American Economic Association Research Articles

Economics and American Literary Studies in the New Gilded Age, or Why Study the History of Bad Predictions and Worse Rationalizations?

AbstractThis introduction to the special issue on Economics and American Literary Studies in The New Gilded Age traces an underexplored history of dissent within the discipline of economics through presidential addresses to the American Economic Association and writings by John Maynard Keynes. It acknowledges the “vexed history” of interdisciplinary engagement between economists and literature scholars, including a recent, halfhearted call for “narrative economics” from 2013 Nobel Laureate Robert Shiller. Seybold suggests that new brands of econo-literary criticism have risen to promise in the last decade and that contributors to this special issue demonstrate the importance of historicism to this subfield, despite its apparent presentist tendencies.

Fidelity of Implementation of Prospera Digital: Evaluation of a Multi-Site mHealth Intervention Aimed at Improving Maternal Health Outcomes in Mexico

ABSTRACTBackgroundInfrastructure and human capital limitations motivate the design of mHealth programs, but their large-scale implementation may be challenging in a development context. Prospera Digital (PD) is a pilot mHealth intervention aiming to improve maternal and child health and nutrition designed as a randomized controlled trial with 3 treatment arms. It was implemented during 2015–2017 in 326 treatment clinics located in 5 states in Mexico.ObjectiveAssess, with an external evaluation, PD's fidelity of implementation using 6 dimensions: adherence, quality, responsiveness, intervention complexity, facilitation strategies, and program differentiation.MethodsBenchmark for implementation was first established by interviewing PD's developers. Extensive fieldwork in the 5 states was then conducted to assess its fidelity in heterogeneous contexts. The evaluation team visited 39 health clinics to assess the initial sign-up events and conduct a follow-up. Overall, the team made 28 closed observations; conducted 17 focus groups; and interviewed 74 health providers, 10 community leaders, and 92 beneficiaries. Field notes from the implementation team on all clinics were also examined.ResultsCo-ordination between the Health and Social Development ministries was adequate, although some health providers were not informed about PD. Program developers added useful implementation strategies during roll-out to reinforce sign-up events. Key quality facilitators were the clarity and relevance of the messages from the short messages service. Beneficiaries expressed high satisfaction with PD. In contrast, implementation barriers to adherence in some localities might reduce the potential impact of PD. Program differentiation was low between the 3 treatment arms.ConclusionsPD is a promising strategy to contribute to the promotion of early childhood development in Mexico. Implementation science evaluation can help improve the quality of large-scale mHealth interventions by anticipating barriers and providing insights on how to increase performance. This is especially relevant to inform impact evaluation in development contexts. The trial was registered at the American Economic Association's registry for randomized controlled trials with trial registry number ‘AEARCTR-0001035’.

Women in the Early Years of the American Economic Association

We use the archives of the American Economic Association to examine the participation of women in the association from its foundation in 1885 to the Great Depression. Women participated actively in the formation of the association, contributed several monographs to its early publications, and won some of its early essay competitions. We find that the membership drives of 1900–1902 (aimed at academics and businessmen) and of 1909–13 (aimed at lawyers, bankers, and businessmen) neglected women interested in social causes and home economics as potential members. Together with the abolition of local branches, these first two membership drives diluted the role of women in the association. In contrast, the membership drive of 1922–26 reflected a growing interest in graduate students and young instructors that somewhat increased the proportion of women among members.

Economics in Two Lessons: Why Markets Work So Well, and Why They Can Fail So Badly, JohnQuiggin. Published by Princeton University Press, Princeton, NJ, 2019, 408 pages, ISBN 9780691154947.

Economics in Two Lessons: Why Markets Work So Well, and Why They Can Fail So Badly, JohnQuiggin. Published by Princeton University Press, Princeton, NJ, 2019, 408 pages, ISBN 9780691154947.

