The Publication Patterns of the Elite Economics Departments: 1995-2000

We examine publication patterns of the top seven U.S. economics departments from 1995 to 2000. We construct a departmental-based journal ranking on both the number of publications and the percentage of journal pages from authors affiliated with top institutions. The data show that publications are highly concentrated among a few journals: seven journals comprise more than one-fourth of aggregate research output for the sample. Nine of the eighty-seven most common publication outlets originated in the 1990s. A departmental measure of journal quality avoids the problems confronting citations data. We suggest that economists reconsider the prestige of journals based on these strikingly different results.Economics Departments; Economics; Journals

Airline Schedule Recovery after Airport Closures: Empirical Evidence Since September 11th

Since the September 11, 2001 terrorist attacks, repeated airport closures due to potential security breaches have imposed substantial costs on travelers, airlines, and government agencies in terms of flight delays and cancellations. Using data from the year following September 11th, this study examines how airlines recover flight schedules upon reopening of airports that have been closed for security reasons. As such, this is the first study to examine service quality during irregular operations. Our results indicate that while outcomes of flights scheduled during airport closures are difficult to explain, a variety of factors, including potential revenue per flight and logistical variables such as flight distance, seating capacity and shutdown severity, significantly predict outcomes of flights scheduled after airports reopen. Given the likelihood of continued security-related airport closings, understanding the factors that determine schedule recovery is potentially important.

Does School Choice Increase School Quality?

Federal No Child Left Behind' legislation, which enables students of low-performing schools to exercise public school choice, exemplies a widespread belief that competing for students will spur public schools to higher achievement. We investigate how the introduction of school choice in North Carolina, via a dramatic increase in the number of charter schools across the state, affects the performance of traditional public schools on statewide tests. We find test score gains from competition that are robust to a variety of specifications. The introduction of charter school competition causes an approximate one percent increase in the score, which constitutes about one quarter of the average yearly growth.

Corporate Social Responsibility and Firm Value: Recent Developments

We provide a synthesized introduction to recent findings in the link between corporate social responsibility and firm value. The focus is on how and why profit-maximizing firms engage in socially responsible actions, and how such activities can increase product demand and shareholder value. Recent studies in empirical evidences, theoretical models, and trends in practice are discussed. This chapter is not intended to be a comprehensive survey but rather an introduction to bring future research interest in this field. Empirical studies show evidences of a positive impact of corporate giving on indicators of firm value such as shareholder value and financial performance. Theoretical models provide mechanisms and economic foundations for the demand increase leading to profits in different market structures. Socially responsible actions can be induced by external activists for fear of boycotts. Investors may prefer to hold shares of responsible firms when corporate giving can substitute for personal giving. A public good may be produced jointly with a private good. Models of general industry equilibrium find that demand increases due to the public good may come from the endogenous market effect. Companies in industries with entry barriers make the top list of corporate giving. Using examples in the pharmaceutical, finance, and high-tech industries, we discuss how corporate social responsibility is conducted in practice

Price Discrimination and Focal Points for Tacit Collusion: Evidence from the Airline Industry

We use unique data sets with round-the-clock posted fares and a regression discontinuity design to identify price discrimination in advance-purchase discounts. Price discrimination increases fares by 7.6% at 14 days to departure, and by 14% at 7 days to departure. While competition reduces price discrimination, it is unaffected by product variety for a multiproduct monopolist. The results show that the arbitrary thresholds of 7 and 14 days-in-advance serve as focal points for tacit collusion and to implement price discrimination in competitive markets. For round-trip tickets price discrimination depends on the days-in-advance for both the outbound and inbound flights

Bundling in advance sales: Theory and evidence from round-trip vs two one-way tickets

We develop a model to derive an optimal price for a bundle of two goods when buyers are risk averse and uncertain about the valuation of each good. In theory, the optimal bundle price depends not only on the probability of a positive valuation of each good, but also on the correlation between the two valuations. We analyze a unique airlines dataset in which we directly observe the prices of both bundled (round trip ticket) and unbundled items (two one-way tickets) for identical itineraries. We find that airlines offer bundle discounts, and that these discounts increase when the correlation between outbound and inbound demands is higher. Moreover, higher certainty about demand decreases bundling discounts. We also find that bundling discounts decrease with competition

Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment

This study develops theory and uses a door-to-door fundraising field experiment to explore the economics of charity. We approached nearly 5000 households, randomly divided into four experimental treatments, to shed light on key issues on the demand side of charitable fundraising. Empirical results are in line with our theory: in gross terms, our lottery treatments raised considerably more money than our voluntary contributions treatments. Interestingly, we find that a one standard deviation increase in female solicitor physical attractiveness is similar to that of the lottery incentive¡ªthe magnitude of the estimated difference in gifts is roughly equivalent to the treatment effect of moving from our theoretically most attractive approach (lotteries) to our least attractive approach (voluntary contributions).

The Hidden Benefits of Control: Evidence from a Natural Field Experiment

An important dialogue between theorists and experimentalists over the past few decades has raised the study of the interaction of psychological and economic incentives from academic curiosity to a bona fide academic field. One recent area of study within this genre that has sparked interest and debate revolves around the “hidden costs” of conditional incentives. This study overlays randomization on a naturally-occurring environment in a series of temporally-linked field experiments to advance our understanding of the economics of charity and test if such “costs” exist in the field. This approach permits us to examine why people initially give to charities, and what factors keep them committed to the cause. Several key findings emerge. First, there are hidden benefits of conditional incentives that would have gone undetected had we maintained a static theory and an experimental design that focused on short run substitution effects rather than dynamic interactions. Second, we can reject the pure altruism model of giving. Third, we find that public good provision is maximized in both the short and long run by using conditional, rather than unconditional, incentives.

Is There a 'Hidden Cost of Control' in Naturally-Occurring Markets? Evidence from a Natural Field Experiment

Several recent laboratory experiments have shown that the use of explicit incentives—such as conditional rewards and punishment—entail considerable “hidden” costs. The costs are hidden in the sense that they escape our attention if our reasoning is based on the assumption that people are exclusively self-interested. This study represents a first attempt to explore whether, and to what extent, such considerations affect equilibrium outcomes in the field. Using data gathered from nearly 3000 households, we find little support for the negative consequences of control in naturally-occurring labor markets. In fact, even though we find evidence that workers are reciprocal, we find that worker effort is maximized when we use conditional—not unconditional—rewards to incent workers.

Is a Donor in Hand Better than Two in the Bush? Evidence from a Natural Field Experiment

This study develops theory and conducts an experiment to provide an understanding of why people initially give to charities, why they remain committed to the cause, and what factors attenuate these influences. Using an experimental design that links donations across distinct treatments separated in time, we present several insights. For example, we find that previous donors are more likely to give, and contribute more, than donors asked to contribute for the first time. Yet, how these previous donors were acquired is critical: agents who are initially attracted by signals of charitable quality transmitted via an economic mechanism are much more likely to continue giving than agents who were initially attracted by non-mechanism factors.