One of the most puzzling findings in asset pricing is that expected returns dominate variation in the dividend-to-price ratio, leaving little room for dividend growth rates. Even more puzzling is that this dominance only emerged after 1945. We develop a present value model to argue that a general increase in equity duration can explain these findings. As cash flows to investors accrue further into the future, shocks to highly persistent expected returns become relatively more important than shocks to growth rates. We provide supportive empirical evidence from dividend strips, the time-series, and the cross-section of stocks.

We develop a model of financial crises with both a financial amplification mechanism, via frictional intermediation, and a role for sentiment, via time-varying beliefs about an illiquidity state. We confront the model with data on credit spreads, equity prices, credit, and output across the financial crisis cycle. In particular, we ask the model to match data on the frothy pre-crisis behavior of asset markets and credit, the sharp transition to a crisis where asset values fall, disintermediation occurs and output falls, and the post-crisis period characterized by a slow recovery in output. We find that a pure amplification mechanism quantitatively matches the crisis and aftermath period but fails to match the pre-crisis evidence. Mixing sentiment and amplification allows the model to additionally match the pre-crisis evidence. We consider two versions of sentiment, a Bayesian belief updating process and one that overweighs recent observations. We find that both models match the crisis patterns qualitatively, generating froth pre-crisis, non-linear behavior in the crisis, and slow recovery. The non-Bayesian model improves quantitatively on the Bayesian model in matching the extent of the pre-crisis froth.

Conjoint experiments enjoy increasing popularity in political and social science, but there is a paucity of research on respondents' underlying decision-making processes. We leverage eye-tracking methodology and a conjoint experiment, administered to a subject pool consisting of university students and local community members, to examine how respondents process information when completing conjoint surveys. Our study has two main findings. First, we find a positive correlation between attribute importance measures inferred from the stated choice data and attribute importance measures based on eye movement. This validation test supports the interpretation of common conjoint metrics, such as Average Marginal Component Effects and marginal R^2 values, as valid measures of attribute importance. Second, when we experimentally increase the number of attributes and profiles in the conjoint table, respondents on average view a larger absolute number of cells but a smaller fraction of the total cells displayed, and the patterns in which they search between cells change conditionally. At the same time, however, their stated choices remain remarkably stable. This overall pattern speaks to the robustness of conjoint experiments and is consistent with a bounded rationality mechanism. Respondents can adapt to complexity by selectively incorporating relevant new information to focus on the important attributes, while ignoring less relevant information to reduce the cognitive processing costs. Together, our results have implications for both the design and interpretation of conjoint experiments.

We provide an equilibrium analysis of the efficiency properties of simultaneous bilateral tariff negotiations in a three-country model of international trade. We consider the setting in which discriminatory tariffs are allowed, and we utilize the “Nash-in-Nash” solution concept of Horn and Wolinsky (1988). We allow for a general family of political-economic country welfare functions and assess efficiency relative to these welfare functions. We establish a sense in which the resulting tariffs are inefficient and too low, so that excessive liberalization occurs from the perspective of the three countries.

Time is the backdrop of historical inquiry, yet it is much more than a featureless setting for events. Different temporalities interact dynamically; sometimes they coexist tensely, sometimes they clash violently. In this innovative volume, editors Dan Edelstein, Stefanos Geroulanos, and Natasha Wheatley challenge how we interpret history by focusing on the nexus of two concepts—“power” and “time”—as they manifest in a wide variety of case studies. Analyzing history, culture, politics, technology, law, art, and science, this engaging book shows how power is constituted through the shaping of temporal regimes in historically specific ways. Power and Time includes seventeen essays on human rights; sovereignty; Islamic, European, Chinese, and Indian history; slavery; capitalism; revolution; the Supreme Court; the Anthropocene; and even the Manson Family. Power and Time will be an agenda-setting volume, highlighting the work of some of the world’s most respected and original contemporary historians and posing fundamental questions for the craft of history.

This paper empirically examines recently declassified tariff bargaining data from the GATT/WTO. Focusing on the Torquay Round (1950–1951), we document stylized facts about these interconnected high-stakes international negotiations that suggest a lack of strategic behavior among the participating governments and an important multilateral element to the bilateral bargains. We suggest that these features can be understood as emerging from a tariff bargaining forum that emphasizes the GATT pillars of MFN and multilateral reciprocity, and we offer evidence that the relaxation of strict bilateral reciprocity facilitated by the GATT multilateral bargaining forum was important to the success of the GATT approach.

This document is a memo from the "Immigration And Populism" workshop held at Stanford University in 2018.

This is a work in progress. DO NOT cite without checking with the authors first.