AEA Research Highlights

Qualitative accounts of anthropologists indicate that social structure plays an important role in how resources are shared in society. But quantitative evidence measuring the impacts of social organization on financial ties and transfers has been lacking.

In a paper in the American Economic Review, authors Jacob Moscona and Awa Ambra Seck helped to fill that gap. They found that in East Africa, cash transfer policies had very different effects in cultures organized by kinship ties compared to cultures organized around age groups.

The findings suggest that social organization has a deep impact on how resources spread through economies and ultimately shape inequality.

Jacob Moscona recently spoke with Tyler Smith about the difference between kin-based societies and age-based societies and how they affect development policies.

The Paycheck Protection Program (PPP) was launched at the height of the COVID-19 pandemic in the hopes that it would keep businesses from laying off workers during government shutdown measures taken to contain the spread of the disease.

Initial estimates of the direct impacts have been mixed, with some studies suggesting that the cost was hundreds of thousands of dollars per job saved.

But a paper in the American Economic Journal: Economic Policy looked beyond the labor market at a second order effect showing a clear and positive benefit. Authors Sumit Agarwal, Brent W. Ambrose, Luis A. Lopez, Xue Xiao found that the PPP reduced mortgage delinquencies for commercial real estate by roughly $36 billion in 2020 and likely played an important role in averting wider distress in financial markets.

Ambrose recently spoke with Tyler Smith about the impact of PPP loans on the commercial real estate market and ways in which the program could have been better targeted.

In 2005, Austria’s most prominent far-right party proclaimed a “Third Turkish Siege of Vienna.” The campaign warned voters that, like their ancestors who were almost overrun by the Ottoman Empire four centuries ago, they were being culturally invaded by Muslims. The campaigners hoped to use long-past historical events to shape the behavior and sentiments of modern-day voters. But did it work?

The strategy sparked a surge in the far-right’s vote share and a wave of anti-Muslim sentiment, according to a paper in the American Economic Journal: Applied Economics. The authors, Christian Ochsner and Felix Roesel, studied areas with ties to the historical trauma of the Sieges of Vienna and explained how political innovators reinvigorated latent xenophobic narratives that mobilized voters.

Ochsner recently spoke with Tyler Smith about the recent political environment in Austria, the use of historical parallels, and the impact on Muslim minorities.

In 1993, the North American Free Trade Agreement (NAFTA) was passed with bipartisan support and near universal endorsement by economists. In hindsight, the economic costs and political consequences were far greater than many contemporary observers would have imagined.

In a paper in the American Economic Review, authors Jiwon Choi, Ilyana Kuziemko, Ebonya Washington, and Gavin Wright found that US counties most exposed to NAFTA and Mexican import competition saw their total employment drop by roughly 6 percent compared to those with little exposure to the trade deal. However, workers in these communities didn’t respond by moving away to find better opportunities, and many, feeling betrayed by the Democratic party, embraced the Republican party instead. 

Choi and Wright recently spoke with Tyler Smith about the economic and political history of NAFTA and what economists have learned since its passage.

Since 2014, over 15,000 migrants have died or gone missing trying to make the voyage from the north coast of Africa to southern Europe. In response, European authorities have launched several search and rescue operations. There are few signs that migration along this deadly route is slowing down. In fact, efforts to curb migrant deaths may encourage even more migrants to make the perilous journey.

In a paper in the American Economic Journal: Economic Policy, authors Claudio Deiana, Vikram Maheshri, and Giovanni Mastrobuoni found evidence that migrants and smugglers responded to search and rescue operations by attempting even more dangerous crossings. However, the authors still say that such operations are likely beneficial to migrants on the whole.

Maheshri recently spoke with Tyler Smith about the impact of search and rescue operations on the market for smuggling along the Central Mediterranean Route and what policymakers should do to reduce migrant deaths.

Timely publication of research in peer-reviewed journals is critical for economists seeking tenure and important for audiences looking for high-quality, trustworthy studies. But in recent decades, there has been an increasing concern that the pace of publishing in economics is too slow.

In a paper in the Journal of Economic Literature, authors Aboozar Hadavand, Daniel S. Hamermesh, and Wesley W. Wilson analyzed the publication lag in top economics journals and compared it to other fields. They found that economics publishing takes nearly twice as long as comparable fields in the other social sciences.

However, Hamermesh says that some innovative journals, such as AER: Insights, are taking steps to shorten the time between submission and publication. He recently spoke with Tyler Smith about the pace of publishing in economics, how to fix it, and some advice for young economists trying to publish their work.

The COVID-19 pandemic highlighted the importance of vaccines, but it also underscored the reservations and low take-up rates among US citizens.

In a paper in the American Economic Journal: Economic Policy, authors Marcella Alsan and Sarah Eichmeyer tested several approaches to improving messages aimed at boosting vaccine demand. Their main finding was that messages delivered by laypersons were more effective than those delivered by persons perceived to be doctors. 

Eichmeyer says that video messages delivered by experts who were of the same race or were perceived as empathetic can be effective for some types of viewers, but for the most hesitant, ordinary citizens may be the best positioned to dispel myths about vaccines. 

She recently spoke with Tyler Smith about the design of her and Alsan’s experiment and what their results imply about vaccine messaging.

In the middle of the day on Friday, March 10, 2023, bank regulators swiftly shut down Silicon Valley Bank (SVB), arguably averting a wider panic. Compared to past financial crises, it was not especially economically significant, but it stands out as an important, illustrative example of the economics of banking.

In a paper in the Journal of Economic Perspectives, author Andrew Metrick explains the causes behind SVB’s failure and how the government responded. He says that understanding the collapse of SVB is a stepping stone to making sense of more complicated financial crises such as the Global Financial Crisis.

Metrick recently spoke with Tyler Smith about why Silicon Valley Bank failed and what policymakers can do to prevent financial crises.

Before Silicon Valley became a byword for innovation, Route 128, outside of Boston, was America's technology highway, connecting the country’s premier technology companies and research facilities. However, this first American high-tech cluster likely would not have developed as it did without one of the biggest shocks to federal R&D funding in US economic history.

In a paper in the American Economic Review, authors Daniel P. Gross and Bhaven N. Sampat explain how a World War II research effort jump-started innovation hubs like Route 128 across the United States. Gross and Sampat recently spoke with Tyler Smith about the history of R&D funding in the United States, and the lessons policymakers can take from it.

Numerous studies have highlighted the importance of effective teachers for student achievement. But new research suggests that school counselors may be just as critical as teaching staff for some students.

In a paper in the American Economic Review, author Christine Mulhern found that effective high school counselors can significantly improve the chance that students graduate from high school and attend a four-year college. She says that although it is challenging to predict which counselors will have these large positive impacts, the effects are comparable to many popular education interventions.

Mulhern recently spoke with Tyler Smith about the role that counselors play in students' choices, which students benefit the most from counseling, and the lessons administrators and parents can take away from her findings.