Accepted Papers

The Review of Economic Studies is one of the most highly respected academic journals in the field of economics. It is known for publishing leading research in all areas of economics, from microeconomics to macroeconomics. The journal is published by the Oxford University Press.

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Motives and Consequences of Libor Strategic Reporting: How Much Can We Learn from Banks’ Self-Reported Borrowing Rates?

Pietro Bonaldi

Libor is an estimate of interbank borrowing costs computed daily from rates reported by a fixed panel of banks. Evidence suggests that banks have manipulated Libor in recent years by misreporting their borrowing costs. I estimate a strategic reporting model that identifies banks’ borrowing costs as well as their motives for misreporting. The estimation places a lower bound on the value that Libor would have had if banks had truthfully reported their borrowing costs.

Outside Options in the Labor Market

Sydnee Caldwell and Oren Danieli

This paper develops a method to estimate workers’ outside employment opportunities. We outline a matching model with two-sided heterogeneity, from which we derive a sufficient statistic, the “outside options index” (OOI), for the effect of outside options on earnings, holding worker productivity constant. The OOI uses the cross-sectional concentration of similar workers across job types to quantify workers’ outside options as a function of workers’ commuting costs, preferences, and skills.

Revisiting Event Study Designs: Robust and Efficient Estimation

Kirill Borusyak, Xavier Jaravel, and Jann Spiess

We develop a framework for difference-in-differences designs with staggered treatment adoption and heterogeneous causal effects. We show that conventional regression-based estimators fail to provide unbiased estimates of relevant estimands absent strong restrictions on treatment-effect homogeneity. We then derive the efficient estimator addressing this challenge, which takes an intuitive “imputation” form when treatment-effect heterogeneity is unrestricted. We characterize the asymptotic behavior of the estimator, propose tools for inference, and develop tests for identifying assumptions.

Information and Bargaining through Agents: Experimental Evidence from Mexico’s Labor Courts

Joyce Sadka, Enrique Seira, and Christopher Woodruff

Well-functioning courts are essential for the health of both financial and real economies. Courts function poorly in most lower-income countries, but the root causes of poor performance are not well understood. We use field experiments with ongoing cases to analyze sources of dysfunction in Mexico’s largest labor court. We provide parties with personalized predictions for case outcomes and show that this information nearly doubles settlement rates and reduces average case duration.

Granular Search, Market Structure, and Wages

Gregor Jarosch, Jan Sebastian Nimczik, and Isaac Sorkin

We develop a model of size-based market power in a frictional labor market. In the canonical search environment, competition for workers is encoded in outside options. In our granular setting, large employers remove their own job postings from their workers’ outside option. Thus, size gives market power and a more concentrated market structure depresses wages because it reduces competition for workers.

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"A new method for identifying and estimating consumer preferences when choice sets are constrained due to selection or search, but are not observed"

New paper by Agarwal & Somaini:

https://www.restud.com/demand-analysis-under-latent-choice-constraints/

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Cities surrounded by expensive farmland are denser and agricultural productivity growth has lowered urban density over time in France. Our multi-region structural change framework can explain it.

New paper by Coeurdacier, @teignier & @FlorianOswald

https://www.restud.com/structural-change-land-use-and-urban-expansion/

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🏠Transaction taxes don’t just cool housing—they reshape it. Same rate, different impact: investors buy more, households less. Result: lower ownership and welfare losses of 111% of tax revenue.

New paper from Han, Ngai & Sheedy:

https://www.restud.com/to-own-or-to-rent-the-effects-of-transaction-taxes-on-housing-markets/

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Slum upgrading is a common policy to help residents, but it can delay redevelopment into formal neighborhoods. Evidence from the largest program highlights the tradeoff: central upgrading can entail long-run opportunity costs.

New paper by Harari & Wong:
https://www.restud.com/slum-upgrading-and-long-run-urban-development-evidence-from-indonesia/

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