Results

CEP discussion paper

Explaining the predictive performance of police in cases of domestic abuse

Police in England and Wales are asked to predict the likelihood of serious recidivism in domestic abuse cases, with little support beyond a flawed questionnaire. To analyze their decisions, we first develop methods to de...Read more...

CEP discussion paper

The equilibrium impact of credit frictions: evidence from default risk using firm-level data

This paper examines the impact of credit frictions arising from firm-level default risk on aggregate economic performance. We build a micro-to-macro model with heterogeneous firms and sector-specific production functions...Read more...

CEP discussion paper

Input uncertainty and firm performance: evidence from critical minerals

We study the effect of input uncertainty about critical minerals on firm performance, separating the second-moment risk channel from first-moment mineral sentiment and from general firm-level uncertainty. Using earnings-...Read more...

CEP discussion paper

What is the public?s social welfare function?

Optimal public policy requires a social welfare function defined over individual utilities. While there is substantial research on income-based social welfare functions, no published study has directly elicited public pr...Read more...

CEP discussion paper

Cleaner energy, higher risk? Firm-level exposure to critical minerals

To what extent has the rise of clean energy technologies created new vulnerabilities in global supply chains? In this paper, I study the role of a new type of 'input uncertainty' associated with critical minerals that un...Read more...

Journal article

Journal of Economic Behavior and Organization:

Is having an expert "friend" enough? An analysis of consumer switching behavior in mobile telephony

We present novel evidence from a large panel of UK consumers who receive personalized reminders from a specialist price-comparison website about the precise amount they could save by switching to their best-suited altern...Read more...

CEP discussion paper

Is having an expert "friend" enough? An analysis of consumer switching behavior in mobile telephony

We present novel evidence from a large panel of UK consumers who receive personalized reminders from a specialist price-comparison website about the precise amount they could save by switching to their best-suited altern...Read more...

Blog

Vox EU:

Loss aversion and consumer inertia: new evidence from phone subscriptions

Across a range of everyday markets, consumers make recurrent tariff choices in the face of a multitude of fees and plans, leading to concerns they may fail to make optimal choices of suppliers or contracts. Christos Gena...Read more...

Journal article

Health Economics:

Risk aversion and Covid-19 vaccine hesitancy

We here investigate the role of risk aversion in COVID-19 vaccine hesitancy. The theoretical effect is ambiguous, as both COVID-19 infection and vaccination side-effects involve probabilistic elements. In large-scale dat...Read more...

Journal article

AEA Papers and Proceedings:

The local labor market effects of modern manufacturing capital: evidence from France

Using an event study methodology and comprehensive micro data from the French manufacturing sector, we analyze the local labor market effects of investments in modern manufacturing capital, including modern automation te...Read more...

Journal article

International Review of Economics and Finance :

Bank default risk propagation along supply chains: evidence from the UK

How does banks' default risk affect the probability of default of non-financial businesses? The literature has focused on the banks' direct corporate customers. It fails to consider the role of supply chain relationships...Read more...

CEP discussion paper

Criminal charges, risk assessment and violent recidivism in cases of domestic abuse

Domestic abuse is a pervasive global problem. Here we analyze two approaches to reducing violent DA recidivism. One involves charging the perpetrator with a crime; the other provides protective services to the victim on ...Read more...

Journal article

Annual Review of Economics :

Risks and global supply chains: what we know and what we need to know

Recent supply disruptions catapulted the issue of risk in global supply chains (GSCs) to the top of policy agendas and created the impression that shortages would have been less severe if GSCs had been either shorter and...Read more...

Blog

VoxEU:

Global supply chain risk and resilience

Supply disruptions caused by systemic shocks such as Brexit, Covid, and Russia-Ukraine tensions have catapulted the issue of risk in global supply chains to the top of policy agendas. In some sectors, however, there is a...Read more...

Journal article

European Economic Review:

Global banking: endogenous competition and risk taking

When banks expand abroad, their riskiness decreases if foreign expansion happens in destination countries that are more competitive than their origin countries. We reach this conclusion in three steps. First, we develop ...Read more...

Journal article

Journal of Empirical Legal Studies:

Comparing conventional and machine-learning approaches to risk assessment in domestic abuse cases

We compare predictions from a conventional protocol-based approach to risk assessment with those based on a machine-learning approach. We first show that the conventional predictions are less accurate than, and have simi...Read more...

