Economics
How do entrepreneurs act on their beliefs when probabilities of outcomes are unknown but subjectively perceived? We theorize that two distinct dimensions of ambiguity attitudes influence entrepreneurial action: ambiguity aversion - the…
How much macroeconomic information is contained in a single input-output table? We feed FIGARO 64-sector symmetric tables into DEPLOYERS, a Darwinian agent-based simulator, producing genuine out-of-sample GDP forecasts. For each year, the…
Portfolio diversification is a cornerstone of modern finance, while risk aversion is central to decision theory; both concepts are long-standing and foundational. We investigate their connections by studying how different forms of…
In light of the recent convergence between Agentic AI and our field of Algorithmization, this paper seeks to restore conceptual clarity and provide a structured analytical framework for an increasingly fragmented discourse. First, (a) it…
The payback period is unambiguously defined for conventional investment projects, projects in which a series of cash outflows is followed by a series of cash inflows. Its definition for nonconventional projects is more challenging, since…
The synthetic control method (SCM) is widely used for causal inference with panel data, particularly when the number of treated units is small. It relies on the stable unit treatment value assumption (SUTVA), ruling out spillover effects.…
When designing product rankings, online retailers and platforms choose which outcome to maximize: revenues from commissions or markups, the number of transactions, or consumer welfare. These objectives need not align, creating potential…
We study the distribution of envy in random matching markets under the Deferred Acceptance (DA) algorithm. Using tools from applied probability, we compute the expected number of proposing agents whom nobody envies and those who envy…
A model-free measure of Granger causality in expectiles is proposed, generalizing the traditional mean-based measure to arbitrary positions of the conditional distribution. Expectiles are the only law-invariant risk measures that are both…
We study how a first heart-failure hospitalization, an adverse health shock, changes patients' care, and whether a nurse-led chronic-care program sustains those post-shock investments. Using linked population-wide administrative records…
This paper examines how regulatory interventions in high-frequency financial markets affect price discovery. We focus on Breaking news, where dynamic circuit breakers trigger trading halts immediately after the release of macroeconomic…
We study Cressie Read power divergence (CRPD) estimation for moment based models, focusing on finite sample behavior. While generalized empirical likelihood estimators, dual to CRPD, are known to outperform generalized method of moments…
This survey (re)introduces reinforcement learning methods to economists. The curse of dimensionality limits how far exact dynamic programming can be effectively applied, forcing us to rely on suitably "small" problems or our ability to…
Interactive fixed effects are routinely controlled for in linear panel models. While an analogous fixed effects (FE) estimator for nonlinear models has been available in the literature (Chen, Fernandez-Val and Weidner, 2021), it sees much…
The foundation model industry exhibits unprecedented concentration in critical inputs: semiconductors, energy infrastructure, elite talent, capital, and training data. Despite extensive sectoral analyses, no comprehensive framework exists…
An agent is a misspecified Bayesian if she updates her belief using Bayes' rule given a subjective, possibly misspecified model of her signals. This paper shows that a belief sequence is consistent with misspecified Bayesian updating if and…
Empirical instrumental variables (IV) studies often report separate results based on low-dimensional instruments and many base instruments. This paper proposes a combination test that integrates these commonly reported statistics. The test…
We provide the first asymptotic analysis of the Boston Mechanism under equilibrium play in random markets. We provide two results. First, while 63\% of students receive their first preference under truthful reporting-outperforming any other…
Generative AI (GenAI) is rapidly transforming knowledge work, yet its implications for organizational hierarchies remain poorly understood. Unlike earlier automation technologies, GenAI can both perform tasks autonomously and assist human…
We show that the higher-order terms and interactions of the common sparse linear factors are significantly priced in the cross-section of equity returns. A higher-order model with only a small number of selected higher-order terms from six…