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.

As a complement to the federal earned income tax credit (EITC), some states offer their own EITC, typically calculated as a percentage of the federal EITC. In this paper, we analyze the effect of state EITC on education using policy discontinuities at US state borders. Our estimates reveal that an increase in the state EITC leads to a statistically significant increase in the high school dropout rate.

We introduce markup equilibrium—an extension of Walrasian equilibrium in which consumers pay a fixed percentage markup over producer prices. In quasilinear markets, markup equilibria exist despite non-convexities. They are resource-feasible and envy-free, incur no budget deficit, and require little more communication and computation than ordinary Walrasian equilibrium. The associated markup mechanism is asymptotically incentive-compatible.

We assess the relationship between the racial diversity of medical providers and racial health disparities in the use of preventive care and in patient outcomes. We use unique data from the Military Health System, where we observe providers as patients so that we can identify their race, and where moves across bases change exposure to provider race in a plausibly exogenous fashion.

This paper explores how state and religious providers of education compete during the nation building process. Using novel administrative data, we characterize the evolution of Indonesia’s Islamic education system and religious school choice after the introduction of mass public primary schooling in the 1970s. Funded through informal taxation, Islamic schools competed with the state by entering in the same markets. While primary enrollment shifted towards state schools, religious education increased overall as Islamic schools absorbed growing demand for secondary education.

Why are job polarization and income inequality higher in large U.S. cities? I offer a new explanation: when house prices grow faster in large cities, middle-income households increasingly cannot afford to own a house there. They move to smaller cities and the middle of the income distribution in large cities hollows out, making them more polarized and unequal. I document that (1) cities with higher price growth experienced larger polarization and increase in inequality since 1980 and (2) middle-income households migrate more often to cheaper locations for housing-related reasons than low- or high-income households.

Economists have studied the impact of numerous state laws, from welfare rules to voting ID requirements. Yet for all this policy evaluation, what do we know about policy diffusion—how these policies are introduced and spread from state to state? We present a series of facts based on a data set of 602 U.S. state policies spanning the past 7 decades. First, proxies of state capacity do not predict a higher likelihood of innovating new policies, but the political leaning of the state does predict a higher likelihood of introducing partisan laws since 1990.