We support dynamic research that can help solve the great economic and social challenges of the 21st century. INET’s research is interdisciplinary, incorporating concepts from history, political science, and the humanities.
Working Papers
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Working Paper Series
Navigating the Crises in European Energy
Sep 2022
Price Inflation, Marginal Cost Pricing, and Principles for Electricity Market Redesign in an Era of Low-Carbon Transition
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Working Paper Series
China’s Development Path: Government, Business, and Globalization in an Innovating Economy
Aug 2022
China’s successful technological development path stands in contrast to the corporate financialization model in the United States
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Working Paper Series
The Role of Public REITs in Financialization and Industry Restructuring
Jul 2022
Real Estate Investment Trusts (REITs) are considered “passive” investors and are exempt from corporate tax. But in reality, they play a very active role in reshaping whole industries, like healthcare.
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Working Paper Series
Monetary Policy for the Climate? A Money View Perspective on Green Central Banking
Jul 2022
Central banks can encourage climate-friendly investments by offering financial institutions favorable haircuts on green collateral
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Working Paper Series
Pari Passu Lost and Found: The Origins of Sovereign Bankruptcy 1798-1873
Jun 2022
Pari passu clauses were deliberately crafted to gain an upper hand in sovereign bankruptcy disputes brought to the London stock exchange’s jurisdiction
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Working Paper Series
Government Deficits and Interest Rates: A Keynesian View
Apr 2022
Contrary to the neoclassical loanable funds theory, historical bond yields show Keynes was right that “convictions” anchor long-term interest rates
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Working Paper Series
An Economic Defense of Multiple Antitrust Goals: Reversing Income Inequality and Promoting Political Democracy
Mar 2022
The Consumer Welfare Standard of antitrust is outdated and defective
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Working Paper Series
After the Allocation: What Role for the Special Drawing Rights System?
Mar 2022
How could the new SDR allocation help developing countries?
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Working Paper Series
Measuring the Impact of Campaign Finance on Congressional Voting: A Machine Learning Approach
Mar 2022
Using aggregate campaign finance data as well as a Transformer based text embedding model we can predict roll call votes for legislation in the US Congress with more than 90% accuracy.
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Working Paper Series
Pricing for Medicine Innovation: A Regulatory Approach to Support Drug Development and Patient Access
Feb 2022
US regulators can step in to ensure drug pricing both supports patient access and drug development
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Working Paper Series
Why Diagnostic Expectations Cannot Replace REH
Jan 2022
A formal argument that Kahneman and Tversky’s compelling empirical findings, and those of other behavioral economists, do not provide a basis for a general approach to specifying participants’ “predictable errors.”
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Working Paper Series
Industrial Feudalism and Wealth Inequalities
Jan 2022
In a society where asset ownership is incredibly unequal, social mobility become severely diminished
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Working Paper Series
The Changing Shape of the World Automobile Industry: A Multilayer Network Analysis of International Trade in Components and Parts
Jan 2022
The pandemic and electrification are shaking the foundations of the auto industry
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Working Paper Series
Can Panel Data Methodologies Determine the Impact of Climate Change on Economic Growth?
Dec 2021
Some cautionary remarks
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Working Paper Series
Central Banks Caught Between Market Liquidity and Fiscal Disciplining: A Money View Perspective on Collateral Policy
Dec 2021
By helping abate the liquidity crisis, incidences of banks becoming insolvent are reduced, and hence moral hazard in its severest form is minimized.
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Working Paper Series
The Knife Edge Election of 2020: American Politics Between Washington, Kabul, and Weimar
Nov 2021
Covid and BLM protests were key to Biden’s victory
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Working Paper Series
Zombies at Large? Corporate Debt Overhang and the Macroeconomy*
Nov 2021
Swift reorganization or liquidation of insolvent businesses is the single best policy to deal with corporate debt booms.
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Working Paper Series
Mexico’s Automotive Industry: A Success Story?
