The Panic of 2007
How did problems with subprime mortgages result in a systemic crisis, a panic? The ongoing Panic of 2007 is due to a loss of information about the location and size [...]
Freddie Mac and Fannie Mae: An Exit Strategy for the Taxpayer
The Fannie Mae-Freddie Mac crisis may have been the most avoidable financial crisis in history. Economists have long complained that the risks posed by the government-sponsored enterprises were large relative [...]
Medical Licensing: An Obstacle to Affordable, Quality Care
In the United States, the authority to regulate medical professionals lies with the states. To practice within a state, clinicians must obtain a license from that state’s government. State statutes [...]
Medical Licensing: An Obstacle to Affordable, Quality Care
I argue here that licensure not only fails to protect consumers from incompetent physicians, but, by raising barriers to entry, makes health care more expensive and less accessible. Institutional oversight [...]
RIAA v. The People: Five Years Later
On September 8, 2003, the recording industry sued 261 American music fans for sharing songs on peer-to-peer (P2P) file sharing networks, kicking off an unprecedented legal campaign against the people [...]
Urban Inequality
What impact does inequality have on metropolitan areas? Crime rates are higher in places with more inequality, and people in unequal cities are more likely to say that they are [...]
Experimentation, Patents, and Innovation
This paper studies a simple model of experimentation and innovation. Our analysis suggests that patents may improve the allocation of resources by encouraging rapid experimentation and efficient ex post transfer [...]
Market Responses to the Panic of 2008
We model the panic of 2008 as part of the wealth and substitution effects deriving from a housing price crash that began in 2006. The dissipation of the wealth effect [...]
The Subprime Panic
Understanding the ongoing credit crisis or panic requires understanding the designs of a number of interlinked securities, special purpose vehicles, and derivatives, all related to subprime mortgages. I describe the [...]
The Political Economy of the U.S. Mortgage Default Crisis
We examine the determinants of congressional voting behavior on two of the most significant pieces of federal legislation in U.S. economic history: the American Housing Rescue and Foreclosure Prevention Act [...]