Quarterly Journal of Economics articles from February 1996

Quarterly Journal of Economics archives from February 1996

Choosing the wrong pond: social comparisons in negotiations that reflect a self-serving bias.
February 1, 1996... I. INTRODUCTION In his book, Choosing the Right Pond, Frank [1985] asserts that a "person's well-being depends in part on how large his income is relative to the incomes of others" and shows how such comparisons affect the wage...

Why are professional forecasters biased? Agency versus behavioral explanations.
February 1, 1996... Professional forecasters may not simply aim to minimize expected squared forecast errors. In models with repeated forecasts the pattern of forecasts reveals valuable information about the forecasters even before the outcome is realized....

Income inequality and choice of free trade in a model of intraindustry trade.
February 1, 1996... I. Introduction The aim of this paper is to provide an explanation for the observation that developed countries frequently impose higher trade barriers on middle-income countries than on either poor countries or developed countries. We...

A model of political competition with citizen-candidates.
February 1, 1996... I. Introduction In this paper we develop a novel spatial model of electoral competition and use it to study the outcomes of elections in which the winner is the candidate who obtains the most votes (plurality rule) and in which the...

Do public schools hire the best applicants?
February 1, 1996... I. INTRODUCTION Much recent discussion of American education has focused on the quality of American teachers. Many teachers are recruited among the least academically talented members of our college-educated population [Weaver 1983;...

Income distribution, communities, and the quality of public education.
February 1, 1996... I. INTRODUCTION A striking feature of the primary and secondary public education system in the United States is the large disparity in spending per student across districts.] As Table I illustrates for jurisdictions in several states,...

Loss-avoidance and forward induction in experimental coordination games.
February 1, 1996... In games with multiple equilibria that are Pareto-ranked, players must somehow coordinate their choices to achieve Pareto efficiency. Games of coordination have been widely used in economics to study macroeconomic cycles, technology adoption,...

The creation and capture of rents: wages and innovation in a panel of U.K. companies.
February 1, 1996... I. INTRODUCTION Economists have traditionally been concerned that employees will try to cream off the fruits of technological innovation into higher earnings. It is often argued that this process is likely to reduce a firm's incentive...

Wages, profits, and rent-sharing.
February 1, 1996... I. INTRODUCTION One of the oldest questions in economics is that of whether the market for labor can be represented satisfactorily by a standard competitive model. The importance of this question, which has implications for...

Search with learning and price adjustment dynamics.
February 1, 1996... Introduction Both formal research and casual observation suggest that the short-run effects of cost changes on prices may be quite different from what conventional economic theory predicts. For example, Cecchetti [1986] finds that...

Is fixed investment the key to economic growth?
February 1, 1996... I. Introduction The strong relationship between fixed capital formation shares of GDP and growth rates since World War II has led many writers, such as De Long and Summers [1991, 1992], to conclude that the rate of capital formation or...