This paper explores the importance of accessible and focal information in influencing beliefs and attention in a learning-to-forecast laboratory experiment where subjects are incentivized to form accurate expectations about inflation and the output gap. We consider the effects of salient and...

Rules are thought to persist to the extent that the direct benefits of having them (e.g. reduced transactions costs) exceed the costs of enforcement and of occasional misapplications. We argue that a second crucial role of rules is as screening mechanisms for identifying cooperative types. Thus...

We consider models defined by a set of moment restrictions that may be subject to weak identification. More specifically, we study the asymptotic properties of the standard GMM estimator and the Hansen J-test when additional moment restrictions that are weaker than the original ones are...

The effectiveness of monetary policy depends, to a large extent, on market expectations of its future actions. In a standard New Keynesian business cycle model with rational expectations, systematic monetary policy reduces the variance of inflation and output gap by at least two-thirds. These...

Currently, we have only a limited understanding of how central bank purchases of illiquid assets (“quantitative easing”) affect long-term interest rates, borrowing costs, and the real economy. Since the historical record of quantitative easing is sparse, theoretical work is needed to guide...

Our experiments refine and extend the work of Fehr and Tyran (2001), who suggest that money illusion can contribute significantly to nominal inertia in strategically complementary environments. By controlling for strategic uncertainty, visual focal points and cognitive load we find that...

Measures of household consumption-­which may be used to investigate average consumption growth, mor consumption poverty and inequality-­must account for the rental flow from owned accommodation. We consider two econometric problems relating to the imputation of rental flows for owned...

This paper explores empirically the relation between party's procedures to nominate candidates, such as primaries, and quality of government. Using a panel data of Latin America countries, I find robust evidence that the quality of government is higher during the mandate of primary-nominated...

This paper studies the effect of costly taxation on the fiscal response of local governments to intergovernmental transfers. Using a panel dataset of Peruvian municipalities, I find robust evidence that central government's grants have a greater stimulatory effect in municipalities facing higher...

Collective household models posit that each household member has access to a fraction of the household budget, called a resource share, which defines the shadow budget faced by a household member. Together with the within-household shadow price vector, the shadow budget determines the material...