Best of #econtwitter - Week of September 4, 2022 [1/3]
Welcome readers old and new to this week’s edition of Best of Econtwitter. Please submit suggestions — very much including your own work! — over email or on Twitter @just_economics.
This is part one of three.
Paper summaries
Road traffic accidents are a leading cause of death in low- and middle-income countries, and more than half may involve informal public transit. What can be done to mitigate this huge loss of life? Erin Kelley, Greg Lane, and I ran some experiments in Kenya to see what works.
Did slavery facilitate Europe's early rise to riches? Steve Redding @ReddingEcon, Stephan Heblich, and I focus on the single biggest slave-trading nation, Britain, and revisit the famous "Williams hypothesis". We combine theory and geographically disaggregated data to show
🧪New Working Paper🧵
with @MehranE6790, @DSraer, @dthesmar
1⃣ We propose a simple inexpensive approach to better understand structural models. We apply our method to illustrate identification, robustness to moment selection and model misspecification.
dropbox.com/s/rolu4h2zn20f…
Just-identified IV is little biased unless endogeneity is egregious. And bias is halved by screening on sign(first-stage t-stat). Just in: M. Kolesar and I show that among pretests of the form t>c, setting c=0 minimizes bias, while c>0 can increase bias
Happy to see @jondr44's paper finally out. It's an important reminder that, in any context, if you condition your choice of estimator based on the result of a prior spec test, you end up with a new estimator:
θ_3=I(fail test)*θ_1+I(pass test)*θ_2
with different properties! Poof
There is by now a voluminous literature on #populism in #economics. Now surveyed by @sguriev & @EliasPapaioann2 in "The Political Economy of Populism", forthcoming in @AEAjournals (Journal of Economic Literature).
Finally out in the AER 🥳🥳!! ⬆️ dividend taxes leads to ⬆️ investment and reduces capital misallocation as firms ⬇️ dividends and reinvest 30% of the unpaid dividends, particularly when they have high ex-ante marginal revenue returns to capital and investment opportunities. A🧵
Excited for the release of this NBER paper today, with some good news: estimates of US wealth inequality have largely converged
There remains disagreement about the very top 0.01%, which we examine in this paper: gabriel-zucman.eu/files/SZ2022NB…
Are the superrich poorer than we think?
Re NBERWP 30396 gabriel-zucman.eu/files/SZ2022NB…, we have written a lot of replies and assembled a lot of evidence on top wealth in America.
Paper: doi.org/10.1093/qje/qj…
Appendix: ericzwick.com/wealth/wealth_…
Reply to SZ21: ericzwick.com/wealth/reply_t…
Reply to SZ20:
Interesting discussions
I am excited to announce the launch of Aletheia, a new platform for communicating peer-evaluated research. My collaborator on this project is @JakeJares. aletheia-platform.netlify.app 1/14
^all submissions accepted; all peer reviewed (?); all reviews public
The top 5 papers (and some books) assigned in economics classes since 1990, thanks to @opensyllabus (ht @emollick).
AJR win by a pretty big margin, followed by Mankiw-Romer-Weil, Coase, and "The Tragedy of the Commons."
Normative economics
Here’s how I view the debate of the last couple of days: some economists want to think that there is a class of things that they can *advocate* that are somehow scientific, and so a different kind of advocacy than being a political activist.
But I don’t see why one kind of advocacy is different than the other. Saying you should do something is never just science.
I think that economists gain a lot of clout by the impression that their advice is just science (as do others, e.g., in public health)
^this is contra this (among others):
There were three types of comments on yesterday’s thread on optimal policy and politics, I’ll collect and summarize what I think about them
Also:
4 arguments for (iii), more graduate training in normative matters in econ
1. If you are going to make normative appeals implicitly, it is better to explicitly study what you are talking about.
2. Whatever you are supposed to just accept without critical reflection will be weak
Paolo G. Piacquadio @pgpiacquadio
^editorial injection: philosophers view economists discussing these issues, in the same way that we view nutritional scientists discussing causality. Very smart folks are simply unaware of fundamental issues 😬
A few more details here: consider a policy that has unknown normatively-relevant characteristics x, where x is a large vector. The optimal social decision rule is to adopt the policy iff F(x)>0. (1/3)
Maya Eden @MayaREden
^more: Price Theory substack post; more; more; more; …