Using data from the German Socio-Economic Panel, this paper analyses the effects of spending part of adolescents’ leisure time on playing music or doing sports, or both. We find that while playing music fosters educational outcomes compared to doing sports, particularly so for girls and...

This article studies traditional and modern theories of executive compensation, bringing them together under a unifying framework. We analyze assignment models of the level of pay, and static and dynamic moral hazard models of incentives, and compare their predictions to empirical findings. We...

Increasing penalty structures for repeat offenses are ubiquitous in penal codes, despite little empirical or theoretical support. Multi-period models of criminal enforcement based on the standard economic approach of Becker (1968) generally find that the optimal penalty structure is either flat...

Japanese GDP per capita grew at an annual rate of 0.04 per cent between 725 and 1874, but the growth was episodic, with the increase in per capita income concentrated in three periods, 1150-1280, 1450-1600 and after 1730, interspersed with periods of stable per capita income. There is a...

We study the determination of Irish inflation between 1926 and 2012. The difference between unemployment and the NAIRU is a significant determinant of inflation in a simple backward-looking Phillips Curve that incorporates import prices. While there is a break in 1979-80, when the link to...

Although Japanese economic growth after the Meiji Restoration is often characterised as a gradual process of trend acceleration, comparison with the United States suggests that catching-up only really started after 1950, due to the unusually dynamic performance of the US economy before 1950. A...

We study firm-level pricing behavior through the lens of exchange rate pass-through and provide new evidence on how firm-level market shares and price complementarities affect pass-through decisions. Using micro-data from U.S. import prices, we identify two facts: First, exactly the firms that...

Do large firm dynamics drive the business cycle? We answer this question by developing a quantitative theory of aggregate fluctuations caused by firm-level disturbances alone. We show that a standard heterogeneous firm dynamics setup already contains in it a theory of the business cycle, without...

This paper models payment evasion as a source of profit by letting the firm choose the purchase price and the fine imposed on detected payment evaders. For a given price and fine, the consumers purchase, evade payment, or choose the outside option. We show that payment evasion leads to a form of...

This paper shows that electoral incentives affect the occurrence of trade disputes. Focusing on WTO disputes filed by the United States during the 1995-2012 period, we show that U.S. presidents are more likely to initiate a dispute in the year preceding their re-election date. Moreover, disputes...