Review of Economic Dynamics最新文献

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Incarceration, employment, and earnings: Dynamics and differences 监禁、就业和收入:动态和差异
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.06.007
Grey Gordon, John Bailey Jones, Urvi Neelakantan, Kartik Athreya
{"title":"Incarceration, employment, and earnings: Dynamics and differences","authors":"Grey Gordon,&nbsp;John Bailey Jones,&nbsp;Urvi Neelakantan,&nbsp;Kartik Athreya","doi":"10.1016/j.red.2023.06.007","DOIUrl":"10.1016/j.red.2023.06.007","url":null,"abstract":"<div><p>We study the dynamics of incarceration, employment, and earnings. Our hidden Markov model distinguishes between first-time and repeat incarceration, between persistent and transitory nonemployment and earnings risks, and accounts for nonresponse bias. We estimate the model via maximum likelihood using the National Longitudinal Survey of Youth 1979, accounting for the large differences in incarceration rates by race, education level, and gender. First-time incarceration is associated with 33% (50%) lower expected lifetime earnings and 6 (10) fewer years of employment for Black (White) men with a high school degree. Among less-educated men, differences in incarceration and nonemployment can explain around half the Black-White lifetime earnings gap.</p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 677-697"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79314282","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 1
Agency frictions, managerial compensation, and disruptive innovations 代理摩擦、管理者报酬和破坏性创新
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2022.11.004
Murat Alp Celik , Xu Tian
{"title":"Agency frictions, managerial compensation, and disruptive innovations","authors":"Murat Alp Celik ,&nbsp;Xu Tian","doi":"10.1016/j.red.2022.11.004","DOIUrl":"https://doi.org/10.1016/j.red.2022.11.004","url":null,"abstract":"<div><p><span>Whether a manager leads the innovation efforts of a firm in line with shareholder preferences is key for firm value and growth. This, in turn, influences aggregate productivity growth and welfare. Data on US public firms reveals that (i) firms with better corporate governance tend to adopt highly incentivized contracts rich in stock options and (ii) such contracts are more likely to lead to disruptive innovations – patented inventions that are in the upper tail of the distribution in terms of quality and originality. Motivated by these empirical results, we develop and estimate a new dynamic general equilibrium model of firm-level innovation with agency frictions and endogenous determination of executive contracts. The model is used to study the joint dynamics of corporate governance, managerial compensation, and disruptive innovations, as well as the consequent aggregate implications on growth and welfare. Better corporate governance can reduce the influence of the manager in determining the compensation structure. This leads to more incentivized contracts and boosts innovation, with substantial benefits for the shareholders as well as the broader economy through knowledge </span>spillovers. Removing agency frictions leads to contracts richer in stock options, boosting growth by 0.51pp, and welfare by 7.3% in consumption-equivalent terms. These findings are robust to incorporating short-termism. Short-termism itself is also detrimental, the removal of which increases welfare by 1.5%. Alleviating both frictions at the same time leads to amplified gains in growth and welfare.</p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 16-38"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138739245","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Misallocation and intersectoral linkages 分配不当和部门间联系
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2022.12.005
Sophie Osotimehin , Latchezar Popov
{"title":"Misallocation and intersectoral linkages","authors":"Sophie Osotimehin ,&nbsp;Latchezar Popov","doi":"10.1016/j.red.2022.12.005","DOIUrl":"10.1016/j.red.2022.12.005","url":null,"abstract":"<div><p>We analytically characterize the aggregate productivity loss from distortions in the presence of sectoral production linkages and show the key role of input substitutability. We analyze the various forces behind the non-monotonic effect of input substitutability on the productivity loss. We then use the second-order approximation to aggregate productivity and find that for moderate distortions, low input substitutability reduces the productivity loss and the role of intermediate-input suppliers. Moreover, when the input elasticity of substitution is low, sectoral linkages do not systematically amplify the productivity loss. Using the model calibrated on industry-level data for 35 countries, we find that the insights obtained from the approximation are relevant in the context of the sectoral distortions caused by market power, even with the large distortions observed in the data. In particular, we find that using Cobb-Douglas production functions (unit elasticities) instead of accounting for low input substitutability (less-than-one elasticities) leads to overestimating the productivity loss by a factor of 1.8.</p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 177-198"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135181172","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Climate policy, financial frictions, and transition risk 气候政策、金融摩擦和转型风险
