"How strong are ethnic preferences?" (New paper)

Ethnic divisions have been shown to adversely affect economic performance and political stability, especially in Africa, but the underlying reasons remain contested, with multiple mechanisms potentially playing a role. We utilize lab experiments to isolate the role of one such mechanism—ethnic preferences—which have been central in both theory and in the conventional wisdom about the impact of ethnic differences, and employ an unusually rich research design and large sample. Most tests yield no evidence of coethnic bias. The results run strongly against the common presumption of extensive ethnic bias among ordinary Kenyans, and suggest that other mechanisms may be more important in explaining the negative impact of ethnic diversity. (Co-authors L. Berge, K. Bjorvatn, S. Galle, D. Posner, B. Tungodden, K. Zhang).

World Bank Lecture on Global Climate Change and Economic Growth (Video)

Ted gave a public lecture on his recent Nature paper "Global non-linear effect of temperature on economic production" on September 15, 2015. Summary: We show that overall economic productivity is nonlinear in temperature for all countries, with productivity peaking at an annual average temperature of 13 C and declining strongly at higher temperatures. The relationship is globally generalizable, unchanged since 1960, and apparent for agricultural and non-agricultural activity in both rich and poor countries, with important implications. If future adaptation mimics past adaptation, unmitigated warming is expected to reshape the global economy by reducing average global incomes roughly 23% by 2100 and widening global income inequality, relative to scenarios without climate change. (Co-authors M. Burke, S. Hsiang).