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Keywords Tax evasion; Socio-economic networks; Game theory Abstract This paper builds on recent insights from network theory and on the rich dataset made available by the Panama Papers in order to investigate the micro-economic dynamics of tax-evasion. We model offshore financial entities documented in the Panama Papers as links between jurisdictions in the global network of tax evasion. A quantitative analysis shows that the resulting network, far from being a random collection of bilateral links, has key features of complex networks such as a core-periphery structure and a fat-tail degree distribution. We argue that these structural features imply that policy must adopt a systemic perspective to mitigate tax evasion. We offer three sets of insights from this perspective. First, we identify through centrality measures tax havens that ought to be priority policy targets. Second, we show that efficient tax treaties must contain exchange information clauses and link tax-havens to non-haven jurisdictions. Third, we show that the optimal deterrence strategies for a social-planner facing a strategic tax-evader in a Stackelberg competition can be characterized using the notion of Bonacich centrality. Author Affiliation: (a) Ca Foscari University of Venice and Paris 1 Pantheon-Sorbonne, France (b) Paris School of Economics and Paris 1 Pantheon-Sorbonne, France * Corresponding author. Article History: Received 3 November 2020; Revised 10 January 2022; Accepted 26 March 2022 (footnote)[white star] This project has received funding from the ITN ExSIDE European Union's Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 721846 and from the ITN EPOC European Union's Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 956107. Byline: Garcia Alvarado Fernando [fernando.garcia@unive.it] (a), Mandel Antoine [antoine.mandel@univ-paris1.fr] (*,b)

Keywords Expropriations and confiscations; Offshore entities; Tax havens; Panama Papers Abstract We study a motive for why individuals may hide wealth in offshore entities that has received scant attention in the academic literature and the public debate: the fear of expropriation. We use the Panama Papers and data on media reporting on expropriations and property confiscations. We document that such news reports increase the probability that offshore entities are incorporated by agents from the same country in the same month. This result is robust to the use of country-year- and month-fixed effects and the exclusion of tax havens. The effect is stronger in countries with well-functioning governments. We argue that individuals start hiding their proceeds from illegal activities in offshore entities when reasonably well-intended and well-functioning governments become more serious about law enforcement. Author Affiliation: (a) School of Economics, University of Adelaide, Australia (b) Department of Economics, University of St. Gallen, Switzerland (c) CEPR, United Kingdom (d) CESifo, Germany (e) Department of Economics and SoDa Labs, Monash University, Australia (f) Department of Economics, University of St. Gallen, Switzerland * Corresponding author. Article History: Received 14 August 2019; Revised 21 December 2019; Accepted 3 January 2020 Byline: Ralph-C. Bayer [ralph.bayer@adelaide.edu.au] (a), Roland Hodler [roland.hodler@unisg.ch] (b,c,d), Paul A. Raschky [paul.raschky@monash.edu] (*,e), Anthony Strittmatter [anthony.strittmatter@unisg.ch] (f)

Keywords Citation; Publication timing; Year-end; Search engine Abstract The present research reveals that academic papers published at year-end on average receive systematically fewer citations than papers published at other times in the year. Using more than 200,000 papers in economics published between 1956 and 2010, the results of our analysis show that papers published between October and December on average get as much as 18.5% fewer citations than those published in the other months in the year. We refer to this phenomenon as the citation trap as there is no evidence that papers published at different times in the year differ in their academic quality. We propose that the current effect could arise because of the time window options in most online academic search engines: the specific setting of those options leads papers published at year-end to appear in the engines' search results for a systematically shorter period of time as compared to papers published at other months in the year. Our analysis reveals evidence that is consistent with the proposed mechanism and that rules out several alternative explanations. Implications of the current research for academia and possible solutions to mitigate the citation trap are discussed. Author Affiliation: (a) School of Public Health, Southeast University, No.87, Dingjiaqiao Road, Nanjing, 210009, China (b) School of Public Health, Yale University, U.S (c) Department of Marketing and International Business, SEK101, 1/F Simon and Eleanor Kwok Building, Lingnan University, Tuen Mun, Hong Kong, China (d) School of Public Economics and Administration, Shanghai University of Finance and Economics, No.777, Guoding Road, Shanghai, 200433, China (e) Faculty of Business Administration, University of Macau, E22, Avenida da Universidade, Macau, Taipa, China * Corresponding author. Article History: Received 27 December 2018; Revised 30 July 2019; Accepted 9 August 2019 Byline: Chao Ma [machao@seu.edu.cn] (a,b), Yiwei Li [victor.li@ln.edu.hk] (c), Feng Guo [guo.feng@mail.sufe.edu.cn] (d,*), Kao Si [kaosi@um.edu.mo] (e)

To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.jue.2015.06.003 Byline: Octavio Figueiredo, Paulo Guimaraes, Douglas Woodward Abstract: This paper investigates Alfred Marshall's hypothesis that knowledge spillovers increase where industries are localized. At the same time, we take a fresh look at the role of distance in the diffusion of knowledge spillovers. Relying on a cited-citing gravity-like equation with high-dimensional fixed effects that control for multiple sources of observed and non-observed heterogeneity, we implement a Poisson pseudo-maximum-likelihood (PPML) estimator. We find that knowledge spillovers correlate positively with industry localization and that the agglomeration of an industry can offset the adverse effect of distance. The results also corroborate the distance decay effect uncovered in earlier research. Our new approach to estimate the PPML with two high-dimensional fixed effects should prove valuable in applications to a variety of other problems in economics, such as the estimation of gravity equations widely used in modeling migration, trade and other flows among countries and regions. Article History: Received 19 February 2014; Revised 25 June 2015

Keywords Dynamic risk; Reinforcement effect; History-dependent preferences; Prospect theory; Realization effect Abstract We conduct a large-scale test of dynamic risk preferences. While most of the literature on dynamic risk restricts attention to positively skewed gambles, subjects in our experiment tend to choose negatively skewed lotteries. This allows us to study dynamic risk preferences in an environment that the literature has not analyzed. We find evidence of the reinforcement effect--individuals take on more risk after a gain and take on less risk after a loss. Furthermore, we exogenously vary whether these outcomes are 'realized' or on paper, according to the distinction put forth by Imas (2016). We find little difference in the responses to realized and paper outcomes in environments of negatively skewed risk. Author Affiliation: Department of Economics, Stanford University, 579 Serra Mall, Stanford, CA 94305, USA Article History: Received 1 May 2018; Revised 18 March 2019; Accepted 19 March 2019 Byline: Kirby Nielsen [http://www.kirbyknielsen.com]

This paper shows that interest rate uncertainty rather than leading economic indicators primarily brought about the rapid rise in treasury bills and is a predictor of real industrial output .

It is shown that John Nyman's criticism of the health policy debate is largely irrelevant to the question of demand-side cost sharing.

