# All Questions

11,808 questions
Filter by
Sorted by
Tagged with
52 views

19 views

### Optimal fee decisions in a Two-Part Tariff with resale and third-degree price discrimination

Say I have two customers - one is a low type and one is a high type (don't worry about their demand functions but assume they are linear). In the original case, we can differentiate consumers (i.e we ...
29 views

### Model specification of gravity model with Global Value Chains

I am trying to build a gravity model with the Global Value Chains indicator (backward and forward participation) as dependent variables. However, I wonder which are the diagnostic tests I should ...
27 views

### If companies could reduce prices to bring up demand during a recession, then why there is less production/output and more unemployment

When consumer demand reduces, and if companies could reduce prices to bring up demand during a recession, then why there is less production/output and more unemployment during a recession?
12 views

### what is 'mid-year estimate' in following chart?

If it is mid-year population then, why it is so less in comparison to 'total population'
20 views

### Rationalising today's bond market and stock market

As of this writing, the 10-year T note yields 1.437%, on a steady 3-month downward trend (from 1.55-1.75% in recent months) while the S&P 500 is nearing all-time-highs. When these long-term bond ...
168 views

### Calculating the amount paid for a loan in today's dollars

So I was trying to figure out the amount paid for a loan in today's dollars using two different methods but they give me different results. I was hoping that someone could explain which method is ...
17 views

### Perfectly functioning credit markets and consumer saving

Today in my Macroeconomics lecture, while covering the Real Intertemporal Model with Investment (Chapter 11 of Williamson's Macroeconomics), my professor proponed that a key assumption to not make ...
27 views

### According to North, Wallis, and Weingast (NWW), which states/societies have successfully made the transition to open access?

Weingast (2016) writes: The NWW framework redefines the process of economic and political development as the transition from a limited access order to an open access order. The transition is a ...
35 views

34 views

### Marginal Productivity Theory - Clarks and Marshall-Hicks

I am referring to the HL Ahuja Microeconomics book and here is what I have understood - Clarks Version : Wage = Marginal Product of Labour ( w = MP(L) ) Marshall Hicks Version: Wage = Value of ...
56 views

### Why the common trend assumption of subsample will be the same with the whole sample in DID?

When separating the sample into subsamples in this topic, this answer stated that I guess parallel trend assumption must hold within municipality size. DID with homogeneous effect typically assumes E[...
24 views

### Finding the cost-minimising production allocation in a Cournot merger with symmetric costs

Suppose I have 3 firms in a market. They have an identical, convex cost function, $C(q) = 20q + q^2$ = $C_1 = C_2 = C_3$, and each firm produces in their own factory. Market demand is linear, $P=200-Q$...
42 views

### When we should use $R^2$ instead of adjusted $R^2$?

Following this topic, adjusted $R^2$ has been widely used to validate the trustable explanation adding of the additional independent variables. I am wondering when we should use $R^2$ instead of ...
4 views

### impact of interest rate and benefits for IMF

We know that when interest rates are high, the economy slows and inflation decreases. when interest rates are low, the economy grows, and inflation increases. Now govt wants low inflation as it has to ...
137 views

### Krugman 1980 AER, Deriving Equation 14

I have been trying to derive equation 14 from Paul Krugman's 1980 AER paper. I keep getting a different result, and further, I find that equation 14 from the paper does not balance payments when I ...
75 views

### Why excluding intercept is dangerous if there is no literature back up in DID setting?

Recently, I run the regression for the generalised DID following this paper: $Y_{it}$ = $\alpha$ + $\beta$ $(Leniency Law)_{kt}$ + $\delta$$X_{ikt} + \theta$$_t$ + $\gamma$$_i +\epsilon$$_{it}$ (1)...
35 views

### What is the “dummy variable trap”?

I saw an interesting Economics post yesterday with the long comment. I post the regression result of the OP here I saw @chan1142 stated that Thanks. I see the _cons row. That's the intercept; the ...
122 views

### A revisit to simple DID and Generalised DID

After a couple of questions being asked, I am curious about the inclusion of Post and Treat variable in a simple DID (two groups two-time period). We mainly know there are mainly two types of DID ...
18 views

### Are short squeezes becoming more common, and if so, why?

This year I have read about short squeezes more often than any time in the past. Are short squeezes becoming more common, and if so, why?
43 views

### Proof that $U(\sum_{n=1}^{N}{p_nL_n})=\sum_{n}^{N}{p_nU(L_n)}$

I understand the expected value of a lottery is $\sum_n^N{p_nL_n}$ where there are $N$ possible outcomes, each with a probability $p_n$ with $n=1,...,N$ and $\sum_{n}p_n=1$ (that's rather trivial I ...
81 views

### What are the meanings of “difference-in-differences” and “causal estimand”?

In one discussion, I saw the answer containing two words that I think can be used interchangeably, but I am not sure if it's the case. I simply state in other posts that the "generalized" **...
14 views

### Disconnect between real and financial economies [duplicate]

I've been reading a lot of articles on how there is a disconnect between how the real economy is currently doing (like falling GDP and high unemployment rates) and how the stock market is doing (...
26 views

