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Remembering Tom Cooley
A video collaboration between the Society for Economic Dynamics (SED), the Laboratory for Aggregate Economics and Finance (LAEF), and NYU Stern School of Business.
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Giulia Brancaccio awarded the Frisch Medal of the Econometric Society
Giulia Brancaccio (jointly with her coauthors Myrto Kalouptsidi and Theodore Papageorgiou) has been awarded the 2022 Frisch Medal of the Econometric Society for their paper, "Geography, Transportation, and Endogenous Trade Costs”, (Econometrica, Vol. 88, No. 2, March 2020, 657-691). The Frisch Medal is awarded biennially for the best applied paper published in Econometrica in the preceding four calendar years. The award will be presented by Econometric Society President, Guido Tabellini, on...
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NYU launches new Master of Science in Quantitative Economics
NYU's MS in Quantitative Economics is a cutting-edge program for students with research-oriented ambitions in economics, such as a demanding doctoral program, or employment in technology, finance and research in both the private or public sectors. Drawing on the combined resources of the Economics Departments of the Faculty of Arts and Science and NYU’s Stern School, the program is streamlined and sequenced to get you where you need to go with maximal stimulation, speed and efficiency.
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Luis Cabral and Gabriel Natividad's "Bundling Sequentially Released Durable Goods," published in the Journal of Industrial Economics
Suppose two durables are sequentially released and suppose that consumer valuations of these goods are positively correlated. By the time the second good is released, high-valuation buyers are out of the market for the first good. Therefore, a bundle can be targeted at the low-valuation consumers without violating the high-valuation consumers' incentive compatibility constraint. We test the model's predictions on data from retail DVD sales in the 2000's. Consistent with theory, our estimates...
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Larry White's "The Dead Hand of Cellophane and the Federal Google and Facebook Antitrust Cases: Market Delineation Will Be Crucial" published in The Antitrust Bulletin
The U.S. Department of Justice (DOJ) and Federal Trade Commission (FTC) monopolization cases against Google and Facebook, respectively, represent the most important federal nonmerger antitrust initiatives since (at least) the 1990s. As in any monopolization case, market delineation will be a central feature of both cases—as it was in the du Pont Cellophane case of sixty-five years ago. Without a delineated market, how can one determine whether a company has engaged in monopolization?
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Larry White's guest article, "A Riff and a Half on the Delineation of Relevant Markets in Antitrust Cases" in the Network Law Review
Excerpt from the Network Law Review -- "In this note, I wish to make two points. First – and most important: A satisfactory paradigm for delineating relevant markets in unilateral monopolization cases – which involve allegations of restrictive, exclusionary, and/or predatory actions, or abuse of dominance – has not yet appeared in the litigation of monopolization cases. Unfortunately, the market delineation paradigm that has been successfully used for delineating relevant markets for..."
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Michael Dickstein, Kate Ho, and Nathaniel Mark's new NBER working paper, "Market Segmentation and Competition in Health Insurance"
In the United States, households obtain health insurance through distinct market segments. We explore the economics of this segmentation by comparing coverage provided through small employers versus the individual marketplace. Using data from Oregon, we find households with group coverage spend 26% less on covered health care than households with individual coverage yet face higher markups. We develop a model of plan choice and health spending to estimate preferences in both markets and...
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Luis Cabral and Lei Xu's "Seller reputation and price gouging: Evidence from the COVID-19 pandemic," published in the Economic Inquiry
From mid-January to March 2020, 3M masks sold on Amazon by third party sellers were priced 2.4 times higher than Amazon's 2019 price. However, this price increase was not uniform across sellers. We estimate that when Amazon is stocked out (one of our measures of scarcity) new (entrant) sellers increase price by 178%, whereas the continuing sellers' increase is limited to 56.7%. This is consistent with the idea that seller reputation limits the extent of profitable price gouging. Similar...
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Niklas Engbom's "Contagious Unemployment," published by the Centre for Economic Policy Research
Recent micro evidence of how workers search for jobs is shown to have critical implications for the macroeconomic propagation of labor market shocks. Unemployed workers send over 10 times as many job applications in a month as their employed peers, but are less than half as likely per application to make a move. I interpret these patterns as the unemployed applying for more jobs that they are less likely to be a good fit for. During periods of high unemployment, it consequently becomes harder...
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Paul Scott, Jonathan Elliott, Georges V. Houngbonon, and Marc Ivaldi's "Market Structure, Investment and Technical Efficiencies in Mobile Telecommunications," published by the Centre for Economic Policy Research
Paul Scott and coauthors develop a model of competition in prices and infrastructural investment among mobile network providers. Market shares and service quality (download speed) are simultaneously determined, for demand affects the network load just as delivered quality affects consumer demand. While consolidation typically has adverse impacts on consumer surplus, economies of scale push in the other direction. Consumer surplus is maximized at a moderate number of firms, and that the...
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Larry White's "Rethinking Antitrust," published in the Milken Institute Review
Antitrust policy in the U.S. has recently gained an unusual amount of media attention. There are critics who have argued that a major overhaul of antitrust policy is needed. This paper argues that instead there are some important but more modest changes that could go a long way toward significantly strengthening the role that antitrust can play in keeping the U.S. economy competitive, vibrant, and innovative.
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Paul Wachtel, Moritz Kuhn, Alina Bartscher, and Moritz Schularick's "Monetary Policy and Racial Inequality," published by the Federal Reserve Bank of New York
This paper aims at an improved understanding of the relationship between monetary policy and racial inequality. We investigate the distributional effects of monetary policy in a unified framework, linking monetary policy shocks both to earnings and wealth differentials between black and white households. Specifically, we show that, although a more accommodative monetary policy increases employment of black households more than white households, the overall effects are small. At the same time...
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Adam Brandenburger, Alexander Danieli, and Amanda Friedenberg's "The Implications of Finite-Order Reasoning," forthcoming in Theoretical Economics
The epistemic conditions of rationality and mth-order strong belief of rationality (RmSBR, Battigalli and Siniscalchi, 2002) formalize the idea that players engage in contextualized forward-induction reasoning. This paper characterizes the behavior consistent with RmSBR across all type structures. In particular, in a class of generic games, R(m −1)SBR is characterized by a new solution concept we call an m-best response sequence (m-BRS). Such sequences are an iterative version of...
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