This study investigates how exposure to a field of study influences students’ major choices. If students have incomplete information, exposure potentially helps them to learn about the scope of a field as well as how well the field matches their interest and abilities. We exploit a natural experiment where university students have to write a research paper in business, economics, or law during their first year before they choose a major. Due to oversubscription of business papers, the field of the paper is assigned quasi-randomly. We find that writing in economics raises the probability of majoring in economics by 2.7 percentage points. We show further that this effect varies across subfields: the effect is driven by assignment to topics less typical of the public's perception of the field of economics, suggesting students learn through exposure that the field is broader than they thought. [ABSTRACT FROM AUTHOR]

Research on procrastination is analyzed to assess whether it can be seen as rational behavior. The model economic model developed from this research explains some aspects of procrastination, though others, such as undesired procrastination, are left unexplained.

Byline: Kuan-Jen Chen [129800@mail.fju.edu.tw] (a), Angus C. Chu [angusccc@fudan.edu.cn] (b,c), Ching-Chong Lai [cclai@econ.sinica.edu.tw] (*,d,e,f) Keywords Small open economy; Home production; Emerging markets; Business cycles Abstract This paper incorporates home production into a real business cycle (RBC) model of small open economies to explain the different empirical patterns of international business cycles between developed economies and emerging markets. It is well known in the literature that in order for the RBC model to replicate quantitatively plausible empirical moments of small open economies, the model needs to feature counterfactually a small income effect on labor supply. This paper considers home production that introduces substitutability between market consumption and home consumption, which in turn generates a high volatility in market consumption in accordance with the data, even in the presence of a sizable income effect on labor supply. Furthermore, the model with estimated parameter values based on the simulated method of moments is able to match other empirical moments, such as the standard deviations of output, investment and the trade balance and the correlations between output and other macroeconomic variables. Given that home production is more prevalent in emerging markets than in developed economies, the model is able to replicate empirical differences between emerging markets and developed economies in the volatility of market consumption and the volatility/countercyclicality of the trade balance. Author Affiliation: (a) Department of Economics, Fu-Jen Catholic University, New Taipei City, Taiwan (b) China Center for Economic Studies, School of Economics, Fudan University, Shanghai, China (c) Shanghai Institute of International Finance and Economics, Shanghai, China (d) Institute of Economics, Academia Sinica, Taipei, Taiwan (e) Department of Economics, National Cheng-Chi University, Taipei, Taiwan (f) Institute of Economics, National Sun Yat-Sen University, Kaohsiung, Taiwan * Corresponding author at: Institute of Economics, Academia Sinica, Taipei, Taiwan. Article History: Received 5 May 2018; Revised 27 July 2018; Accepted 2 August 2018 (footnote)[white star] The authors are deeply grateful to the Editor, Professor B. Ravikumar, an Associate Editor, and two anonymous referees for their insightful comments, which substantially improved the paper. The authors would also like to thank Juin-Jen Chang, Nan-Kuang Chen, Yi-Chan Tsai, and Shu-Chun S. Yang for providing helpful suggestions in relation to earlier versions of this article. The usual disclaimer applies.

Keywords Schumpeterian growth; Financial frictions; Land prices; Macroprudential policy Abstract Recent evidence suggests that credit booms and asset price bubbles may undermine economic growth even as they occur, regardless of whether a crisis follows, by crowding out investment in more productive, R&D-intensive industries. This paper incorporates Schumpeterian endogenous growth into a DSGE model with credit-constrained entrepreneurs to show how shocks affecting firms' access to credit can generate boom-bust cycles featuring large fluctuations in land prices, consumption, and investment. During the expansion, rising land prices tend to crowd out capital and (especially) R&D investment: over the medium term, this results in a slowdown in the rate of creation of new (innovative) firms. Moreover, higher initial loan-to-value ratios tend to be associated with larger macroeconomic fluctuations. A counter-cyclical LTV ratio targeting credit growth has relevant stabilization effects but brings about small gains in terms of long-run consumption levels, and thus of welfare. Author Affiliation: School of European Political Economy, LUISS University, Via di Villa Emiliani 14, Roma, 00197, Italy * Corresponding author. Article History: Received 29 June 2018; Revised 18 November 2018; Accepted 29 December 2018 Byline: Claudio Battiati [cbattiati@luiss.it] (*)

This paper proposes a novel approach to evaluate location decisions for public facilities. The approach addresses, not only the standard distance-minimizing problem, but also the endogenous location decisions of individuals. The paper develops a quantifiable general equilibrium model with endogenous (residential and commercial) densities, housing prices, commutes to work, as well as to public/private facilities. The framework is applied to the case of secondary schools in Paris' greater region at a 1km.sup.2 geographical scale. The analysis reveals that the observed location decisions made between 2001 and 2015 underestimate the endogenous reaction of individuals. A more decentralized strategy is predicted to increase welfare growth by 10 percent, reduce density in Paris' center, and shorten commuting times to school globally. Author Affiliation: ETH Zürich, Department of Management, Technology, and Economics, Leonhardstrasse 21, Zurich 8092, Switzerland * Corresponding author. Article History: Received 10 February 2021; Revised 23 January 2023; Accepted 1 February 2023 (footnote)# I am grateful to the editor, Donald R. Davis, and three anonymous referees for many helpful and productive suggestions. I am grateful to seminar and conference participants in Barcelona, Aix-en-Provence, Munich, Tampere, Cologne, Paris and Amsterdam. In particular, I thank Gabriel Ahlfeldt, Peter Egger, Marko Koethenbuerger, Matthias Krapf, Etienne Lehmann, Nicole Loumeau, Mohammed Mardan, Yasusada Murata, Dávid Nagy, Ariell Reshef, Frédéric Robert-Nicoud, Laurent Simula, and Nora Strecker for helpful comments and suggestions; and Juliette Caillaudeau from the 'Direction de l'Evaluation, de la Prospective et de la Performance' (DEPP) for great help in accessing the data. Byline: Gabriel Loumeau [loumeau@ethz.ch] (*,#)

Keywords Household finance; Individual investor; Financial advice; Inducements; Consumer financial protection Highlights * German brokerage introduces a flat-fee alongside a commission-based scheme. * Comparison of switchers to the flat-fee to matched commission-based clients. * Adopters seek and follow (unchanged) financial advice more. * Adopters increase portfolio values and trade more. * Adopters improve portfolio efficiency through higher fund shares. Abstract Using a field study at a German brokerage, we investigate advised individual investors' behavior and outcomes after self-selecting into a flat-fee scheme (percentage of portfolio value) for mutual funds. In a difference-in-differences setting, we compare 699 switchers to propensity-score-matched advisory clients who remained in the commission-based scheme. Switchers increase their portfolio values, improve portfolio diversification, and increase their portfolio performance. They also demand more financial advice and follow more advisor recommendations. We argue that switchers attribute a higher quality to the unchanged advisory services. Author Affiliation: (a) Aarhus University, Fuglesangs Allé 4, DK-8210 Aarhus V, Denmark (b) University of New South Wales, UNSW Business School, Sydney, High St, Kensington NSW 2052, Australia (c) Goethe University Frankfurt, Theodor-W.-Adorno Platz 3, 60323 Frankfurt am Main, Germany * Corresponding author. Article History: Received 24 January 2022; Revised 14 March 2023; Accepted 16 March 2023 (footnote)â° This research could never have been accomplished without the collaboration and support of a German bank. We are grateful to the bank for providing the data. We would like to acknowledge the contributions of the bank and its employees who helped us. Financial support from the Think Forward Initiative research grant and the Danish Finance Institute (DFI) is also gratefully acknowledged. For useful comments and discussions, we thank Sascha Baghestanian, Holger Kraft, Roman Inderst, Martin Weber, Laura Lindsey, Alessandro Previtero, and Mikael Paaso. Conference and seminar comments at the AFA meetings in San Diego, AEA meetings in San Francisco, the 1st CEPR Household Finance workshop in London, the FIRS meetings in Lissabon, the DGF meetings in Leipzig, Goethe University Frankfurt, Leibniz University Hanover, University of Mannheim, and University of Tübingen significantly improved the paper. Please note that the paper previously circulated under the title 'fee-only advice' Byline: Steffen Meyer [steffen.meyer@econ.au.dk] (a,*), Charline Uhr (a), Benjamin Loos (b), Andreas Hackethal (c)

