Are location-specific factors--such as the education and attitude of the local workforce, supplier networks, institutional infrastructure, and local "culture"--important for understanding persistent heterogeneities among firms? We address this question in the context of the automobile industry....

When asked to name one proposition in the social sciences that is both true and non-trivial, Paul Samuelson famously replied: 'Ricardo's theory of comparative advantage'. Truth, however, in Samuelson's reply refers to the fact that Ricardo's theory of comparative advantage is mathematically...

Greater patient cost-sharing could help reduce the fiscal pressures associated with insurance expansion by reducing the scope for moral hazard. But it is possible that low-income recipients are unable to cut back on utilization wisely and that, as a result, higher cost-sharing will lead to worse...

Fuel economy standards change the composition of the vehicle fleet, potentially influencing accident safety. I introduce a model of the fleet that captures risks across interactions between vehicle types while simultaneously recovering estimates of unobserved driving safety behavior. The model...

A number of commentators have argued that the desirability of inflation targeting as a framework for monetary policy analysis should be reconsidered in light of the global financial crisis, on the ground that it requires neglect of the implications of monetary policy for financial stability....

We use broad-based yet detailed data from the economy's goods-producing sectors to investigate firms' ownership of production chains. It does not appear that vertical ownership is primarily used to facilitate transfers of goods along the production chain, as is often presumed: Roughly one-half...

Riester pensions are voluntary, but heavily subsidized private pension schemes in Germany. They were designed as a matching defined contribution scheme to fill the emerging "pension gap" that is being generated by the gradually declining generosity of the public pay-as-you-go pensions in...

Programs to encourage labor market activity among youth, including public employment programs and wage subsidies like the Work Opportunity Tax Credit, can be supported by three broad rationales. They may: (1) provide contemporaneous income support to participants; (2) encourage work experience...

Why do individuals choose different types of post-secondary education, and what are the labor market consequences of those choices? We show that answering these questions is difficult because individuals choose between several unordered alternatives. Even with a valid instrument for every type...

We develop a dynamic political-economic theory of welfare state and immigration policies, featuring three distinct voting groups: skilled workers, unskilled workers, and old retirees. The essence of inter- and intra-generational redistribution of a typical welfare system is captured with a...