Has the rise in globalization reduced U.S. inflation in the 1990s?

This article investigates whether increased globalization of the U.S. economy has helped hold down inflation in the 1990s. Based on several measures, we find that globalization has increased. Further, we find that import prices exert a greater impact on prices of products in industries faced with greater import penetration. High foreign excess capacity accounts for much of the recent decline in U.S. inflation. Our results suggest that the decline in inflation is explained by the interaction of increased globalization and high excess foreign capacity. Globalization by itself does not lead to less inflation, just greater sensitivity to foreign economic conditions.     

Using interviews to understand the assignment mechanism in a nonexperimental study: the case of eighth grade algebra

Many inquiries regarding the causal effects of policies or programs are based on research designs where the treatment assignment process is unknown, and thus valid inferences depend on tenuous assumptions about the assignment mechanism. This article draws attention to the importance of understanding the assignment mechanism in policy and program evaluation studies, and illustrates how information collected through interviews can develop a richer understanding of the assignment mechanism. Focusing on the issue of student assignment to algebra in 8th grade, I show how a preliminary data collection effort aimed at understanding the assignment mechanism is particularly beneficial in multisite observational studies in education. The findings, based on ten interviews and administrative data from a large school district, draw attention to the often ignored heterogeneity in the assignment mechanism across schools. These findings likely extend beyond the current research project in question to related educational policy issues such as ability grouping, tracking, differential course taking, and curricular intensity, as well as other social programs in which the assignment mechanism can differ across sites.     

Competition and privatization amidst weak institutions: evidence from Mongolia

Mongolia's mass privatization program was implanted in a country that lacked the very basic institutions of capitalism. This paper examines the effects of competition and ownership on the efficiency of the newly privatized enterprises, using a representative sample of enterprises and controlling for possible selection biases. Competition has quantitatively large effects; perfectly competitive firms having nearly double the efficiency of monopolies. Enterprises with residual state ownership appear to be more efficient than other enterprises, reflecting an environment where the government was pressured to focus on efficiency and institutions gave little voice to outsider owners.