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Review of Economic Studies
Journal Prestige (SJR): 9.589
Citation Impact (citeScore): 4
Number of Followers: 163  
  Hybrid Journal Hybrid journal (It can contain Open Access articles)
ISSN (Print) 0034-6527 - ISSN (Online) 1467-937X
Published by Oxford University Press Homepage  [406 journals]
  • Growth Through Inter-sectoral Knowledge Linkages
    • Authors: Cai J Li N.
      Pages: 1827 - 1866
      Abstract: The majority of innovations are developed by multi-sector firms. The knowledge needed to invent new products is more easily adapted from some sectors than from others. We study this network of knowledge linkages between sectors and its impact on firm innovation and aggregate growth. We first document a set of sectoral-level and firm-level observations on knowledge applicability and firms’ multi-sector patenting behaviour. We then develop a general equilibrium model of firm innovation in which inter-sectoral knowledge linkages determine the set of sectors a firm chooses to innovate in and how much R&D to invest in each sector. It captures how firms evolve in the technology space, accounts for cross-sector differences in R&D intensity, and describes an aggregate model of technological change. The model matches new observations as demonstrated by simulation. It also yields new insights regarding the mechanism through which sectoral fixed costs of R&D affect growth.
      PubDate: Mon, 05 Nov 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy062
      Issue No: Vol. 86, No. 5 (2018)
  • Inference on Causal and Structural Parameters using Many Moment
    • Authors: Chernozhukov V; Chetverikov D, Kato K, et al.
      Pages: 1867 - 1900
      Abstract: This article considers the problem of testing many moment inequalities where the number of moment inequalities, denoted by $p$, is possibly much larger than the sample size $n$. There is a variety of economic applications where solving this problem allows to carry out inference on causal and structural parameters; a notable example is the market structure model of Ciliberto and Tamer (2009) where $p=2^{m+1}$ with $m$ being the number of firms that could possibly enter the market. We consider the test statistic given by the maximum of $p$ Studentized (or $t$-type) inequality-specific statistics, and analyse various ways to compute critical values for the test statistic. Specifically, we consider critical values based upon (1) the union bound combined with a moderate deviation inequality for self-normalized sums, (2) the multiplier and empirical bootstraps, and (3) two-step and three-step variants of (1) and (2) by incorporating the selection of uninformative inequalities that are far from being binding and a novel selection of weakly informative inequalities that are potentially binding but do not provide first-order information. We prove validity of these methods, showing that under mild conditions, they lead to tests with the error in size decreasing polynomially in $n$ while allowing for $p$ being much larger than $n$; indeed $p$ can be of order $\exp (n^{c})$ for some $c > 0$. Importantly, all these results hold without any restriction on the correlation structure between $p$ Studentized statistics, and also hold uniformly with respect to suitably large classes of underlying distributions. Moreover, in the online supplementonline supplement, we show validity of a test based on the block multiplier bootstrap in the case of dependent data under some general mixing conditions.
      PubDate: Fri, 16 Nov 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy065
      Issue No: Vol. 86, No. 5 (2018)
  • Regional Transfer Multipliers
    • Authors: Corbi R; Papaioannou E, Surico P.
      Pages: 1901 - 1934
      Abstract: A series of discontinuities in the allocation mechanism of federal transfers to municipal governments in Brazil allow us to identify the causal effect of public spending on local labour markets, using a “fuzzy” Regression Discontinuity Design (RDD). Our estimates imply a cost per job of about 8,000 US dollars per year and a local income multiplier around two. The effect comes mostly from employment in services and is more pronounced among less financially developed municipalities.
      PubDate: Tue, 27 Nov 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy069
      Issue No: Vol. 86, No. 5 (2018)
  • The Elasticity of Intergenerational Substitution, Parental Altruism, and
           Fertility Choice
    • Authors: Carlos Córdoba J; Ripoll M.
      Pages: 1935 - 1972
      Abstract: Dynastic models common in macroeconomics use a single parameter to control the willingness of individuals to substitute consumption both intertemporally, or across periods, and intergenerationally, or across parents and their children. This article defines the concept of elasticity of intergenerational substitution (EGS), and extends a standard dynastic model in order to disentangle the EGS from the EIS, or elasticity of intertemporal substitution. A calibrated version of the model lends strong support to the notion that the EGS is significantly larger than one. In contrast, estimates of the EIS suggests that it is at most one. What disciplines the identification is the need to match empirically plausible fertility rates for the U.S. We illustrate the potential role of the EGS in macroeconomics.
