Post-1980 US data trace out a stable long-run money demand relationship of Cagan's semi-log form between the M1-income ratio and the nominal interest rate, with an interest semielasticity below 2. Integrating under this money demand curve yields estimates of the welfare costs of modest...

This paper experimentally investigates whether money illusion generates substantial nominal inertia. Building on the design of Fehr and Tyran (2001), we find no evidence that agents choose high nominal payoffs over high real payoffs. However, participants do select prices associated with high...

In this paper, I try to shed some new light on the "puzzle" of why the Lucas critique, believed to be important by most economists, seems to have received very little empirical support. I use a real-business-cycle model to verify that the Lucas critique is quantitatively important in theory, and...

This paper considers the mechanisms behind a positive correlation between inheritances and health. First, there may merely be a correlation: those from families with enough wealth to provide an inheritance tend to have better health. Second, financial resources could be used to purchase inputs...

Using the most comprehensive developing country dataset ever compiled on air and water pollution and environmental regulations, the paper assesses India's environmental regulations with a difference-in-differences design. The air pollution regulations are associated with substantial improvements...

I test the effect of harsher punishments and sanctions on driving under the influence (DUI). In this setting, punishments are determined by strict rules on blood alcohol content (BAC) and previous offenses. Regression discontinuity derived estimates suggest that having a BAC above the DUI...

In recent years workplace smoking policies have become increasingly prevalent and restrictive. Using data from two large-scale national surveys, we investigate whether these policies reduce smoking. Our estimates suggest that workplace bans reduce smoking prevalence by 5 percentage points and...