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Redesigning the US Army’s Branching Process: A Case Study in Minimalist Market Design

American Economic Review 2024 114(4), 1070-1106
We present a proof-of-concept for minimalist market design (Sönmez 2023) as an effective methodology to enhance an institution based on stakeholders’ desiderata with minimal interference. Four objectives— respecting merit, increasing retention, aligning talent, and enhancing trust—guided reforms to the US Army’s centralized branching process of cadets to military specialties since 2006. USMA’s mechanism for the class of 2020 exacerbated challenges in implementing these objectives. Formulating the Army’s desiderata as rigorous axioms, we analyze their implications. Under our minimalist approach to institution redesign, the Army’s objectives uniquely identify a branching mechanism. Our design is now adopted at USMA and ROTC.

Electronic Food Vouchers: Evidence from an At-Scale Experiment in Indonesia

American Economic Review 2023 113(2), 514-547 open access
We compare how in-kind food assistance and an electronic voucher-based program affect the delivery of aid in practice. The Government of Indonesia randomized across 105 districts the transition from in-kind rice to approximately equivalent electronic vouchers redeemable for rice and eggs at a network of private agents. Targeted households received 46 percent more assistance in voucher areas. For the bottom 15 percent of households at baseline, poverty fell 20 percent. Voucher recipients received higher-quality rice, and increased consumption of eggs. The results suggest moving from a manual in-kind to electronic voucher-based program reduced poverty through increased adherence to program design.

Sources of Displaced Workers’ Long-Term Earnings Losses

American Economic Review 2020 110(10), 3231-3266
We estimate the magnitudes of reduced earnings, work hours, and wage rates of workers displaced during the Great Recession using linked employer-employee panel data from Washington state. Displaced workers’ earnings losses occurred mainly because hourly wage rates dropped at the time of displacement and recovered sluggishly. Lost employer-specific premiums explain only 17 percent of these losses. Fully 70 percent of displaced workers moved to employers paying the same or higher wage premiums than the displacing employers, but these workers nevertheless suffered substantial wage rate losses. Loss of valuable specific worker-employer matches explains more than one-half of the wage losses.

The Welfare Effects of Coordinated Assignment: Evidence from the New York City High School Match

American Economic Review 2017 107(12), 3635-3689 open access
Coordinated single-offer school assignment systems are a popular education reform. We show that uncoordinated offers in NYC's school assignment mechanism generated mismatches. One-third of applicants were unassigned after the main round and later administratively placed at less desirable schools. We evaluate the effects of the new coordinated mechanism based on deferred acceptance using estimated student preferences. The new mechanism achieves 80 percent of the possible gains from a no-choice neighborhood extreme to a utilitarian benchmark. Coordinating offers dominates the effects of further algorithm modifications. Students most likely to be previously administratively assigned experienced the largest gains in welfare and subsequent achievement.

Cities Are Physical Too: Using Computer Vision to Measure the Quality and Impact of Urban Appearance

American Economic Review 2016 106(5), 128-132 open access
For social scientists, developing an empirical connection between the physical appearance of a city and the behavior and health of its inhabitants has proved challenging due to a lack of data on urban appearance. Can we use computers to quantify urban appearance from street-level imagery? We describe Streetscore: a computer vision algorithm that measures the perceived safety of streetscapes. Using Streetscore to evaluate 19 American cities, we find that the average perceived safety has a strong positive correlation with population density and household income; and the variation in perceived safety has a strong positive correlation with income inequality.

Charters without Lotteries: Testing Takeovers in New Orleans and Boston

American Economic Review 2016 106(7), 1878-1920 open access
Charter takeovers are traditional public schools restarted as charter schools. We develop a grandfathering instrument for takeover attendance that compares students at schools designated for takeover with a matched sample of students attending similar schools not yet taken over. Grandfathering estimates from New Orleans show substantial gains from takeover enrollment. In Boston, grandfathered students see achievement gains at least as large as the gains for students assigned charter seats in lotteries. A non-charter Boston turnaround intervention that had much in common with the takeover strategy generated gains as large as those seen for takeovers, while other more modest turnaround interventions yielded smaller effects.

Satellites, Self-reports, and Submersion: Exposure to Floods in Bangladesh

American Economic Review 2015 105(5), 232-236
A burgeoning “Climate-Economy” literature has uncovered many effects of changes in temperature and precipitation on economic activity, but has made considerably less progress in modeling the effects of other associated phenomena, like natural disasters. We develop new, objective data on floods, focusing on Bangladesh. We show that rainfall and self-reported exposure are weak proxies for true flood exposure. These data allow us to study adaptation, giving accurate measures of both long-term averages and short term variation in exposure. This is important in studying climate change impacts, as people will not only experience new exposures, but also experience them differently.

Revealed (P)Reference Theory

American Economic Review 2015 105(1), 299-321
This paper develops axiomatically a revealed preference theory of reference-dependent choice behavior. Instead of taking the reference for an agent as exogenously given in the description of a choice problem, we suitably relax the Weak Axiom of Revealed Preference to obtain, endogenously, the existence of reference alternatives as well as the structure of choice behavior conditional on those alternatives. We show how this model captures some well-known choice patterns such as the attraction effect.