Browse Articles

Meltdown of trust in weakly governed economies

A well-functioning society requires well-functioning institutions that ensure prosperity, fair distribution of wealth, social participation, security, and informative media. Such institutions are built on a foundation of trust. However, while trust is essential for economic success and good governance, interconnected mechanisms inherent in weakly governed market economies tend to undermine the very trust on which such success depends. These mechanisms include the intrinsic tendency for inequality to grow, media to boost perceived unfairness, and self-interest to gain rewards at the expense of others. These mechanisms, if left unchecked, allow wealth concentration to result in state capture where institutions facilitate further wealth concentration instead of the promoting the common good. As a result, people may become alienated and untrusting of fellow citizens and of institutions. Several democracies now experience such dynamics, the United States being a prime example. We discuss ways in which well-functioning democracies can design institutions to help avoid this social trap, and the much harder challenge of escaping the trap once in it. Successful cases such as the ability of Scandinavian democracies to maintain high-trust, and the US progressive era in the early 20th century provide instructive examples.

Correction for Kuan et al., Behavioral nudges prevent loan delinquencies at scale: A 13-million-person field experiment

Correction for Pitzen et al., Comparative transcriptomics reveals a mixed basal, club, and hillock epithelial cell identity in castration-resistant prostate cancer

Acknowledgment of Referees

Correction for Zhu et al., Asymmetric arginine dimethylation of cytosolic RNA and DNA sensors by PRMT3 attenuates antiviral innate immunity

Daily briefing: Long-COVID activists fought Trump research cuts and won ― for now

154 million lives and counting: 5 charts reveal the power of vaccines

Can Pollution Markets Work in Developing Countries? Experimental Evidence from India

Abstract Market-based environmental regulations are seldom used in low-income countries, where pollution is highest but state capacity is often low. We collaborated with the Gujarat Pollution Control Board (GPCB) to design and experimentally evaluate the world’s first particulate-matter emissions market, which covered industrial plants in a large Indian city. There are three main findings. First, the market functioned well. Treatment plants, randomly assigned to the emissions market, traded permits to become significant net sellers or buyers. After trading, treatment plants held enough permits to cover their emissions 99% of the time, compared with just 66% compliance with standards under the command-and-control status quo. Second, treatment plants reduced pollution emissions, relative to control plants, by 20%–30%. Third, the market reduced abatement costs by an estimated 11%, holding constant emissions. This cost-savings estimate is based on plant-specific marginal cost curves that we estimate from the universe of bids to buy and sell permits in the market. The combination of pollution reductions and low costs imply that the emissions market has mortality benefits that exceed its costs by at least 25 times.

Generative AI at Work

Abstract We study the staggered introduction of a generative AI–based conversational assistant using data from 5,172 customer-support agents. Access to AI assistance increases worker productivity, as measured by issues resolved per hour, by 15% on average, with substantial heterogeneity across workers. The effects vary significantly across different agents. Less experienced and lower-skilled workers improve both the speed and quality of their output, while the most experienced and highest-skilled workers see small gains in speed and small declines in quality. We also find evidence that AI assistance facilitates worker learning and improves English fluency, particularly among international agents. While AI systems improve with more training data, we find that the gains from AI adoption are largest for moderately rare problems, where human agents have less baseline experience but the system still has adequate training data. Finally, we provide evidence that AI assistance improves the experience of work along several dimensions: customers are more polite and less likely to ask to speak to a manager.

Race to the Bottom: Competition and Quality in Science

Abstract This article investigates how competition to publish first and thereby establish priority affects the quality of scientific research. We begin by developing a model where scientists decide whether and how long to work on a given project. When deciding how long they should let their projects mature, scientists trade off the marginal benefit of higher-quality research against the marginal risk of being preempted. Projects with the highest scientific potential are the most competitive because they induce the most entry. Therefore, the model predicts these projects are also the most rushed and lowest quality. We test the predictions of this model in the field of structural biology using data from the Protein Data Bank (PDB), a repository for structures of large macromolecules. An important feature of the PDB is that it assigns objective measures of scientific quality to each structure. As suggested by the model, we find that structures with higher ex ante potential generate more competition, are completed faster, and are lower quality. Consistent with the model, and with a causal interpretation of our empirical results, these relationships are mitigated when we focus on structures deposited by scientists who—by nature of their employment position—are less focused on publication and priority. We estimate that the costs associated with improving these low-quality structures are between $1.5 and $8.8 billion since the PDB’s founding in 1971.

