We document that the expectations of households, firms, and professional forecasters in standard surveys simultaneously extrapolate from recent events underreact to new information. Existing models expectation formation, whether behavioral or rational, cannot account for these observations. develop a rational theory extrapolation based on limited attention, which is consistent with this evidenc...

We provide experimental evidence on coordination within large groups that could proxy the atomistic nature of real-world markets. use a bank run game where two pure-strategy equilibria can be ranked by payoff and risk dominance sequence public announcements introduces stochastic sunspot equilibria. find systematic group size effects theory fails to predict. When payoff-dominant strategy is risk...

I estimate the effects of collaborative and adversarial intergroup contact. randomly assigned Indian men from different castes to participate in cricket leagues or serve as a control group. League players faced variation contact, through random assignment homogeneous-caste mixed-caste teams, opponents. Collaborative contact increases cross-caste friendships efficiency trade, reduces own-caste f...

We compare contrarian to conformist advice, a expert being one whose preference bias is against the decision-maker’s prior optimal decision. Optimality of an depends on characteristics information and learning. If either fully informed or fine can be acquired cheaply, then for symmetric distributions F state, (contrarian) superior if single peaked (bimodal). only coarse acquired, acquires more ...

We use data from Airbnb to identify the mechanisms underlying discrimination against ethnic minority hosts. Within same neighborhood, hosts groups charge 3.2 percent less for comparable listings. Since ratings provide guests with increasingly rich information about a listing’s quality, we can measure contribution of statistical discrimination, building upon Altonji and Pierret (2001). find that...

Moral behavior is more prevalent when individuals cannot easily distort their beliefs self-servingly. Do seek to limit or enable ability beliefs? How do these choices affect behavior? Experiments with over 9,000 participants show preferences are heterogeneous—30 percent of prefer belief distortion, while 40 it, even if costly. A random assignment mechanism reveals that being assigned the prefer...

We model digital platforms as attention brokers that have proprietary information about their users’ product preferences and sell targeted ad space to retail industries. Retail producers—incumbents or entrants—compete for access this bottleneck. discuss when increased concentration among results in a tightening of the bottleneck, leading higher prices, fewer ads being sold entrants, lower consu...

We develop a theory of low-frequency movements in inflation expectations, and use it to interpret joint dynamics expectations for the United States other countries over postwar period. In our theory, long-run are endogenous. They driven by short-run surprises, way that depends on recent forecasting performance monetary policy. This distinguishes from common explanations properties inflation. Th...

Sellers often have the power to censor reviews of their products. We explore effect these censorship policies in markets where some consumers are unaware possible censorship. find that if share such “naïve” is not too large, then rational treat any bad review revealed equilibrium as good news about product quality. This makes worth revealing and allows seller use them signal his product’s quali...

When a user shares her data with online platforms, she reveals information about others. In such setting, externalities depress the price of because once user's is leaked by others, has less reason to protect and privacy. These depressed prices lead excessive sharing. We characterize conditions under which shutting down markets improves welfare. Platform competition does not redress problem exc...