Knowledge that Transforms

We study the selection of Fellows of the Econometric Society, using a new data set of publications and citations for over 40,000 actively publishing economists since the early 1900s. Conditional on achievement, we document a large negative gap in the probability that women were selected as Fellows in the 1933–1979 period. This gap became positive (though not statistically significant) from 1980 to 2010, and in the past decade has become large and highly significant, with over a 100% increase in the probability of selection for female authors relative to males with similar publications and citations. The positive boost affects highly qualified female candidates (in the top 10% of authors) with no effect for the bottom 90%. Using nomination data for the past 30 years, we find a key proximate role for the Society's Nominating Committee in this shift. Since 2012, the Committee has had an explicit mandate to nominate highly qualified women, and its nominees enjoy above‐average election success (controlling for achievement). Looking beyond gender, we document similar shifts in the premium for geographic diversity: in the mid‐2000s, both the Fellows and the Nominating Committee became significantly more likely to nominate and elect candidates from outside the United States. Finally, we examine gender gaps in several other major awards for U.S. economists. We show that the gaps in the probability of selection of new fellows of the American Academy of Arts and Sciences and the National Academy of Sciences closely parallel those of the Econometric Society, with historically negative penalties for women turning to positive premiums in recent years.

We theoretically analyze the problem of testing for p ‐hacking based on distributions of p ‐values across multiple studies. We provide general results for when such distributions have testable restrictions (are non‐increasing) under the null of no p ‐hacking. We find novel additional testable restrictions for p ‐values based on t ‐tests. Specifically, the shape of the power functions results in both complete monotonicity as well as bounds on the distribution of p ‐values. These testable restrictions result in more powerful tests for the null hypothesis of no p ‐hacking. When there is also publication bias, our tests are joint tests for p ‐hacking and publication bias. A reanalysis of two prominent data sets shows the usefulness of our new tests.

This paper provides a general analysis of signaling under double‐crossing preferences with a continuum of types. There are natural economic environments where the indifference curves of two types cross twice, such that the celebrated single‐crossing property fails to hold. Equilibrium exhibits a threshold type below which types choose actions that are fully revealing and above which they pool in a pairwise fashion, with a gap separating the actions chosen by these two sets of types. The resulting signaling action is quasi‐concave in type. We also provide an algorithm to establish equilibrium existence by construction.

We develop a unique survey that focuses on the job search behavior of individuals regardless of their labor force status and field it annually starting in 2013. We use our survey to study the relationship between search effort and outcomes for the employed and non‐employed. Three important facts stand out: (1) on‐the‐job search is pervasive, and is more intense at the lower rungs of the job ladder; (2) the employed are at least three times more effective than the unemployed in job search; and (3) the employed receive better job offers than the unemployed. We set up a general equilibrium model of on‐the‐job search with endogenous search effort, calibrate it to fit our new facts, and find that the search effort of the employed is highly elastic. We show that search effort substantially amplifies labor market responses to productivity shocks over the business cycle.

The public debate over disability insurance has centered on concerns about individuals without severe health conditions receiving benefits. We go beyond health risk alone to quantify the overall insurance value of U.S. disability programs, including value from insuring nonhealth risk. We find that disability recipients, especially those with less‐severe health conditions, are much more likely to have experienced a wide variety of nonhealth shocks than nonrecipients. Selection into disability receipt on the basis of nonhealth shocks is so strong among individuals with less‐severe health conditions that by many measures less‐severe recipients are worse off than more‐severe recipients. As a result, under baseline assumptions, benefits to less‐severe recipients have an annual surplus value (insurance benefit less efficiency cost) over cost‐equivalent tax cuts of $7700 per recipient, about three‐fourths that of benefits to more‐severe recipients ($9900). Insurance against nonhealth risk accounts for about one‐half of the value of U.S. disability programs.

We study firm responses to a large‐scale change in apprenticeship regulation in Colombia. The reform requires firms to train, setting apprentice quotas that vary discontinuously in firm size. We document strong heterogeneity in responses across sectors, where firms in sectors with high skill requirements tend to avoid training apprentices, while firms in low‐skill sectors seek apprentices. Guided by these reduced‐form findings, we structurally estimate firms' training costs. Especially in high‐skill sectors, many firms face large training costs, limiting their willingness to train apprentices. Yet, we find substantial overall benefits of expanding apprenticeship training, in particular when the supply of trained workers increases in general equilibrium. Finally, we show that counterfactual policies taking into account heterogeneity across sectors can deliver similar benefits from training while inducing less distortions in the firm‐size distribution and in the allocation of resources across sectors.

We study the design of approval rules when costly experimentation must be delegated to an agent with misaligned preferences. When the agent has the option to end experimentation, we show that in contrast to standard stopping problems, the optimal approval rule must be history‐dependent. We characterize the optimal rule and show the approval threshold moves downward over the course of experimentation. We find that private information may qualitatively change the optimal mechanism: an agent can choose a fast‐track option in the form of an initially depressed approval threshold. On expiry of the fast track, the threshold jumps up, introducing more stringent standards. Our results provide a theoretical foundation for both the loosening of approval standards on longer experimentation paths and fast‐track mechanisms.

An agent has access to multiple information sources, each modeled as a Brownian motion whose drift provides information about a different component of an unknown Gaussian state. Information is acquired continuously—where the agent chooses both which sources to sample from, and also how to allocate attention across them—until an endogenously chosen time, at which point a decision is taken. We demonstrate conditions on the agent's prior belief under which it is possible to exactly characterize the optimal information acquisition strategy. We then apply this characterization to derive new results regarding: (1) endogenous information acquisition for binary choice, (2) the dynamic consequences of attention manipulation, and (3) strategic information provision by biased news sources.

Trade liberalization changes the volatility of returns by reducing the negative correlation between local prices and productivity shocks. In this paper, we explore these second‐moment effects of trade. Using forty years of agricultural micro‐data from India, we show that falling trade costs due to expansions of the Indian highway network reduced the responsiveness of local prices to local yields but increased the responsiveness of local prices to yields elsewhere. In response, farmers shifted their production toward crops with less volatile yields, especially so for those with poor access to risk mitigating technologies such as banks. We then characterize how volatility affects farmers' crop allocation using a portfolio choice framework where returns are determined in general equilibrium by a many‐location, many‐good Ricardian trade model with flexible trade costs. Finally, we structurally estimate the model—recovering farmers' risk‐return preferences from the gradient of the mean‐variance frontier at their observed crop choices—to quantify the second‐moment effects of trade. The simultaneous expansion of both the highway and rural bank networks increased the mean and the variance of farmer real income, with the first‐moment effect dominating such that expected welfare rose 4.4%. But had rural bank access remained unchanged, welfare gains would have been only half as great, as risk mitigating technologies allowed farmers to take advantage of higher‐risk higher‐return allocations.

This paper investigates whether the range of an attribute's outcomes in the choice set alters its relative importance. I derive distinguishing predictions of two prominent theories of range‐dependent attribute weighting: the focusing model of Kőszegi and Szeidl (2013) and the relative thinking model of Bushong, Rabin, and Schwartzstein (2021). I test these predictions in a laboratory experiment in which I vary the prices of high‐ and low‐quality variants of multiple products. The data provide clear evidence of choice‐set dependence consistent with relative thinking: price increases that expand the range of prices in the choice set lead to more purchases. Structural estimates imply economically meaningful effect sizes: the average participant was willing to pay around 17% more when a seemingly irrelevant option is added to their choice set.