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Symposium: Does the US Really Gain From Trade?
"The US Gains from Trade: Valuation Using the Demand for Foreign Factor Services," past times Arnaud Costinot together with Andrés Rodríguez-Clare
About viii cents out of every dollar spent inwards the US of America is spent on imports. What if, because of a wall or another extreme policy intervention, imports were to stay on the other side of the US border? How much would US consumers live willing to pay to forbid this hypothetical policy modify from taking place? The answer to this inquiry represents the welfare cost from autarky or, equivalently, the welfare gains from trade. In this article, nosotros hash out how to evaluate these gains using estimates of the demand for unusual ingredient services.
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"Alternative Sources of the Gains from International Trade: Variety, Creative Destruction, together with Markups," past times Robert C. Feenstra
The modern theory of international merchandise identifies several additional sources of the gains from international merchandise beyond the gains from traditional comparative advantage. These are the gains from importing novel production varieties; the gains from "creative destruction" every bit the relatively most productive firms expand their output past times exporting spell the less-productive firms exit; together with the gains from contest betwixt firms inwards dissimilar countries, which tin give the axe Pb to reduced markups. Estimates of these various gains are provided for the US of America together with other countries.
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"New Perspectives on the Decline of US Manufacturing Employment," past times Teresa C. Fort, Justin R. Pierce together with Peter K. Schott
We utilisation relatively unexplored dimensions of US microdata to examine how US manufacturing work has evolved across industries, firms, establishments, together with regions. These information render back upwardly for both trade- together with technology-based explanations of the overall spend upwardly of work over this period, spell also highlighting the difficulties of estimating an overall contribution for each mechanism. Toward that end, nosotros hash out how to a greater extent than careful analysis of these trends mightiness yield sharper insights.
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"What Do Trade Agreements Really Do?" past times Dani Rodrik
Economists have got a style to associate "free merchandise agreements" all also closely amongst "free trade." They may live unaware of some of the novel (and often problematic) beyond-the-border features of electrical current merchandise agreements. As merchandise agreements have got evolved together with gone beyond import tariffs together with quotas into regulatory rules together with harmonization—intellectual property, wellness together with security rules, project standards, investment measures, investor-state dispute small town procedures, together with others—they have got instruct harder to agree into received economic theory. It is possible that rather than neutralizing the protectionists, merchandise agreements may empower a dissimilar ready of rent-seeking interests together with politically well-connected firms—international banks, pharmaceutical companies, together with multinational firms. Trade agreements could even then outcome inwards freer, mutually beneficial trade, through commutation of marketplace access. They could outcome inwards the global upgrading of regulations together with standards, for labor, say, or the environment. But they could also make purely redistributive outcomes nether the guise of "freer trade." As merchandise agreements instruct less almost tariffs together with nontariff barriers at the border together with to a greater extent than almost domestic rules together with regulations, economists mightiness practice good to worry to a greater extent than almost the latter possibility.
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Symposium: Risk inwards Economics together with Psychology
"Modeling Risk Aversion inwards Economics," past times Ted O'Donoghue together with Jason Somerville
To capture the risk-aversion intuition, the touchstone approach inwards economics has been to utilize the model of expected utility, inwards which withdraw chances aversion derives from diminishing marginal utility for wealth (or diminishing marginal utility for aggregate consumption). The expected utility model for withdraw chances aversion has been used to derive many of import insights. But over the years, economists together with psychologists have got identified various problematic issues amongst expected utility every bit a descriptive model of choice. In this article, nosotros urge economists to have got seriously the inquiry agenda of developing together with assessing dissimilar ways to model withdraw chances aversion. We gain off inwards 3 principal steps. First, nosotros highlight that the basic intuition of withdraw chances aversion that drives many results inwards economics is non intimately tied to expected utility. Second, nosotros push clitoris a few option models that tin give the axe also capture the basic intuition of withdraw chances aversion. Finally, nosotros hash out that, spell expected utility together with the option models mightiness all capture the basic intuition of withdraw chances aversion, the option models tin give the axe generate additional, to a greater extent than nuanced implications non shared amongst expected utility, that inwards some cases seem to live borne out past times data. We emphasize that these option models also are non perfect, together with farther inquiry is needed to position fifty-fifty amend approaches.