Keywords Relative performance information; Relative performance evaluation; Rank feedback; Social incentives; Social and self-image; Knowledge-sharing; On-the-job help; Collaboration; Experiment Abstract Social comparisons are known to increase individual work morale, but because they could foster competition, they may also negatively impact how well co-workers work together. This paper uses a novel experiment to explore this potential tradeoff. The experiment varies whether members of a reference group receive relative performance information on a knowledge task and measures how this affects the willingness to subsequently help the productivity of others by sharing knowledge with them. The findings reveal that relative performance information spurs competition between members of a reference group when compared to the baseline with no such information. Yet, there is no evidence that relative performance information substantially lowers group morale, that is, the willingness to help the productivity of others in the group. These findings advance our understanding of how relative performance concerns among co-workers affect the way they work together. Author Affiliation: Department of Economics, Ludwig-Maximilians-Universität München, Kaulbachstraße 45, 80539 München Article History: Received 15 July 2022; Revised 2 March 2023; Accepted 7 March 2023 (footnote)â° I am grateful to Roberto Weber and Ernst Fehr for their guidance and support in the development of this project. I thank Björn Bartling, Yves Breitmoser, Dirk Engelmann, Yiming Liu, Eva Ranehill, Ernesto Reuben, Karl Schlag, Florian Schneider, Anja Schöttner, Julien Senn, Vanessa Valero, Georg Weizsäcker, Florian Zimmermann and two anonymous referees for their comments. This paper also benefited from discussions with the audience in numerous conference and seminar presentations. Financial support from the Excellence Foundation Zurich, the Zurich Graduate School of Economics through their Director's Grant program and by Deutsche Forschungsgemeinschaft through CRC TRR 190 (project number 280092119) is gratefully acknowledged. All remaining errors are my own. Byline: Lea Heursen [lea.heursen@econ.lmu.de]

Keywords contest; all-pay auction; stochastic abilities; bid cap; disclosure Abstract In this paper, we study the optimal disclosure of bidders' types in a two-bidder all-pay auction in the presence of a common and exogenously given bid cap. We focus on the set of disclosure policies that are contingent on realizations of bidders' types and fully characterize the unique symmetric equilibrium under each of them. We find that, allowing only for full disclosure and full concealment, the ex ante expected revenue is higher under full disclosure only for intermediate levels of the bid cap. Allowing also for partial disclosure policies: (i) the ex ante expected revenue under full disclosure is higher than under partial disclosure to low-type bidders but lower than under partial disclosure to high-type bidders, regardless of the bid cap; (ii) full concealment could rank from the highest to the third highest, depending on the bid cap, the prior type distribution, and the type values. These results are due to the different sensitivities of bidders' bids across bidders' types and disclosure policies. Author Affiliation: (a) School of Economics, Shenzhen University, China (b) Department of Economics, Shenzhen MSU-BIT University, China (c) Max Planck Institute for Tax Law and Public Finance, Germany * Corresponding author. Article History: Received 3 December 2020; Revised 23 September 2022; Accepted 2 October 2022 (footnote)[white star] We thank Bo Chen, Jingfeng Lu, Kai Konrad, Dmitriy Knyazev, Tsz-Ning Wong, and Lily Yang for comments and discussions. This work was supported by the National Natural Science Foundation of China [No. 72203148 and No. 71973040] and the Department of Education of Guangdong Province [No. 2021WQNCX085]. The authors have equal contribution to the paper. Byline: Bo Chen [bochenbonn@gmail.com] (a,b,*), Marco Serena [marco.serena85@gmail.com] (c)

Keywords Cheating; Dishonesty; Misreporting in teams; Real effort Highlights * We analyze the impact of information and communication on misreporting of performance in teams of two. * Both team members get the same payoff but report independently. * Informing players 2 about the reports of players 1 reduces misreporting. * Letting players 1 send messages to players 2 reduces misreporting by players 2. * Information transmission and communication thus reduce misreporting. Abstract We extend the experimental analysis of misreporting performance in real effort tasks (cheating) to situations where two members of a team perform the task sequentially and decide independently on their potentially inflated reports. We vary three factors in our experiment: whether no players, only players 2, or both players can misreport; whether players 2 learn the report of players 1; and whether players 1 can send a message to players 2 requesting honest or dishonest behavior. Our data yield two main insights. First, higher reports by players 1 lead to higher reports by players 2, i.e. misreporting is reinforcing. Second, allowing players 1 to send a message suggesting that players 2 either report honestly or a minimum number of correct solutions reduces misreporting by players 2. There are two channels for this. First, most players 1 request an honest report. Second, players 2 misreport far less when they receive the honest message, but, compared to the treatments without messages, hardly change their reports when they are asked to report a minimum number of correct solutions. We find a similar, though less pronounced, asymmetric response when players 2 learn the reports of players 1. These findings suggest that communication and information transmission can reduce cheating, and that there are notable spillover effects of honesty even in anonymous environments. Author Affiliation: (a) Victoria University of Wellington, Pipitea Campus, Lambton Quay, Wellington, New Zealand (b) Trier University, Universitätsring 15, Trier, D-54296, Germany (c) Graduate School of Business, HSE University, Shabolovka Ulitsa 26--28, Moscow, Russia * Corresponding author. Article History: Received 26 April 2022; Revised 20 March 2023; Accepted 26 March 2023 (footnote)[white star] Paper presented at the University of Auckland, the University of Bern, Victoria University of Wellington, Otto Beisheim School of Management, and European Business School. We are grateful to Frauke von Bieberstein, Steffen Lippert, Gerd Muehlheusser, and Ronald Peeters for helpful comments. We are very grateful to two anonymous referees and the Associate Editor, whose comments improved the paper very much. This study was supported by grants of the Russian Science Foundation (Project No. 20-78-00023) and Wellington School of Business and Government (Project No. FSRG 225754). Byline: Eberhard Feess [eberhard.feess@vuw.ac.nz] (a), Thomas Schilling [dudek@uni-trier.de] (b), Yuriy Timofeyev [y.timofeyev@hse.ru] (*,c)

