Experimentation in Endogenous Organizations 22 June 2023 Germán Gieczewski and Svetlana KosterinaWe study policy experimentation in organizations with endogenous membership. An organization decides when to stop a policy experiment based on its results. As information arrives, agents update their beliefs, and enter or leave the organization based on their expected flow payoffs.
Changes in Social Network Structure in Response to Exposure to Formal Credit Markets 22 June 2023 Abhijit Banerjee, Emily Breza, Arun G. Chandrasekhar, Esther Duflo, Matthew O. Jackson, and Cynthia KinnanWe show that the entry of formal financial institutions can have far-reaching and long-lasting impacts on informal lending and social networks more generally. We first study the introduction of microfinance in 75 villages in Karnataka, India, 43 of which were exposed to microfinance. Using difference-in-differences, we show that networks shrank more in exposed villages.
Memory and Markets 22 June 2023 Sergey Kovbasyuk and Giancarlo SpagnoloIn many environments, including credit and online markets, records about participants are collected, published, and erased after some time. We study the effects of erasing past records in a dynamic market where the quality of sellers follows a Markov process, and buyers leave feedback about sellers to an information intermediary.
Heterogeneous Paths of Industrialization 22 June 2023 Federico Huneeus and Richard RogersonIndustrialization experiences differ substantially across countries. We use a benchmark model of structural change to shed light on the sources of this heterogeneity and, in particular, the phenomenon of premature deindustrialization.
The Darwinian Returns to Scale 4 June 2023 David Rezza Baqaee, Emmanuel Farhi, and Kunal SanganiHow does an increase in market size, say due to globalization, affect welfare? We study this question using a model with monopolistic competition, heterogeneous markups, and fixed costs. We characterize changes in welfare and decompose changes in allocative efficiency into three different effects.
Is the Social Safety Net a Long-Term Investment? Large-Scale Evidence from the Food Stamps Program 4 June 2023 Martha Bailey, Hilary Hoynes, Maya Rossin-Slater, and Reed WalkerWe use novel, large-scale data on 17.5 million Americans to study how a policy-driven increase in economic resources affects children’s long-term outcomes. Using the 2000 Census and 2001-2013 American Community Survey linked to the Social Security Administration’s NUMIDENT, we leverage the county-level roll-out of the Food Stamps program between 1961 and 1975.
Resolving Failed Banks: Uncertainty, Multiple Bidding & Auction Design 4 June 2023 Jason Allen, Robert Clark, Brent Hickman, and Eric RichertThe FDIC resolves insolvent banks with scoring auctions. Although the structure of the scoring rule is known to bidders, they are uncertain about how the FDIC trades off different bid components. Scoring-rule uncertainty motivates bidders to submit multiple bids for the same failed bank.
The Slaughter of the Bison and Reversal of Fortunes on the Great Plains 24 May 2023 Donn. L. Feir, Rob Gillezeau, and Maggie E.C. JonesIn the late nineteenth century, the North American bison was brought to the brink of extinction in just over a decade. We demonstrate that the loss of the bison had immediate, negative consequences for the Native Americans who relied on them and ultimately resulted in a permanent reversal of fortunes. Once amongst the tallest people in the world, the generations of bison-reliant people born after the slaughter lost their entire height advantage.
