This paper examines schools' decisions to sort students into different classes and how those sorting processes impact student achievement. There are two potential effects that result from schools creating homogeneous classes--a "tracking effect," which allows teachers to direct their focus to a...

This paper uses an estimated demand system that accounts for heterogeneity to calculate and compare the lost consumer surplus from a higher tax on gasoline, a tax on distance, or a subsidy for buying a newer car. We introduce a view of cost-effectiveness that compares policies instead of...

This paper provides a search model for housing market where the number of buyers and/or sellers plays very important role. The model makes three testable predictions: (1) the unemployment rate has a negative impact on the trading volume and the sale prices of the housing market; (2) a larger...

This paper investigates to what extent the differences in education between black and white men can be explained by the differences in their mortality risks. A dynamic optimal stopping-point life cycle model is examined, in which group-level mortality risk plays an important role in determining...

This paper proposes an econometric model to identify unobserved consumer types in the credit market. Consumers choose different amounts of loan because of differences in their time or risk preferences (types). Thus, the unconditional probability of default is modeled using a mixture density...

A test of adverse events and strategic timing theories can be conducted by determining whether some relevant financial decision variables, such as financial benefit from filing for bankruptcy, or debt discharged in bankruptcy are endogenous with the bankruptcy decision or not. For the strategic...

Using a sample of households in 48 Chinese villages for the period 1986-2002, this paper studies the dynamic effects of major health shocks on household income and the role played by village elections in mitigating these effects. Our results show that in the first 15 years after a shock, a...

In this paper, we propose a matching model to study the efficiency of thin and thick markets. Our model shows that the probabilities of matches in a thin market are significantly lower than those in a thick market. When applying our results to a job search model, it implies that, if the ratio of...

This paper investigates to what extent and through which channels that health and educational attainment are interdependent. A dynamic model of schooling, work, health expenditure, and savings is developed. The structural framework explicitly models two existing hypotheses on the correlation...

We present a simple model of the effects of hate crime legislation. It shows that even if the direct harm to victims of hate crime is the same as for other crimes, because of other differences in the effects it may still be optimal to exert more law-enforcement effort to deter or prevent hate...