Rodney J. Andrews

Quantile Treatment Effects of College Quality on Earnings

We use administrative data from Texas to estimate how graduating from a state flagship or a community college relative to a nonflagship university affects the distribution of earnings. We control for the selection of students across sectors using a rich set of observable ability and background characteristics and find evidence of substantial heterogeneity in the returns to quality. Returns increase with earnings among UT–Austin graduates but decline among Texas A&M graduates. For community colleges, returns are negative for lower earners but go to zero for higher earners. Our estimates also point to differences in the distribution of returns by race/ethnicity.

Identifying Confirmatory Bias in the Field: Evidence from a Poll of Experts

Laboratory experiments have established the existence of cognitive biases, but their explanatory power in real-world economic settings has been difficult to quantify. We evaluate the extent to which a cognitive bias, confirmatory bias, affects the opinions of experts in a real-world environment. In the Associated Press Top 25 College Football Poll, expert pollsters are tasked with assessing team quality, and their beliefs are treated week to week with game results that serve as signals about an individual team’s quality. We exploit the variation provided by actual game results relative to market expectations to develop a novel regression-discontinuity approach to identify confirmatory bias. We construct a data set that matches more than 20 years of individual game characteristics to poll results and betting market information and show that teams that slightly exceed and barely miss market expectations are exchangeable. The likelihood of winning the game, the average number of points scored by teams and their opponents, and even the average week of the season are no different between teams that slightly exceed and barely miss market expectations. Pollsters, however, significantly upgrade their beliefs about a team’s quality when a team slightly exceeds market expectations. The effects are sizable—one fifth of the standard deviation in poll points in a given week can be attributed to confirmatory bias, which is equivalent to nearly half of the voters in the poll ranking a team one slot higher when they slightly exceed market expectations. This type of updating suggests that even when informed agents make repeated decisions, they may act in a manner consistent with confirmatory bias.

Comments on “Black Americans in the 21st Century: Should We Be Optimistic or Concerned?”

In “Black Americans in the 21st Century: Should we be Optimistic or Concerned?”, Dr. Angel Harris discusses a number of facts about the myriad gaps in performance between black Americans and white Americans. In what follows, I present evidence that suggests that a combination of race-conscious policies and early-childhood investments should be included in any policy that seeks to reduce the gaps in performance between black Americans and white Americans.

The Effects of Local Economic Activity on Crime: Evidence from Oil Price

We exploit plausibly exogenous changes in the value of reserves in Texass giant oil fields to determine the impact of crime in Texas counties that have reserves. Texas provides an ideal setting for this research strategy. First, Texas has the largest number of giant oil fields. Second, Texass giant oil fields possess the greatest remaining oil potential. Third, giant oil fields are dispersed throughout the state. We find that a one percent increase in the lagged value of oil reserves increases violent crime by 0.32%, aggravated assaults by 0.40%, sex offenses by 0.40-0.50%, and drug offenses by 0.40 %. We find that changes in the value of oil reserves in counties adjacent to a given county have no effect on crime in that county. This is evidence of crime creation and not displacement of criminal activities across counties. We explore potential mechanisms that could be driving this increase in crime and find an increase in the share of young males and no increase in the size of the police force