Oct 2021
Between a rock and a hard place
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Working Paper Series
Ambivalence About International Trade in Open- and Closed-ended Survey Responses
Oct 2021
Open-ended polling responses reveal considerably more complexity – and more ambivalence and negativity – in Americans’ views of international trade than has been inferred from widely cited closed questions
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Working Paper Series
Why do Sovereign Borrowers Post Collateral? Evidence from the 19th Century
Oct 2021
In the 19th Century, “hypothecations” provided investors with valuable information on sovereign fiscal resources
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Working Paper Series
Expectations Concordance and Stock Market Volatility: Knightian Uncertainty in the Year of the Pandemic
Oct 2021
Stock-Price Volatility During the Pandemic
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Working Paper Series
Why the CHIPS Are Down: Stock Buybacks and Subsidies in the U.S. Semiconductor Industry
Oct 2021
To strengthen the American semiconductor industry, Congress should condition additional funds on suspending stock buybacks
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Working Paper Series
How Milton Friedman Exploited White Supremacy to Privatize Education
Sep 2021
“School choice” aimed to block the choice of equal, integrated education for Black families
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Working Paper Series
Automotive Global Value Chains in Europe
Aug 2021
In Europe, imbalances in the structure of the automotive and a lack of industrial policies risk creating a deadly cocktail for millions of European workers just as the auto sector is undergoing decisive changes.
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Working Paper Series
Bagehot for Central Bankers
Jun 2021
Is Victorian writer Walter Bagehot, whose adage “lending freely against good collateral at a penalty rate” has been gospel for central bankers, still relevant in a post-Great Financial Crisis world?
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Working Paper Series
The Updated Okun Method for Estimation of Potential Output with Broad Measures of Labor Underutilization: An Empirical Analysis
May 2021
Despite fear-mongering about the latest Consumer Price Index, unemployment remains elevated and stimulus is needed to prevent a collapse in demand
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Working Paper Series
Country Risk
May 2021
Analyzing corporate conference calls reveals the way that countries perceive and spread risk through the global financial system
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Working Paper Series
On the Non-Inflationary Effects of Long-Term Unemployment Reductions
Apr 2021
Contrary to the New Keynesian paradigm, long-term unemployment can be reversed without a significant uptick in inflation
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Working Paper Series
US Employment Inequality in the Great Recession and the COVID-19 Pandemic
Apr 2021
Unlike the Great Recession, the pandemic has hit women workers harder than men, and disproportionately hurt the job prospects of lower education workers
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Working Paper Series
The Long Search for Stability: Financial Cooperation to Address Global Risks in the East Asian Region
Apr 2021
The People’s Bank of China’s network of local currency swap arrangements provide Asian countries with a much-needed safety net, while also strengthening China’s diplomatic position
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Working Paper Series
Mass Incarceration Retards Racial Integration
Apr 2021
Formerly incarcerated Black people emerge from prison with far less education and social skills than white ex-cons. And they have great trouble forming families or earning a good living.
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Working Paper Series
Lessons for the Age of Consequences: COVID-19 and the Macroeconomy
Mar 2021
Mortality and economic data show how constraints to government spending and a skepticism of redistributive policies have made the pandemic far worse
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Working Paper Series
Cordon of Conformity: Why DSGE models Are Not the Future of Macroeconomics
Mar 2021
The New Keynesian Dynamic Stochastic General Equilibrium (DSGE) is a straightjacket for macroeconomics
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Working Paper Series
Masking Real Unemployment: The Overall and Racial Impact of Survey Non-Response on Measured Labor Market Outcomes
Mar 2021
A large and growing percentage of households are missed in the monthly Current Population Survey (CPS).