CEP occasional paper

Are happier people more compliant? Global evidence from three large-scale surveys during Covid-19 lockdowns

Around the world, governments have been asking their citizens to practice physical distancing and stay at home to contain the spread of Covid-19. Are happier people more willing to comply with these measures? Using three...Read more...

CEP discussion paper

Bank default risk propagation along supply chains: evidence from the UK

How does banks? default risk affect the probability of default of non-financial businesses? The literature has addressed this question by focusing on the direct effects on the banks? corporate customers ? demonstrating t...Read more...

CEP discussion paper

Comparing conventional and machine-learning approaches to risk assessment in domestic abuse cases

We compare predictions from a conventional protocol-based approach to risk assessment with those based on a machine-learning approach. We first show that the conventional predictions are less accurate than, and have simi...Read more...

CEP discussion paper

The aggregate consequences of default risk: evidence from firm-level data

This paper studies the implications of perceived default risk for aggregate output and productivity. Using a model of credit contracts with moral hazard, we show that a firm?s probability of default is a sufficient stati...Read more...

Journal article

Journal of International Economics:

Foreign expansion, competition and bank risk

Using a novel dataset on the 15 European banks classified as G-SIBs from 2005 to 2014, we find that the impact of foreign expansion on risk is always negative and significant for most individual and systemic risk metrics...Read more...

Journal article

Journal of Public Economics:

Does competition from private surgical centres improve public hospitals? performance? Evidence from the English National Health Service

This paper examines the impact of a government programme which facilitated the entry of for-profit surgical centres to compete against incumbent National Health Service hospitals in England. We examine the impact of comp...Read more...

CEP discussion paper

History dependence in the housing market

Using data on the universe of housing transactions in England and Wales over a twenty-year period, we document a robust pattern of history dependence in housing markets. Sale prices and selling propensities are affected ...Read more...

CEP discussion paper

Foreign expansion, competition and bank risk

Using a novel dataset on the 15 European banks classified as G-SIBs from 2005 to 2014, we find that the impact of foreign expansion on risk is always negative and significant for most individual and systemic risk metrics...Read more...

Journal article

Journal of Urban Economics:

Mortgage debt and entrepreneurship

We study the link between mortgage debt and entrepreneurship using a model of occupational choice and housing tenure in a setting where loans are recourse?like in the UK and several US states. Our model shows that as lon...Read more...

Journal article

The World Bank Economic Review:

On minimizing the risk of bias in randomized controlled trials in economics

Estimation of empirical relationships is prone to bias. Economists have carefully studied sources of bias in structural and quasi-experimental approaches, but the randomized control trial (RCT) has only begun to receive ...Read more...

CEP discussion paper

International expansion and riskiness of banks

We exploit an original dataset on European G-SIBs to assess how banks? internationalization affects risk in the banking sector. We find a robust negative correlation between foreign expansion and banking risk as captured...Read more...

CEP discussion paper

Global banking: risk taking and competition

Direct involvement of global banks in local retail activities can reduce risk-taking by promoting local competition. We develop this argument through a model in which multinational banks operate simultaneously in differe...Read more...

Journal article

Management Science:

Risk aversion and wealth: Evidence from person-to-person lending portfolios

We estimate risk aversion from investors' financial decisions in a person-toperson lending platform. We develop a method that obtains a risk-aversion parameter from each portfolio choice. Since the same individuals inves...Read more...

CEP discussion paper

Does competition from private surgical centres improve public hospitals' performance? Evidence from the English National Health Service

This paper examines the impact of competition from government-facilitated entry of private, specialty surgical centres on the efficiency and case mix of incumbent public hospitals within the English NHS. We exploit the f...Read more...

CentrePiece article

What makes consumers switch mobile phone tariffs?

The potential psychological pain of nasty surprises on mobile phone bills is a great motivator to switch tariffs, according to research by Christos Genakos and colleagues. Their study notes that navigating through thousa...Read more...

CEP discussion paper

Loss aversion on the phone

We analyze consumer switching between mobile tariff plans using consumer-level panel data. Consumers receive reminders from a specialist price-comparison website about the precise amount they could save by switching to a...Read more...

CentrePiece article

In brief... Business cycle blues

People do not psychologically benefit from economic expansions nearly as much as they suffer from recessions, according to research by JanEmmanuel De Neve and colleagues....Read more...