Explaining the fame of Friedman’s Presidential Address

AbstractIt is noted that although in fact it lacks the revolutionary content commonly ascribed to it, Friedman’s Presidential Address to the American Economic Association is very highly regarded as an original and formative contribution. It is argued that close attention to the literature shows that it was not initially seen as original, and only after an interval of five years did the idea of its revolutionary status retrospectively, but suddenly become widely accepted. The explanation of this change of view is considered. Four explanations are suggested: one involving terminological confusion, one involving a change in theoretical priorities, and two involving debates of the 1970s, which, although they did not in fact do so, appeared to build on Friedman’s presentation, and by this appearance gave it an undeserved stature.

Pilot randomized controlled trial testing the influence of front-of-pack sugar warning labels on food demand

BackgroundFront-of-pack (FOP) nutrition warning labels to identify potentially harmful foods/beverages have recently been considered in Singapore. The objective of this study was to pilot test two promising FOP warning labels intended to reduce purchases of products high in sugar to determine whether a full scale trial testing one or both these labels using actual purchases is warranted.MethodsFive hundred twelve participants ≥21 years old and residing in Singapore completed all study elements online via the NUSMart Online Grocery Store study website. The study was designed as a Randomized Controlled Trial (RCT) where consumers were randomized and asked to hypothetically shop in one of three versions of an online grocery store; 1) no FOP label (control), 2) a graphical high-in-sugar label shaped like a stop sign, or 3) a text-based warning label. The proportion of labelled products purchased (primary outcome) and all secondary measures of diet quality were calculated using participants’ orders. Ordinary Least Squares (OLS) regression was used to compare purchasing behavior across the three study arms.ResultsThe proportion of high-in-sugar products selected (i.e., those targeted for labelling) was largest in the no label control arm at 20%. The proportion was a non-statistically significant 2 percentage points lower (P = 0.146) for the high-in-sugar stop-sign label arm and 4 percentage points lower (P < 0.05) in the warning label with deterrent text arm. We could not reject the hypothesis of equal effectiveness of the two warning labels (P = 0.231).ConclusionsResults suggest that the two health warning labels have potential to reduce demand for high-in-sugar products in Singapore. Future studies should test the influence of these labels using actual purchases in efforts to identify whether either labelling strategy should be considered for adoption in the local setting.Trial registrationThe American Economic Association’s registry for randomized controlled trials; AEARCTR-0003800. Registered 18 January 2019.

Making a Community of Experts

In the second half of the twentieth century consensus became the language through which scientists and other experts spoke truth to power and provided expert advice for policy making. Historical scholarship on science policy has acknowledged this trend but has not explained how consensus came to play such a large role in the relationship between experts and policy makers. This paper examines two historical case studies from the mid-twentieth century in which consensus was introduced—the failed consensus report experiments of the American Economic Association and the successful establishment of the National Research Council’s consensus studies. These examples demonstrate that consensus was not a natural or obvious choice. Rather, the choice was driven by the growth and definition of the postwar scientific community and its negotiated relationship to the Cold War national security state. In this context, consensus became associated with depersonalized and objective knowledge. As it reinforces the notion of a divide between science and politics, consensus has remained an instrumental part of the relationship between the NRC and its patrons.

Parag Pathak: Winner of the 2018 Clark Medal

The American Economic Association awarded Parag Pathak the 2018 John Bates Clark Medal for his research on the impacts of educational policies. Both the theory and the empirical research take the constraints facing administrators seriously. As a result, Parag’s research led directly to educational reforms in many large US cities and abroad. The leading example is Parag (and co-authors’) research on school assignment mechanisms that led many school districts to institute fairer and more efficient procedures for allocating students to schools. The institutional detail Parag learned in working on the assignment problem led to innovative empirical work on the impacts of different types of schools, most notably of charters, which was suggestive of the characteristics of both successful schools and of the types of students who gained from being enrolled in them. Using the data generated by the new assignment rules, his recent work provides complete frameworks for the quantitative analysis of the benefits of different assignment mechanisms and has measured those benefits in New York high schools.