Keywords Occasionally binding constraints; Global nonlinearities; Financial frictions; Liquidity; Business cycles Abstract What drives nonlinearities in modern macroeconomic models? Building on global methods, the present paper isolates the effects associated with an occasionally binding constraint in a widely discussed macro-finance framework. Only the proper computational treatment provides a holistic understanding of the (hidden) economics in tail events, and the full reflection of large and consecutive shocks in economic forecasts. An improper treatment provides an overestimation of asset pricing dynamics and a misleading association between high levels of capital and liquidity and high levels of investment. Author Affiliation: Universität Zürich, Chair of Quantitative Business Administration, Plattenstrasse 14, CH - 8032 Zurich, Switzerland Article History: Received 18 February 2021; Revised 13 December 2022; Accepted 1 February 2023 (footnote)[white star] This paper is a revised version of the first chapter of our dissertation, written at the University of Zurich. It was selected for the student presentations of the Macro Financial Modeling Summer Session for Young Scholars 2017, held by the Becker Friedman Institute in Bretton Woods, NH (U.S.A.). We are grateful to two anonymous referees and the editor, Juan Francisco Rubio-Ramírez, for careful reviews of an earlier version of this paper. We are grateful to Johannes Brumm, Wouter den Haan, Martin Ellison, Andrea Eisfeldt, Lars Hansen, Felix Kübler, Alexander Ludwig, Walter Pohl, Pontus Rendahl, Andreas Schabert, Karl Schmedders, Andrés Schneider, Frank Schorfheide, Ctirad Slavík, and Sevin Yeltekin for helpful discussions. Finally, we thank Dave Brooks for excellent editorial support on earlier versions. A former version of this paper circulated under the preliminary title 'Occasionally Binding Liquidity Constraints and the Volatility of Consumption and Investment', under which it was also presented at the CEF 2013 in Vancouver and at the European Macro Workshop 2013 in London. Byline: Maximilian Werner [maximilian.werner@business.uzh.ch]

Keywords Early childhood; Pretrial detention; Judicial bias; Communal violence Abstract We estimate the causal effects of judges' exposure to communal violence during early childhood on pretrial detention rates by exploiting novel administrative data on judgments and detailed resumes of judicial officers born during 1955--1991. Our key result is that judges exposed to communal violence between ages 0 and 6 years are 16% more prone to deny bail than the average judge, with the impact being stronger for the experience of riots between ages 3 and 6 years. The observed judicial stringency is driven by childhood exposure to riots with a higher duration of state-imposed lockdowns and low riot casualties. Author Affiliation: (a) Paris School of Economics and University of Namur, France (b) Research School of Economics, Australian National University, Australia * Corresponding author at: Postdoc Associate at New York, Univerisity-Abu Dhabi. Article History: Received 14 March 2022; Revised 8 January 2023; Accepted 16 February 2023 (footnote)[white star] We would like to thank Guilhem Cassan, Yan Chen, Mathieu Couttenier, Oliver Vanden Eynde, James Fenske, Kareem Haggag, Namrata Kala, John List, Ameet Morjaria, Thomas Piketty, Herakles Polemarchakis, Dominic Rohner, Marc Sangnier, and Rabee Tourky for their comments and support. We would like to thank participants of the Young Economist Symposium (Princeton), 100 years of Economic Development Conference (Cornell University), Applied Econometrics Conference (Hitotsubashi University), KVS (Leiden University), and seminar participants at the Paris School of Economics and the University of Namur for suggestions and comments. We gratefully acknowledge Sudhir Gupta, Rahil Vora, and Yucheng Lu for their research assistance. We thank Lakshmi Iyer for providing us the dataset from their paper . We are very thankful to John Mitchell Poverty Lab for providing financial support to this project. This paper was written during the time Sutanuka Roy visited the Department of Economics at the University of Chicago. The author thanks the hosts for their support. This work was also supported by the Fonds Wetenschappelijk Onderzoek - Vlaanderen (FWO) and the Fonds de la Recherche Scientifique - FNRS under EOS project O020918F (EOS ID 30784531) Byline: Nitin Kumar Bharti [nitin-kumar.bharti@psemail.eu] (a,*), Sutanuka Roy [sutanuka.roy@anu.edu.au] (b)

Keywords Pension reform; Early retirement age; Savings; Pension wealth; Consumption expenditure Highlights * In this paper, we examine how households adjust their savings and consumption expenditure in response to an anticipated increase in the early retirement age. * We explore the abolishment of women's pension in 1999 in Germany and an Regression Discontinuity Difference-in-Differences (RD-DD) framework using the German Income and Consumption Survey. * We find a negative impact on private savings of 0.6 percentage points that is driven by married households. * Furthermore, we find that the treated households increase their leisure spending while maintaining an unchanged level of disposable income. * Our findings suggest that the treated households absorb the pension wealth shock without increasing their savings. Abstract This paper examines how households adjust their savings and consumption expenditure in response to an anticipated increase in the early retirement age (ERA). We examine the 1999 pension reform in Germany, which increased the ERA for women born after 1951 by at least three years. First, we present suggestive evidence that women update their retirement planning in response to the reform. Using the German Income and Consumption Survey, we find a negative impact on private savings of 0.6 percentage points that is driven by households with married women. We show that households consisting of highly educated women and homeowners are more likely to reduce their savings rates. Furthermore, we find that the treated households increase their leisure spending while maintaining an unchanged level of disposable income. Our findings suggest that the households anticipate experiencing a lifetime income increase and reduce their savings rate to smooth consumption. Author Affiliation: (a) DIW Berlin, Germany (b) ZEW Mannheim, Germany (c) University of Mannheim, IZA, ZEW, Germany * Corresponding authors. Article History: Received 18 December 2020; Revised 13 February 2023; Accepted 16 February 2023 (footnote)[white star] We would like to thank the editor and three anonymous referees for their comments, which greatly improved the paper. We are grateful to Christian Dustmann, Johannes Geyer, Hans-Martin von Gaudecker, Peter Haan, Eckhard Janeba, Michèle Tertilt, Nicolas Ziebarth and participants at seminars in DIW Berlin, University of Mannheim, CReAM, EPSE 2019, EALE 2019 and University of South Florida for their helpful insights and suggestions. The views expressed here are solely those of the authors. The authors acknowledge funding from the Forschungsnetzwerk Alterssicherung of the German Statutory Pension Scheme and the German Federal Ministry of Labor and Social Affairs within the BMAS-FIS network 'InterdisciplinarySocial Policy Research'. Funding by the German Research Foundation (DFG) through CRC TR 224 (Project C01) is also gratefully acknowledged. All errors are our own. Byline: Stefan Etgeton (a), Björn Fischer [bjoern.fischer@zew.de] (b,*), Han Ye [han.ye@uni-mannheim.de] (c,*)

