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When firms and people are located near each other in cities and in industrial clusters, they benefit in various ways, including by reducing the costs of exchanging goods and ideas. One might assume that these benefits would become less important as transportation and communication costs fall. Paradoxically, however, cities have become increasingly important, and even within cities, industrial clusters remain vital. This book brings together chapters that examine the reasons why economic activity continues to cluster together despite the falling costs of moving goods and transmitting information. The studies cover a wide range of topics and approach the economics of agglomeration from different angles. Together they advance the understanding of agglomeration and its implications for a globalized world.

Between 1965 and 1985, the Western world and the United States in particular experienced a staggering amount of social and economic change. This book argues that the common thread underlying all these changes was the post-World War II baby boom—in particular, the passage of the baby boomers into young adulthood. The author focuses on the pervasive effects of changes in “relative cohort size,” the ratio of young to middle-aged adults, as masses of young people tried to achieve the standard of living to which they had become accustomed in their parents' homes despite dramatic reductions in their earning potential relative to that of their parents. She presents the results of detailed empirical analyses that illustrate how varied and important cohort effects can be on a wide range of economic indicators, social factors, and even on more tumultuous events including the stock market crash of 1929, the “oil shock” of 1973, and the “Asian flu” of the 1990s. The book demonstrates that no discussion of business or economic trends can afford to ignore the effects of population.

Advances in human genetics have begun to yield clinical benefits through the development of Precision Medicine (PM). The benefits of this innovation are promising, both through application of constitutional genetics detecting mutations that affect the risk of disease and tumor genetics, and malignancy-causing mutations susceptible to targeted therapies. While PM may ultimately be used in all aspects of medicine, to date, the most fruitful applications have been in maternal-fetal medicine and cancer. However, due to the complexity and cost of developing these innovations, and to privacy issues, advancing PM is a challenge in traditional clinical, reimbursement, and regulatory landscapes. Although much of the literature focuses on challenges in relating constellations of mutations to the identification of actual current or potential disease states, and to the efficacy of treatments, diffusion of PM also depends on many non-clinical factors. For example, how will information on accurate diagnosis and treatment success be disseminated, and who will bear the cost? How might physician training change to incorporate genetic, probability, statistics, and economic considerations? How can patients reconcile with the ethical and privacy concerns related to the availability of genetic information? Will the era of PM yield still more disparities in access to care? Will cost-effectiveness analysis need to change to better take into account patient heterogeneity? This volume explores the intersection of the scientific, clinical, and economic factors to consider in developing PM. We explore the theoretical and historical underpinnings of PM, discuss implementation issues, and present examples of real-world applications.

Recent advances in artificial intelligence (AI) highlight its potential to affect productivity, growth, inequality, market power, innovation, and employment. In September 2017, the National Bureau of Economic Research held its first conference on the Economics of AI in Toronto. The purpose of the conference and associated volume is to set the research agenda for economists working on AI. The focus of the volume is on the economic impact of machine learning, a branch of computational statistics that has driven the recent excitement around AI. The volume also highlights key questions on the economic impact of robotics and automation, as well as the potential economic consequences of a still-hypothetical artificial general intelligence. The volume covers four broad themes: AI as a general purpose technology; the relationship between AI, growth, jobs, and inequality; regulatory responses to changes brought on by AI; and the effects of AI on the way economic research is conducted. In highlighting these themes, the volume provides several frameworks for understanding the economic impact of AI. In doing so, it identifies a number of key open research questions in a variety of research areas including productivity, growth, decision-making, jobs, inequality, market structure, privacy, trade, liability, political economy, econometrics, behavioral economics, and innovation.

The celebrated economist Zvi Griliches's entire career can be viewed as an attempt to advance the cause of accuracy in economic measurement. His interest in the causes and consequences of technical progress led to his pathbreaking work on price hedonics, now the principal analytical technique available to account for changes in product quality. This book, a collection of papers from a National Bureau of Economic Research (NBER) conference held in Griliches's honor, is a tribute to his many contributions to current economic thought. Here, scholars of economic measurement address issues in the areas of productivity, price hedonics, capital measurement, diffusion of new technologies, and output and price measurement in “hard-to-measure” sectors of the economy. The book furthers Griliches's vital work that changed the way economists think about the U.S. National Income and Product Accounts.

High-skilled immigrants represent an increasing share of the U.S. workforce, particularly in science and engineering fields. High-skill immigration cuts across the traditional field boundaries in economics, potentially impacting innovation and economic growth, patterns of trade, education choices, and the earnings of workers with different types of skills. The aim of the six chapters in this volume is to integrate ideas from trade, macro, industrial organization and labor in the study of high-skill immigration in the United States. The chapters in this volume bring models of firms and individuals to questions about how the growth of high-skill immigration affects broad-based economic outcomes. By applying a broad-based theoretical lens to the challenges and opportunities of high-skill talent flows to the United States, the chapters in this volume go beyond the questions of how the inflow of foreign workers affects native employment and earnings. The chapters consider additional margins of adjustment to high-skill immigration including the effects on innovation and productivity, the impact on overall inequality across skill groups, the particular response of multi-national firms, firm-level dynamics of entry and exit, the nature of comparative advantage across countries, while also identifying new margins of potential adjustment including digital markets and contests which extend globalization without the physical migration of labor.