Cost-Effectiveness of Colorectal Cancer Screening Strategies—A Systematic Review

Widespread screening for colorectal cancer (CRC) has reduced its incidence and mortality. Previous studies investigated the economic effects of CRC screening. We performed a systematic review to provide up-to-date evidence of the cost effectiveness of CRC screening strategies by answering 3 research questions. We searched PubMed, National Institute for Health Research Economic Evaluation Database, Social Sciences Citation Index (via the Web of Science), EconLit (American Economic Association) and 3 supplemental databases for original articles published in English from January 2010 through December 2017. All monetary values were converted to US dollars (year 2016). For all research questions, we extracted, or calculated (if necessary), per-person costs and life years (LYs) and/or quality-adjusted LYs, as well as the incremental costs per LY gained or quality-adjusted LY gained compared with the baseline strategy. A cost-saving strategy was defined as one that was less costly and equally or more effective than the baseline strategy. The net monetary benefit approach was used to answer research question2. Our review comprised 33 studies (17 from Europe, 11 from North America, 4 from Asia, and 1 from Australia). Annual and biennial guaiac-based fecal occult blood tests, annual and biennial fecal immunochemical tests, colonoscopy every 10 years, and flexible sigmoidoscopy every 5 years were cost effective (even cost saving in most US models) compared to no screening. In addition, colonoscopy every 10 years was less costly and/or more effective than other common strategies in the United States. Newer strategies such as computed tomographic colonography, every 5 or 10 years, was cost effective compared with no screening. In an updated review, we found that common CRC screening strategies and computed tomographic colonography continued to be cost effective compared to no screening. There were discrepancies among studies from different regions, which could be associated with the model types or model assumptions.

Sociology, Demography, and Economics Presidential Ages and Sex over Time

I provide a visualization of presidential ages and gender over time for three academic associations: the American Sociological Association (ASA), the Population Association of America (PAA), and the American Economic Association (AEA). The figure reveals important trends in the twentieth century concerning (1) the continued aging of association presidents, (2) the relatively recent increasing gender parity in association presidents of ASA and PAA but not AEA, and (3) the sharp increase in PAA presidential ages beginning near the turn of the twenty-first century.

Lucky Boy in the Lucky Country: The Autobiography of Max Corden, Economist, edited by Werner MaxCorden. Published by Palgrave Macmillan, 2017, 243 pages, ISBN: 978-331965165-1, AU$ 149.00

Lucky Boy in the Lucky Country: The Autobiography of Max Corden, Economist, edited by Werner MaxCorden. Published by Palgrave Macmillan, 2017, 243 pages, ISBN: 978-331965165-1, AU$ 149.00

Can child-focused sanitation and nutrition programming improve health practices and outcomes? Evidence from a randomised controlled trial in Kitui County, Kenya

IntroductionIn Kenya’s Kitui County, 46% of children under 5 years are stunted. Sanitation and nutrition programmes have sought to reduce child undernutrition, though they are typically implemented separately. We evaluate...

How Does Governance Modify the Relationship between Public Finance and Economic Growth: A Global Analysis

How Does Governance Modify the Relationship between Public Finance and Economic Growth: A Global Analysis

Explaining the Fame of Friedman's Presidential Address

It is noted that although in fact it lacks the revolutionary content commonly ascribed to it, Friedman’s Presidential Address to the American Economic Association is very highly regarded as an original and formative contribution. It is argued that close attention to the literature shows it was not initially seen as original, and only after an interval of five years did the idea of its revolutionary status retrospectively, but suddenly become widely accepted. The explanation of this change of view is considered. Four explanations are suggested: one involving terminological confusion; one involving a change of theoretical priorities; and two involving debates of the 1970s which, although they did not in fact do so, appeared to build on Friedman’s presentation, and by this appearance gave it an undeserved stature.

Channeling Fisher: Randomization Tests and the Statistical Insignificance of Seemingly Significant Experimental Results*

I follow R. A. Fisher's The Design of Experiments (1935), using randomization statistical inference to test the null hypothesis of no treatment effects in a comprehensive sample of 53 experimental papers drawn from the journals of the American Economic Association. In the average paper, randomization tests of the significance of individual treatment effects find 13\% to 22\% fewer significant results than are found using authors’ methods. In joint tests of multiple treatment effects appearing together in tables, randomization tests yield 33\% to 49\% fewer statistically significant results than conventional tests. Bootstrap and jackknife methods support and confirm the randomization results.