Wage Hysteresis and Entitlement Effects: The Persistent Impacts of a Temporary Overtime Policy

Abstract This article studies the unexpected retraction of a U.S. federal policy in 2016 that would have more than doubled the “overtime exemption threshold” from $455 to $913 per week and thereby grant overtime protection to an additional 20% of salaried workers. Although the policy was blocked by a federal court injunction a week before it was supposed to take effect, I show that it nevertheless had a persistent positive impact on workers’ earnings. Leveraging a bunching design with administrative payroll data from ADP, I find that employers raised workers’ salaries to the $913 threshold even after the policy was repealed. Over the next 18 months, difference-in-difference estimates reveal that employers did not slow the wage growth of workers affected by the policy relative to those already earning above $913 per week, nor did they hire new employees at a lower pay rate. Real wages remained persistently elevated relative to what they would have been absent the policy and separation rates decreased among workers bunched at the $913 threshold. Comparing highly exposed firms to unaffected firms, I find an increase in employers’ wage bills but no change in aggregate employment. Taken together, the results indicate that temporary policies impacting wage levels can have permanent effects on the labor market. Survey responses collected by the Department of Labor suggest that morale concerns play a key role in driving the wage hysteresis.

Officer-Involved: The Media Language of Police Killings

Abstract This article examines language patterns in U.S. television news coverage of police killings. First, we document that the media use syntactic structures—such as passive voice, nominalizations, and intransitive verbs—that obscure responsibility more often in cases of police killings than in cases of civilian killings. Through an online experiment, we demonstrate the significance of these syntactic differences, revealing that participants are less likely to hold police officers morally responsible and demand penalties when exposed to obfuscatory language, particularly in cases involving unarmed victims. Further analysis of news data shows greater use of obfuscatory language when the victims are unarmed or video footage is available—situations in which obfuscation may have the greatest impact. Exploring the causes of this differential obfuscation, we do not find evidence that it is driven by either demand-side factors or supply-side factors associated with TV station ownership and political leaning. Instead, our results suggest that narratives crafted by police departments are more likely drivers of media obfuscation. This article highlights how syntactic choices and their semantic consequences in media shape perceptions, extending beyond coverage volume and bias.

The Impact of Being Denied a Wanted Abortion on Women and Their Children

Abstract This article examines the impact of denying a wanted abortion on women and children in Colombia using high-quality administrative microdata and credibly exogenous variation in abortion access. Women can seek legal abortions through a tutela, with cases randomly assigned to judges. Female judges are 20 percentage points (32%) less likely to deny abortion cases than are male judges, and we use the judge’s sex as an instrument for abortion denial. Denial of a wanted abortion has both immediate and lasting effects. It increases a woman’s risk of death by 2.5 percentage points within nine months, mainly due to unsafe abortion procedures, and raises the likelihood of carrying the pregnancy to term by 31 percentage points. Tracking outcomes up to 15 years later, we find that women denied an abortion experience more health issues, lower educational attainment, reduced labor force participation, and higher rates of single motherhood, poverty, and reliance on government assistance. Existing children, born before their mother sought an abortion, are less likely to attend school and are more likely to work.

“Something Works” in U.S. Jails: Misconduct and Recidivism Effects of the IGNITE Program

Abstract A long-standing and influential view in U.S. correctional policy is that “nothing works” when it comes to rehabilitating incarcerated individuals. We revisit this hypothesis by studying an innovative law-enforcement-led program launched in the county jail of Flint, MI: Inmate Growth Naturally and Intentionally through Education (IGNITE). We develop an instrumental variables approach to estimate the effects of IGNITE exposure, leveraging quasi-random court delays that cause individuals to spend more time in jail before and after the program’s launch. Holding time in jail fixed, we find that one additional month of IGNITE exposure reduces weekly misconduct in jail by 25% and three-month recidivism by 24%, with the recidivism effects growing over time. Surveys of staff and community members, along with administrative test-score records and within-jail text messages, suggest that cultural change and improved literacy and numeracy scores are contributing mechanisms.

Exploitation Through Racialization

Abstract I develop a model of the social construction of race. Racial categories emerge from labor conflict when elites privilege intrinsically irrelevant traits to divide workers against each other and extract workers’ surplus. I show that elites use color to grant unequal rights and track these rights across generations because it is heritable, observable, and relatively immutable. Depending on the demographic conditions the elites face, the system of racialization manifests either as ancestry-based or color-based categories. This approach to the social construction of race provides a unified explanation of skin-tone inequality, racial homophily in marriage, the social status of mixed-race people, the psychological wage of Jim Crow, and legal restrictions on manumission. I test for historical variations in racial boundaries using census data from the United States and Brazil and for differential patterns of skin-tone inequality between ancestry-based and color-based systems using survey data from across the Americas.

