While traditional empirical models using determinants like size and trade costs are able to predict RTA formation reasonably well, we demonstrate that allowing for machine detected non-linear patterns helps to improve the predictive power of RTA formation substantially. We employ machine...

We postulate a nonlinear DSGE model with a financial sector and heterogeneous households. In our model, the interaction between the supply of bonds by the financial sector and the precautionary demand for bonds by households produces significant endogenous aggregate risk. This risk induces an...

We examine how the adoption of digital automation technology affects labor demand, operations and profitability in the context of the logistics industry. Our data covers 9,300 digital automation projects in a multinational company involving service robots and machine learning-based software from...

We provide a comprehensive overview of the literature on the measurement of democracy and present an extensive update of the Machine Learning indicator of Gründler and Krieger (2016, European Journal of Political Economy). Four improvements are particularly notable: First, we produce a...

We develop an algorithm for solving a large class of nonlinear high-dimensional continuous-time models in finance. We approximate value and policy functions using deep learning and show that a combination of automatic differentiation and Ito's lemma allows for the computation of exact...

This paper addresses the steep learning curve in Machine Learning faced by non-computer scientists, particularly social scientists, stemming from the absence of a primer on its fundamental principles. I adopt a pedagogical strategy inspired by the adage ”once you understand OLS, you can work...

Artificial intelligence (AI) is starting to pervade the economic and social life rendering strategic interactions with artificial agents more and more common. At the same time, experimental economic research has increasingly employed computer players to advance our understanding of strategic...

This paper defines economic slumps as sequences of structural breaks exhibiting a specific pattern. We identify 58 such episodes between 1950 and 2008 among 138 countries, and then examine the phases of decline and their duration. In some countries declines last extremely long, and we put...

Understanding how price regulations affect the adoption of new patent-protected pharmaceutical technologies is a crucial question in designing health systems. This paper addresses this question by examining how price expectations shape the probability of launch, controlling for competition,...

The extent of government deficits and debt has been one of the most debated issues in recent years. However, much less has been contributed about their dynamics. Yet, the issue of entering into and exiting from excessive deficits is critical in the Economic and Monetary Union since the Stability...