The role of financial policy

I review the contribution and influence of Milton Friedman's 1968 presidential address to the American Economic Association. I argue that Friedman's influence on the practice of central banking was profound and that his arguments in favour of monetary rules were responsible for 30 years of low and stable inflation in the period from 1979 through 2009. I present a critique of Friedman's position that market economies are self-stabilizing and I describe an alternative reconciliation of Keynesian economics with Walrasian general equilibrium theory from that which is widely accepted today by most neoclassical economists. My interpretation implies that government should intervene actively in financial markets to stabilize economic activity.

The wrong track also leads someplace: Milton Friedman's presidential address at 50

Milton Friedman's presidential address to the American Economic Association holds a mythical status as the harbinger of the supply-side counter-revolution in macroeconomics – centred on the rejection of the long-run Phillips-curve inflation–unemployment trade-off. Friedman (seconded by Edmund Phelps) argued that the long run is determined by ‘structural’ forces, not demand, and his view swept the profession and dominated academic economics and macro policymaking for four decades. Friedman, tragically, put macroeconomics on the wrong track which led to disaster: secular stagnation, rising inequality, mounting indebtedness, financial fragility, a banking catastrophe and recession – and no free lunches. This is Friedman's legacy. We have to unlearn the wrong lessons and return macroeconomics to the right track. To do so, this paper shows that Friedman's (and Phelps's) conclusions break down in a general model of the long run in which productivity growth is endogenous – aggregate demand is driving everything again, short and long.

Mandatory Medicare Bundled Payment Program for Lower Extremity Joint Replacement and Discharge to Institutional Postacute Care

Bundled payments are an increasingly common alternative payment model for Medicare, yet there is limited evidence regarding their effectiveness. To report interim outcomes from the first year of implementation of a bundled payment model for lower extremity joint replacement (LEJR). As part of a 5-year, mandatory-participation randomized trial by the Centers for Medicare & Medicaid Services, eligible metropolitan statistical areas (MSAs) were randomized to the Comprehensive Care for Joint Replacement (CJR) bundled payment model for LEJR episodes or to a control group. In the first performance year, hospitals received bonus payments if Medicare spending for LEJR episodes was below the target price and hospitals met quality standards. This interim analysis reports first-year data on LEJR episodes starting April 1, 2016, with data collection through December 31, 2016. Randomization of MSAs into the CJR bundled payment model group (75 assigned; 67 included) or to the control group without the CJR model (121 assigned; 121 included). Instrumental variable analysis was used to evaluate the relationship between inclusion of MSAs in the CJR model and outcomes. The primary outcome was share of LEJR admissions discharged to institutional postacute care. Secondary outcomes included the number of days in institutional postacute care, discharges to other locations, Medicare spending during the episode (overall and for institutional postacute care), net Medicare spending during the episode, LEJR patient volume and patient case mix, and quality-of-care measures. Among the 196 MSAs and 1633 hospitals, 131 285 eligible LEJR procedures were performed during the study period (mean volume, 110 LEJR episodes per hospital) among 130 343 patients (mean age, 72.5 [SD, 0.91] years; 65% women; 90% white). The mean percentage of LEJR admissions discharged to institutional postacute care was 33.7% (SD, 11.2%) in the control group and was 2.9 percentage points lower (95% CI, -4.95 to -0.90 percentage points) in the CJR group. Mean Medicare spending for institutional postacute care per LEJR episode was $3871 (SD, $1394) in the control group and was $307 lower (95% CI, -$587 to -$27) in the CJR group. Mean overall Medicare spending per LEJR episode was $22 872 (SD, $3619) in the control group and was $453 lower (95% CI, -$909 to $3) in the CJR group, a statistically nonsignificant difference. None of the other secondary outcomes differed significantly between groups. In this interim analysis of the first year of the CJR bundled payment model for LEJR among Medicare beneficiaries, MSAs covered by CJR, compared with those that were not, had a significantly lower percentage of discharges to institutional postacute care but no significant difference in total Medicare spending per LEJR episode. Further evaluation is needed as the program is more fully implemented. ClinicalTrials.gov Identifier: NCT03407885; American Economic Association Registry Identifier: AEARCTR-0002521.

