The Review of Economic Studies is one of the core journals in economics. It is essential reading for economists, consistently ranking among the top five journals.

How do cities grow in the process of structural transformation? To answer this question, we develop a multi-sector spatial equilibrium model with endogenous land use: land is used either for agriculture or housing. Urban land, densely populated due to commuting frictions, expands out of agricultural land. With low productivity and high subsistence needs, farmland is expensive, households cannot afford large homes and cities are very dense.

Using sales and leasing data, this paper finds three novel effects of a higher property transaction tax: higher buy-to-rent transactions alongside lower buy-to-own transactions despite both being taxed, a lower sales-to-leases ratio, and a lower price-to-rent ratio. This paper explains these facts by developing a search model with entry of investors and households, households choosing to own or rent in the presence of credit frictions, and homeowners deciding when to move house.

Developing countries face massive urbanization and slum upgrading is a popular policy to improve shelter for many. Yet, preserving slums at the expense of formal developments can raise concerns of misallocation of land. We estimate causal, long-term impacts of the 1969-1984 KIP program, which provided basic upgrades to 5 million residents covering 25% of land in Jakarta, Indonesia. We assemble high-resolution data on program boundaries and 2015 outcomes and address program selection bias through localized comparisons.

Environmental externalities – uncompensated damages imposed on others – lie at the root of climate change, pollution, deforestation and biodiversity loss. Empirical evidence is limited, however, as to how externalities drive private decision making. We study one such behavior, illegal tropical forest fires, using 15 years of daily satellite data covering over 107,000 fires across Indonesia. Weather-induced variation in fire spread risk and variation in who owns surrounding land allow us to identify how far externalities influence the decision to use fire.

When a policy prioritizes one person over another, is it because they benefit more, or because they are preferred? This paper develops a method to uncover the values consistent with observed allocation decisions. We estimate how much each individual benefits from an intervention, and then reconcile the allocation with (i) the welfare weights assigned to different people; (ii) heterogeneous treatment effects of the intervention; and (iii) weights on different outcomes.

A common challenge in estimating the impact of interventions (e.g., job training programs, educational programs) is that many outcomes of interest (e.g., lifetime earnings or other labor market outcomes) are observed with a long delay. In biomedical settings this is often addressed by using short-term outcomes as so-called “surrogates” for the outcome of interest, e.g., tumor size as a surrogate for mortality in cancer studies. We build on this literature by combining multiple, possibly qualitatively distinct, short-term outcomes (e.g., short-run earnings and employment indicators) systematically into a “surrogate index.”