoly model with quality-differentiated products. The public firm offers its product for free to eligible individuals, while the private firm chooses its product quality and price to maximize profit. We calibrate the model to health insurance for the U.S. working-age population, with Medicaid being the public firm. We examine distributional implications of policies that expand Medicaid to various degrees. Despite potentially significant inefficiency of Medicaid, its expansion is welfare improving. Central to these findings is the significant market power of the private firm when left unchecked, which is increasingly disciplined as more individuals become Medicaid eligible.

Why so few women graduate in Economics? We investigate the gender gap among Italian university graduates in Economics between 2010 and 2019. With women's probability of graduating in Economics being 27% lower than men's, the gap is larger than in Business and even STEM. The association between the gender gap and the mathematical content of high school curricula is especially strong in Economics. A triple difference analysis shows that a reform raising the mathematical content of traditionally low math curricula caused an increase in the gender gap, with women's probability of graduating in Economics decreasing by 12 percentage points.

This paper analyses the differential effect of trade agreements on income per capita of subnational regions with international borders. We construct an extensive panel dataset covering 1350 regions in 86 countries worldwide between 1950 and 2017. Our results show that trade agreements are positively associated with income per capita of regions sharing contiguous borders with trading partners, relative to regions sharing borders with countries with whom no trade agreements exist. For border regions, the positive relationship of trade agreements and regional income roughly compensates potential income disadvantages of having international borders. These insights help in explaining and mitigating regional inequalities.

Who knows the underlying productivity distribution function? Interestingly, this ambiguous function is often referenced to make decisions including job creations, wage determinations, contract formulations, etc. To investigate how ambiguity shapes labor markets, we integrate ambiguity preferences into the Diamond-Mortensen-Pissarides (DMP) model. We find that ambiguity-averse job- and talent-hunters are conservative. Our quantitative analysis indicates that but for the ambiguity, the American unemployment rate would have increased in the postwar era. This paper generalizes the DMP model, enhances our understanding of the labor market, and calls for policies concerning labor market information.

Though antitrust authorities have historically focused on prices in merger analyses, there is now growing interest in the impact of mergers on non-price outcomes. In this paper, we examine the effect of horizontal mergers on product variety in the U.S. beer industry. Our difference-in-differences analyses provide evidence that acquired firms increase variety available to consumers by expanding into new markets, while reducing the variety of products sold in their existing markets. Back of the envelope calculations suggest that in aggregate, these acquisitions have a net positive effect on product variety.

This paper estimates the impact of new stadiums on attendance and revenues of Major League Baseball teams between 1970 and 2019. Recent studies reveal that two-way fixed effects (TWFE) models may produce biased estimates, proposing an “imputation” method instead. This paper uses the imputation method to generate a counterfactual estimate, based on untreated observations: the average treatment effect on the treated (ATT) equals the difference between actual and counterfactual estimates. The analysis shows that there were significant anticipation effects associated with new stadiums, up to three seasons before opening. It suggests previous estimates may significantly understate new stadium revenue gains.

I study how hospital chains consider the tradeoff between internal and external network benefits in technology adoption. I estimate a discrete-choice model that characterizes adoption decisions using a national sample of U.S. hospitals from 2005 to 2014. After instrumenting a vendor's market and system shares, I find affiliated hospitals tend to choose the internally preferred vendor, but experienced adopters also welcome external popular options. Factors affecting the tradeoff include chain size and the need for internal coordination. The stronger incentives for internal integration in health IT adoption among chains might create frictions to sharing information externally.

There are two opposing welfare effects of market power in a model with monopolistic competition, loan defaults and moral hazard. The loss of output produced if firms set a higher mark-up over marginal costs confronts with some gain due to higher expected profits and the reduction of defaults. Such tradeoff results in an optimal level of market power that decreases with the efficiency of liquidation following default on a loan. If moral hazard is pervasive, credit rationing cuts down the default rates and mitigates the welfare cost of financial frictions.

Most studies that look at long-term effects of Head Start, the largest early childhood intervention in the US, exploit its rollout in the 1960s, missing the effects of many changes to the program in the 1980s and 1990s. I study the effects of Head Start on long-term physical and mental health for children who attend Head Start in the 1980s–1990s and are new labor market entrants. I find large improvements in health, resulting in a 0.15 standard deviation decrease in the incidence of poor health. Ultimately, Head Start improves health outcomes up to 25 years after participation in the program.

Using an existing coordination (traffic) experiment, we investigate information's effect on traffic congestion when subjects already have a history of past play. In contrast to previous studies, our interventions neither alter aggregate nor individual payoffs. A second study isolates individual-subject response to information using a fixed distribution of past subjects. We find information alters subject play: subjects switch roads more often and receive higher payoffs conditional on switching roads. Because switching reduces payoffs unconditionally, information does not generally improve payoffs overall. Only subjects that receive information upon starting the game appear to increase their payoffs due to the information treatment.