Limited liability and asymmetric information between an investment bank and its lenders provide an incentive for a bank to undercapitalise and finance overly risky business projects. To counter this market failure, national governments have imposed solvency constraints on banks. However, these...

Motivated by recent events, this paper studies the welfare impact of extreme sanctions regimes on Russia. To do so, it models the demographic and fiscal transition of the Russian Federation under free trade and autarky. Unlike previous studies of sanctions, our paper utilizes a large scale...

The welfare associated with public insurance is often difficult to quantify. Relative to private insurance, a fundamental difficulty is that public insurance is typically compulsory, so the demand for coverage is unobserved and thus cannot be used to analyze welfare. However, in many public...

Many organizations have budgets that expire at the end of the fiscal year and may face incentives to rush to spend resources on low quality projects at year's end. We test these predictions using data on procurement spending by the U.S. federal government. Spending in the last week of the year...

This paper investigates self-reported wedges between how much people work and how much they want to work, at their current wage. More than two-thirds of full-time workers in German survey data are overworked--actual hours exceed desired hours. We combine this evidence with a simple model of...

In 2010, the Affordable Care Act (ACA) mandated that private insurance plans extend coverage to adult dependents under the age of 26. We hypothesize that this policy may have had the unintended consequence of increasing "job lock" among parents who would otherwise leave their employer. We use a...

Policymakers are increasingly interested in non-standard policy instruments (NPIs), or "nudges," such as simplified information disclosure and warning labels. We characterize the welfare effects of NPIs using public finance sufficient statistic approaches, allowing for endogenous prices, market...

This paper studies the labor market impacts of firm accommodation decisions and assesses implications for the design of social insurance for workplace disability. We leverage a unique workers' compensation (WC) program in Oregon that provides wage subsidies to firms for accommodating injured...

We estimate the returns to IRS audits of taxpayers across the income distribution. We find an additional $1 spent auditing taxpayers above the 90th income percentile yields more than $12 in revenue, while audits of below-median income taxpayers yield $5. We draw upon comprehensive internal...

What are the most effective ways to address climate change? This paper extends and applies the marginal value of public funds (MVPF) framework to help answer this question. We examine 96 US environmental policy changes studied over the past 25 years. These policies span subsidies (wind,...