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"On the Relationship betwixt Cognitive Ability together with Risk Preference," past times Thomas Dohmen, Armin Falk, David Huffman together with Uwe Sunde
This newspaper volition focus on the human relationship betwixt cognitive powerfulness together with decision-making nether withdraw chances together with uncertainty. Taken every bit a whole, this inquiry indicates that cognitive powerfulness is associated amongst risk-taking demeanour inwards various contexts together with life domains, including incentivized choices betwixt lotteries inwards controlled environments, demeanour inwards nonexperimental settings, together with self-reported style to have got risks. One designing that emerges oft inwards these studies is that cognitive powerfulness tends to live positively correlated amongst avoidance of harmful risky situations, but it tends to live negatively correlated amongst withdraw chances aversion inwards advantageous situations. We conclude past times discussing perspectives for time to come research, inwards particular the reach for the evolution of richer sets of elicitation instruments together with mensuration across a wider gain of concepts.
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"Are Risk Preferences Stable?" past times Hannah Schildberg-Hörisch
It is ultimately an empirical inquiry whether withdraw chances preferences are stable over time. The bear witness comes from various strands of literature, roofing the stability of withdraw chances preferences inwards panel information over shorter periods of time, life-cycle dynamics inwards withdraw chances preferences, the perhaps long-lasting effects of exogenous shocks on withdraw chances preferences every bit good every bit temporary variations inwards withdraw chances preferences. Individual withdraw chances preferences seem to live persistent together with moderately stable over time, but their flat of stability is also depression to live reconciled amongst the supposition of perfect stability inwards neoclassical economic theory. We offering an option conceptual framework for preference stability that builds on inquiry regarding the stability of personality traits inwards psychology. The Definition of stability used inwards psychology implies high levels of rank-order stability across individuals together with non that the private volition hold the same flat of a trait over time. Preference parameters are considered every bit distributions amongst a hateful that is significantly but less than perfectly stable, plus some systematic variance. This framework accommodates bear witness on systematic changes inwards withdraw chances preferences over the life cycle, due to exogenous shocks such every bit economical crises or natural catastrophes, together with due to temporary changes inwards self-control resources, emotions, or stress. We annotation that inquiry on the stability of (risk) preferences is conceptually at the see of microeconomics together with systematic changes inwards withdraw chances preferences have got vital real-world consequences.
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"Risk Preference: H5N1 View from Psychology," past times Rui Mata, Renato Frey, David Richter, Jürgen Schupp together with Ralph Hertwig
Psychology offers conceptual together with analytic tools that tin give the axe advance the give-and-take on the nature of withdraw chances preference together with its mensuration inwards the behavioral sciences. We hash out the revealed together with stated preference mensuration traditions, which have got coexisted inwards both psychology together with economics inwards the study of withdraw chances preferences, together with explore issues of temporal stability, convergent validity, together with predictive validity amongst regard to mensuration of withdraw chances preferences. As for temporal stability, practice withdraw chances preference every bit a psychological trait demo a flat of stability over fourth dimension that approximates what has been established for other major traits, such every bit intelligence, or, alternatively, are they to a greater extent than like inwards stability to transitory psychological states, such every bit emotional states? Convergent validity refers to the flat to which dissimilar measures of a psychological build capture a mutual underlying characteristic or trait. Do measures of withdraw chances preference all capture a unitary psychological trait that is indicative of risky demeanour across various domains, or practice they capture various traits that independently contribute to risky demeanour inwards specific areas of life, such every bit financial, health, together with recreational domains? Predictive validity refers to the extent to which a psychological trait has powerfulness inwards forecasting behavior. Intelligence together with major personality traits have got been shown to predict of import life outcomes, such every bit academic together with professional person achievement, which suggests at that spot could live studies of the short- together with long-term outcomes of withdraw chances preference—something lacking inwards electrical current psychological (and economic) research. We hash out the electrical current empirical cognition on withdraw chances preferences inwards low-cal of these considerations.
