Located in Prague, CERGE-EI is dedicated to excellence and innovation in economic research and education. Chartered by the State of New York, CERGE-EI is a joint workplace of Charles University and the Czech Academy of Sciences, and is supported by numerous donors.
The theory of rational inattention is becoming an integral part of economics. It formalizes the idea that humans lack the ability to process all available information, yet they can choose how to deal with this limitation. The authors provide an extensive review of the current state of the field and its relevant literature, present the underlying theoretical mechanisms, and illustrate their application across several fields of economics. Read more
Shifting Punishment onto Minorities: Experimental Evidence of Scapegoating
Michal Bauer, Jana Cahlíková, Julie Chytilová, Gérard Roland, and Tomáš Želinský
Do people scapegoat? It is often suggested that aggrieved people are more likely to take revenge on an innocent “scapegoat” who belongs to a vulnerable and negatively stereotyped minority. Using the Roma minority in Slovakia as a subject, this experimental research offers unique evidence of scapegoating—when a member of one’s own group is harmed, the punishment more than doubles for minority targets. Read more
Welfare Cuts and Crime: Evidence from the New Poor Law
Welfare cuts are often used to stabilize public budgets, but little is known about their other effects. The authors use the New Poor Law reform of 1834, which induced dramatic and heterogeneous reductions in welfare spending across English and Welsh counties, to identify a robust negative relationship between the generosity of welfare provision and criminal activity. The results are driven by non-violent property crimes and are strongest during months of seasonal unemployment. Read more
Allocation Choice in Charitable Giving: A Natural Field Experiment
Would you donate more if you could choose from a variety of projects? Kouro explores this topic in a field experiment of employees from large Albanian companies donating to Down Syndrome Albania projects. Treatments varied in whether participants were allowed (or forced) to choose between different projects, and in the amount of information they were given. Giving donors a choice substantially increased giving; information did not. Read more
Inflation Expectations in the Wake of the War in Ukraine
Geghetsik Afunts, Misina Cato, and Tobias Schmidt
The war in Ukraine has been a major trigger of high inflation. In this paper, the authors aim to quantify the impact of the invasion on the short- and long-term inflation expectations of individuals in Germany using microdata from the Bundesbank Online Panel - Households (BOP-HH), from February 15 to March 29, 2022. They find that both short- and long-term inflation expectations increased as an immediate result of the invasion.Read more
Racial Discrimination and Lost Innovation: Evidence from US Inventors, 1895–1925
Davide M. Coluccia, Gaia Dossi, and Sebastian Ottinger
Race-based discrimination is one of the leading forces generating and perpetuating large and persistent gaps throughout economy. Working with the data on US investors and the population censuses in 1895-1925, the authors leverage plausibly exogenous variation in the timing of lynchings and the name of the victims. They find an immediate and persistent decrease in patents granted to inventors who share their names with the Black victims of lynchings, an evidence of discrimination by patent examiners. Read more
What is the relationship between temperature and production? Kyrychenko, together with Liu, use plant-level manufacturing data and satellite-based temperature estimates from India in 1998-2007 to find an inverted U-shape relationship between temperature and output, with especially large losses at extreme cold and hot temperatures. Understanding this relationship and underlying mechanisms is critical for effective climate change adaptation. Read more
Why Has Science Become an Old Man’s Game? March 2023
Numerous studies show that a researcher’s productivity tends to decline after their thirties. But is this also reflected in the age composition of the academic workforce? Using novel U.S. data, Hrendash and coauthors find an increase in the average age of scientists to above 50, which continues to grow. They aim to find the main drivers of this change and answer the key question–-which policies could rejuvenate the scientific workforce? Read more
Optimally Biased Expertise April 2023
In this paper from Illinov’s dissertation, the authors show that a biased principal can strictly benefit from delegating to a misaligned agent. They consider a “delegated expertise” problem in which the agent has a learning advantage relative to the principal. The authors show that it is optimal for a principal who is ex ante biased towards one action to select an agent who is less biased. Read more
250,000 Students Milestone Reached by the Teaching Fellows Program
#AlumniLive: Data-Driven Policymaking with Juraj Valachy
MA in Economic Research Application Deadline Approaching
We are proud to announce that we have now reached over 250,000 students in 26 countries through the CERGE-EI and CERGE-EI Foundation’s Teaching Fellows and the Distance Learning Program. Our programs are bolstering economics education throughout post-socialist Central and Eastern Europe and Central Asia, building institutional capacity, and improving pedagogical methods at universities throughout the region.
The CERGE-EI #AlumniLive series continued on May 19, 2023 with Juraj Valachy, our PhD graduate (2003). Juraj Valachy is one of the most recognized experts in macroeconomics and econometrics in Slovakia, currently serving as Director of the Institute for Financial Policy at the Slovak Ministry of Finance. He discussed data-driven policymaking in Slovakia and the role CERGE-EI played in his career. You can watch the recording here.
CERGE-EI’s Master’s in Economic Research is a two-year Western-style program designed for students interested in applied economic research and public policy. The aim of the program is to prepare students for positions in public policy institutions, international organizations, think-tanks, and private businesses. The degree is recognized in both the U.S. and EU. The deadline for applications is August 15, details are available here. Attend a webinar on June 15 to learn more.
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