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Working Paper Series
The Erroneous Foundations of Law and Economics
Feb 2021
Conservative legal theory is based on a shoddy definition of what constitutes “efficiency”
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Working Paper Series
Artificial Intelligence, Globalization, and Strategies for Economic Development
Feb 2021
Labor-saving advances in AI may undo the gains from globalization and pose new challenges for economic development
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Working Paper Series
Inflation? It’s Import Prices and the Labor Share!
Jan 2021
Recognizing that inflation of the value of output and its costs of production must be equal, we focus on a cost-based macroeconomic structuralist approach in contrast to micro-oriented monetarist analysis.
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Working Paper Series
Local David Versus Global Goliath: Populist Parties and the Decline of Progressive Politics in Italy
Jan 2021
This paper analyzes the role of local spending, particularly on social welfare, and local inequality as factors in the Italian political crisis following the adoption in 2011 of more radical national austerity measures.
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Working Paper Series
Employment Mobility and the Belated Emergence of the Black Middle Class
Jan 2021
“Build back” means restoring the government and business investments in the productive capabilities of the U.S. labor force that created a growing middle class in the three decades after World War II
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Working Paper Series
The Future of the Automotive Industry: Dangerous Challenges or New Life for a Saturated Market?
Dec 2020
How electric and self-driving cars could change the industry
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Working Paper Series
Carbon Pricing and the Elasticity of CO2 Emissions
Nov 2020
Carbon pricing still has the potential to be a powerful tool contributing to emissions reductions, but it is clearly no panacea.
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Working Paper Series
Predicting United States Policy Outcomes with Random Forests
Nov 2020
In this paper we analyze the Gilens dataset using the complementary tools of Random Forest classifiers (RFs), from Machine Learning.
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Working Paper Series
Shadow Lobbyists
Oct 2020
Unregistered lobbyists, including former members of Congress, are a key resource for lobbying firms
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Working Paper Series
Unemployment and Income Distribution: Some Extensions of Shaikh’s Analysis
Sep 2020
Our findings confirm the existence of a negative relationship between labor market slack and the wage share, and we find no tendency to return to a ‘normal’ unemployment rate associated with a stable wage share.
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Working Paper Series
Masters of Illusion: Bank and Regulatory Accounting for Losses in Distressed Banks
Sep 2020
The study seeks to explain why the instruments of central banking inevitably break down over time.
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Working Paper Series
Voting Rights, Deindustrialization, and Republican Ascendancy in the South
Sep 2020
How NAFTA led to GOP dominance of the American South
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Working Paper Series
Government as the First Investor in Biopharmaceutical Innovation: Evidence From New Drug Approvals 2010–2019
Sep 2020
Amid debates over costs—and profits—from a coronavirus vaccine, a new study shows that taxpayers have been footing the bill for every new drug approved between 2010 and 2019
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Working Paper Series
Spilt Milk: COVID-19 and the Dangers of Dairy Industry Consolidation
Aug 2020
Consolidation in the dairy industry has created separate, inflexible supply chains for consumers and commercial markets. When COVID killed commercial demand, perfectly good milk and cheese was wasted.
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Working Paper Series
International Financial Regulation: Why It Still Falls Short
Aug 2020
Despite post-2008 regulations, the boom-bust credit cycle continues to run wild
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Working Paper Series
Immaculate Deception: How (and Why) Bankers Still Enjoy a Global Rescue Network
Jul 2020
A look at Dodd-Frank’s impact
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Working Paper Series
Employment and Earnings of African Americans Fifty Years After: Progress?
Jul 2020
To fulfill MLK’s vision of jobs and freedom for Black Americans, Washington must rein in corporate greed
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Working Paper Series
How the Disappearance of Unionized Jobs Obliterated an Emergent Black Middle Class
Jun 2020
In this introduction to our project, “Fifty Years After: Black Employment in the United States Under the Equal Employment Opportunity Commission,” we outline the socioeconomic forces behind the promising rise and disastrous fall of an African American blue-collar middle class.
