The value of letting independent social scientists study the administrative data collected by companies of all sorts is hardly in doubt. Economists are particularly keen on basing hypotheses, models, and economic indicators on such information. Companies are often reluctant to share their data, however, in part due to concerns regarding data privacy, costs, inconvenience, reputational risk, or ethical issues. Recent regulatory measures, which give users control over their data, complicate matters even further. Without better data sharing mechanisms, we may soon live in a world where only a few large companies have access to that data and the insights such information provides. This grant supports Sara Jordan at the Future of Privacy Forum (FPF) Education and Innovation Foundation, a strictly nonpartisan and nonprofit organization, who is developing a strategy to further accelerate corporate-academic data sharing. Grant funds provide continued support for the Foundation’s Award for Research Data Stewardship, allow Jordan to prepare compelling use cases to demonstrate how insights generated by administrative data can advance research and evidence-based policymaking, and also allow the creation of a legislative tracker producing real-time analysis to be shared with the research community. Combined, Jordan’s efforts accelerate the safe and responsible sharing of administrative data between companies and academic researchers.

“Consumer surplus” is defined as the total monetary gain to consumers when they can buy an item at a price lower than the maximum price they'd willingly pay for it. If a book costs $20 and three people would be willing to pay $40 for it, the consumer surplus of that book’s price is 3 x ($40-$20), or $60. This metric is frequently used by economists to measure the effectiveness of different policies, particularly those involving antitrust cases. Traditional calculations of social welfare that use consumer surplus, however, ignore the fact that the value of an extra dollar, known as the “marginal utility” of income, can have very different value for different people. Because adding another dollar to their paycheck means less to the affluent than it does to those who are less well off, the latter receive systematically less weight in consumer surplus calculations. This grant supports Matthew Backus at Columbia Business School, who will call attention to those weights by calculating what they actually are for different subpopulations. His goal is to develop an alternative framework to consumer-surplus analysis that makes distributional considerations more explicit. Backus’s new framework will weave distributional concerns into policy analysis, bring transparency to the ways consumer surplus measures weigh the welfare of different demographic groups, and use those weights in policy evaluation to account for distributional issues. One particularly interesting application Backus will explore is examining how public welfare measurements vary when completely different weights are assigned to various demographic groups, starting with equal weights for all.

This grant supports Juan Carlos Suбrez Serrato, a professor of economics at Duke University and faculty associate at the National Bureau of Economic Research (NBER), who is seeking to improve our understanding of DEI issues in economics by expanding the pool of researchers studying the economics of racial and ethnic disparities. Grant funds will provide one-year fellowships to three postdoctoral researchers whose work addresses labor market disparities, the institutions that reduce or reinforce them, and the ways in which economic choices can affect such outcomes. To reach perspectives beyond those of predominant groups in the profession, the plan is for Suбrez Serrato and the rest of a highly distinguished, diverse, and experienced selection committee to recruit assiduously for postdoctoral candidates from underrepresented groups. Fellows will spend a year working at NBER’s Cambridge headquarters, where they will each both work with a mentor and also network with the Bureau’s wider scholarly community.

“Administrative data” refers to information gathered for purposes other than research. Examples include educational, legal, hospital, commercial, and other transaction records compiled either by the public or private institutions. Such data could be extremely valuable in economics research but the process of compiling it can be complicated, expensive, and frustrating—with data quality, privacy, and documentation issues representing only some of the common problems facing researchers. As a result, we still have a limited understanding of how valuable administrative data is for economics research. This grant supports Abishek Nagaraj, head of the Data Innovation Lab at the UC Berkeley’s Haas School of Business, who seeks to derive fundamental economic estimates of the value of administrative data. Nagaraj will analyze the role administrative data plays in determining the quality, rate, and direction of science, with a particular focus on economics research and policy. Though his initial focus is on evaluating the value of public sector data—with a focus on the Federal Statistical Research Data Centers—Nagaraj foresees a second phase of his work that would study the value to researchers of administrative data compiled by the private sector. The project will explore topics such as: which types of research benefit from administrative data access; how data access impacts faculty and students differently; the heterogeneous impact of data access across researchers’ demographics and the status of their institutions; the impact of data access on the diversity of research topics studied and demographics in academia; how data access shapes the balance between theoretical and empirical approaches in economics; and the mechanisms through which data access translates into career outcomes.

