Kapteyn and Ypma (Journal of Labour Economics 2007) is an influential study of errors in survey and administrative data on employment earnings. To fit their mixture models, Kapteyn and Ypma assume a specific fraction of their sample have error-free earnings. Using a new UK dataset, we assess the...

This paper proposes a method for empirically mapping psychological personality traits to economic preferences. Careful modelling of random components of decision making is crucial to establishing the long supposed but empirically elusive link between economic and psychological systems for...

This paper constructs internationally consistent measures of macroeconomic uncertainty. Our econometric framework extracts uncertainty from revisions in data obtained from standardized national accounts. Applying our model to quarterly post-WWII real-time data, we estimate macroeconomic...

A common view in the law and economics literature holds that equal increases in type-1 and type-2 error lower deterrence by the same amount. We demonstrate that this view is generally incorrect both when the court's error concerns the assessment of the alleged offender's act (mistake of act) and...

Initial Gross Domestic Product (GDP) announcements are important economic signals that convey information on the state of the economy but contain substantial estimation error. We investigate how GDP estimation errors affect firms' real decisions and profitability. Consistent with theoretical...

This comment points out mismeasurement of variables in the DSGE model in Smets and Wouters (2007) and in models that follow the Smets-Wouters measurement procedures. The mismeasurement errors appear to be large

This paper studies a variation of the continuous-time mean-variance portfolio selection where a tracking-error penalization is added to the mean-variance criterion. The tracking error term penalizes the distance between the allocation controls and a reference portfolio with same wealth and fixed...

Popularity bias -- the tendency to make choices that are more popular -- is a widespread behavior. We incorporate this bias into a dynamic model of a bipartite economy with heterogeneous agents, where each agent primarily cares about obtaining her optimal number of partners. We provide a full...

Measurement error and omitted variables are challenging problems in linear regression: they may render least squares estimation biased and inconsistent. Many proposals for consistent estimation require instrumental variables, but in practice valid instruments are often elusive. Theil suggests an...