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Working Paper Series
The Economics and Politics of Social Democracy: A Reconsideration
May 2020
The popular discontent and rise of ‘populist’ political parties is closely related to the failure of New Labor to navigate social democracy’s dilemma.
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Working Paper Series
Modigliani Meets Minsky: Inequality, Debt, and Financial Fragility in America, 1950-2016
May 2020
Increased borrowing by middle-class families with low income growth played a central role in rising indebtedness
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Working Paper Series
How Market Sentiment Drives Forecasts of Stock Returns
May 2020
We reveal a novel channel through which market participants’ sentiment influences how they forecast stock returns: their optimism (pessimism) affects the weights they assign to fundamentals.
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Working Paper Series
Payroll Share, Real Wage and Labor Productivity across US States
Apr 2020
This paper analyzes regional contributions to the US payroll share from 1977 to 2017 and the four major business cycles throughout this period.
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Working Paper Series
Profits, Innovation and Financialization in the Insulin Industry
Apr 2020
This paper considers the relationship between profits realized from higher insulin list prices, pharmaceutical innovation, and the financial structures of the three dominant insulin manufacturing companies, which set list prices.
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Working Paper Series
How Much Can the U.S. Congress Resist Political Money? A Quantitative Assessment
Apr 2020
The links between campaign contributions from the financial sector and switches to a pro-bank vote were direct and substantial
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Working Paper Series
Firm-Level Exposure to Epidemic Diseases: Covid-19, SARS, and H1N1
Apr 2020
As Covid-19 spreads globally in the first quarter of 2020, this paper finds that firms’ primary concerns relate to the collapse of demand, increased uncertainty, and disruption in supply chains
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Working Paper Series
The EU’s Green Deal: Bismarck’s ‘What Is Possible’ Versus Thunberg’s ‘What Is Imperative’
Apr 2020
This paper considers the ambition, scale, substance and strategy of the European Union’s Green Deal
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Working Paper Series
Private Equity Buyouts in Healthcare: Who Wins, Who Loses?
Mar 2020
Private equity firms have become major players in the healthcare industry. How has this happened and what are the results?
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Working Paper Series
Who’s Responsible Here? Establishing Legal Responsibility in the Fissured Workplace
Mar 2020
This article proposes a new “Concentric Circle framework” which would improve workers’ access to civil, labor, and employment rights.
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Working Paper Series
Modeling Myths: On the Need for Dynamic Realism in DICE and other Equilibrium Models of Global Climate Mitigation
Feb 2020
We conclude that representing dynamic realism in such models is as important as – and far more empirically tractable than – continued debate about the monetization of climate damages and ‘social cost of carbon’.
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Working Paper Series
Payment vs. Funding: The Law of Reflux for Today
Feb 2020
The central bank today is not just the government’s bank, but also a bankers’ bank, a truly hybrid institution
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Working Paper Series
Is the Most Unproductive Firm the Foundation of the Most Efficient Economy? Penrosian Learning Confronts the Neoclassical Fallacy
Jan 2020
To get beyond the neoclassical fallacy, economists have to stop relying on constrained-optimization methodology
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Working Paper Series
The Secular Stagnation of Productivity Growth
Jan 2020
This paper argues that it is a mistake to dismiss secular demand stagnation as main cause of declining potential growth in the OECD.
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Working Paper Series
Inclusive American Economic History: Containing Slaves, Freedmen, Jim Crow Laws, and the Great Migration
Jan 2020
This paper records the path by which African Americans were transformed from enslaved persons in the American economy to partial participants in the progress of the economy.
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Working Paper Series
The Global Impact of Brexit Uncertainty
Dec 2019
Using tools from computational linguistics, we construct new measures of the impact of Brexit on listed firms in the United States and around the world
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Working Paper Series
The Decline of the U.S. Labor Share Across Sectors
Nov 2019
This paper provides novel insights on the changing functional distribution of income in the post–war US economy.
