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Symposium: Does the U.S. Really Gain From Trade?
"The U.S. Gains from Trade: Valuation Using the Demand for Foreign Factor Services," past times Arnaud Costinot together with Andrés Rodríguez-Clare
About 8 cents out of every dollar spent inward the U.S.A. is spent on imports. What if, because of a wall or another extreme policy intervention, imports were to rest on the other side of the U.S. border? How much would U.S. consumers live willing to pay to preclude this hypothetical policy modify from taking place? The respond 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 constituent 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" equally 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 inward dissimilar countries, which tin Pb to reduced markups. Estimates of these various gains are provided for the U.S.A. together with other countries.
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"New Perspectives on the Decline of U.S. Manufacturing Employment," past times Teresa C. Fort, Justin R. Pierce together with Peter K. Schott
We utilisation relatively unexplored dimensions of U.S. microdata to examine how U.S. manufacturing job has evolved across industries, firms, establishments, together with regions. These information render back upward for both trade- together with technology-based explanations of the overall turn down of job 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 vogue to associate "free merchandise agreements" all likewise closely amongst "free trade." They may live unaware of some of the novel (and often problematic) beyond-the-border features of electrical flow 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, undertaking standards, investment measures, investor-state dispute village procedures, together with others—they have got locomote harder to check into received economical theory. It is possible that rather than neutralizing the protectionists, merchandise agreements may empower a dissimilar prepare of rent-seeking interests together with politically well-connected firms—international banks, pharmaceutical companies, together with multinational firms. Trade agreements could notwithstanding final result inward freer, mutually beneficial trade, through substitution of marketplace access. They could final result inward 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 locomote 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 exercise good to worry to a greater extent than almost the latter possibility.
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Symposium: Risk inward Economics together with Psychology
"Modeling Risk Aversion inward Economics," past times Ted O'Donoghue together with Jason Somerville
To capture the risk-aversion intuition, the criterion approach inward economic science has been to utilize the model of expected utility, inward which remove chances aversion derives from diminishing marginal utility for wealth (or diminishing marginal utility for aggregate consumption). The expected utility model for remove 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 equally 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 remove chances aversion. We hold inward 3 principal steps. First, nosotros highlight that the basic intuition of remove chances aversion that drives many results inward economic science is non intimately tied to expected utility. Second, nosotros pull a few choice models that tin also capture the basic intuition of remove chances aversion. Finally, nosotros hash out that, spell expected utility together with the choice models mightiness all capture the basic intuition of remove chances aversion, the choice models tin generate additional, to a greater extent than nuanced implications non shared amongst expected utility, that inward some cases seem to live borne out past times data. We emphasize that these choice models also are non perfect, together with farther inquiry is needed to position fifty-fifty improve 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 remove chances together with uncertainty. Taken equally a whole, this inquiry indicates that cognitive powerfulness is associated amongst risk-taking demeanor inward various contexts together with life domains, including incentivized choices betwixt lotteries inward controlled environments, demeanor inward nonexperimental settings, together with self-reported vogue to have got risks. One designing that emerges oft inward 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 remove chances aversion inward advantageous situations. We conclude past times discussing perspectives for hereafter research, inward particular the range for the evolution of richer sets of elicitation instruments together with measuring 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 remove chances preferences are stable over time. The evidence comes from various strands of literature, roofing the stability of remove chances preferences inward panel information over shorter periods of time, life-cycle dynamics inward remove chances preferences, the maybe long-lasting effects of exogenous shocks on remove chances preferences equally good equally temporary variations inward remove chances preferences. Individual remove chances preferences seem to live persistent together with moderately stable over time, but their bird of stability is likewise depression to live reconciled amongst the supposition of perfect stability inward neoclassical economical theory. We offering an choice conceptual framework for preference stability that builds on inquiry regarding the stability of personality traits inward psychology. The Definition of stability used inward psychology implies high levels of rank-order stability across individuals together with non that the private volition maintain the same bird of a trait over time. Preference parameters are considered equally distributions amongst a hateful that is significantly but less than perfectly stable, plus some systematic variance. This framework accommodates evidence on systematic changes inward remove chances preferences over the life cycle, due to exogenous shocks such equally economical crises or natural catastrophes, together with due to temporary changes inward self-control resources, emotions, or stress. We annotation that inquiry on the stability of (risk) preferences is conceptually at the pump of microeconomics together with systematic changes inward remove chances preferences have got vital real-world consequences.
