1/ New short paper (w/ Isabel Tecu and @martincschmalz) responding to Dennis, Gerardi and Schenone's critique of our airlines paper.

To summarize: DGS's critique is completely unfounded. This paper explains why.

Link here👉 dropbox.com/s/hjewpp5jk3n0… 2/ DGS's main claim is that they separate variation in the MHHI delta into two parts:

(i) variation coming from ownership changes only, keeping market shares constant, and

(ii) variation coming from market shares changes only, keeping ownership constant.

My paper with Xavier Vives on "General Equilibrium Oligopoly and Ownership Structure" is forthcoming in Econometrica. Link here: 👉econometricsociety.org/system/files/1… 2/ The main contribution of the paper is methodological. We introduce a new (and arguably better) way to do oligopoly models in general equilibrium.

1/ @tylercowen cites the @kevinrinz study showing a decline in local labor market HHIs over time as evidence that "monopsony isn't such a big problem".

This is wrong, first, because it confuses trends with levels, and Rinz finds the level of the HHI is not that low.

https://twitter.com/MargRev/status/1218629141940953088

@tylercowen @kevinrinz 2/ Second, one has to be careful when comparing the trend in local geographic market HHIs between 1976 and 2015. The geographic market definition most likely changed a lot over such a long period, in the direction of narrower geographic markets, because travel speeds are slower.

For those interested in understanding the current trade debate, I recommend starting with an incredibly prescient and somewhat forgotten paper by Wolfgang Mayer (1984), titled "Endogenous tariff formation" jstor.org/stable/556

https://twitter.com/Noahpinion/status/1215725732350980096

2/ The paper does something super simple: adds a median voter model to the Heckscher-Ohlin trade model. The insights he obtains from this are amazing.

New paper on the growing demand for AI skills in the labor market, and how you can measure its diffusion and wage impact using the @Burning_Glass online job posting data (w/ Mila Alekseeva, @mireiagine, @SampsaSamila, and @Bledi_Taska) papers.ssrn.com/sol3/papers.cf… @Burning_Glass @mireiagine @SampsaSamila @Bledi_Taska Demand for AI skills has been growing fast in the last few years, especially in IT, Engineering, and Science occupations. But interestingly also in Management occupations. And we find that the AI wage premium is the highest for management.

1/ Thread on a project I have been working on with Xavier Vives: common ownership and secular stagnation. I presented it at the Atlanta AEA meetings organized by @ThomasPHI2 on increasing concentration in the US economy (Link here: blog.iese.edu/xvives/files/2… ) 2/ One of the biggest puzzles in macro is what is the explanation for a pattern (broadly decribed as "secular stagnation") documented by @LHSummers, @ThomasPHI2, @Nacho2G , and others: low investment amid high profits and low real interest rates. Why are firms not investing?

@Econ_Marshall @MartinSGaynor @martincschmalz @judy_chevalier @ProfFionasm @crampell @Noahpinion @steventberry Note: when I say we use concentration in other cities, I mean average of log (1/Number of firms), not HHI so it's not subject to endogeneity of market shares. @Econ_Marshall @MartinSGaynor @martincschmalz @judy_chevalier @ProfFionasm @crampell @Noahpinion @steventberry Also note that this identification strategy was not possible in the old SCP work because the unit of observation was a national level industry, not geographic/occupational markets. So what we're doing is in a way closer to the NEIO approach (but still reduced form).