NOVEMBER 24 2016

Patrick Schneider, BoE: There are two productivity puzzles. Much has been written about the productivity puzzle. But there are actually two puzzles apparent in the data – one in the level that hit at the crisis and the other in the growth rate, which is a more recent phenomenon – and they could be driven by completely different sources. Distinguishing between the two puzzles is important precisely because of these potential differences – if anyone analyses the puzzle as a whole looking for the force driving it, the actual underlying variety will confound our estimates of the relative importance of these drivers.

Thomas Piketty, The Guardian: We must rethink globalization, or Trumpism will prevail. Let it be said at once: Trump’s victory is primarily due to the explosion in economic and geographic inequality in the United States over several decades and the inability of successive governments to deal with this. It is time to change the political discourse on globalization: trade is a good thing, but fair and sustainable development also demands public services, infrastructure, health and education systems. In turn, these themselves demand fair taxation systems. If we fail to deliver these, Trumpism will prevail.

Simen Markussen, Knut Røed, IZA: Leaving Poverty Behind? The Effects of Generous Income Support Paired with Activation. We evaluate a comprehensive activation program in Norway targeted at hard-to-employ social assistance claimants with reduced work capacity. The program offers a combination of tailored rehabilitation, training and job practice, and a generous, stable, and non-meanstested benefit. Its main aims are to mitigate poverty and subsequently promote selfsupporting employment. Our evaluation strategy exploits a geographically staggered program introduction, and the causal effects are identified on the basis of changes in employment prospects that coincide with local program implementation in a way that correlates with the predicted probability of becoming a participant. We find that the program raised employment prospects considerably.

David M. Cutler, Wei Huang, Adriana Lleras-Muney, NBER: Economic Conditions and Mortality: Evidence from 200 Years of Data. Using data covering over 100 birth-cohorts in 32 countries, we examine the short- and long-term effects of economic conditions on mortality. We find that small, but not large, booms increase contemporary mortality. Yet booms from birth to age 25, particularly those during adolescence, lower adult mortality. A simple model can rationalize these findings if economic conditions differentially affect the level and trajectory of both good and bad inputs into health. Indeed, air pollution and alcohol consumption increase in booms. In contrast, booms in adolescence raise adult incomes and improve social relations and mental health, suggesting these mechanisms dominate in the long run.

Justin R. Pierce and Peter K. Schott, FED: Trade Liberalization and Mortality: Evidence from U.S. Counties. We investigate the impact of a large economic shock on mortality. We find that counties more exposed to a plausibly exogenous trade liberalization exhibit higher rates of suicide and related causes of death, concentrated among whites, especially white males. These trends are consistent with our finding that more-exposed counties experience relative declines in manufacturing employment, a sector in which whites and males are disproportionately employed. We also examine other causes of death that might be related to labor market disruption and find both positive and negative relationships. More-exposed counties, for example, exhibit lower rates of fatal heart attacks.

Christopher Chabris, WSJ: Does Chess Make You Smarter? To test the independent effect of playing chess, the Educational Endowment Foundation in the United Kingdom sponsored an experiment last year in which fifth-grade classrooms in 100 schools were randomly chosen either to incorporate chess lessons into their regular schedule or to continue instruction as usual. The students weren’t given IQ tests at the end of the year, but their performance in math, science and reading was evaluated. Those who had studied chess did no better than those who had not. A similar but slightly less rigorous 2011 study in Italy found, however, that adding chess instruction to third-grade classrooms improved the performance of students on math tests.

Lynn Vavreck, NYT: This Election Was Not About the Issues. Blame the Candidates. I compared the content of campaign ads with the content of news articles about two specific topics: candidate traits or characteristics, and the economy or jobs. Both the candidates and news organizations spent more time discussing the candidates’ fitness for office (or lack of it) than they did the nation’s economy. And the imbalance grew more lopsided as the election approached. Using analytic tools provided by Crimson Hexagon, I categorized the campaign news coverage of 23 media outlets. This consisted of four broadcast networks; three cable news networks; National Public Radio and Hugh Hewitt on the radio; two online news sites; and 12 newspapers. I specifically searched for news about Mrs. Clinton’s campaign and her email server or her campaign and WikiLeaks, and several controversies connected to Mr. Trump’s campaign. From this point, 53 percent of the campaign articles mentioning either controversies or the economy discuss Mrs. Clinton’s email, while only 6 percent mention her alongside jobs or the economy. As for Mr. Trump, 31 percent mention his entanglements, while 10 percent mention him related to jobs and the economy.