Do Teachers Really Leave for Higher Paying Jobs in Alternative Occupations?

There is a common perception that teacher attrition is driven in large part by the allure of higher paying jobs in alternative occupations. However, little is known about what teachers do when they leave teaching. We examine the extent to which teachers leave teaching for higher paying jobs by merging several years of administrative teacher records from the education system in Georgia with salary information from the Georgia Department of Labor. We find strong evidence that very few of those who leave teaching take jobs that pay more than their salary as teachers.

A Simple Model of Entry That Increases Price Levels and Price Dispersion

A monopolist who originally charges a uniform price across all markets may switch to discriminatory pricing upon the entry of a competitor. As a result, intensified competition may lead to more dispersed prices as well as higher prices for some or all consumers.

The Impact of Midwifery-Promoting Public Policies on Medical Interventions and Health Outcomes

This paper measures the impact of midwifery-promoting public policies on maternity care in the United States, using national Vital Statistics data on births spanning 1989-1999. State laws mandating insurance coverage of midwifery services are associated with an 18-percentage rise in midwife-attended births. The laws did not decrease rates of cesarean deliveries or lead to consistent effects on maternal mortality or Apgar scores. They did, however, lead to a statistically significant drop in neonatal deaths. Divergence between OLS and natural experiment estimates suggests that women are selecting into provider groups based on unobserved preferences and health.

Prescription Drug Advertising and Patient Compliance: A Physician Agency Approach

This paper proposes an analysis of both doctors and patients' behavior in an agency model that accounts for the interplay between two highly debated health issues: drug advertising toward doctors and/or patients, and the serious problem of patients' noncompliance with their doctors' prescriptions. Due to the lack of individual data, we propose a structural approach inspired from the industrial organization literature. The model is estimated semiparametrically with product level data on the U.S. market for anti-glaucoma drugs. The results suggest that doctors' prescriptions are directly influenced by the probability of noncompliance, as well as advertising aimed at both doctors and patients. Advertisement toward patients (respectively, doctors) appears to have contributed to (respectively, slowed down) the reduction of the estimated average noncompliance rate.

Auction Bids and Shopping Choices

Economists and marketers are often interested in estimating demand for new products and in valuing other non-market goods. Due to the increasing recognition that elicited valuations are sensitive to whether decisions are hypothetical, economists have begun to utilize incentive compatible mechanisms with real goods and real money. This paper investigates preferences expressed in two of the most popular elicitation formats: experimental auctions and discrete choice experiments. We compare the bidding behavior of consumers in four different incentive compatible auctions to the behavior of consumers who made non-hypothetical discrete choices between five goods. Despite the fact that the choice task and auction mechanisms are incentive compatible, we find that auction bids were significantly lower, as much as two times lower in many cases, than valuations implied from choices. We also find that auction data imply own-price elasticities of demand for higher quality products that are significantly more elastic than those implied from choice data. Nevertheless, for the five goods evaluated, individuals' preference orderings were consistent across value elicitation methods. These findings hold important implications for economists' view of preferences and may provide some insight into retailers' prevalent use of markets with posted-prices: individuals were more willing to part with their cash when making choices versus bids.

Does the Open Economy Assumption Really Mean That Labor Bears the Burden of a Capital Income Tax?

The conventional view holds that domestic labor, not domestic capital, bears most of the long-run burden of a corporate income tax in an open economy due to the ability of capital to move across borders. This result assumes that domestic and foreign products (as well as investments) are perfect substitutes. This paper includes imperfect product substitution within a multi-sector open-economy model, and shows that much of the burden may fall on capital. To be sure, if savings falls sufficiently, much of the burden shifts to labor, but this fact also holds in a closed economy. Hence, the debate about tax incidence must focus more on the savings response and less on whether an economy is open or closed.

Are Experienced Managers Experts at Overcoming Coordination Failure?

This paper studies experiments set in a corporate environment where a manager attempts to overcome a history of coordination failure by employees using either financial incentives or communication. I compare the choices of subject managers drawn from a standard undergraduate population with subject managers drawn from the executive MBA (EMBA) program at Case's Weatherhead School of Management. The EMBA subjects are a group of experienced, successful managers; all of the EMBA subjects have at least ten years of work experience, including at least five years in a supervisory role, and have average annual earnings in excess of $120,000. The EMBA subject managers are able to overcome a history of coordination failure significantly faster than the undergraduate subject managers. This superior performance is driven neither by differences in the financial incentives offered to the employees nor by use of an inherently different communications strategy. Instead, EMBA subject managers are significantly more likely to use the same "good" communication strategy as is identified for undergraduate subject managers through systematic coding of manager’s messages to employees.