CentrePiece article

Long shadow of the Berlin Wall

Do people born at different points of the economic cycle have different outcomes ? and if so, why? Arnaud Chevalier and Olivier Marie examine the educational attainment and criminal activity of children born in East Germ...Read more...

CEP discussion paper

Economic uncertainty, parental selection, and the criminal activity of the 'Children of the Wall'

We study the link between parental selection and children criminality in a new context. After the fall of the Berlin Wall, East Germany experienced an unprecedented temporary drop in fertility driven by economic uncertai...Read more...

CEP occasional paper

Money, well-being and loss aversion: does an income loss have a greater effect on well-being than an equivalent income gain?

Higher income is associated with greater well-being, but do income gains and losses impact on well-being differently? Loss aversion, whereby losses loom larger than gains, is typically examined with relation to decisions...Read more...

CEP occasional paper

Fluctuations in uncertainty

This review article tries to answer four questions: (i) what are the stylized facts about uncertainty over time; (ii) why does uncertainty vary; (iii) do fluctuations in uncertainty matter; and (iv) did higher uncertaint...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Do Long Distance Moves Discourage Homeownership? Evidence from England

We hypothesize that as the distance of a residential move increases, the cost of collecting information on the destination housing market rises, the amount and quality of information collected fall, and the chances of ma...Read more...

CEP discussion paper

Debt and incomplete financial markets: a case for nominal GDP targeting

Financial markets are incomplete, thus for many agents borrowing is possible only by accepting a financial contract that specifies a fixed repayment. However, the future income that will repay this debt is uncertain, so ...Read more...

CEP discussion paper

Policy Design in a Model with Swings in Risk Appetite

This paper studies the policy implications of habits and cyclical changes in agents' appetite for risk-taking. To do so, it analyses the non-linear solution of a New Keynesian (NK) model, in which slow-moving habits help...Read more...

CEP discussion paper

Heterogeneity, Demand for Insurance and Adverse Selection

Recent empirical work finds that surprisingly little variation in the demand for insurance is explained by heterogeneity in risks. I distinguish between heterogeneity in risk preferences and risk perceptions underlying t...Read more...

CEP discussion paper

Cyclical Risk Aversion, Precautionary Saving and Monetary Policy

This paper analyzes the conduct of monetary policy in an environment in which cyclical swings in risk appetite affect households' propensity to save. It uses a New-Keynesian model featuring external habit formation to sh...Read more...

CEP discussion paper

Portfolio Allocation and International Risk Sharing

Recent contributions have shown that it is possible to account for the so-called consumption-real exchange anomaly in models with goods market frictions where international asset trade is limited to a riskless bond. In t...Read more...

CEP discussion paper

To Join or Not to Join? Factors Influencing Employee Share Plan Membership in a Multinational Corporation

Many firms encourage employees to own company stock through share plans that subsidize the price at favorable rates, but even so many employees do not buy shares. Using a new survey of employees in a multinational with a...Read more...

CEP discussion paper

Towards a New Architecture for Financial Stability: Seven Principles

In this paper we use insights from organizational economics and financial regulation to study the optimal architecture of supervision. We suggest that the new architecture should revolve around the following principles: ...Read more...

CEP discussion paper

Inequality and Unemployment in a Global Economy

This paper develops a new framework for examining the distributional consequences of international trade that incorporates firm and worker heterogeneity, search and matching frictions in the labor market, and screening o...Read more...

CEP discussion paper

Interim Rank, Risk Taking and Performance in Dynamic Tournaments

Little is known about the effects of revealing information on relative performance during a dynamic tournament. We empirically study the impact of interim rank on risk taking and performance using data on professionals c...Read more...

CEP discussion paper

Evaluating the Economic Significance of Downward Nominal Wage Rigidity

This paper seeks to contribute to the literature on downward nominal wage rigidity (DNWR) along two dimensions. First, we formulate and solve an explicit model of wage-setting in the presence of worker resistance to nomi...Read more...

CEP discussion paper

Cross-Generation Correlations of Union Status For Young People in Britain

In this paper we investigate whether young people whose fathers are union members are themselves more likely to join a union. The work builds upon a large social science literature on intergenerational mobility that, to ...Read more...

CEP discussion paper

Consumption and Savings with Unemployment Risk: Implications for Optimal Employment Contracts

This paper derives optimal employment contracts when workers are risk averse and there are employment and unemployment risks. Without income insurance, consumption rises during employment and falls during unemployment. O...Read more...