      PubDate: Fri, 21 Dec 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy071
      Issue No: Vol. 86, No. 5 (2018)
  • Automobile Prices in Market Equilibrium with Unobserved Price
    • Authors: D’Haultfœuille X; Durrmeyer I, Février P.
      Pages: 1973 - 1998
      Abstract: In markets where sellers are able to price discriminate, individuals pay different prices that may be unobserved by the econometrician. This article considers the structural estimation of a demand and supply model of differentiated products with such price discrimination and limited information on prices taking the form of, e.g., observing list prices from catalogues or average prices. Within this framework, identification is achieved not only with usual moment conditions on the demand side, but also through supply-side restrictions. The model can be estimated by GMM using a nested fixed point algorithm that extends the usual contraction mapping algorithm to our setting. We apply our methodology to estimate the demand and supply in the French new automobile market. Our results suggest that discounting arising from price discrimination is important. The average discount is estimated to be 9.6%, with large variation depending on buyers’ characteristics and cars’ specifications. Our results are consistent with other evidence on transaction prices in France.
      PubDate: Mon, 29 Oct 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy064
      Issue No: Vol. 86, No. 5 (2018)
  • Revenue Management without Commitment: Dynamic Pricing and Periodic Flash
    • Authors: Dilmé F Li F.
      Pages: 1999 - 2034
      Abstract: A seller has a fixed number of goods to sell by a deadline. At each time, he posts a regular price and decides whether to hold a flash sale. Over time, buyers privately enter the market and strategically time their purchases. If a buyer does not purchase when she arrives, she can pay an attention cost to recheck the regular price afterwards, or she can wait for future flash sales where she may obtain a good at a discounted price. In the unique Markov perfect equilibrium, the seller sporadically holds flash sales to lower the stock of goods. A flash sale increases the willingness to pay of future buyers, but decreases the willingness to pay of buyers who arrive early in the game. When it is very likely that a buyer will obtain a good in a flash sale, the seller holds a “big” initial flash sale for all but one unit of the good.
      PubDate: Wed, 19 Dec 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy073
      Issue No: Vol. 86, No. 5 (2018)
  • Refugee Migration and Electoral Outcomes
    • Authors: Dustmann C; Vasiljeva K, Piil Damm A.
      Pages: 2035 - 2091
      Abstract: To estimate the causal effect of refugee migration on voting outcomes in parliamentary and municipal elections in Denmark, our study is the first that addresses the key problem of immigrant sorting by exploiting a policy that assigned refugee immigrants to municipalities on a quasi-random basis. We find that in all but the most urban municipalities, allocation of larger refugee shares between electoral cycles leads to an increase in the vote share for right-leaning parties with an anti-immigration agenda, and we show large differences in voters’ responses to refugee allocation according to pre-policy municipal characteristics. However, in the largest and urban municipalities, refugee allocation has—if anything—the opposite effect on vote shares for anti-immigration parties. This coincides with a sharp divide in attitudes to refugees between urban and rural populations, which may be partly explained by distinctive interactions between natives and those with different background in cities and rural areas. Refugee allocation also has a large impact on the anti-immigration parties’ choice of where to stand for municipal election, and we provide some evidence that it influences voter turnout.
      PubDate: Tue, 04 Sep 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy047
      Issue No: Vol. 86, No. 5 (2018)
  • Internet and Politics: Evidence from U.K. Local Elections and Local
           Government Policies
    • Authors: Gavazza A; Nardotto M, Valletti T.
      Pages: 2092 - 2135
      Abstract: We empirically study the effects of broadband internet diffusion on local election outcomes and on local government policies using rich data from the U.K. Our analysis shows that the internet has displaced other media with greater news content (i.e. radio and newspapers), thereby decreasing voter turnout, most notably among less-educated and younger individuals. In turn, we find suggestive evidence that local government expenditures and taxes are lower in areas with greater broadband diffusion, particularly expenditures targeted at less-educated voters. Our findings are consistent with the idea that voters’ information plays a key role in determining electoral participation, government policies, and government size.
      PubDate: Sat, 09 Jun 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy028
      Issue No: Vol. 86, No. 5 (2018)
  • Attribution Bias in Consumer Choice
    • Authors: Haggag K; Pope D, Bryant-Lees K, et al.
