Debora Revoltella, 22 January 2019

Europe is at risk of falling behind its global competitors. In a period of radical technological transformation, European firms are investing too little, with a gap both in tangible and intangible investment compared to the US. This column calls for a ‘retooling’ of Europe’s economy in relation to skills, innovation finance, the business environment, infrastructure, and deepening the Single Market.

William J. Collins, Ariell Zimran, 19 January 2019

Negative sentiment towards immigrants is often based on fears about their ability to integrate into economic, political, and social institutions. This column analyses the impact of the influx of Irish immigrants into the US in the 19th century. It shows that the children of immigrants had assimilated in terms of labour market outcomes within one generation, providing some perspective for the current debate about immigration policy.

Jeffrey Frankel, 08 January 2019

Molly Frean, Mark V. Pauly, 08 January 2019

Both healthcare spending levels and growth in the US have exceeded other developed countries for many years. With healthcare costs rising at an unsustainable pace, a greater percentage of workers in the US are being enrolled in high-deductible health plans. This column estimates the relationship between high deductibles and the growth in total healthcare spending on all medical goods and services. It finds that deductible levels have a considerable effect on spending growth, and suggests that the natural next step is to explore whether or how that affects health outcomes.

Juan C. Palomino, Gustavo A. Marrero, Juan Gabriel Rodríguez, 03 January 2019

The American Dream is grounded in the US being the land of opportunities, but real opportunity requires mobility across generations. This column examines the influence of parents’ income on the income of their children in the US for the period 1980-2010. Parental income has a greater influence, implying lower levels of mobility, for families with the highest and lowest levels of income. Education also plays a stronger role in economic persistence at both tails of the income distribution, while race affects mobility in the middle and lower parts of the distribution. 

Edward Wolff, 23 December 2018

Unlike income inequality, wealth inequality along racial lines in the US has received relatively little attention. This column presents new evidence on the changing landscape of relative wealth among whites, blacks, and Hispanics between 1983 and 2016. Using an augmented measure of wealth, it highlights how cuts to social security will disproportionately affect minorities.

Seth Gershenson, Cassandra Hart, Joshua Hyman, Constance A. Lindsay, Nicholas W. Papageorge, 22 December 2018

There have been many calls to increase the racial and gender diversity of teachers in US primary and secondary schools, with the evidence to date showing that improving the match between student and teacher demographics has significant positive effects on test scores. This column looks at the longer term effects of such changes. Random assignment to a black teacher in grades K–3 increased the chances that black students graduated from high school and enrolled in college. 

Hans Koster, Jos van Ommeren, Nicolas Volhausen, 20 December 2018

Short-term rental platforms such as Airbnb have grown spectacularly in recent years, and local governments around the globe have responded differently in regulating such rentals. This column analyses the effects of a policy change in several cities of Los Angeles County that restricted short-term rentals of entire homes and apartments. Airbnb has led to an increase in house prices that is particularly pronounced in popular tourist areas, and homeowners in these areas lose out from the regulation. Renters, on the other hand, benefit from the regulation.

Pierre Siklos, Samantha St. Amand, Joanna Wajda, 16 December 2018

There is an ongoing debate regarding how far central bankers, as unelected technocrats, should go outside of their remit when communicating in public fora. This column uses a machine-learning algorithm to assess the topics of speeches by officials at the US Federal Reserve and Bank of Canada over the last two decades. It concludes that the topics of central bankers’ speeches have not significantly widened in scope relative to their mandate documents.

João Granja, Christian Leuz, Raghuram Rajan, 04 December 2018

Risk taking was pervasive during the Global Crisis even in the most unlikely areas, such as stretching to lend at a distance. Using US data, this column examines the degree to which competition amongst lenders interacts with the cyclicality in lending standards using a simple and policy-relevant measure, the average physical distance of borrowers from banks’ branches. It finds that distances widen considerably when credit conditions are lax and shorten considerably when credit conditions become tighter. A sharp departure from the trend in distance between banks and borrowers is indicative of increased risk taking. 

