Raj Chetty, Matthew O. Jackson, Theresa Kuchler and Johannes Stroebel
Using data on 21 billion Facebook friendships, the authors construct ZIP-code-level measures of three distinct forms of social capital: cross-class connectedness, social cohesion, and civic engagement. They show these measures vary widely across areas and are only weakly correlated with one another. They find that economic connectedness between low- and high-income people is strongly associated with upward income mobility, more so than other forms of social capital.
Thibaut Lamadon, Magne Mogstad and Bradley Setzler
The authors build and estimate an equilibrium model of imperfect competition in the US labor market using linked employer-employee administrative data, combining firm-level productivity shocks with worker mobility. They quantify the degree of employer wage-setting power (monopsony), how firms share rents with workers, and the role of compensating differentials for non-wage amenities. They find that firms have substantial market power and pass through only part of productivity gains to wages, while amenities matter for worker sorting.
The paper develops a framework for difference-in-differences designs in which units adopt treatment at different times across multiple periods. It defines group-time average treatment effects and shows how to identify and estimate them under conditional parallel trends, then aggregate them into interpretable summary parameters. The authors provide valid simultaneous inference and apply the methods to estimating the effect of minimum wage increases on teen employment.
Martin S. Eichenbaum, Sergio Rebelo and Mathias Trabandt
The authors extend the canonical SIR epidemiological model by embedding it in a macroeconomic framework where people's consumption and labor decisions affect the spread of infection. They show that the epidemic causes a sharp recession because infected and susceptible agents cut activity to reduce contagion. A key tension emerges: the competitive equilibrium worsens the epidemic because individuals do not internalize the infection externality, and well-designed containment policy can mitigate the death toll though it deepens the short-run economic contraction.
Francisco J. Buera, Joseph P. Kaboski and Yongseok Shin
The paper builds a general-equilibrium model with heterogeneous agents and financial frictions to evaluate the economy-wide effects of large-scale microfinance programs. It finds that while microfinance raises the incomes of marginal entrepreneurs, partial-equilibrium estimates overstate aggregate gains because general-equilibrium wage and capital responses redistribute benefits. The aggregate effects on output and total factor productivity are modest, but the welfare and distributional consequences can be substantial, especially for poorer households.
The paper shows that linear regressions with group and period fixed effects estimate a weighted sum of treatment effects across cells where some weights can be negative. As a consequence the coefficient can be negative even when every cell-level effect is positive, undermining its interpretation as an average treatment effect. The authors propose an alternative estimator (DID_M) that is robust to heterogeneous effects and assess the empirical relevance of the negative-weighting problem.
The authors study how the spread of industrial robots affected US local labor markets between 1990 and 2007, using variation in industry robot adoption combined with regional industry composition. They estimate the effect on employment and wages in commuting zones more exposed to robotization. They find that each additional robot per thousand workers reduced the employment-to-population ratio and wages in the affected local labor markets, with the largest negative effects on routine manual occupations.
Raj Chetty, Nathaniel Hendren, Maggie R. Jones and Sonya R. Porter
Using de-identified longitudinal data covering nearly the entire U.S. population, the authors study racial and ethnic differences in intergenerational income mobility. They find persistent black-white income gaps driven primarily by differences among men, while black and white women have similar outcomes conditional on parental income. They show neighborhood and family-background factors explain little of the gap, which persists even within the same neighborhoods.
David Autor, David Dorn, Lawrence F. Katz, Christina Patterson and John Van Reenen
The authors document the decline in the labor share of income across US industries and propose a 'superstar firm' explanation: industries are increasingly dominated by highly productive, low-labor-share firms. Using US Economic Census data and cross-country evidence, they show that reallocation of economic activity toward these firms, rather than declines within typical firms, drives the aggregate fall in the labor share. Industries with rising concentration show the largest labor-share declines.
Using firm-level data for the U.S. economy since 1955, the authors estimate price-cost markups and document a sharp rise in aggregate market power beginning around 1980. They argue this increase in markups can account for several secular macroeconomic trends, including the declining labor and capital shares and reduced labor-market dynamism.
Hunt Allcott, Luca Braghieri, Sarah Eichmeyer and Matthew Gentzkow
The authors ran a randomized experiment in which participants were paid to deactivate their Facebook accounts for four weeks before the 2018 US midterm elections. Deactivation reduced time online, increased offline socializing and TV watching, lowered factual news knowledge and political polarization, and modestly improved self-reported well-being. After the experiment, participants reduced their Facebook use, and many lowered their valuation of the platform, suggesting that habitual use exceeds its private benefits for some users.
Doruk Cengiz, Arindrajit Dube, Attila Lindner and Ben Zipperer
The authors estimate the employment effects of US state-level minimum wage increases by examining changes in the entire frequency distribution of hourly wages around each policy change. Using a bunching estimator across 138 prominent state-level increases, they count the number of jobs lost below the new minimum and the number gained at or above it. They find the number of jobs paying below the new minimum fell while jobs at or above it rose by roughly the same amount, implying minimal disemployment effects.
Jae Song, David J. Price, Fatih Guvenen, Nicholas Bloom and Till von Wachter
Using US Social Security earnings records linked to employers, the authors decompose the rise in earnings inequality over 1978-2013 into within-firm and between-firm components. They find that most of the increase in earnings dispersion occurred between firms rather than within them, reflecting growing differences in average pay across employers and increased sorting of high-paid workers into high-paying firms. Within the largest firms, however, pay dispersion among workers remained relatively stable.