Keywords Rent control; Apartment lottery; Labor income; Employment Highlights * Receiving a rent-controlled contract have negative effects on the labor supply. * Receiving a rent-controlled contract reduces the labor income. * Receiving a rent-controlled contract have negative effects on employment. Abstract Using a unique randomized rental apartment lottery in Stockholm metropolitan statistical area, this paper analyses behavioral effects on individuals receiving a rent-controlled contract in the Swedish rent control program. The result shows that receiving a rent-controlled contract reduces the annual labor income by 13 to 20 percent and employment by 8 to 13 percent. To some extent, these effects can be explained by an increased propensity to enter higher education. Author Affiliation: (a) Institute for Housing and Urban Research, Uppsala University, Uppsala, Sweden (b) Department of Statistics, Uppsala University, Uppsala, Sweden (c) YMSC, Tsinghua University, Beijing, China * Corresponding author. Article History: Received 18 November 2020; Revised 23 February 2023; Accepted 4 March 2023 (footnote)[white star] We thank seminar participants at Uppsala University and at the SNS. Enström Öst acknowledges support from the Swedish Research Council for Health, Working Life and Welfare (grant 2014--00034). The authors declare that they have no relevant or material financial interests that relate to the research in this paper. Byline: Cecilia Enström Öst [cecilia.enstrom_ost@ibf.uu.se] (a,*), Per Johansson [per.johansson@statistics.uu.se] (b,c)

Keywords COVID-19; Social distancing policy; Mobility; Vaccination; Republic of Korea; Structural VAR; Threshold VAR Abstract This paper investigates the dynamic impact of social distancing policy on coronavirus disease (COVID-19) infection control, mobility of people, and consumption expenditures in the Republic of Korea. We employ structural and threshold vector autoregressive (VAR) models using big-data-driven mobility data, credit card expenditure, and a social distancing index. We find that the social distancing policy significantly reduces the spread of COVID-19, but there exists a significant, growing trade-off between infection control and economic activity over time. When the level of stringency in social distancing is already high, its marginal effect on mobility is estimated to be smaller than when social distancing stringency is low. The effect of social distancing also becomes secondary after vaccination. Increased vaccination is found to significantly reduce the critical cases while it increases visitors and consumption expenditures. The results also show that the effect of social distancing policy on mobility reduction is strongest among the population of age under 20 and the weakest among the population of age over 60. Author Affiliation: (a) Economic Research and Regional Cooperation Department at the Asian Development Bank (ADB), Philippines (b) Department of Economics, Seoul National University, Republic of Korea (c) Future Strategy Development Department, Korea Development Bank, Republic of Korea (d) Economic Research and Regional Cooperation Department, ADB, Philippines * Corresponding author. Article History: Received 10 October 2022; Revised 26 January 2023; Accepted 17 March 2023 (footnote) Note: In this paper, 'Korea' has been used to refer to the Republic of Korea. Byline: Kijin Kim (a), Soyoung Kim [soyoungkim@snu.ac.kr] (b,*), Donghyun Lee (c), Cyn-Young Park (d)

Keywords Consumption externalities; Competitive equilibrium à la Nash; Decentralization; Social redistribution Abstract We consider a pure exchange economy with consumption externalities in preferences. We use the notion of competitive equilibrium à la Nash. We provide the Social Redistribution assumption to restore the Second Welfare Theorem. We then introduce the differentiable characterizations of Social and Strong Redistribution. We show that all these conditions are weaker than other relevant assumptions studied in the literature. Our conditions entail interesting results on the decentralized implementation of Pareto optima, that link together the competitive supporting price and the shadow price of the utilitarian social planner. Finally, we provide a specific condition for Bergson-Samuelson utility functions, which has a nice interpretation in terms of positive or negative externalities. Author Affiliation: (a) Paris School of Economics -- Université Paris 1 Panthéon-Sorbonne, Centre d'Economie de la Sorbonne, 106-112 Boulevard de l'Hôpital, 75647 Paris Cedex 13, France (b) Centre d'Economie de la Sorbonne, Université Paris 1 Panthéon-Sorbonne, 106-112 Boulevard de l'Hôpital, 75647 Paris Cedex 13, France * Corresponding author. Article History: Received 9 July 2021; Revised 27 February 2023; Accepted 1 March 2023 (footnote)[white star] Earlier drafts of this paper circulated as 'Sufficient conditions for a 'simple' Second Welfare Theorem with other-regarding preferences'. The decentralization addressed in this paper is 'simple' because it can be done through competitive prices, while in other classical papers the decentralization requires Lindahl equilibria and personalized prices, see , , and . We wish to thank Paolo Siconolfi and Jean-Marc Bonnisseau for much encouragement and advice. We are also grateful to Federica Ceron for attentively reading a previous version of this paper. We are grateful to the anonymous Reviewers and the Editor of this journal for their valuable comments and suggestions. Byline: Elena L. del Mercato [Elena.delMercato@univ-paris1.fr] (a,*), Van-Quy Nguyen [Van-Quy.Nguyen@univ-paris1.fr] (b)

Keywords Continuous implementation; Full implementation; Incentive compatibility; Robustness; Transfers Abstract The literature on robust mechanism design assumes players' knowledge about a fixed payoff environment and investigates global robustness of optimal mechanisms to large changes in the information structure. Acknowledging global robustness as a demanding requirement, we propose continuous implementation as a notion of local robustness. Keeping the assumption of payoff knowledge, we say that an SCF is continuously implementable if there exists a mechanism which yields the outcome close to the desired one for all types close to the planner's initial model. We show that when a generic correlation condition is imposed on the class of interdependent-value environments, any (interim) incentive compatible SCF is continuously implementable with arbitrarily small transfers imposed on and off the equilibrium. This stands in stark contrast to , who show that their global robustness amounts to ex post incentive compatibility, as well as to , who show that continuous implementation without payoff knowledge generates a substantial restriction on the SCF, tightly connected to full implementation in rationalizable strategies. Author Affiliation: (a) Department of Economics and Risk Management Institute, National University of Singapore, Singapore (b) School of Economics, Singapore Management University, Singapore (c) School of International Trade and Economics, University of International Business and Economics, China * Corresponding author. Article History: Received 10 October 2019; Revised 26 November 2022; Accepted 12 February 2023 (footnote)[white star] This paper was formerly titled 'Continuous Implementation with Small Transfers.' We thank the editor and two anonymous referees for stimulating comments that have substantially improved the paper. We thank Atsushi Kajii, Michihiro Kandori, Hitoshi Matsushima, Rene Saran, Roberto Serrano, Satoru Takahashi, Olivier Tercieux, Rajiv Vohra, Takuma Wakayama and audiences at various seminar/conference presentations for helpful comments. Part of this paper was written while the three authors were visiting Academia Sinica, and we would like to thank the institution for its hospitality and support. We also gratefully acknowledge the financial support from the Singapore Ministry of Education Academic Research Fund Tier 1 (R-122-000-328-115), Tier 2 (MOE-T2EP402A20-0007), and the National Natural Science Foundation of China (NSFC72273029). All errors remaining are our own. Byline: Yi-Chun Chen [ecsycc@nus.edu.sg] (a), Takashi Kunimoto [tkunimoto@smu.edu.sg] (b), Yifei Sun [sunyifei@uibe.edu.cn] (c,*)

