Current Table of Contents

• The Effect of Low‐Skilled Immigration on U.S. Prices: Evidence from CPI Data
  Journal of Political Economy, Volume 116, Issue 3, Page 381-422, June 2008. <br/> I exploit the large variation across U.S. cities and through time in the relative size of the low‐skilled immigrant population to estimate the causal effect of immigration on prices of nontraded goods and services. Using an instrumental variables strategy, I find that, at current immigration levels, a 10 percent increase in the share of low‐skilled immigrants in the labor force decreases the price of immigrant‐intensive services, such as housekeeping and gardening, by 2 percent. Wage equations suggest that lower wages are a likely channel through which these effects take place. However, wage effects are significantly larger for low‐skilled immigrants than for low‐skilled natives, implying that the two are imperfect substitutes.
• Spatial Competition with Heterogeneous Firms
  Journal of Political Economy, Volume 116, Issue 3, Page 423-466, June 2008. <br/> I model endogenous horizontal and vertical product differentiation with arbitrarily many heterogeneous firms. Firms are asymmetric in that they differ in their marginal costs. I prove that under an equilibrium refinement, all economically relevant firm outcomes are uniquely determined across all strict subgame perfect Nash equilibria. There are two central results. First, a firm’s price, market share, and profit are independent of its neighbors’ marginal costs, conditional on the average marginal cost in the market. Second, more productive firms are more isolated, all else equal. In particular, the distance between two firms is strictly decreasing in their average marginal cost.
• Capital Deepening and Nonbalanced Economic Growth
  Journal of Political Economy, Volume 116, Issue 3, Page 467-498, June 2008. <br/> We present a model of nonbalanced growth based on differences in factor proportions and capital deepening. Capital deepening increases the relative output of the more capital‐intensive sector but simultaneously induces a reallocation of capital and labor away from that sector. Using a two‐sector general equilibrium model, we show that nonbalanced growth is consistent with an asymptotic equilibrium with a constant interest rate and capital share in national income. For plausible parameter values, the model generates dynamics consistent with U.S. data, in particular, faster growth of employment and slower growth of output in less capital‐intensive sectors, and aggregate behavior consistent with the Kaldor facts.
• Stature and Status: Height, Ability, and Labor Market Outcomes
  Journal of Political Economy, Volume 116, Issue 3, Page 499-532, June 2008. <br/> The well‐known association between height and earnings is often thought to reflect factors such as self‐esteem, social dominance, and discrimination. We offer a simpler explanation: height is positively associated with cognitive ability, which is rewarded in the labor market. Using data from the United States and the United Kingdom, we show that taller children have higher average cognitive test scores and that these test scores explain a large portion of the height premium in earnings. Children who have higher test scores also experience earlier adolescent growth spurts, so that height in adolescence serves as a marker of cognitive ability.
• A Phillips Curve with an Ss Foundation
  Journal of Political Economy, Volume 116, Issue 3, Page 533-572, June 2008. <br/> We develop an analytically tractable Phillips curve based on state‐dependent pricing. We consider a local approximation around a zero inflation steady state and introduce infrequent idiosyncratic shocks. The resulting Phillips curve is a simple variant of the conventional time‐dependent Calvo formulation with important differences. First, the model is able to match the micro evidence on the magnitude and timing of price adjustments. Second, our state‐dependent model exhibits greater flexibility in the aggregate price level than the time‐dependent model. With real rigidities present, however, our model can exhibit nominal stickiness similar to a conventional time‐dependent model.
• Journal of Political Economy: acknowledges the assistance of
  Journal of Political Economy, Volume 116, Issue 3, Page In Back Cover, June 2008. <br/>
• The Distortionary Effects of Regulation and Rent Seeking
  Journal of Political Economy, Volume 116, Issue 3, Page Back Cover, June 2008. <br/>