Armin Falk, Anke Becker, Thomas Dohmen, Benjamin Enke, David Huffman and Uwe Sunde
Using the Global Preference Survey, a dataset of risk, time, social, and trust preferences measured for about 80,000 individuals across 76 countries, the authors document how fundamental economic preferences vary across populations. They show systematic relationships between these preferences and individual behaviors as well as aggregate national outcomes. The paper also explores how geographic, cultural, and historical factors correlate with the global distribution of preferences.
Raj Chetty, John N. Friedman, Nathaniel Hendren, Maggie R. Jones and Sonya R. Porter
The authors link anonymized federal tax records to census data to estimate children's adult outcomes by the neighborhood in which they grew up, at the Census-tract level for the entire United States. They build the Opportunity Atlas, showing that mobility varies enormously even between adjacent tracts and that childhood environment causally shapes later outcomes. The data reveal which specific neighborhoods foster upward mobility and identify correlates such as poverty rates, family structure, and racial composition.
Victor Chernozhukov, Mert Demirer, Esther Duflo and Iván Fernández-Val
The paper develops a generic method to use any machine learning algorithm to draw valid statistical inference about features of heterogeneous treatment effects in randomized experiments. Rather than estimating the conditional average treatment effect function itself (which ML may estimate inconsistently), it targets summary parameters such as the best linear predictor of the effect on ML proxies, sorted average effects across groups, and average characteristics of the most/least affected units, using sample splitting and aggregation over many splits to obtain robust confidence intervals. It illustrates the approach with an immunization study in India.
The authors combine tax, survey, and national accounts data to build distributional national accounts that allocate 100% of U.S. national income to individuals from 1913 onward. This lets them measure income growth consistently with macroeconomic aggregates across the entire distribution, both before and after taxes and transfers. They document a sharp rise in top income shares and stagnation at the bottom since 1980.
Greg Kaplan, Benjamin Moll and Giovanni L. Violante
The paper builds a Heterogeneous Agent New Keynesian (HANK) model in which households hold liquid and illiquid assets, generating realistic distributions of marginal propensities to consume. It uses this framework to analyze the transmission of monetary policy, decomposing the response of consumption into direct (intertemporal substitution) and indirect (general-equilibrium income) channels. The authors find that, unlike in representative-agent models, indirect effects operating through labor income dominate the transmission of interest rate changes.
Victor Chernozhukov, Denis Chetverikov, Mert Demirer, Esther Duflo, Christian Hansen, Whitney Newey, et al.
The paper develops a general framework for estimating low-dimensional treatment or structural parameters when high-dimensional nuisance components are estimated with machine learning methods. By combining Neyman-orthogonal (debiased) moment conditions with sample-splitting/cross-fitting, the approach removes regularization and overfitting biases. The resulting estimators are root-N consistent, asymptotically normal, and valid for inference despite slowly converging nuisance estimates.
Raj Chetty, David Grusky, Maximilian Hell, Nathaniel Hendren, Robert Manduca and Jimmy Narang
The authors measure absolute income mobility, defined as the fraction of children who earn more than their parents did at the same age, for U.S. birth cohorts from 1940 to the 1980s. Combining tax records with historical data, they show that this measure has declined dramatically over the period. They attribute most of the decline to the rising concentration of income growth rather than to slower aggregate growth.
The paper documents rising midlife mortality among non-Hispanic white Americans without a college degree since the late 1990s, driven by 'deaths of despair' from drugs, alcohol, and suicide alongside stalled progress against heart disease. The authors link these trends to a long-term deterioration in economic and social conditions for less-educated workers.
Nordhaus presents the updated DICE-2016R integrated assessment model and uses it to re-estimate the social cost of carbon, incorporating revised data on output, emissions, carbon cycle, and climate dynamics. The updated model yields a substantially higher social cost of carbon than earlier DICE versions and indicates that limiting warming to 2.5°C is feasible only with very rapid and stringent emissions reductions. The paper concludes that current policies fall well short of an economically optimal climate trajectory.
Daron Acemoglu, Asuman Ozdaglar and Alireza Tahbaz-Salehi
The paper studies how the structure of production networks shapes the distribution of aggregate output, with particular attention to large downturns. It shows that even when idiosyncratic shocks are thin-tailed, interconnections can generate fat-tailed, asymmetric aggregate fluctuations in which large recessions are far more likely than large booms. Network features such as dominant suppliers and limited input substitutability amplify the probability of deep contractions.
The authors review the empirical literature on how U.S. local labor markets adjusted to the surge in import competition from China beginning around 1990. They synthesize evidence showing that the gains from trade coexisted with large, geographically concentrated adjustment costs. They conclude that markets adjusted far more slowly than standard trade models predicted.
Marshall Burke, Solomon M. Hsiang and Edward Miguel
Using data from 166 countries over 1960-2010, the authors estimate a non-linear relationship between annual average temperature and economic productivity, finding output peaks near 13°C and falls sharply at higher temperatures. They project that unmitigated warming could substantially reduce average global incomes and widen global inequality by the end of the century.
Kahneman and Tversky presented experimental evidence that people systematically violate the axioms of expected utility theory when choosing among risky prospects, and proposed prospect theory as a descriptive alternative. In their model, outcomes are evaluated as gains and losses relative to a reference point through an S-shaped value function that is concave for gains, convex for losses, and steeper for losses (loss aversion), while objective probabilities are transformed by a nonlinear decision-weighting function that overweights small probabilities. The theory accounts for observed anomalies such as the certainty, reflection, and isolation effects.