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Working Paper Series
The Political Economy of Europe Since 1945: A Kaleckian Perspective
Nov 2019
This paper analyzes the early stages of the formation of the Common Market.
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Working Paper Series
Europe 1957 to 1979: From the Common Market to the European Monetary System
Nov 2019
This essay deals with the contradictory dynamics that engulfed Europe from 1959 to 1979, the year of the launching of the European Monetary System.
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Working Paper Series
From the EMS to the EMU and...to China
Nov 2019
This essay deals with the EMS experience and its failure, with the Maastricht Treaty, and with the interregnum leading to the formation of the EMU in 1999.
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Working Paper Series
Synthetic MMT: Old Line Keynesianism with an Expansionary Twist
Oct 2019
Policy hype but vintage fiscal economics from Godley, Lerner, and Keynes
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Working Paper Series
Big Tech Acquisitions and the Potential Competition Doctrine: The Case of Facebook
Oct 2019
How antitrust law is ill-equipped to address tech mergers
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Working Paper Series
American Gothic: How Chicago Economics Distorts “Consumer Welfare” in Antitrust
Jul 2019
The Chicago School has long used bankrupt assumptions to strangle antitrust policy.
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Working Paper Series
Firm-Level Political Risk: Measurement and Effects
Jul 2019
We adapt simple tools from computational linguistics to construct a new measure of political risk faced by individual US firms: the share of their quarterly earnings conference calls that they devote to political risks.
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Working Paper Series
Expansionary Austerity and Reverse Causality: A Critique of the Conventional Approach
Jul 2019
It was too good to be true: Another effort to vindicate austerity falls victim to flawed methodology.
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Working Paper Series
State Capacity and Demand for Identity: Evidence from Political Instability in Mali
Jun 2019
Frequent civil conflicts in African countries may erode national identity, thus highlighting a reason why civil conflict is costly for growth and development
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Working Paper Series
Demand-determined potential output: a revision and update of Okun’s original method
May 2019
Everyone is waking up to the fact that estimates of what is possible in the economy are way off: this paper explains why
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Working Paper Series
Antitrust and Economic History: The Historic Failure of the Chicago School of Antitrust
May 2019
This paper presents an historical analysis of the antitrust laws.
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Working Paper Series
Lost in Deflation
Apr 2019
Why Italy’s woes are a warning to the whole Eurozone
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Working Paper Series
Economic Consequences of the U.S. Convict Labor System
Mar 2019
Prisoners employed in manufacturing constitute 4.2% of total U.S. manufacturing employment in 2005; they produce cheap goods, creating labor demand shock.
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Working Paper Series
The Knightian Uncertainty Hypothesis: Unforeseeable Change and Muth’s Consistency Constraint in Modeling Aggregate Outcomes
Mar 2019
This paper introduces the Knightian Uncertainty Hypothesis (KUH), a new approach to macroeconomics and finance theory.
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Working Paper Series
New Evidence on the Portfolio Balance Approach to Currency Returns
Feb 2019
Asset markets are indispensable in harnessing society’s diverse views and insights about future business performance. But those views are shaped as much by emotion and crowd mentality as by rational expectations.
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Working Paper Series
The Contributions of Socioeconomic and Opioid Supply Factors to Geographic Variation in U.S. Drug Mortality Rates
Feb 2019
Economic distress in rural areas and opioid exposure in cities are key indicators of overdose deaths
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Working Paper Series
Labor Laws and Manufacturing Performance in India: How Priors Trump Evidence and Progress Gets Stalled
Feb 2019
For years, governments in India and much of the developing world have followed the advice of a paper arguing that labor regulations actually hurt workers. The problem? The research was wrong.
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Working Paper Series
Estimates of the Natural Rate of Interest and the Stance of Monetary Policies: A Critical Assessment
Jan 2019
Starting with the literature on the estimates of the natural rate of interest, this paper critically analyzes the modern practice of identifying the benchmark rate of monetary policy with an equilibrium or neutral interest rate reflecting “fundamental forces” unaffected by monetary factors.