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.08.003
Stefano Carattini , Garth Heutel , Givi Melkadze
{"title":"Climate policy, financial frictions, and transition risk","authors":"Stefano Carattini ,&nbsp;Garth Heutel ,&nbsp;Givi Melkadze","doi":"10.1016/j.red.2023.08.003","DOIUrl":"10.1016/j.red.2023.08.003","url":null,"abstract":"<div><p>We study climate and macroprudential policies in an economy with financial frictions. Using a dynamic stochastic general equilibrium model<span> featuring both a pollution market failure and a market failure in the financial sector, we explore transition risk – whether ambitious climate policy can lead to macroeconomic instability. It can, but the risk can be alleviated through macroprudential policies – taxes or subsidies on banks' assets. Then, we explore efficient climate and macroprudential policy in the long run and over business cycles. The presence of financial frictions affects the steady-state value and dynamic properties of the efficient carbon tax.</span></p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 778-794"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135894827","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Misallocation and markups: Evidence from Indian manufacturing 错配和加价:印度制造业的证据
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2022.12.004
Yan Liang
{"title":"Misallocation and markups: Evidence from Indian manufacturing","authors":"Yan Liang","doi":"10.1016/j.red.2022.12.004","DOIUrl":"10.1016/j.red.2022.12.004","url":null,"abstract":"<div><p>This study examines the implications of variable markups for resource misallocation and for aggregate productivity. Using manufacturing data from India, I show that variable markups alone account for a small fraction of the dispersion in revenue productivity when allowing for other sources of misallocation. Meanwhile, variable markups are crucial to understanding the aggregate consequences of policies that reduce misallocation. When equalizing marginal products across firms in narrowly defined industries, my model generates a smaller total factor productivity gain than does a model that uses constant markups because more productive firms endogenously choose higher markups. Thus, the indirect costs of markups are higher than one might expect.</p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 161-176"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84720928","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Credit markets, relationship lending, and the dynamics of firm entry 信贷市场、关系贷款和企业进入的动力
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.02.001
Qingqing Cao , Paolo Giordani , Raoul Minetti , Pierluigi Murro
{"title":"Credit markets, relationship lending, and the dynamics of firm entry","authors":"Qingqing Cao ,&nbsp;Paolo Giordani ,&nbsp;Raoul Minetti ,&nbsp;Pierluigi Murro","doi":"10.1016/j.red.2023.02.001","DOIUrl":"10.1016/j.red.2023.02.001","url":null,"abstract":"<div><p>We study the impact of credit relationships on firm entry, and the implications for aggregate investment and output. Exploiting Italian data, we find that relationship-oriented local credit markets feature fewer, larger entrants, and relatively more spinoff entrants. Relationship lending discourages de novo entry when banks' knowledge is incumbent-specific but promotes knowledge transfers to spinoffs. We explain these patterns in a dynamic general equilibrium model where banks accumulate information in credit relationships and can reuse information when financing entrants. Relationship lending raises output, as the larger investments and the credit reallocation from de novos to spinoffs outweigh the entry slowdown.</p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 343-369"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85433905","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Demand, growth, and deleveraging 需求、增长和去杠杆化
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.08.004
Brian Greaney , Conor Walsh
{"title":"Demand, growth, and deleveraging","authors":"Brian Greaney ,&nbsp;Conor Walsh","doi":"10.1016/j.red.2023.08.004","DOIUrl":"10.1016/j.red.2023.08.004","url":null,"abstract":"<div><p><span>We present empirical evidence that weak household demand contributed to a reduction in firm entry in the Great Recession<span>. Motivated by this evidence, we study the general equilibrium response of aggregate economic growth to a severe deleveraging event. To do so, we combine a standard incomplete markets model with a class of </span></span>endogenous growth models<span>. A large reduction in credit access causes the zero lower bound to bind, inducing a drop in demand via employment rationing. Decreased demand in turn lowers the return to entrepreneurship and innovation, endogenously lowering productivity. We find that a persistent recession induced by deleveraging can significantly influence growth in productivity. Our main result is a powerful feedback effect: households increase savings in response to future slow growth, exacerbate the fall in demand, and further slow the recovery.</span></p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 795-812"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135200679","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Bequest motives and the Social Security Notch 遗赠动机和社会保障缺口