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Articles together with Features
"Space, the Final Economic Frontier," past times Matthew Weinzierl
After decades of centralized command of economical activeness inwards space, NASA together with US policymakers have got begun to cede the direction of human activities inwards infinite to commercial companies. NASA garnered to a greater extent than than 0.7 per centum of gross domestic product inwards the mid-1960s, but is solely around 0.1 per centum of gross domestic product today. Meanwhile, infinite has instruct large business, amongst $300 billion inwards annual revenue. The shift from world to private priorities inwards infinite is peculiarly pregnant because a widely shared destination amid commercial space's leaders is the achievement of a large-scale, largely self-sufficient, developed infinite economy. Jeff Bezos, has stated that the mission of his theatre Blue Origin is "millions of people living together with working inwards space." Elon Musk, founder of SpaceX, has set out plans to build a metropolis of a i M 1000 people on Mars inside the adjacent century. Both Neil deGrasse Tyson together with Peter Diamandis have got been given credit for stating that Earth's get-go trillionaire volition live an asteroid-miner. Such visions are clearly non going to instruct reality inwards the close future. But detailed roadmaps to them are existence produced together with recent progress inwards the required technologies has been dramatic. If such space-economy visions are fifty-fifty partially realized, the implications for social club volition live enormous. Though economists should process the prospect of a developed infinite economic scheme amongst salubrious skepticism, it would live irresponsible to process it every bit scientific discipline fiction. In this article, I render an analytical framework—based on classic economical analysis of the purpose of authorities inwards marketplace economies—for understanding together with managing the evolution of the infinite economy.
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"Dave Donaldson: Winner of the 2017 Clark Medal," past times Daron Acemoglu
The 2017 John Bates Clark Medal of the American Economic Association was awarded to Dave Donaldson for his path-breaking contributions inwards international trade. Donaldson’s function sheds low-cal on some of the fundamental questions of international economics, ranging from the economical together with welfare implications of marketplace integration inside a terra firma to testing the centre empirical predictions of models of international merchandise based on comparative advantage. In these areas, empirical function faces the challenge of taking into line of piece of work organisation human relationship the broader equilibrium implications of changes inwards policies or economical conditions—that is, the possibility that bilateral relations betwixt 2 regions or countries volition comport upon others via merchandise diversion or their effects on equilibrium prices. Donaldson’s function has managed to address these challenges past times combining careful theory amongst detailed together with creative empirical work. Indeed, this inquiry strategy has turned Dave into a leader inwards the revival of empirical function inwards international trade.
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"Retrospectives: Adam Smith's Discovery of Trade Gravity," past times Bruce Elmslie
The gravity equation is a electrical current workhorse of empirical merchandise theory. It is mostly acknowledged that this theory, which relates the extent of merchandise betwixt countries to their respective sizes, distances, together with relative merchandise barriers, was get-go developed past times January Tinbergen inwards 1962. Acceptance of the gravity model every bit purpose of the discipline's centre was express past times its scant theoretical foundation for the get-go xl years of its existence. This newspaper finds that a theory of merchandise gravity was get-go developed past times Adam Smith inwards The Wealth of Nations. Moreover, it is shown that Smith's contestation of a proportional relation betwixt economical size together with distance came almost every bit an application of his full general theory of differential uppercase productivity inwards dissimilar economical sectors, together with his elaboration of a theory of the gains from merchandise originated past times David Hume. It is farther shown that Smith had an explanation of the size of border affects inwards merchandise volumes, together with a gravity theory of merchandise restrictions.
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"Recommendations for Further Reading," past times Timothy Taylor
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"Do You Use JEP Articles inwards Your Classroom? One More Chance to Share!"
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