Recent papers involving binary choices have argued that increasing heterogeneity decreases positive feedback. We show that no such result holds in models where all agents make interior choices. The results in the binary choice case arise for two reasons. First, if we increase heterogeneity...

Building on the idea that members of religious communities insure each other against some idiosyncratic risks, we argue that religious communities should be more widespread where populations face greater common risk. Our empirical analysis exploits rainfall risk as a source of common...

We study how restrictions on firm entry affect intersectoral factor reallocation when open economies experience global economic shocks. In our theoretical framework, countries trade freely in a range of differentiated sectors that are subject to country-specific and global shocks. Entry...

We examine the effect of oil price fluctuations on democratic institutions over the 1960-2007 period. We also exploit the very persistent response of income to oil price fluctuations to study the effect of persistent (oil price-driven) income shocks on democracy. Our results indicate that...

We propose estimating gender peer effects in school by exploiting within-school variation in gender composition across birth cohorts. Our approach differs from the existing literature, which exploits variation in gender composition at a given grade level in different years. We argue that the...

We use a dynamic monopolistic competition model to show that an economy that inherits a small range of specialized inputs can be trapped into a lower stage of development. The limited availability of specialized inputs forces the final goods producers to use a labor intensive technology, which...

The Industrial Revolution was characterized by technological progress and an increasing capital intensity. Why did real wages stagnate or fall in the beginning? I answer this question by modeling the Industrial Revolution as the introduction of a relatively more capital intensive production...