Steven Brakman, Harry Garretsen, Tristan Kohl, 01 December 2018

Axel Dreher, Valentin Lang, B. Peter Rosendorff, James Raymond Vreeland, 24 November 2018

Countries that vote with the US when serving on the UN Security Council also receive more financial assistance. This column uses voting records in the Council to show that when these countries were US allies, they received more in US aid, but when the countries were not natural allies, they received more financial assistance from US-dominated international institutions instead.

Raj Chetty, John Friedman, Nathaniel Hendren, Maggie R. Jones, Sonya R. Porter, 06 November 2018

Economic mobility varies dramatically across the US. This column introduces a new interactive mapping tool that traces the roots of outcomes such as poverty and incarceration back to the neighbourhoods in which children grew up. Among the insights the data reveal are that children who grow up a few miles apart in families with comparable incomes have very different life outcomes, and that moving in early childhood to a neighbourhood with better outcomes can increase a child’s income by several thousands of dollars later in life.

Joshua S. Goodman, Oded Gurantz, Jonathan Smith, 04 November 2018

Retaking college entrance exams can only improve students’ chances of being admitted to a college, yet little is known about students’ decisions to retake them and the impact of retaking. This column uses data on over 10 million SAT takers from the high school classes of 2006-2014 to show that the increases resulting from retaking are large enough to drive substantial improvements in college enrolment outcomes, and that retaking appears to close college enrolment gaps by income and race.

John Ameriks, Joseph Briggs, Andrew Caplin, Minjoon Lee, Matthew D. Shapiro, Christopher Tonetti, 29 October 2018

As countries such as the US face increasingly ageing populations, policymakers face the question of whether to encourage workers to work beyond historical retirement age. Using strategic survey questions, this column gauges whether older Americans stop working due to their lack of interest in working longer or due to lack of opportunity, and finds that it may be the latter. The revealed strong willingness to work implies that job opportunities with flexible schedules are hard for older Americans to find. 

William Kerr, 26 October 2018

The US has held a very special place in terms of absorbing global talent. This column brings together various data sources to demonstrate how high-skilled immigration has transformed US innovation over the past five decades. Among the trends identified are rates of international migration rising by skill level, a huge share of skilled immigration going to the US, and a disproportionate immigration impact on the US at higher skill levels. Not surprisingly, these changes have had enormous economic impact.

Ian Goldin, Benjamin Nabarro, 24 October 2018

Anti-migration sentiment has been rising across Europe. This column shows that the economic impact of migration is positive, but depends almost entirely on the policies implemented to ensure that migrants can be productive and the extent to which the positive economic consequences of migration are distributed across individuals. Unless the rhetoric of a perceived cultural and economic threat posed by migrants is countered effectively, economies stand to lose out substantially from the implementation of anti-immigration policies.

David Jacks, John Tang, 21 October 2018

Foreign goods and workers are regularly blamed when the national economy is performing poorly. Economic theory suggests that trade and migration are substitutes – one can import cheaper products from a trade partner, or one can import the foreign workers themselves to narrow the difference in international factor prices. Yet, empirically this is not obvious. Based on available long-run data for international trade and migration since the late 19th century for the US and Canada, this column finds that during the interwar period, trade and immigration did in fact appear to be substitutes.

Esteban Rossi-Hansberg, Pierre-Daniel Sarte, Nicholas Trachter, 19 October 2018

Recent literature has documented increasing US product-market concentration at the national level. This column argues that when measured at the more relevant local level, concentration has actually decreased over the last 25 years on average and in all major sectors. In the many industries with diverging national and local trends, top firms are bringing down local concentration even as they increase national concentration. These findings support the idea that top firms expand their national market share by opening establishments in new locations, thereby increasing local competition. 

Massimiliano Calì, 16 October 2018

The US-China trade war has rapidly escalated, promising to disrupt trade flows between the two countries and beyond. This column provides the first estimates of trade and investment effects of the trade war on East Asia, one of the most exposed regions. By combining trade and tariff data, it provides some order of magnitude of the expected effects and identifies the possible winners and losers from the trade war in the region.

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