AEA Research Highlights American Economic Association

Around the world, female entrepreneurs borrow less than their male counterparts. Many people suggest that the reason for this gap comes down to the fact that women select into less capital-intensive industries.
But in a paper in the American Economic Journal: Applied Economics, authors J. Michelle Brock and Ralph De Haas show that implicit bias against women leads to more onerous ​​guarantor requirements on loans. The findings come from a lab-in-the-field experiment conducted with over three hundred Turkish loan officers and real-life loan applications.
Brock says that the additional collateral requirements placed on female entrepreneurs could be a significant barrier to women running businesses. But there may be steps that banks can take to mitigate the problem. 
Brock recently spoke with Tyler Smith about her and De Haas’s experiment in Turkey and what lessons policymakers should take away from the results.

A wave of political demonstrations in recent years has grabbed headlines and helped to reshape the political landscape. But it’s an open question as to whether these protest movements actually change opinions in the long run.
In a paper in the American Economic Journal: Applied Economics, authors Daniel Hungerman and Vivek Moorthy found that activism can have a lasting impact on local communities. In particular, they found that areas with unusually bad weather on the original Earth Day in 1970, which would have presumably lowered the participation rate, saw weaker support for the environment and worse newborn health outcomes 10 to 20 years later.
Hungerman says that while climate change is a global phenomenon, their work is a reminder that bringing people together still makes a difference at the local level.
He recently spoke with Tyler Smith about how the first Earth Day shaped communities’ views about the environment and what his research contributes to the broader conversation around climate change.

Fans have frequently experienced the frustration of event tickets selling out in a matter of minutes and then being resold for twice as much or more. This combination of underpriced tickets in the primary market and rent-seeking speculation in the secondary market has long puzzled economists. 
In a paper in the American Economic Journal: Microeconomics, authors Eric Budish and Aditya Bhave show that auctions are an easy way to fix broken ticket markets by looking at changes Ticketmaster made in 2003.
However, the benefits of using auctions in primary markets are unlikely to be felt by consumers. Budish says that other reforms, such as preventing resales, could be a way for artists and sports teams to reward their die-hard followers.
Budish recently spoke with Tyler Smith about Ticketmaster’s efforts to curb secondary markets with auctions, and how reforming the primary market for tickets benefits sellers as well as society.

Graduate school should be about learning how to push the frontiers of knowledge. Many students, however, also learn that getting a PhD can push them into emotional and psychological trouble.
In a paper in the Journal of Economic Literature, authors Valentin Bolotnyy, Matthew Basilico, and Paul Barreira surveyed eight top-ranked economics PhD programs across the country and found high levels of significant depression and anxiety symptoms among students.
Their survey indicates that some norms in the field, such as working alone and downplaying emotional distress, may be exacerbating the profession’s mental health issues.
Bolotnyy recently spoke with Tyler Smith about the prevalence of mental distress among economics PhD students and what universities can do to remedy the situation, such as encouraging a more collaborative research environment.

Cognitive behavioral therapy (CBT) is a form of counseling designed to change unhelpful patterns of thinking. A strong, evidence-based track record has led to its widespread use in high-income countries. But it may also be an important tool for helping people in some of the poorest countries in the world. 
In a paper in the American Economic Review: Insights, authors Nathan Barker, Gharad Bryan, Dean Karlan, Angela Ofori-Atta, and Christopher Udry found that group-based CBT in rural Ghana significantly improved mental and perceived physical health, as well as cognitive and socioemotional skills—even for individuals who did not report mental distress.
The findings may be paired with more traditional economic assistance to get the most out of anti-poverty programs, says Nathan Barker.
Barker recently spoke with Tyler Smith about his experiment in Ghana and why CBT can be beneficial for everyone, not just people suffering poor mental health.

When most Americans look for financial advice, they don't turn to academic journals for guidance. Instead, they’re likely to get information from financial personalities like Dave Ramsey or Robert Kiyosaki, whose books have sold millions of copies.
But how good is that advice? In a paper in the Journal of Economic Perspectives, author James J. Choi looked through 50 of the most popular personal finance books on the market and found that they sometimes deviate from the advice of economists.
However, that doesn’t necessarily mean the popular authors are wrong. Choi says that while popular finance books may occasionally give bad advice, economists may learn something deeper about how people make financial decisions and the constraints they operate under if they take the popular authors’ prescriptions more seriously.
Choi recently spoke with Tyler Smith about popular financial advice on a range of issues, such as savings rules and mortgage types, and how closely this advice matches modern economic theory.