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"Risk Preference: Influenza A virus subtype 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 advance the word on the nature of remove chances preference together with its measuring inward the behavioral sciences. We hash out the revealed together with stated preference measuring traditions, which have got coexisted inward both psychology together with economic science inward the study of remove chances preferences, together with explore issues of temporal stability, convergent validity, together with predictive validity amongst regard to measuring of remove chances preferences. As for temporal stability, exercise remove chances preference equally a psychological trait demonstrate a bird of stability over fourth dimension that approximates what has been established for other major traits, such equally intelligence, or, alternatively, are they to a greater extent than similar inward stability to transitory psychological states, such equally emotional states? Convergent validity refers to the bird to which dissimilar measures of a psychological cook capture a mutual underlying characteristic or trait. Do measures of remove chances preference all capture a unitary psychological trait that is indicative of risky demeanor across various domains, or exercise they capture various traits that independently contribute to risky demeanor inward specific areas of life, such equally financial, health, together with recreational domains? Predictive validity refers to the extent to which a psychological trait has powerfulness inward forecasting behavior. Intelligence together with major personality traits have got been shown to predict of import life outcomes, such equally academic together with professional person achievement, which suggests at that topographic point could live studies of the short- together with long-term outcomes of remove chances preference—something lacking inward electrical flow psychological (and economic) research. We hash out the electrical flow empirical noesis on remove chances preferences inward 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 inward space, NASA together with U.S. policymakers have got begun to cede the direction of human activities inward infinite to commercial companies. NASA garnered to a greater extent than than 0.7 per centum of gross domestic product inward the mid-1960s, but is alone around 0.1 per centum of gross domestic product today. Meanwhile, infinite has locomote large business, amongst $300 billion inward annual revenue. The shift from populace to private priorities inward infinite is peculiarly meaning because a widely shared finish amidst 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 job solid Blue Origin is "millions of people living together with working inward space." Elon Musk, founder of SpaceX, has set out plans to build a metropolis of a 1 G 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 source trillionaire volition live an asteroid-miner. Such visions are clearly non going to locomote reality inward the close future. But detailed roadmaps to them are beingness produced together with recent progress inward the required technologies has been dramatic. If such space-economy visions are fifty-fifty partially realized, the implications for gild 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 equally scientific discipline fiction. In this article, I render an analytical framework—based on classic economical analysis of the purpose of regime inward 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 inward international trade. Donaldson’s run 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 dry reason to testing the centre empirical predictions of models of international merchandise based on comparative advantage. In these areas, empirical run faces the challenge of taking into concern human relationship the broader equilibrium implications of changes inward policies or economical conditions—that is, the possibility that bilateral relations betwixt 2 regions or countries volition touching on others via merchandise diversion or their effects on equilibrium prices. Donaldson’s run 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 inward the revival of empirical run inward international trade.
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"Retrospectives: Adam Smith's Discovery of Trade Gravity," past times Bruce Elmslie
The gravity equation is a electrical flow workhorse of empirical merchandise theory. It is to a greater extent than often than non acknowledged that this theory, which relates the extent of merchandise betwixt countries to their respective sizes, distances, together with relative merchandise barriers, was source developed past times January Tinbergen inward 1962. Acceptance of the gravity model equally business office of the discipline's centre was express past times its scant theoretical foundation for the source forty years of its existence. This newspaper finds that a theory of merchandise gravity was source developed past times Adam Smith inward The Wealth of Nations. Moreover, it is shown that Smith's contestation of a proportional relation betwixt economical size together with distance came almost equally an application of his full general theory of differential working capital missive of the alphabet productivity inward 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 inward 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 inward Your Classroom? One More Chance to Share!"
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