Knowledge that Transforms

The current study finds that societies which historically engaged in plough agriculture today have lower fertility. We argue, and provide ethnographic evidence, that the finding is explained by the fact that with plough agriculture, children, like women, are relatively less useful in the field. The plough requires strength and eliminates the need for weeding, a task particularly suitable for women and children. This in turn generates a preference for fewer children, lowering fertility.

This paper describes the progress, eight years after matriculating, of 586 individuals who entered one of 27 economics Ph.D. programs in fall 2002. By October 2010, 59 percent of the fall 2002 entering cohort had earned a Ph.D. in economics at the university where they initially matriculated, 37 percent had dropped out, and 4 percent were still writing their dissertations.We examine student outcomes by Ph.D. program tier and investigate factors associated with completion and time to degree. We document and describe the rise in median time to degree from 5.0 to 5.6 years during the period 1996–2010.

This paper develops a tractable extension of a Mortensen-Pissarides style matching model that allows for risk averse workers with limited ability to smooth consumption. I show that this leads to a form of equilibrium wage rigidity, as the inability of workers to smooth their consumption across unemployment and employment spells changes how unemployed workers value wage offers, and hence also the offers that employers find profitable to make. In the model risk-averse entrepreneurs use optimal long-term contracts to attract risk averse workers facing limited access to asset markets. A simple analytic representation for the equilibrium is derived. JEL: D81, E21, E24, E32, J31, J41, J64

Many federal government housing policies began during the New Deal of the 1930s. Many claim that minorities benefitted less from these policies than whites. We estimate the relationships between policies in the 1920s and 1930s and black and white home ownership in farm and nonfarm settings using a pseudo-panel of repeated cross-sections of households in 1920, 1930, and 1940 matched with policy measures in 460 state economic areas. The policies examined include FHA mortgage insurance, HOLC loan refinancing, state mortgage moratoria, farm loan programs, public housing, public works and relief, and payments to farmers to take land out of production.

We show that current differences in trust levels within Africa can be traced back to the transatlantic and Indian Ocean slave trades. Combining contemporary individual-level survey data with historical data on slave shipments by ethnic group, we find that individuals whose ancestors were heavily raided during the slave trade are less trusting today. Evidence from a variety of identification strategies suggests that the relationship is causal. Examining causal mechanisms, we show that most of the impact of the slave trade is through factors that are internal to the individual, such as cultural norms, beliefs, and values. (JEL J15, N57, Z13)

Using Current Population Survey and US Army administrative data, we document that between 2000 and 2010, the employment rate of Vietnam era veterans fell markedly relative to non-veterans of the same cohorts while simultaneously their enrollment increased steeply in the Veterans Disability Compensation (DC) program, which provides healthcare and transfer payments to veterans with service-connected disabilities. Thirty percent of Vietnam era Army veterans enrolled in DC in 2006 received benefits for Post-Traumatic Stress Disorder, with median annual payments of $25,500. The declining employment and rising transfer payments to Vietnam era veterans underscore the long-term private and public costs of wartime service, potentially stemming from both adverse health consequences and policies that have expanded benefits eligibility.

We examine the value of terroir—the set of special characteristics of a location that impart unique qualities to the wine produced. We conduct a hedonic analysis of vineyard sales in the Willamette Valley of Oregon to ascertain whether site attributes—such as slope, aspect, elevation, and soil types—or designated appellations are more important determinants of price. We find that prices are strongly determined by appellation designations, but not by specific site attributes. These results indicate that the concept of terroir matters economically, but that the reality of terroir—as proxied by locational attributes—is not significant.

Little is known about the relationship between variation in drug and non-drug medical treatment and how areas may substitute one type of care for the other. Using pharmacy and medical claims data for Medicare beneficiaries, we examine whether areas with more drug use have lower non-drug medical costs and how the quality of prescribing and primary care are associated with medical costs. We find that areas with higher drug spending do not have lower non-drug medical spending; however, poorer-quality prescribing and primary care are associated with higher medical spending in general and inpatient spending in particular.

Isoni, Loomes, and Sugden (2011) assert that Plott and Zeiler (2005) reported inaccurate results. Placing ILS's selective quotes into context demonstrates otherwise. Additionally, examining the data closely yields three conclusions. First, all mug data reject endowment effect theory. Second, lottery gaps are associated with unstable attitudes toward uncertainty, a finding consistent with PZ's (2005) lottery data description, explicit warnings about procedure limitations and the data supplement, which reports the lottery data and cautions. Third, lottery outcome beliefs are influenced by whether WTP or WTA is reported, suggesting that changing beliefs, as opposed to the shape of preferences, produce lottery gaps. (JEL C91)

This paper investigates the impact of equity markets and top incomes on art prices. Using a newly constructed art market index, we demonstrate that equity market returns have had a significant impact on the price level in the art market over the last two centuries. We also find evidence that an increase in income inequality may lead to higher prices for art. Finally, the results of Johansen's cointegration tests strongly suggest the existence of a long-run relation between top incomes and art prices.