Progressive learning

We study a dynamic principal–agent relationship with adverse selection and limited commitment. We show that when the relationship is subject to productivity shocks, the principal may be able to improve her value over time by progressively learning the agent's private information. She may even achieve her first‐best payoff in the long run. The relationship may also exhibit path dependence, with early shocks determining the principal's long‐run value. These findings contrast sharply with the results of the ratchet effect literature, in which the principal persistently obtains low payoffs, giving up substantial informational rents to the agent

Essays in the Positive Theory of Policy Choice

This manuscript consists of three essays in the positive theory of policy choice. The first essay, titled Equilibrium False Consciousness, focuses on policy choice through majoritarian voting in a model of class conflict and social mobility. It studies a new model of social mobility with two types of voters: high income voters and low income voters. All voters are fully rational and care only about their economic payoff. However, the main result of the chapter is the existence of an equilibrium (for large electorates) where some low income voters cast their ballot for the right wing policy despite knowing that the left wing policy gives them a higher expected payoff. The chapter provides a new explanation for why rational low income voters may oppose redistribution on the basis of their preferences and expectations regarding the prospect of upward mobility. The second essay, titled Incomplete Policymaking: Making Healthcare Policy 2009-2010, explains the emergence of incomplete policies as the outcome of a dynamic logrolling problem between policymakers. The idea that incomplete policies may emerge as a partial solution to the dynamic logrolling problem is new to the formal literature on policy-making. The theory is developed through a narrative of the healthcare policy negotiations that took place in the U.S. Congress between 2009 and 2010. The third and final essay, titled Coordination and Development in Dictatorships, develops a theory of inefficient policy choice by authoritarian regimes, and highlights the tradeoff between the benefits of economic coordination for rulers vis-a-vis the costs of political coordination. One important implication of the theory is the result that part of the impetus for democratization may emerge as a consequence of the eciency gains associated with eliminating some of the intensity of political conflict. This is in sharp contrast to most of the previous formal literature, which emphasizes social conflict at the expense of modernization in explaining the emergence of democracy

Replication Data for: The Political Legacy of American Slavery

Contains all code to reproduce tables and figures in "The Political Legacy of American Slavery." Also contains the data to produce most of the tables. Links to restricted data or data too large for this archive are contained in the source code

Replication Data for: Analyzing Causal Mechanisms in Survey Experiments

Researchers investigating causal mechanisms in survey experiments often rely on non-randomized quantities to isolate the indirect effect of treatment through these variables. Such an approach, however, requires a ``selection-on-observables'' assumption, which undermines the advantages of a randomized experiment. In this paper, we show what can be learned about casual mechanisms through experimental design alone. We propose a factorial design that provides or withholds information on mediating variables and allows for the identification of the overall average treatment effect and the controlled direct effect of treatment fixing a potential mediator. While this design cannot identify indirect effects on its own, it avoids making the selection-on-observable assumption of the standard mediation approach while providing evidence for a broader understanding of causal mechanisms that encompasses both indirect effects and interactions. We illustrate these approaches via two examples, one on evaluations of U.S. Supreme Court nominees and the other on perceptions of the democratic peace