The role of specific institutions was important in giving Europe a technological advantage well before the Industrial Revolution. This column argues that apprenticeships were crucial to Europe’s rise. Unlike in the extended families or clans in other parts of the world, apprentices in Europe’s guild systems could learn from any master. New techniques and innovations could thus spread rapidly across the continent, without being constrained by family lines.
David de la Croix, Matthias Doepke, Joel Mokyr, 02 March 2017
Scott Carrell, Mark Hoekstra, Elira Kuka, 25 April 2016
Bad behaviour by peers is well-known to worsen educational outcomes in the short run. This column investigates the long-run effects of peers from families marked by domestic violence. Individual-level US data linking middle and high school test scores, college enrolment, and earnings at ages 24–28 show that students exposed to more disruptive peers experience worse adult outcomes. Policies that mitigate exposure to disruptive peers could pay high dividends.
Luigi Guiso, Luigi Pistaferri, Fabiano Schivardi, 03 April 2016
Entrepreneurship often concentrates in certain geographic locations, with Silicon Valley the most famous example today. While a large literature focuses on these cross-location differences in entrepreneurial density, questions remain about the supply of entrepreneurial skills across locations. Using Italian data, this column investigates whether selection into entrepreneurship is affected by learning opportunities in adolescence. Those who grow up in an area with higher entrepreneurial density are found to be more likely to become entrepreneurs themselves. They are also more likely to succeed and earn a higher income.
Kaoru Hosono, Daisuke Miyakawa, Miho Takizawa, 27 August 2015
‘Learning by exporting’ refers to productivity gains experienced by firms after they commence exporting. Such gains are argued to be due to access to new knowledge and resources. This column explores some of the preconditions for learning-by-exporting effects, using data on the overseas activities and affiliations of Japanese firms. Firms that enter markets in which they don’t have affiliates or subsidiaries are found to enjoy the most learning-by-exporting productivity gains. These findings have implications for the timing of new market entry.
Alberto Cavallo, Guillermo Crucas, Ricardo Perez-Truglia, 10 November 2014
Although central banks have a natural desire to influence household inflation expectations, there is no consensus on how these expectations are formed or the best ways to influence them. This column presents evidence from a series of survey experiments conducted in a low-inflation context (the US) and a high-inflation context (Argentina). The authors find that dispersion in household expectations can be explained by the cost of acquiring and interpreting inflation statistics, and by the use of inaccurate memories about price changes of specific products. They also provide recommendations for central bank communication strategies.
Charles Manski, 01 October 2014
Clinical practice guidelines recommend treating all patients with similar attributes the same way. This column argues that, under conditions of uncertainty or ambiguity, this may be bad advice. Treating similar patients differently provides two benefits. The first is diversification – assigning similar patients to different treatments limits the consequences of choosing an inappropriate treatment. The second benefit is that randomly assigning treatments helps clinicians learn which ones are most effective.