### Why is the IS-LM model taught?

my question is rather simple but I would like to know why the IS-LM model is still taught in from my experience most undergrad economics classes? My understanding is that the model is considered old ...
15 views

### RDD with time-varying cut-off

I have a sharp assignment rule based on age cut-off. During my observation period, the cut-off was reduced expanding access. I can do a normal RDD based on the current cut-off, but is there a better ...
51 views

### Is the pooling equilibrium profit maximising for the firm?

Is the pooling equilibrium profit maximising for the firm? I understand that when there are no ways for the firm to distinguish among highly productive and low productive worker the best the firm can ...
104 views

### Are there economic models that predict (only) a medium/long-term negative effect of protectionism?

Going by some ECB models/estimates from last year, protectionism would result in negative consequences pretty fast, e.g. For illustration, I will use the results of simulations carried out by ECB ...
43 views

### Where can I retrieve a complete history of macro economic data annoucements?

I'd like to get the complete ( well at least the last 20 years) history of economic data announcement calendar firstly for US and secondly for G5 countries. I have found many websites that propose the ...
51 views

### How could DTI(debt-to-income ratio) go well above 1?

IMF Working Paper No. 19/258: Assessing Macro-Financial Risks of Household Debt in China (PDF version) The riskiness of household debt increased as well: between 2010 and 2016, the share of debt held ...
354 views

### How does GNU software development sustain economically?

I apologise if this question is out of topic, but it is simultaneously an economy and a programming question. If it should go to another SE communality, please indicate me. In theory, GNU software is ...
47 views

Given a utility function $u(\cdot)$ and two bundles $x$ and $y$. Assuming $u(x)=u(y)$. I am to prove or disprove that $x \succcurlyeq y$. Now I'm confused by this. We say $x$ is strictly preferred to $... 0answers 22 views ### How to interpret the Alpha in a multi-factor model? For the CAP-M, the alpha can be interpreted as the excess returns of a benchmark index. However, how should we interpret the alpha in a multi-factor model, like Carhart's 4-factor model? Does it still ... 1answer 21 views ### What is the relationship between interest rates and stock values I have started reading the book After the music stopped and came across a section which I couldnt quite understand. This is the following passage the fundamental determinants of stock values are ... 1answer 75 views ### Derive and Decompose The Aggregate Elasticity of Substitution in CES Economy The paper is Oberfield & Raval 2021. Consumers have standard Dixit-Stiglitz preferences consuming the bundle$$Y= \left(\sum_{i \in I} D_{i}^{\frac{1}{\varepsilon}} Y_{i}^{\frac{\varepsilon-1}{\... 1answer 35 views ### Price/value with and without consideration of resale When thinking about various economic phenomena I have often found it useful to separate out the value of an item purely for its own sake from the value when you also consider the fact that you may ... 1answer 23 views ### What does "dependent and independent variables only vary at the ($g,t$) level mean? From de Chaisemartin and D'Haultfoeuille 2020, p.2969 I saw an equation$D_{g,t}=\alpha$+$\gamma_g$+$\delta_t$+$\epsilon_{g,t}D_{g,t}$is the treatment in group$g$at period$t$They ... 1answer 58 views ### Is the book by Nicholson and Snyder more rigorous when compared to Varian's Intermediate Microeconomics? I am about to start learning college level Economics and the two books that are commonly used are Intermediate Microeconomics by Hal Varian and Microeconomic Theory: Basic Principles and Extensions by ... 2answers 39 views ### Representative Agent and Maximization If there's a maximization of utility subject to a budget constraint-would it be always a representative agent model? Can it be heterogenous in some cases? 0answers 14 views ### Why do lumber prices soar but cost of gypsum does not drop? The cost of lumber has increased 3 fold over the last year, whereas the cost of other building materials such as gypsum has hardly budged. In North America, lumber is a dominant material used in the ... 2answers 374 views ### What is the difference between ATE and ATT? I saw ATE and ATT in some discussions regarding DID settings recently. ATE is the Average Treatment Effect while ATT is Average Treatment Effects on Treated. I am wondering the difference between ... 23answers 16k views ### Criticism of Math in Economics I've been reading and speaking to a number of educated economists and economics PhDs who are against the use of intense mathematics and mathematical proof in economic theory. Specifically I've been ... 1answer 39 views ### Data for producer prices for products I am working with some data that express the environmental byproducts for the manufacturing of specific broad product categories (e.g. milk, soap, leather). The statistics are given per dollar of ... 1answer 46 views ### What does expectation of$\varepsilon_{c,t}$conditional on$_c$mean? From a discussion, I recieve a mathematic answer, I understand until one point This decomposition can always be made by setting$\delta_c$to be the expectation of$\varepsilon_{c,t}$conditional on$...
We are in an Insurance Adverse Selection. Assume that consumers differ in their own risk $\pi_i$ distributed on the interval $[\underline \pi, \bar\pi ]=[0, 0.5]$. CDF is as follows \$F(\pi)= 2\pi^2 + ...