This grant supports Ajay Agrawal, Avi Goldfarb, Joshua Gans, and Catherine Tucker, who are coordinating a conference on the economics of artificial intelligence at the Rotman School of Management, University of Toronto. Five years since its successful launch in 2017, the fall 2022 instalment of the conference will focus on specific applications of AI—particularly in the realms of national security, infrastructure, and health. The conference will, therefore, seek to connect the community of economics of AI scholars with scholars from these disciplines. AI applications like those in health economics, for example, precipitate questions about privacy, ethics, venture capital, and regulatory issues. In addition to activities relating to the conference, the organizers are also planning to join efforts with the Sloan-supported Working Group on the Economics of Digitization at the National Bureau of Economic Research.

Economists justify government intervention in a market when, left to their own devices, economic agents produce an inefficient outcome—a “market failure”. Perhaps the most well-known example is the excessive accumulation of market power by large firms, which at the extreme can create a monopoly. Market power allows large companies to tilt the playing field in their favor, impose significant barriers to market entry, and ultimately squash competition. There’s also a less well-known mechanism through which large companies can stifle competition and innovation—by scooping up all the workers. There is reason to believe that in the tech industry, small companies are being systematically outbid by large companies in the market for talent. In a theoretically efficient market, workers receive compensation commensurate with their productivity. In an inefficient market, however, large firms can afford to hire talent at outsized salaries—even to perform tasks that do not put them to their best use. This is not just a problem for the small, innovative startups that compete with large tech firms. It is also a problem for the economy and wider society, since startups play a key role in commercializing scientific and technological advances which, in turn, benefit lives and produce economic growth. This grant supports James Bessen at Boston University, who is studying the conduct and consequences of labor markets where established platforms compete with startup firms for STEM workers. Bessen’s team will explore how competition for employees from large companies affects the growth, financing, and performance of startups, and the implications for policymaking. Their research will pay particular attention to the impacts on those startups whose founders are women or persons from marginalized groups. The project’s empirical approach will combine three datasets: Burning Glass data, which covers job openings; Crunchbase, a large database of corporations which contains information on firm founding and financing amounts; and Compustat, which provides extensive financial data on publicly listed firms. In addition to their own analyses, the team will make their code publicly available, creating a valuable public good for other researchers.

This grant supports computer scientist Rediet Abebe at the University of California, Berkeley and economist Maximilian Kasy at the University of Oxford, who are organizing the Association for Computing Machinery’s inaugural conference focused on Equity and Access in Algorithms, Mechanisms, and Optimization—EAAMO 2021. The virtual conference will convene experts from academia, government, and industry working on the computational tools and relevant economic or social science research required to address urgent societal problems. EAAMO 2021 seeks to foster community-bridging collaborations for addressing issues such as access to education and healthcare, interventions for alleviating poverty, as well as policies to promote fairness and privacy in labor markets.

EconoFact (https://econofact.org) is a website that specializes in disseminating non-partisan and rigorous analysis from leading economists. Their work is edited in the form of short memos and podcasts that are accessible and digestible to a broad audience. Michael Klein, the leader of this effort, has assembled a network of more than 100 prominent economists who regularly contribute to EconoFact. Topics covered include employment, the costs of pollution, debts and deficits, household finance, and Medicaid reform, among others. Since its 2018 launch, the site has garnered almost 1.9 million pageviews and its work has been mentioned in major news outlets, including the PBS Newshour, the New Yorker, the Washington Post, The New York Times, The Financial Times, and NPR’s “All Things Considered”. By 2020, EconoFact had become an important source for analysis of the economic impacts of the COVID-19 pandemic, publishing more than 50 memos and 18 podcasts on the topic. Funds from this grant provide support for the continued operation and expansion of EconoFact, including the production of 150 new memos, 100 podcasts, and 36 video pieces, providing accessible, expert economic analysis on topics relevant to policymakers and the public alike.