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.09.001
Siha Lee , Kegon T.K. Tan
{"title":"Bequest motives and the Social Security Notch","authors":"Siha Lee ,&nbsp;Kegon T.K. Tan","doi":"10.1016/j.red.2023.09.001","DOIUrl":"10.1016/j.red.2023.09.001","url":null,"abstract":"<div><p><span>Bequests may be a key driver of late life savings behavior and more broadly, a determinant of intergenerational inequality<span><span>. However, distinguishing bequest motives from precautionary savings is challenging. Using data from the Health and Retirement Study, we exploit an unanticipated change in </span>Social Security benefits, commonly called the Social Security </span></span>Notch<span>, as an instrument to identify the effect of benefits on bequests. We match data moments generated by the Notch with a model of late life savings behavior that accounts for mortality risk and unobserved expenditure shocks to identify bequest motives. The model is used to decompose the importance of bequest motives as a driver of late life savings by comparing asset profiles with and without utility from bequests. We find that roughly 40% of accumulated assets and bequests are attributable to bequest motives among retirees. Our policy counterfactual features a more progressive Social Security benefits schedule that reduces benefits for the richest retirees. We show that although wealth declines, consumption remains largely unchanged since wealth generated by bequest motives acts as a cushion against benefit reduction.</span></p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 888-914"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135685693","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 5
The costs of macroprudential deleveraging in a liquidity trap 流动性陷阱中宏观审慎去杠杆化的成本
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.09.005
Jiaqian Chen , Daria Finocchiaro , Jesper Lindé , Karl Walentin
{"title":"The costs of macroprudential deleveraging in a liquidity trap","authors":"Jiaqian Chen ,&nbsp;Daria Finocchiaro ,&nbsp;Jesper Lindé ,&nbsp;Karl Walentin","doi":"10.1016/j.red.2023.09.005","DOIUrl":"10.1016/j.red.2023.09.005","url":null,"abstract":"<div><p>We study various macroprudential tools and their interaction with monetary policy<span> in a New Keynesian model featuring long-term debt, illiquid housing and an effective lower bound constraint on policy rates. We find that the short-run deleveraging costs of different macroprudential tools – all sized to imply the same reduction in household debt in the medium and long-term – can differ significantly, depending on the state of economy and monetary policy. Specifically, a loan-to-value tightening is more than three times as contractionary as a loan-to-income tightening when debt is high and monetary policy cannot accommodate.</span></p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 991-1011"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136119740","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Retirement timing uncertainty: Empirical evidence and quantitative evaluation 退休时间的不确定性:经验证据和定量评估
IF 2 3区 经济学
Review of Economic Dynamics Pub Date : 2023-12-01 DOI: 10.1016/j.red.2023.01.002
Frank N. Caliendo , Maria Casanova , Aspen Gorry , Sita Slavov
{"title":"Retirement timing uncertainty: Empirical evidence and quantitative evaluation","authors":"Frank N. Caliendo ,&nbsp;Maria Casanova ,&nbsp;Aspen Gorry ,&nbsp;Sita Slavov","doi":"10.1016/j.red.2023.01.002","DOIUrl":"10.1016/j.red.2023.01.002","url":null,"abstract":"<div><p>People often retire at a different age than expected. We construct a measure of retirement timing uncertainty and find that the standard deviation of the difference between retirement expectations and actual retirement dates ranges from 3 to 6 years. To understand the potential implications of this uncertainty, we develop a simple model of exogenous but risky retirement. In this environment, individuals would give up 1.0%-4.5% of total lifetime consumption to fully insure this risk and 0.8%-3.2% of lifetime consumption simply to know their actual retirement date upon entering the labor force. This is crucial for retirement planning purposes because not saving to hedge this risk would leave individuals with even larger welfare costs.</p></div>","PeriodicalId":47890,"journal":{"name":"Review of Economic Dynamics","volume":"51 ","pages":"Pages 226-266"},"PeriodicalIF":2.0,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79390709","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 2
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