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Working Paper Series
Finance in Economic Growth: Eating the Family Cow
Jan 2019
The American economy changed rapidly in the last half-century. The National Income and Product Accounts (NIPA) were designed before these changes started. They have stretched to accommodate new and growing service activities, but they are still organized for an industrial economy.
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Working Paper Series
Economic Growth and Carbon Emissions: The Road to ‘Hothouse Earth’ is Paved with Good Intentions
Dec 2018
Wishful thinking and tinkering won’t cut it. Nothing short of a mass mobilization for deep de-carbonization across the global economy can avert the looming climate catastrophe.
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Working Paper Series
Citation Patterns in Economics and Beyond
Nov 2018
Assessing the Peculiarities of Economics from Two Scientometric Perspectives
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Working Paper Series
Citation Patterns in Economics and Beyond
Nov 2018
In this paper we comparatively explore three claims concerning the disciplinary character of economics by means of citation analysis.
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Working Paper Series
The Economic and Social Roots of Populist Rebellion: Support for Donald Trump in 2016
Oct 2018
This paper critically analyzes voting patterns in the 2016 U.S. presidential election.
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Working Paper Series
Publishing and Promotion in Economics: The Tyranny of the Top Five
Oct 2018
This paper examines the relationship between placement of publications in Top Five (T5) journals and receipt of tenure in academic economics departments.
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Working Paper Series
Double Whammy: Implicit Subsidies and the Great Financial Crisis
Sep 2018
This paper concerns itself with the joint effect of implicit subsidies that are built into the US housing-finance system and financial safety net.
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Working Paper Series
Executive compensation in Europe: Realized gains from stock-based pay
Sep 2018
This paper adds to the empirical evidence on the extent to which stock-based pay incentivizes and rewards European corporate executives. It shows that the actual realized gains (that is, take-home compensation) from stock-based pay of CEOs in European publicly-listed firms may be underestimated by the use of “estimated fair value” measures. The paper also documents the heterogeneity among countries in terms of the levels and components of CEO take-home pay. We base our work on a sample of 301 large, publicly-traded companies listed in the S&P Europe 350 index from 11 EU countries: Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Spain, Sweden and United Kingdom for the fiscal year 2015. Through analyzing companies’ annual reports, we have hand-collected data on various elements of compensation of the company’s CEO in 2015, including the gains that executives realize from stock-based pay. We document that on average half of the total compensation of the European CEOs in our sample is stock-based, measured by actual realized gains, with large differences among countries. Although in some European countries the majority of total compensation is stock-based, the proportions are still well below those that prevail in the
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Working Paper Series
Race to the Bottom: Low Productivity, Market Power, and Lagging Wages
Aug 2018
“Dualism” in the structure of production across sectors of the US economy, employment by sector, productivity levels and growth, real wages, and intersectoral terms-of trade increased markedly between 1990 and 2016.
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Working Paper Series
Social Stability and Resource Allocation within Business Groups
Aug 2018
Using datasets on transactions within business groups and social sentiment in China, I show that state-owned enterprises (SOEs) use internal funds to address social unrest, complying with the government’s political goals.
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Working Paper Series
The Subversion of Shareholder Democracy and the Rise of Hedge-Fund Activism
Aug 2018
This paper explains how hedge-fund activists are exerting power over corporate resourceallocation far in excess of the actual voting power of their shareholdings.
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Working Paper Series
Too Big to Fail Banks' Regulatory Alchemy
Jun 2018
Converting an Obscure Agency Footnote into an “At Will” Nullification of Dodd-Frank’s Regulation of the Multi-Trillion Dollar Financial Swaps Market
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Working Paper Series
Labor Institutions and Development Under Globalization
Jun 2018
Labor market regulation is a controversial area of public policy in both developed and developing countries.