Consumers need information to compare alternatives for markets to function efficiently. Recognizing this, public policies often pair competition with easy access to comparative information. The implicit assumption is that comparison friction--the wedge between the availability of comparative...

We empirically examine the role of social networks in welfare participation using data on language spoken at home to better infer networks within an area. Our empirical strategy asks whether being surrounded by others who speak the same language increases welfare use more for those from high...

Firms spend billions of dollars developing advertising content, yet there is little field evidence on how much or how it affects demand. We analyze a direct mail field experiment in South Africa implemented by a consumer lender that randomized advertising content, loan price, and loan offer...

The contracting view of CEO pay assumes that pay is used by shareholders to solve an agency problem. Simple models of the contracting view predict that pay should not be tied to luck, where luck is defined as observable shocks to performance beyond the CEO's control. Using several measures of...

We study the allocation of driver's licenses in India by randomly assigning applicants to one of three groups: bonus (offered a bonus for obtaining a license quickly), lesson (offered free driving lessons), or comparison. Both the bonus and lesson groups are more likely to obtain licenses....

In order to investigate the impact of limited memory on human behavior, I develop a model of memory grounded in psychological and biological research. I assume that people take their memories as accurate and use them to make inferences. The resulting model predicts both over- and underreaction...

Most papers that employ Differences-in-Differences estimation (DD) use many years of data and focus on serially correlated outcomes but ignore that the resulting standard errors are inconsistent. To illustrate the severity of this issue, we randomly generate placebo laws in state-level data on...

We present a model of uninformative persuasion in which individuals "think coarsely": they group situations into categories and apply the same model of inference to all situations within a category. Coarse thinking exhibits two features that persuaders take advantage of: (i) transference,...

Owners of business groups are often accused of expropriating minority shareholders by tunneling resources from firms where they have low cash flow rights to firms where they have high cash flow rights. In this paper we propose a general methodology to measure the extent of tunneling activities....