Knowledge that Transforms

We provide evidence of a large and persistent land price discount in neighborhoods historically inhabited by the outcaste group (buraku) in Japan. Our border design shows that this price discount declined from 53% in 1912 to 11% in 2006 but remained constant thereafter. Furthermore, we provide evidence that the vestiges of territorial stigma of buraku areas is the primary cause of these persistently lower land prices. Living in the stigmatized buraku area increases the risk of being identified as buraku and experiencing discrimination. Therefore, the lower land prices reflect the higher discrimination risk in the spatial equilibrium of our model.

Partly due to their negative effects on surrounding neighborhoods, some countries have been replacing distressed public housing developments with mixed-income housing. We study the impact of such policies on local housing markets in London, U.K., where several public housing developments were demolished and rebuilt while adding market-rate units on-site. We show that these ‘regenerations’ increase nearby house prices and rents, consistent with strong demand effects outweighing supply effects from additional market-rate housing in the immediate vicinity. We provide suggestive evidence that these effects are driven by regenerations removing an eyesore, attracting higher-income households, and reducing nearby crime.

Using a novel scanner data and difference-in-differences strategy, we assess how consumers respond to a large-scale tax reform in India that introduces exogenous variations in tax rate changes at the product level. We show evidence of a strong and persistent spending response to tax rate changes. The response is highly asymmetrical, with consumers responding significantly more strongly to tax rate increases than to decreases. We find empirical support for both intertemporal and cross-product substitution effects: Households (1) shift consumption forward preceding a tax increase and (2) substitute one good for another and alter their relative weight in the consumption basket to avoid paying higher tax. Heterogeneity analysis indicates that consumers with more personal shopping experience exhibit stronger consumption responses. Our findings have empirical implications for the efficacy of tax policy initiatives.

Administrative barriers to social insurance program take-up are pervasive, including in subsidized health insurance. We conducted a randomized controlled trial with Massachusetts' Affordable Care Act marketplace to reduce these barriers and other behavioral frictions. We find that a “check the box” streamlined enrollment intervention raises enrollment by 10.5%, more than personalized reminder letters (7.6% increase) or generic reminder letters (4.3% increase). Effects are concentrated among individuals eligible for zero-premium plans, who faced no further administrative burdens of setting up payments. Producing this enrollment effect through premium reduction would cost about $7 million in subsidies, highlighting the importance of these burdens.

How do preferences for neighborhood amenities vary by income? Using data on over 100 million visits to 1.4 million establishments, I estimate a discrete choice model of demand for restaurants, shops, personal services, and entertainment places. While preferences for specific establishments often vary by income, preferences for neighborhoods' overall amenity access are highly aligned. The primary determinant is density: dense urban areas have sufficient variety to offer broad appeal. For incumbents of gentrifying neighborhoods, tailoring amenities to higher-income entrants has only modest welfare effects relative to the effects of potential displacement to cheaper neighborhoods with worse access to amenities.

Using administrative data on the Chinese National College Entrance Examination, we study how left-digit bias affects college applications. We find strong discontinuities in students’ admission outcomes at ten-point thresholds. Students with scores just below multiples of 10 make more conservative college application choices that place them into less selective colleges and majors. In contrast, students who score at or just above multiples of 10 aim at and achieve higher but are at greater risk of overshooting. The discontinuity reveals that despite the educational and labor market consequences, students’ self-evaluation based on exam scores is subject to information-processing heuristics.

We analyze attention to personal finances using a high-frequency panel of bank data, including information on logins. We document a number of robust patterns. Relative to their personal histories, individuals pay more attention when holding more cash and liquidity and when receiving income. In contrast, attention decreases discretely as bank account balances go from positive to negative and then decreases further as overdraft debt increases. We conclude that Ostrich effects in a personal finance context, i.e., the avoidance of obtaining information on everyday personal finances, is a widespread phenomenon and explore a number of explanations for our findings.

This paper shows that replacing paper-based records with electronic medical records (EMRs) improves HIV patient retention and prevents AIDS deaths in the low-income country of Malawi. An event study of 106 HIV clinics shows a 28 percent reduction in annual deaths five years after EMR implementation, with the greatest impact on children. Improvements in health outcomes appear due to efficiency gains, rather than to changes in the medical care provided at visits. These efficiency gains allow clinics to better manage patient data, trace lapsed patients and return them into care, and adapt to higher patient volumes over time.

I examine how individuals learn about health risks from household health shocks using US administrative data. When a family member is diagnosed with a chronic condition, relatives increase healthcare spending by 10%, a response that would require price declines as large as 50% to justify on demand alone. I quantify the mechanisms behind these effects, showing they are most consistent with individuals updating their beliefs about health risks. I evaluate the welfare and efficiency implications of this learning using a structural approach. I find that the majority of individuals overreact to diagnoses, overweighting their ex-post risks and offsetting potential welfare gains from informed decision-making.

We provide the first national analysis of mortality in the U.S. homeless population by linking 140,000 homeless individuals from the 2010 Census to twelve years of all-cause mortality data from the Social Security Administration (SSA). Non-elderly homeless individuals face 3.5 times the mortality risk of the housed after accounting for demographic differences and geography, with a time pattern suggesting that persistently poor health, rather than homelessness itself, primarily drives this disparity. Employment, higher income, and more extensive recent family connections are associated with lower mortality, underscoring the persistence of health disparities into the extreme lower tail of socioeconomic disadvantage.