The Diffusion of New Technologies

Abstract We identify phrases associated with novel technologies using textual analysis of patents, job postings, and earnings calls, enabling us to identify four stylized facts on the diffusion of jobs relating to new technologies. First, the development of economically impactful new technologies is geographically highly concentrated, more so even than overall patenting: 56% of the most economically impactful technologies come from just two U.S. locations, Silicon Valley and the Northeast Corridor. Second, as the technologies mature and the number of related jobs grows, hiring spreads geographically. This process is very slow, taking around 50 years to disperse fully. Third, while initial hiring in new technologies is highly skill-biased, over time the mean skill level in new positions declines, drawing in an increasing number of lower-skilled workers. Finally, the geographic spread of hiring is slowest for higher-skilled positions, with the locations where new technologies were pioneered remaining the focus for the technology's high-skill jobs for decades.

A glycosylated lipooctapeptide promotes uptake and growth of Mycobacterium abscessus in the host

Abstract Pathogenic mycobacteria produce a wide array of lipids which participate in host cell interactions and virulence. While some of these are conserved across all mycobacteria, others, like glycopeptidolipids (GPL), are restricted to a few species. Mycobacterium abscessus, an emerging rapid-growing pathogen, transitions from a smooth to a virulent rough variant upon the loss of surface GPL. Here, we discovered that M. abscessus and phylogenetically-close species harbor a second GPL-related locus, comprising two adjacent non-ribosomal peptide synthetase genes, MAB_4690c and MAB_4691c. A MAB_4690c deletion mutant (ΔMAB_4690c) failed to produce a yet undescribed lipid, designated GL8P for glycosylated lipooctapeptide, sharing an acylated octapeptide core adorned by mono or di-O-rhamnosyl substituents. ΔMAB_4690c exhibited impaired uptake and survival in THP-1 cells and was attenuated in mice. Importantly, GL8P elicited a strong humoral response in patients infected with M. abscessus. These results highlight the role of GL8P in the pathophysiology of infection by rough M. abscessus and suggest its potential as a selective marker for M. abscessus infections.

The Earnings and Labor Supply of U.S. Physicians

Abstract Is government guiding the invisible hand at the top of the labor market? We use new administrative data to measure physicians’ earnings and estimate the influence of health care policies on these earnings, physicians’ labor supply, and the allocation of talent. Combining the administrative registry of U.S. physicians with tax data, Medicare billing records, and survey responses, we find that physicians’ annual earnings average $350,000 and make up 8.6% of national health care spending. Business income makes up one-quarter of earnings and is systematically underreported in survey data. Earnings increase steeply early in the career, and there are major differences across specialties, regions, and firm sizes. The geographic pattern of earnings is unusual compared with other workers. We argue that these patterns reflect policy choices to subsidize demand for physician care, amplified by restrictions on physician entry, especially in certain specialties. Health policy has a major impact on the margin: 25% of physician fee revenue driven by Medicare reimbursements accrues to physicians personally. Physicians earn 8% of public money spent on insurance expansion. These policies in turn affect the type and quantity of medical care physicians supply, retirement timing, and the allocation of talent across specialties.

Discrete photoentrainment of mammalian central clock is regulated by bi-stable dynamic network in the suprachiasmatic nucleus

Abstract The biological clock synchronizes with the environmental light-dark cycle through circadian photoentrainment. While intracellular pathways regulating clock gene expression after light exposure in the suprachiasmatic nucleus are well studied in mammals, the neuronal circuits driving phase shifts remain unclear. Here, using a mouse model, we show that chemogenetic activation of early-night light-responsive neurons induces phase delays at any circadian time, potentially breaking the photoentrainment dead zone. In contrast, activating late-night light-responsive neurons mimics light-induced phase shifts. Using in vivo two-photon microscopy, we found that most neurons in the suprachiasmatic nucleus exhibit stochastic light responses, while a small subset is consistently activated in the early subjective night and another is inhibited in the late subjective night. Our findings suggest a dynamic bi-stable network model for circadian photoentrainment, where phase shifts arise from a functional circuit integrating signals to groups of outcome neurons, rather than a labeled-line principle seen in sensory systems.

When Did Growth Begin? New Estimates of Productivity Growth in England from 1250 to 1870

Abstract We estimate productivity growth in England from 1250 to 1870. Real wages over this period were heavily influenced by plague-induced swings in the population. Our estimates account for these Malthusian dynamics. We find that productivity growth was zero before 1600. Productivity growth began in 1600—almost a century before the Glorious Revolution. Thus, the onset of productivity growth preceded the bourgeois institutional reforms of seventeenth-century England. We estimate productivity growth of 2% per decade between 1600 and 1800, increasing to 5% per decade between 1810 and 1860. Much of the increase in output growth during the Industrial Revolution is explained by structural change—the falling importance of land in production—rather than faster productivity growth. Stagnant real wages in the eighteenth and early nineteenth centuries—Engels’ Pause—is explained by rapid population growth putting downward pressure on real wages. Yet feedback from population growth to real wages is sufficiently weak to permit sustained deviations from the “iron law of wages” prior to the Industrial Revolution.