Using New 20th Century Datasets, Akcigit et al. Analyze Effects of Taxation on Innovation, Inventors, and R&D Firms

Understanding how taxation influences innovation is of central importance to create investment incentives for research and development, yet knowledge remains limited due to a lack of data, especially covering a long period of time.

In their recent VOX CEPR column, "Taxation and innovation in the 20th century," Ufuk Akcigit, John Grigsby, Tom Nicholas, and Stefanie Stantcheva use newly constructed datasets from the 20th century to examine the effects of both personal and corporate income taxation on inventors, as well as on firms that do R&D. It finds consistently negative effects of high taxes on innovation over time as well as on individual inventors and firms. Read full story »

Economist Paul Romer, SB’77, PhD’83, Wins Share of Nobel Prize

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On today’s 50th anniversary of the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, we are happy to announce the award was given to William D. Nordhaus and Paul M. Romer for their work on climate change and innovation.

I hope the prize today could help everyone see that humans are capable of amazing accomplishments when we set about trying to do something. If we set about trying to make the policy changes that are required here, we can absolutely make substantial progress towards protecting the environment—and do it without giving up the chance to sustain growth.” - Paul Romer [SB’77, PhD’83] quoted from a news conference with the Swedish Academy.

Romer received his Ph.D. from our department in 1983. His dissertation was supervised by Robert E. Lucas, Jr., Charles Kahn, and Jose Scheinkman. He served as an Assistant Professor at University of Rochester from 1982-1988, and then joined our department as Professor of Economics for the period of 1988-1990. Recently, Romer served as Chief Economist of the World Bank from October 2016 through January 2018 while on leave from his current position as Professor of Economics at the Stern School of Business at New York University and Director of the Marron Institute of Urban Management. William D. Nordhaus is currently the Sterling Professor of Economics and School of Forestry and Environmental Studies at Yale University.

Full story at https://news.uchicago.edu/story/economist-paul-romer-sb77-phd83-wins-share-nobel-prize

List and Levitt Named Among Leading Behavioral Economists

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While using insights about human nature to explain economic behavior is as old as the field itself, the sub-discipline of behavioral economics – intersecting classical economic theory with personality and social psychology – is a much more recent phenomenon that has fundamentally changed the way we study economics and human behavior in general. TheBestSchools.org recently named the world’s Top 25 Behavioral Economists, including among them two members of our department: Steve Levitt and John A. List.

[They] are doing some of the most innovative, exciting, and potentially useful intellectual work going on anywhere today…behavioral economists give us insight into how other people—and we ourselves—work that we just can't get from either traditional psychologists or economists alone.

John A. List, the Kenneth C. Griffin Distinguished Service Professor in Economics at the University of Chicago, is renowned for his pioneering use of field experiments as a methodology for learning about behavioral principles across different domains. List received the 2010 Kenneth Galbraith Award and the 2008 Arrow Prize for Senior Economists for his research in behavioral economics in the field. The extensive repository of data List has collected provides ongoing insight into discrimination and wage gaps, education incentives, pricing behavior, valuation of non-marketed goods and services, provision of public goods, and charitable giving. Recently he launched the TMW Center for Early Learning + Public Health, a joint venture between the University of Chicago’s Biological Sciences and Social Science Divisions that develops and scales evidence-based interventions that help parents and caregivers optimize foundational brain development in children birth to age five, particularly those born into poverty.

Steve Levitt is the William B. Ogden Distinguished Service Professor of Economics at the University of Chicago, where he directs the Becker Friedman Institute's Price Theory Initiative. In 2004, Levitt was awarded the John Bates Clark Medal, and in 2006, was named one of Time magazine's “100 People Who Shape Our World.” Levitt co-authored the New York Times Best Seller Freakonomics and its sequel, SuperFreakonomics, featuring new research on topics from terrorism to prostitution to global warming. He also the co-author of the popular Freakonomics Blog.

Of the ranking, James Barham, president and general editor of TheBestSchools.org, states "These people are doing some of the most innovative, exciting, and potentially useful intellectual work going on anywhere today…[they] give us insight into how other people—and we ourselves—work that we just can't get from either traditional psychologists or economists alone." Read the full story here.

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