Economics and Policy
Is the U.S. in Recession? CBS Experts Weigh in on the Economic Outlook
New data has sparked a debate about the state of the economy. Here’s what some of our faculty members had to say.
Economics Articles
Economics Research
Inflation and the User Cost of Capital: Does Inflation Still Matter?
Firm Leverage, Consumer Demand, and Unemployment during the Great Recession
We argue that firms' balance sheets were instrumental in the propagation of consumer demand shocks during the Great Recession. Using establishment-level data, we show that establishments of more highly levered firms exhibit a significantly larger decline in employment in response to a drop in consumer demand. These results are not driven by firms being less productive, having expanded too much prior to the Great Recession, or being generally more sensitive to fluctuations in either aggregate employment or house prices.
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An Economic Assessment of 'Fair Trade' in Coffee
The price of coffee plunged by more than 50 percent between 1997 and 2001, driving millions of growers into poverty. Fair Trade is a much-heralded micro-economic response that allows coffee-producing cooperatives to sell directly to importers and roasters in the consuming countries, bypassing the customary network of middlemen in their own countries. Consumers of Fair Trade coffee typically pay a premium, and cooperatives are guaranteed a floor price. In this paper, the author argues that Fair Trade is unlikely to improve growers????????????
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Improving Labor Productivity: Human Resource Management Policies Do Matter
Despite the consistency with which the theoretical and normative connections between human resource management practices and firm-level performance outcomes are made, empirical studies that link the two are sparse. This paper presents results from a study of 319 business units that addresses this gap. Hypotheses are derived from a resource-based perspective on strategy. Positive and significant effects on labor productivity are found for organizations that utilize more sophisticated human resource planning, recruitment, and selection strategies.
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Competition and Competitiveness in a New Economy
There is perhaps no topic that is more important for the functioning of a market economy than competition policy. The theorems and analyses stating that market economies deliver benefits in the form of higher living standards and lower prices are all based on the assumption that there is effective competition in the market. At the same time when Adam Smith emphasised that competitive markets deliver enormous benefits, he also emphasised the tendency of firms to suppress competition.
Economics Faculty
In the News
Insider
Cutting Russia out of the Global Economy Means Higher Prices, a Slower Recovery, and a Whole New Global Power Structure: 'We Don't Really Have a Playbook for How This Might Work'
Highlighted by Columbia Business School, this media piece showcases Topics and Areas of Expertise about our esteemed faculty. The content is specifically curated from the publication that showcased the mentioned faculty and/or research, emphasizing its contributions in various fields. The featured Topics and Areas of Expertise reflects the school's commitment to sharing valuable insights and knowledge.
Mentioned Faculty
Politico
No More Whispers: Recession Talk Surges in Washington
Highlighted by Columbia Business School, this media piece showcases Topics and Areas of Expertise about our esteemed faculty. The content is specifically curated from the publication that showcased the mentioned faculty and/or research, emphasizing its contributions in various fields. The featured Topics and Areas of Expertise reflects the school's commitment to sharing valuable insights and knowledge.
Mentioned Faculty
The Financial Times
The Flaws in the Fed's Approach to Inflation
Highlighted by Columbia Business School, this media piece showcases Topics and Areas of Expertise about our esteemed faculty. The content is specifically curated from the publication that showcased the mentioned faculty and/or research, emphasizing its contributions in various fields. The featured Topics and Areas of Expertise reflects the school's commitment to sharing valuable insights and knowledge.
Mentioned Faculty
Marketplace Radio
Our Feelings about Jobs and the Economy Have Parted Ways
Highlighted by Columbia Business School, this media piece showcases Topics and Areas of Expertise about our esteemed faculty. The content is specifically curated from the publication that showcased the mentioned faculty and/or research, emphasizing its contributions in various fields. The featured Topics and Areas of Expertise reflects the school's commitment to sharing valuable insights and knowledge.
Mentioned Faculty
More in Economics
Asset Management, Capital Markets and Investments, Economics and Policy
Trump’s Tariffs and Market Chaos: Abby Joseph Cohen Shares What Investors Need To Know
The veteran economist and CBS professor joined Professor Brett House to explore how erratic policymaking, rising tariffs, and politicized institutions are shaking global confidence in the U.S. economy.
McKinsey’s Eric Kutcher on AI, Management Strategy, and Climate Innovation
During a recent Distinguished Speakers Series event, the Senior Partner and Chair of North America at McKinsey shared leadership insights on AI business strategy, climate innovation, and the future of work.
How Trump’s Tariffs are Threatening Global Economic Stability
Insights from Columbia Business School faculty explain how the president’s “Liberation Day” tariffs are fueling market volatility, undermining global economic stability, and impacting the Fed's ability to lower interest rates.
When Economic Struggles Foster Self-Interest, Not Universal Compassion
A Columbia Business School study shows that experiencing a recession in young adulthood leads to lasting support for wealth redistribution—but mostly for one’s own group.
Are Inflationary Shocks Regressive? A Feasible Set Approach
We develop a framework to measure the welfare impact of macroeconomic shocks throughout the distribution. The first-order impact of a shock is summarized by the induced movements in agents’ feasible sets: their budget constraint and borrowing constraints. We combine estimated impulse response functions with micro-data on household consumption bundles, asset holdings, and labor income for different US households. We find that inflationary oil shocks are regressive, but monetary expansions are progressive, and there is substantial heterogeneity throughout the life cycle.
Synthesis of evidence yields high social cost of carbon due to structural model variation and uncertainties
Minimum Viable Signal: Venture Funding, Social Movements, and Race
How do venture capital investors react to social movements, especially those that relate to historical underrepresentation in their funding decisions? We use image and name algorithms combined with clerical review to classify race for 150,000 founders and 30,000 investors. Our new data allow us to assess the impact of George Floyd's murder on VC funding of Black entrepreneurs and identify which VCs were most responsive. Although VCs responded swiftly, investment in Black-owned startups reverted to prior levels within two years.
Leaders in Social Movements: Evidence from Unions in Myanmar
Social movements are catalysts for crucial institutional changes. To succeed, they must coordinate members’ views (consensus building) and actions (mobilization). We study union leaders within Myanmar’s burgeoning labor movement. Union leaders are positively selected on both ability and personality traits that enable them to influence others, yet they earn lower wages. In group discussions about workers’ views on an upcoming national minimum wage negotiation, randomly embedded leaders build consensus around the union’s preferred policy.
Elite Conflict and Industry Regulation: How Political Polarization Affects Local Restriction and State Preemption of the U.S. Hydraulic Fracturing Industry
We leverage Lachmann’s insight on elite conflict to explain the politics surrounding industry regulation in contemporary America and argue that conflicts between political elites create both constraints on industry players and opportunities for them to shape regulation. The widening urban-rural polarization of American society, in particular, has made urban political elites more liberal than those in state politics. The greater the political polarization of a state, the more local restrictions the nascent U.S.