Economics

We study identification of differentiated product demand from market-level data when product characteristics can be endogenous. Past work suggests nonparametric identification may be impossible: that is, in addition to standard price instruments, exogenous characteristic-based instruments are essentially necessary to identify sufficiently flexible demand models with standard index restrictions. We show, however, that price counterfactuals are nonparametrically identified using recentered instruments—which combine exogenous price instruments with possibly endogenous product characteristics—under a weaker index restriction and a new condition we term faithfulness. We argue that faithfulnes..

This paper defines pro-worker technologies, including Artificial Intelligence, as technologies that make human skills and expertise more valuable by expanding worker capabilities. Our conceptual framework distinguishes among five categories of technological change: labor-augmenting, capital-augmenting, automating, expertise-leveling, and new task-creating. Only the last category is unambiguously pro-worker, generating demand for novel human expertise rather than commodifying it. We illustrate these distinctions through hypothetical and real-world examples spanning aviation maintenance, electrical services, custodial work, education, patent examination, and gig delivery. While AI’s capacity..

We estimate the mortality impact of local labor market exposure to the 1994 North American Free Trade Agreement (NAFTA) as well as to other local area shocks, and provide a parsimonious empirical explanation for differently-signed mortality estimates across different sources of local labor market contractions. Leveraging spatial variation in exposure to Mexican important competition from NAFTA, we find that more exposed areas experienced larger increases in mortality. In the 15 years post-NAFTA, an area with average NAFTA exposure experienced an increase in annual, age-adjusted mortality of 0.68 percent (standard error = 0.19), an increase that more than erases prior estimates of the welfare..

Does government funding influence the choice of research topics? Novel grant-making modalities such as the Advanced Research Projects Agency-Energy (ARPA-E) program aim to encourage scientists to take on difficult-to-solve, wicked societal problems such as clean energy. Yet little causal evidence exists linking funding and research direction, with most existing studies focusing on health sciences. We provide new evidence on the effect of funding on clean energy research, addressing two questions: (1) Do scientists change the focus of their research in response to targeted government funding opportunities? (2) If so, what types of calls for funding best attract new researchers? Using data on ..

How does the expectation of aid change behavior? We propose a simple approach to separate expectations effects from the direct effects of relaxing resource constraints: compare the promise of a program to the program itself. We test this approach in a four-arm randomized controlled trial of cash transfers in Uganda. Both those who received cash and those promised-to-receive cash increase their labor supply and investment. Immediate transfers also increase household expenditures and savings. Our results are not consistent with standard life-cycle models; they are better explained by a model in which the transfer increases individual labor productivity.

Food insecurity is an existential threat for Africa (a continent facing rapid population growth and dire climate impacts) and addressing it a global imperative. Over 30% of caloric intake comes from maize, but crop yields are low partly because high costs make synthetic fertilizers uneconomical. A field experiment with Kenyan smallholder farmers explores the promise of genetically modified (microbial) biofertilizers to deliver nitrogen and increase yields at affordable costs. We see significant increases in yields (up to 110% for some farmers) and lower environmental impact than synthetic products. This suggests that biofertilizers could dramatically improve food security and child nutrition..

Production is a sequence of steps that can be executed (1) manually, (2) augmented with AI, or (3) fully automated within contiguous AI-executed steps called “chains.” Firms optimally bundle steps into tasks and then jobs, trading off specialization gains against coordination costs. We characterize the optimal assignment of humans and AI to steps and the firm’s resulting job structure, showing that comparative advantage logic can fail with AI chaining. The model implies non-linear productivity gains from AI quality improvements and admits a CES representation at the macro level. Empirical evidence supports the model’s key predictions that (1) AI-executed steps co-occur in chains, (2)..