The effect of alcohol strength on alcohol consumption: a randomised controlled cross-over pilot trial

BackgroundEffective interventions are required to reduce alcohol consumption and its associated harms at the population level. Reducing the alcohol content of beverages has the potential to reduce alcohol consumption through non-conscious processes. Before implementing a randomised controlled trial (RCT) to assess the effect of alcohol strength on alcohol consumption, its feasibility needs to be established. This study aims to pilot a RCT and obtain data to estimate key parameters required when designing a RCT. These key parameters include the direction and size of the intervention effect, the efficacy and efficiency of the study processes and the rates of licenced premises recruitment, participant recruitment and attrition.MethodsA double-blind randomised controlled cross-over pilot trial comparing the number of units of reduced strength lager consumed and the number of units of regular strength lager consumed in a single drinking occasion within licenced premises in the UK.Descriptive statistics will report the efficacy and efficiency of the study processes and the rates of licenced premises recruitment, participant recruitment and attrition. Mean and 95% confidence intervals will be used to compare the consumption of alcohol and the duration of participation in study sessions, between the intervention arm and the control arm. The mean and standard deviation of UK units of alcohol consumed will be used to calculate a sample size for a definitive RCT.DiscussionThis is the first naturalistic experimental study to assess the effect of alcohol strength on alcohol consumption in a single drinking occasion within licenced premises. Results from this pilot study will establish the feasibility of, and inform key data parameters for, a larger scale study.Trial registrationThe trial is registered in the American Economic Association (AEA) Randomised Controlled Trial (RCT) Registry as of 16 June 2017. The unique identifying number is AEARCTR-0002266.

Wealth Discrimination Theory

One approach to analyzing inequality is to compare average economic choices from a classical theoretical framework. Another approach considers the impact of the formation of society, through statutes and institutions, on average economic outcomes. This paper studies the effects of slavery on black-white wealth inequality upon the emancipation of slaves in the US using historical data. The purpose of wealth has varied from over time. From an economics perspective, wealth is the accumulation of resources that have market value and can be liquidated for present and future consumption. This study proceeds based on the most measurable assumption: households reside in a country with a mixed economy of markets and social planning, such that they have an incentive to accumulate material wealth for intertemporal household consumption and social influence. Becker (1957) and Arrow (1972) developed the most general theories of wage discrimination and favoritism. Oaxaca (1973) and Blinder (1973) have mechanized their theories for empirical analysis. While their findings are insightful, they cannot be directly applied to studying wealth differences since wealth is a complex combination of wages and other variables. Finally, since unexplained differences in states that abolished slavery after the Civil War were 10 percent higher than unexplained effects in states that abolished slavery well before the Civil War and the magnitudes of the unexplained effects were similar over the long-run, we cannot reject the existence of a negatively bounded correlation between the duration of time from enslavement and the magnitude of unexplained differences in wealth. This research was funded in part by the National Science Foundation under Grant SES 0096414. I would like to thank John Ham, Richard Steckel, Randall Olsen, Bruce Weinberg, Audrey Light, Nori Hashimoto, James Peck, Patricia Reagan, Charles Kirwin, Rebecca Blank, Charles Betsey, Alvin Thornton, Leibert Morris, Maude Toussaint-Comeau, Simone Wegge, James Wilbanks, Thomas Maloney, and William Collins for their insightful comments. I would also like to thank participants in workshops and seminars at the Ohio State University, Howard University, University of Michigan, American Economic Association Summer Program and Pipeline Conferences, Western Economics Association International meetings, and Social Science History Association meetings. I would also like to thank James Curtis Sr, K D Curtis, Karen Curtis (deceased), Lariece Grant-Brown, Barbara Broadnax, Dwayne Broadnax, Rudy Broadnax, Zee Curtis-Grant, Raymond Tillery, Chris Cooper, Dr. K A Troy, Dr. H. Beecher Hicks, Reverend Charles Lewis, Reverend Cornelius Wheeler, Reverend James Lewis, Elder David Treadwell, Dr. Stephen Tucker and Roberta Tucker, Minister Charles Webb, Minister David Surles, and Elder Gregory Strong for their support. This draft is a revision of a November 2010 paper and August 2001 paper.