Environmental and Urban Economics

China features state owned enterprises (SOEs) that pursue a "double bottom line".  They simultaneously seek to earn profit and to please the powerful Central Government.  Relative to their private sector counterparts, these Chinese SOE firms receive special treatment. They can often access subsidized energy, land and capital.  Facing such low factor prices such firms use more resources and this creates distortions because the opportunity cost of one firm using scarce resources is that another more productive firm does not use those resources. Macroeeconomists continue to study the implications of such misallocation for the macro-economy.

The new issue of the Economist includes an excellent Free Exchange column titled Lose-Lose Ordeal with the heading; "New research counts the costs of the Sino-American trade war".  The article does a great job citing the new research by several top economists including my old colleague Pablo Fajgelbaum.  

Empirical research helps to understand the short run dynamics brought about by the Trump tariffs.

An excellent new NBER Working Paper titled "Mandated vs. Voluntary Adaptation to Natural Disasters: The Case of U.S Wildfires" has been published.  The authors have assembled a great data set to document that building codes cause upgrades of properties such that subsequent wildfires cause lower damage to property.  This is a highly optimistic adaptation paper and it puts Government at the center of achieving adaptation progress.