Taylor Jaworski

Go West Young Man: Self-Selection and Endogenous Property Rights

If, as Hume argues, property is a self-referring custom of a group of people, then property rights depend on how that group forms and orders itself. In this article we investigate how people construct a convention for property in an experiment in which groups of self-selected individuals can migrate between three geographically separate regions. To test a hypothesis of Demsetzs, we vary across two treatments the external benefits of migrating. We find that self-selection has a powerful effect on establishing conventions of property and begetting increases in wealth through exchange and specialization. We also find support for the Demsetz hypothesis.

Discovering Economics in the Classroom with Experimental Economics and the Scottish Enlightenment

This paper describes a curriculum for teaching economics using laboratory experiments. The key features of the curriculum are the low technology barriers, complete instructions for running the experiment and debriefing the results, and a guide for teacher-led roundtable discussions motivated by the Scottish philosophers. Our main goal is to present economic principles to young students in a way that is both exciting and accessible, while emphasizing the discovery process underlying wealth creation in modern economies using laboratory experiments.

Bubbles, Crashes and Endogenous Uncertainty in Linked Asset and Product Markets

In laboratory asset markets, subjects trade shares of a firm whose profits in a linked product market determine dividends. Treatments vary whether dividend information is revealed once per period or in real time and whether the firm is controlled by a profit‐maximizing robot or human subject. The latter variation induces uncertainty about firm behavior, bridging the gap between laboratory and field markets. Our data replicate well‐known features of laboratory asset markets (e.g., bubbles), suggesting these are robust to a market‐based dividend process. Compared to a sample of previous experiments, both real‐time information revelation and endogenous uncertainty impede the bubble‐mitigating impact of experience.

Shakeout in the Early Commercial Airframe Industry

The commercial airframe industry in the US experienced a shakeout from the early 1930s into the post†Second World War period. Unlike shakeouts in automobiles, tyres, or televisions, the commercial airframe industrys early life cycle was affected by external factors, particularly government demand. Using newly digitized data on all planes introduced in the commercial market between 1926 and 1965, we find that commercial airframe manufacturers with bomber contracts during the Second World War were more likely to have postwar market share than firms without such contracts, controlling for plane characteristics and other forms of government contracting. We attribute the effect of bomber contracts to advantages in R&D learning capacity acquired by firms with military airframe contracts. Despite low (or zero) initial presence in the commercial market, these learning capacity advantages allowed such firms to survive the early period of the shakeout, and later to thrive.

Entry and pricing on Broadway.

ABSTRACT This article investigates the pricing decisions of Broadway shows. We find evidence that incumbent Broadway shows lower prices several weeks prior to the opening of a new show. In addition, prices are lower when the threat of competition, due to more entrants, is larger. A decomposition suggests that prices are more important than quantities for changes in revenue prior to entry and that this pattern reverses after entry occurs.

World War II and US Economic Performance

One popular view is that World War II ended the Great Depression and led to a postwar boom in the United States. On the other hand, recent studies suggest that the reallocation of resources to meet war demands may have imposed more costs than benefits. In the first part of this chapter we review recent evidence on the war’s impact on the United States economy at both the national and local levels. In the second part we extend recent work on the impact of World War II on local economies. We use a simple spatial equilibrium model and data for all United States counties to estimate the long-run impact of the war-related spending on income per capita, population, and median housing values per decade from 1960 to 2010. The empirical results show that the main changes in local economies were due to the reallocation of population toward counties that received more per capita war spending. The War was associated with very little growth in income per capita and median house values. When combined with the model, these results suggest that mobilization for World War II was mostly correlated with an increase in the value of local amenities, which were likely related to the proximity to defense-related industries and associated non-wage benefits.

Health on the home front: Infant deaths and industrial accidents during mobilization for world war II

Abstract The view that the US economy and living standards benefited from mobilization for World War II is commonplace. The main source of evidence is aggregate comparisons of standard macroeconomic variables over the Great Depression and war years. In this paper, we use newly collected data on infant health and industrial accidents to document changes in health conditions during World War II. The findings suggest that infant health and work conditions deteriorated in the early 1940s. Opening or expanding a plant for war production is associated with 7 additional infant deaths (per 1,000 live births) in 1942 and incidence of industrial accidents increased by 16 percent. The war years interrupted the long-run trend toward improved health along a number of dimensions, however, recovery to pre-war levels occurred quickly after 1945.