Keywords Random utility; Quasi-linear utility; Tie-breaking; Finite datasets; ARSP; Block-Marschak polynomials Abstract We propose a random quasi-linear utility model (RQUM) where quasi-linear utility functions are drawn randomly via some probability distribution [pi], and utility ties are broken by a convenient lexicographic rule. We characterize RQUM and identify [pi] uniquely in terms of stochastic choice data. McFadden's (1973) additive random utility model is obtained as a special case where utility ties have a zero probability in all menus. Another distinct case of RQUM captures finite populations and derives [pi] with a finite support. Our main axioms are testable. They prohibit context and reference dependence, and also modify the non-negativity of Block-Marschack polynomials for monetary cost variations. We also characterize RQUM through a stronger version of McFadden and Richter's (1990) axiom of revealed stochastic preferences (ARSP). This approach extends to incomplete datasets. Author Affiliation: (a) Business School, Sun Yat-sen University, 518107 Shenzhen, China (b) Department of Economics, University of California, Irvine, United States of America * Corresponding author. Article History: Received 8 April 2022; Revised 20 March 2023; Accepted 27 March 2023 (footnote)1 We thank Mira Frick, Ryota Iijima, Asen Kochov, Stergios Skaperdas, Michael McBride, Jay Lu, Andrew Ellis, Christopher Turansick, David Brownstone, Miguel Zerecero, and Jiawei Chen for their helpful suggestions on this paper. We are grateful to the editor Faruk Gul and two anonymous referees; their insightful comments helped significantly in improving this paper. We would also like to thank participants at seminars at UCI, Rochester, Yale, Sun Yat-sen, and SWUFE Universities. Byline: Erya Yang [yangery@mail.sysu.edu.cn] (a,*,1), Igor Kopylov [ikopylov@uci.edu] (b,1)

Keywords Deformed likelihood; Dynamic systems; Judgment; Repeated games; Robust filtering Abstract We answer positively to this question by using Maximum Lq-Likelihood (or Deformed Likelihood) estimator. This is based on a parameter which measures the aggregate quote of judgment in the forecasting (game-based) system formed by three players--Forecaster, Policy Maker and Reality. For the first time in econometric literature, we apply this estimator to a dynamic system and derive a robust version of the Kalman Filter--the Deformed Kalman Filter (DKF). The evidence from U.S. data suggests that the judgmental dynamics exists and is correlated (but not coincident) with the phases of the Business Cycle. Furthermore its knowledge improves in-sample as well as out-of-sample estimation. Author Affiliation: University of Bergamo, Department of Economics, Via dei Caniana, 2 - 24127, Bergamo, Italy Article History: Received 20 August 2022; Revised 21 December 2022; Accepted 3 March 2023 (footnote)1 The Author is particularly grateful to Giovanni Urga and Salvatore Piccolo for their support. He also thanks Barbara Annicchiarico, Marcelle Chauvet, Raffaella Giacomini, Ana Maria Herrera, Alessandra Luati, Giuseppe Ragusa, Francesco Ravazzolo and Tom Stark for their feedback, as all the participants to the 2nd Ventotene Workshop in Macoreconomics, the 41st International Symposium on Forecasting 2021, the internal Seminar Series in Mathematics and Statistics of the University of Bergamo, the IWEEE2022 in Rimini and the IAAE2022 in London. In some of that occasion the paper had been presented with the title 'Measuring Unobserved Strategic Judgment'. The co-editor, Juan Francisco Rubio-Ramirez, and a referee are grateful for their contributions to the paper's readability and scientific correctness. Finally, the Author is in debt with doctors, nurses and workers of Policlinico 'S. Matteo' of Pavia, without whose uncompensated cares this paper would not have been written. Byline: Emilio Zanetti Chini [emilio.zanettichini@unibg.it] (1)

Keywords Quantitative easing; Global financial cycle; Domestic credit; Exchange rate interventions; Capital controls; Macroprudential policy Abstract Large international capital movements tend to be associated with strong fluctuations in asset prices and credit, contributing to domestic financial cycles and posing challenges for stabilization policies, especially in emerging market economies. In this paper we argue that these challenges are particularly severe if the global financial cycle is driven by quantitative easing (QE) in the US, and when the local banking sector has large holdings of government bonds, like in many Latin American (LA) countries. We first investigate empirically the impact of a typical round of QE by the US Fed on LA economies, finding a persistent expansion in credit to households and house prices, as well as a significant loss of price competitiveness. We next develop a quantitative macroeconomic model of a small open economy with segmented asset markets and banks, which accounts for these observations. In this framework, foreign QE creates tensions between macroeconomic and financial stability as a contractionary impact of exchange rate appreciation is accompanied by booming credit and house prices. As a consequence, conventional monetary policy accommodation aimed at stabilizing output and inflation would further exacerbate domestic financial cycle. We show that an effective way of resolving this trade-off is to impose measures that directly reduce the inflow of capital. Combining foreign exchange interventions with tightening of local credit policies can also restore macroeconomic and financial stability, but at the expense of a large redistribution of wealth between borrowers and savers. Author Affiliation: (a) SGH Warsaw School of Economics and International Monetary Fund. Al. Niepodleglosci 162, Warszawa 02-554, Poland (b) University of Warsaw * Corresponding author. Article History: Received 3 June 2022; Revised 1 March 2023; Accepted 3 March 2023 (footnote)[white star] This paper benefited from discussions with M.Brzoza-Brzezina, M.Gradzewicz, J.Lindé, B.Mackowiak, I.Presno, R.Priftis, R.Reis, H.Rey, S.Schmitt-Grohe, and P.Zabczyk. The authors also acknowledge useful comments from two anonymous referees, as well as from participants at the IAAE Annual Meeting in Rotterdam, CEF Conference in Tokyo, 3rd Warsaw Money-Macro-Finance Conference, CBMMW in Santiago de Chile, Warsaw Economic Seminar (all held virtually), and 10th Summer Workshop in Macroeconomics and Finance in Warsaw. The views expressed herein are those of the authors and not of the institutions they are affiliated with. Declarations of interest: none. Byline: Marcin Kolasa [mkolas@sgh.waw.pl] (*,a), Grzegorz Wesolowski (b)

Keywords Intervivos transfers; Bequests; Coresidency; Parental altruism Abstract This paper uses 1996--2014 longitudinal HRS data to establish the relative importance of intervivos transfers, bequests and coresidency in the United States. We find that when computing the relative importance of intervivos transfers versus bequests, the aggregate perspective that pools all data into a single cross-section is very different than the parent-level longitudinal perspective, highlighting the special value of panel data. This difference reflects the fact that large bequests are highly concentrated and play an influential role at the aggregate level, while at the micro parent-level, intervivos transfers constitute the main form of financial support for most parents. Regarding coresidency, we find that although older children and parents tend to coreside when the child is helping the parent, coresidency tends to be more prevalent among poorer, younger parents and their children. Children who ever coreside with parents also receive larger total intervivos transfers. Author Affiliation: (a) Center for Transnationals' Studies & Laboratory for Economic Behaviors and Policy Simulation, Nankai University, Tianjin, China (b) Department of Economics, University of Pittsburgh, United States * Corresponding author. Article History: Received 27 July 2021; Revised 31 December 2022; Accepted 6 February 2023 (footnote)1 A previous version of this paper circulated under the title 'The Patterns of Intervivos Transfers to Adult Children.' We thank the editor and two anonymous referees for insightful comments. Siqiang Yang acknowledges financial support from Tianjin Philosophy and Social Science Planning Foundations (TJYJQN22-003) and the Fundamental Research Funds for the Central Universities (No. 63202020). Byline: Siqiang Yang [siy10@nankai.edu.cn] (a), Marla Ripoll [ripoll@pitt.edu] (*,1,b)