      Pages: 2136 - 2183
      Abstract: When judging the value of a good, people may be overly influenced by the state in which they previously consumed it. For example, someone who tries out a new restaurant while very hungry may subsequently rate it as high quality, even if the food is mediocre. We produce a simple framework for this form of attribution bias that embeds a standard model of decision making as a special case. We test for attribution bias across two consumer decisions. First, we conduct an experiment in which we randomly manipulate the thirst of participants prior to consuming a new drink. Second, using data from thousands of amusement park visitors, we explore how pleasant weather during their most recent trip affects their stated and actual likelihood of returning. In both of these domains, we find evidence that people misattribute the influence of a temporary state to a stable quality of the consumption good. We provide evidence against several alternative accounts for our findings and discuss the broader implications of attribution bias in economic decision making.
      PubDate: Tue, 18 Sep 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy054
      Issue No: Vol. 86, No. 5 (2018)
  • Household Sharing and Commitment: Evidence from Panel Data on Individual
           Expenditures and Time Use
    • Authors: Lise J; Yamada K.
      Pages: 2184 - 2219
      Abstract: In this article, we analyse the dynamics of intra-household allocations using unique panel data on individual-specific consumption expenditures and time used for leisure, market production, and home production. Cross-sectional differences at the time of marriage in expected wage profiles between a husband and wife strongly affect the allocation of private consumption expenditures and time use by households in the cross section. There are substantial gender asymmetries in these allocations. Even for households where the husband and wife have identical wages, the private consumption expenditures for the wife are about half those for the husband. Within a given household over time, shocks to wages lead households to shift the relative weights in favour of the spouse receiving the favourable shock. Additionally, we find that households adjust the weights in response to large but not to small shocks; the adjustment to the weights is twice as large in the year leading up to a divorce; and adjustments are more frequent in dual- than in single-earner households. We interpret the data using a dynamic collective model of the household with potentially limited commitment.
      PubDate: Wed, 31 Oct 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy066
      Issue No: Vol. 86, No. 5 (2018)
  • Do Female Officers Improve Law Enforcement Quality' Effects on Crime
           Reporting and Domestic Violence
    • Authors: Miller A; Segal C.
      Pages: 2220 - 2247
      Abstract: We study the impact of the integration of women in U.S. policing between the late 1970s and early 1990s on violent crime reporting and domestic violence (DV). Along these two key dimensions, we find that female officers improved police quality. Crime victimization data reveal that as female representation increases among officers in an area, violent crimes against women in that area, and especially DV, are reported to the police at significantly higher rates. There are no such effects for violent crimes against men or from increases in the female share of civilian police employees. Furthermore, increases in female officer shares are followed by significant declines in rates of intimate partner homicide and non-fatal domestic abuse. These effects are all consistent between fixed effects models with controls for economic and policy variables and models that focus exclusively on increases in female police employment driven by externally imposed affirmative action plans following litigation for employment discrimination.
      PubDate: Tue, 18 Sep 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy051
      Issue No: Vol. 86, No. 5 (2018)
  • Trading, Profits, and Volatility in a Dynamic Information Network Model
    • Authors: Walden J.
      Pages: 2248 - 2283
      Abstract: We introduce a dynamic noisy rational expectations model in which information diffuses through a general network of agents. In equilibrium, agents who are more closely connected have more similar period-by-period trades, and an agent’s profitability is determined by a centrality measure that is related to Katz centrality. Volatility after an information shock is more persistent in less central networks, and volatility and trading volume are also influenced by the network’s asymmetry and irregularity. Using account-level data of all portfolio holdings and trades on the Helsinki Stock Exchange between 1997 and 2003, we find support for the aggregate predictions, altogether suggesting that the market’s network structure is important for these dynamics.
      PubDate: Mon, 24 Sep 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy058
      Issue No: Vol. 86, No. 5 (2018)
  • Corrigendum
    • Pages: 2284 - 2284
      Abstract: PASCAL MICHAILLAT and EMMANUEL SAEZ. (2018), “Optimal Public Expenditure with Inefficient Unemployment” Review of Economic Studies, doi:10.1093/restud/rdy030.
      PubDate: Tue, 04 Dec 2018 00:00:00 GMT
      DOI: 10.1093/restud/rdy067
      Issue No: Vol. 86, No. 5 (2018)
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