How the Financial Crisis and Great Recession Affected Higher Education analyzes how universities manage their endowments and how they responded to the financial crisis and ensuing Great Recession. The authors were selected deliberately to include experts on finance (especially those who had experience with endowments) and experts on the economics of higher education. From the outset, the book was intended to foster a conversation with university leaders, and the chapters benefitted greatly from the meaningful discussions with them that occurred at the associated conference. Key questions included (i) whether universities’ methods of endowment management were optimal, rational, and/or likely to create budget crises during financial market downturns; (ii) whether donors, state governments, or the federal government exacerbate or ameliorate the effect of business cycles on universities; (iii) whether universities respond to reduced income by cutting costs (for instance, by reducing their number of faculty) or by raising tuition. Like a few previous NBER volumes-but unlike the vast majority of other work by economists-the studies analyze the economics of higher education from the institutions’ point of view, taking them seriously as organizations with incentives and constraints of their own.

Many countries including the U.S. are now embarking on multiyear projects to redesign their surveys of household expenditures. This volume presents work by many of the world’s leading experts on consumption measurement meant to illuminate the challenges and opportunities that lie ahead. The aim of the volume, in broadest terms, is to provide a knowledge base for use of agencies and researchers as they design new systems for measurement of household expenditures. To that end, the volume includes a comprehensive set of chapters describing the current status and use of the U.S. Consumer Expenditure (CE) survey, with a focus on documenting the key deficiencies that the redesign process is meant to address; a number of chapters describing new modes of data collection (including the use of scanner data, internet panels, and administrative data from government and private sources); chapters outlining the importance of various objectives that such surveys might satisfy, ranging from estimation of price and income elasticities to studying the differential evolution of income and consumption inequality; chapters describing comparisons of the data available from other existing sources to those obtainable from an expenditure survey; comparisons of alternative approaches and results in different countries; and much more. The chapters in this volume were written around the same time that the National Academy of Science released its report on the Bureau of Labor Statistics proposed redesign for the US CE survey, and the two approaches provide complementary perspectives on the pros and cons of various proposed redesign strategies.

As the structure of the economy has changed over the past few decades, researchers and policy makers have been increasingly concerned with how these changes affect workers. This book examines a variety of important trends in the new economy, including inequality of earnings and other forms of compensation, job security, employer reliance on temporary and contract workers, hours of work, and workplace safety and health. In order to better understand these issues, scholars must be able to accurately measure labor market activity. Thus, the book also addresses a host of measurement issues: from the treatment of outliers, imputation methods, and weighting in the context of specific surveys to evaluating the strengths and weaknesses of data from different sources. At a time when employment is a central concern for individuals, businesses, and the government, this volume provides insight into the recent past.

A significant factor for many people deciding where to live is the quality of the local school district, with superior schools creating a price premium for housing. The result is a “race to the top,” as all school districts attempt to improve their performance in order to attract homebuyers. Given the importance of school districts to the daily lives of children and families, it is surprising that their evolution has not received much attention. This book argues that the historical development of school districts reflects Americans' desire to make their communities attractive to outsiders. The result has been a standardized, interchangeable system of education not overly demanding for either students or teachers, one that involved parents and local voters in its governance and finance. Innovative in its focus on bottom-up processes generated by individual behaviors rather than top-down decisions by bureaucrats, this book provides a new perspective on education reform that emphasizes how public schools form the basis for the localized social capital in American towns and cities.

The Census Bureau has recently begun releasing official statistics that measure the movements of firms in and out of business and workers in and out of jobs. The economic analyses in this book exploit this newly available data on establishments, firms, and workers, to address issues in industrial organization, labor, growth, macroeconomics, and international trade. The volume brings together a group of economists to probe topics such as firm dynamics across countries; patterns of employment dynamics; firm dynamics in nonmanufacturing industries such as retail, health services, and agriculture; employer-employee turnover from matched worker/firm data sets; and turnover in international markets.

The labor market for specialists in STEM jobs is a complex and controversial topic for economists, labor market researchers, and policy makers. U.S. Engineering in a Global Economy continues a long tradition of research by the NBER into both the supply and demand sides of the engineering job market, while also expanding the scope beyond the United States to consider the practice of engineering and innovation in a global economy. Contributors draw on the most up-to-date data on engineering education and practice to explore the challenges of developing an engineering workforce that can contribute substantially to the innovation driving modern economic growth. These authors highlight what economists and labor market researchers have learned and identify issues that might be addressed in future research, including a labor market that is not optimally employing STEM qualified workers in their field of training, and the ways in which US students, firms, and educational institutions are responding to increased competition in the global economy. This book examines both the demand and supply side of the engineering job market in the United States and the practice of engineering and innovation in a global economy. The authors provide assessments of engineering education, engineering practice, and careers which can inform science and engineering educational institutions, funding agencies, and policy makers about the challenges facing the U.S. in developing its engineering workforce in the global economy.

American women in their sixties and seventies are working more now than ever. Their increased participation at older ages started in the late 1980s, before the turnaround in older men’s labor force participation and prior to the economic downturns of the 2000s. The higher labor force participation of older women is a real trend that has persisted for almost 30 years. It is, moreover, consequential and consists disproportionately of women who are working at full-time, not part-time, jobs. Many other OECD nations have also experienced an increase in the participation of older women. But few have had as large an increase as the US from as high a level. The nine essays in this volume address the reasons for the increase in the US and what the future could hold for women working longer. The essays consider factors such as expanded lifecycle participation, increased education, occupational change, changes in marriage and divorce, caregiving, retirement saving and financial literacy, and changes in Social Security generosity. One essay confronts why black women have not been working longer and another assesses data problems regarding income adequacy during the older years. These essays address a relatively new trend and they will be a starting point for any researcher or policy-minded individual interested in this fundamental change in women’s lifecycle labor force participation.