Keywords Optimal currency denominations; Cash transactions; Burden of exchanging cash; Penny elimination Highlights * We describe a model of optimal consumer-merchant exchange of cash payments. * Diary data are used to quantify the burden of exchanging currency notes and coins. * The model and data are used to analyze the effects of eliminating the one-penny coin. * Penny elimination would reduce the burden of exchanging cash. * Penny elimination would result in little or no inflationary consequences. * Elimination of the penny and the nickel would not reduce this burden relative to penny elimination only. Abstract This article quantifies the burden of exchanging currency notes and coins using a model of optimal consumer-merchant exchange of cash payments and consumer payment choice diary data. The model is then applied to analyze a policy debate whether to eliminate the penny coin from circulation. We find that penny elimination would reduce the burden of exchanging cash and will not have any significant inflationary consequences caused by price rounding. Surprisingly, a removal of both the penny and nickel coins from circulation would slightly increase (not decrease) the burden relative to penny elimination only. Author Affiliation: (a) Department of Economics, Washington University in St. Louis. 1 Brookings Dr, St. Louis, MO, 63130, United States (b) Research Department, Federal Reserve Bank of Atlanta. 1000 Peachtree St. NE, Atlanta, GA, 30309, United States * Corresponding author. Article History: Received 15 February 2022; Revised 25 January 2023; Accepted 27 January 2023 (footnote)[white star] We thank Marcin Hitczenko and two anonymous reviewers for most helpful comments and suggestions. This paper was formerly circulated as 'The Burden of Cash and the Penny Policy Debate.' Part of the work on this paper was conducted while Brian Prescott was at the research department of the Federal Reserve Bank of Atlanta. The views expressed here are the authors' and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. Byline: Brian C. Prescott [b.prescott@wustl.edu] (a), Oz Shy [oz.shy@atl.frb.org] (*,b)

Keywords Dominant minority; Indirect governance; Loyalty; Economic history; China Highlights * Manchusused a cross-ethnic strategy to rule China where Han elites were appointed to handle daily tasks andManchu superiors were assigned for oversight. * Higher governance complexityled to a higher likelihoodof cross-ethnic arrangements. * Cross-ethnic assignments were more frequent in regions where Han elitesaccumulatedmore discretionary power. * Cross-ethnic assignments wereassociated with better local economic development, more efficient policy execution, and enhanced recognition of imperialauthority. Abstract This paper examines how a million Manchus, as a dominant minority, partly relied on a cross-ethnic personnel strategy to rule over 100 million Han Chinese for 267 years. Under this strategy, Han elites were appointed to handle daily administrative issues, on top of whom Manchu superiors were assigned for oversight. We find that more frequent local extreme weather -- a proxy for governance complexity -- led to higher likelihood of such cross-ethnic arrangements. This link is stronger in regions where Han elites accumulated more discretionary power. Moreover, the cross-ethnic strategy was associated with better local economic development, more efficient policy execution, and enhanced recognition of imperial authority. Author Affiliation: (a) School of Economics, Fudan University, Shanghai 200433, China (b) Cheung Kong Graduate School of Business, Beijing, China (c) Cheung Kong Graduate School of Business, Beijing, China (d) World Bank, 1818 H Street, NW, Washington, DC 20433, United States * Corresponding author. Article History: Received 30 September 2021; Revised 20 January 2023; Accepted 10 February 2023 (footnote)[white star] The views of this paper are the authors' own, and do not implicate the World Bank and its member countries. We thank the coeditor, Maria Petrova, and three anonymous referees for valuable comments and guidance. Helpful and much appreciated suggestions were provided by Shiyu Bo, Cong Liu, and Tianyang Xi. We thank Yantong Fang, Zhichen Huang, Yongtao Li, Yaohui Peng, Xuanyi Wang, Lixi Xu, and Qin Yao for their excellent research assistance. The project has benefited from World Bank RSB support. Chen would like to acknowledge the support from the National Natural Science Foundation of China (71933002; 72121002), Zhuoyue Talent Project, Theoretical Economics Peak Program and Legendary Project on Humanities and Social Sciences (XM04221238) at Fudan University. All remaining errors are our own. Byline: Shuo Chen [cs@fudan.edu.cn] (a), Xinyu Fan [xyfan@ckgsb.edu.cn] (b,*), L. Colin Xu [lixinxu@ckgsb.edu.cn] (c), Xun Yan [xyan@worldbank.org] (d)

Keywords Tax evasion; Value-added tax; Income tax credit; Third-party reporting Highlights * Tax credit incentivizes consumers to ask for invoices that complete the VAT paper trail. * Empirical analysis uses VAT tax returns of the universe of VAT payers in Germany. * Counterfactuals are based on non-eligible industries with high levels of noncompliance. * Two thirds of revenue losses in the income tax are recovered by increase in VAT revenue. * Between a quarter and half of the VAT revenue gain is associated to the VAT evasion margin. Abstract This paper analyzes the effects of an income tax credit for hard-to-tax consumer services on evasion of the value-added-tax (VAT). Based on the individual tax files of the universe of VAT payers in Germany, our analysis shows that harnessing incentives for consumers through tax credits fosters firms' compliance with VAT by bringing in an element of third-party reporting at the last VAT stage. Our results point at strong stimulating effects of the introduction of the tax credit on reported sales as well as on the ratio of reported sales to inputs and we find limited price effects. While two thirds of the revenue losses in the income tax are recovered by an increase in VAT revenues, at least a quarter and up to a half of the revenue gain is associated with a response at the VAT evasion margin. The policy thus fosters considerable formalization effects. Author Affiliation: (a) Friedrich-Alexander-Universität Erlangen-Nürnberg, Lange Gasse 20, 90403 Nürnberg, Germany (b) CESifo, Germany * Corresponding author. Article History: Received 8 August 2021; Revised 28 January 2023; Accepted 1 February 2023 (footnote)[white star] The authors gratefully acknowledge the financial support of the German Science Foundation under grant project 'BU-1254/6'. For helpful comments and suggestions, we are grateful to Albrecht Bohne, Lars Feld, Frank Hechtner, Duccio Gamannossi degl'Innocenti, Christos Kotsogiannis, Sarah Necker, Sandip Sukhtankar, three anonymous referees, and the participants of various seminars and conferences including the ZEW Public Finance Conference (2019), the Annual Meeting of the Verein fuer Socialpolitik in Leipzig (2019), the Workshop 'Enforcing Tax Compliance at the Limits of Third Reporting' at Walter Eucken Institut (2019), the TARC Annual Conference (2020), the 7th Conference on 'Shadow economy, tax behaviour and institutions' (2021), and the Economics Research Seminar at the University of Tübingen (2023). For data support, we thank the DESTATIS team of Melanie Heiliger, Anette Erbe, and especially Hannes Fauser. Byline: Thiess Buettner [thiess.buettner@fau.de] (a,b,*), Boryana Madzharova [boryana.madzharova@fau.de] (a,b), Orlando Zaddach [orlando.zaddach@posteo.de] (a)

Keywords Board of directors; Gender; Diversity; Investment efficiency; Capital investment Abstract This paper investigates the effect of board gender diversity on a firm's investment inefficiency and finds that a firm with at least one female director on its board has significantly less investment inefficiency than firms without one. The fraction of female directors on the board has a significantly negative association with investment inefficiency. The instrumental variable approach and propensity score matching show that this relation is robust after addressing endogeneity concerns. Furthermore, the effect of board gender diversity on investment inefficiency is more pronounced for overinvestment than underinvestment. Consistently, the effect is more substantial for firms that tend to overinvest ex-ante. It also indicates that board independence is a channel for board gender diversity to reduce investment inefficiency. Author Affiliation: (a) School of Economics and Finance, Victoria University of Wellington, Wellington 6140, New Zealand Article History: Received 31 January 2022; Revised 8 December 2022; Accepted 12 December 2022 (footnote)[white star] I thank Professor Hai Lin for his support and comments on this paper. I appreciate the comments and suggestions on this paper. from the participants in the 2021 Financial Market and Corporate Governance (FMCG) Conference. I also thank Dr. Griffin Geng, Dr. Peter Huang, and Prof. Alfred Yawson for their comments on this paper in the examiner's report of my Ph.D. thesis. Byline: Chang Yu [chang.yu@vuw.ac.nz] (a)

Keywords Grossman-Stiglitz-style and kyle-style models; Dampening effect; Price informativeness and short-term return reversals; Contrarian trading; Aggregate risk Abstract The way informed traders use their privileged information affects the properties of asset prices. This paper analyzes the differences in market efficiency between the two most widely adopted informed trading paradigms (Grossman-Stiglitz-style and Kyle-style) in a unified three-period framework. The aggregate risk--the product of fundamental risk, liquidity trading risk, and traders' risk aversion coefficient--uniquely determines three measures of market efficiencies, including price informativeness, return autocorrelations, and the unconditional expected utilities of uninformed market makers. In the Kyle-style model, a self-reinforcing dampening effect arises from informed traders' trading on fundamental information and non-fundamental information about their prior positions, leading to less efficient markets, contrarian trading by informed traders, and a return reversal between the two trading periods. Our study proposes to estimate price informativeness using information from short-term return reversals. Author Affiliation: ShanghaiTech University, Shanghai 201210, China * Corresponding author. Article History: Received 28 August 2022; Revised 11 January 2023; Accepted 14 January 2023 (footnote)1 I am very grateful to two anonymous referees; an anonymous associate editor, and Tony He (Editor) for their invaluable comments and suggestions. I am also very grateful to Wen Chen (discussant at CICF), Hanming Fang, Pete Kyle, Lionel Huntley Henderson, Alan Tucker, and seminar participants at the China International Finance Conference, Central University of Finance and Economics, Jiangxi University of Finance and Economics, Shanghai Jiaotong University, ShanghaiTech University, Southwestern University of Finance and Economics, Wellington finance summit, and University of Frankfurt for helpful discussions. I am solely responsible for any errors. This paper is supported by National Natural Science Foundation of China (No. 71773077). Byline: Mng Guo [guoming@shanghaitech.edu.cn] (*,1)

Keywords Preference; Decision-making autonomy; Willingness-to-pay Highlights * Spouses in low-income societies engage in division of labor. * Improved cookstoves benefit women more than men. * Women are willing to pay more for improved cookstoves than men. * Men dominate household decision-making. Abstract We use a field experiment to identify how differences in preferences and spousal influence result in low willingness to pay (WTP) for technologies that can benefit all household members. We create income-earning opportunities to empower households and conduct an actual stove purchase experiment to elicit their WTP for fuel, time, and indoor air pollution-reducing improved cookstoves. The decision to buy the stove was randomly assigned to either wives, husbands, or couples using either individually or jointly earned income. Experimental results suggest that wives, who often are responsible for cooking and collecting fuelwood, are willing to pay 57% more than husbands and 39% more than couples. Wives who made the stove purchase decision alone using the income they earned alone are willing to pay 67% more than husbands who made the purchase decision alone. We also find that couples' WTP is similar to that of husbands, implying that husbands dominate joint decisions. A follow-up survey conducted 15 months after the stove purchase shows that the treatments do not affect stove use. Our findings highlight the importance of considering the division of labor, preference difference, and spousal influence within the household when promoting the adoption of new household technologies. Improving access to cash for poor women would likely enable them to make decisions consistent with their preferences. Author Affiliation: (a) University of Gothenburg, Vasagatan 1, Box 600 405 30, Gothenburg, Sweden (b) ECRC, Vasagatan 1, Box 600 405 30, Gothenburg, Sweden * Corresponding author. Article History: Received 19 March 2021; Revised 16 January 2023; Accepted 24 January 2023 (footnote)[white star] Yonas Alem (Lead Author) is a Senior Research Fellow and Director of Academic Programs at the Environment for Development (EfD), School of Business, Economics and Law, University of Gothenburg; his email address is yonas.alem@gu.se. Sied Hassen is a post-doctoral researcher at the Environment and Climate Research Center of the Policy Studies Institute (PSI), Addis Ababa, Ethiopia; his email address is seidy2004@gmail.com. Gunnar Köhlin is Director of EfD at the School of Business, Economics, and Law at the University of Gothenburg; his email address is gunnar.kohlin@gu.se. We thank the editor (Laura Schechter), an anonymous associate editor, and two anonymous reviewers for helpful inputs, which significantly improved the paper. We also extend our gratitude to Cyndi Berck, the late Peter Berck, Randall Bluffstone, Fredrik Carlsson, Haileselassie Medhin, Alemu Mekonnen, Subhrendu Pattanayak, Dale Whittington, Thomas Sterner, Simon Schürz, Måns Söderbom, Roberto Weber, seminar participants at the Department of Economics, University of Gothenburg (Gothenburg, Sweden), participants in the Economic Sciences Association annual conference (Bergen, Norway), and participants at the Nordic Conference in Development Economics (Copenhagen, Denmark) for helpful comments on earlier versions of the paper. Financial support from the Swedish International Development Cooperation Agency (Sida) through the Environment for Development (EfD) is gratefully acknowledged. All correspondence to Yonas Alem, yonas.alem@gu.se. All errors and omissions are ours. Byline: Yonas Alem [yonas.alem@economics.gu.se] (*,a), Sied Hassen (b), Gunnar Köhlin (a)