Research

Many mental health disorders start in adolescence and appropriate initial treatment may improve trajectories. But what is appropriate treatment? We use a large national database of insurance claims to examine the impact of initial mental health treatment on the outcomes of adolescent children over the next two years, where treatment is either consistent with FDA guidelines, consistent with looser guidelines published by professional societies (“grey-area” prescribing), or inconsistent with any guidelines (“red-flag” prescribing). We find that red-flag prescribing increases self-harm, use of emergency rooms, and health care costs, suggesting that treatment guidelines effectively scale up good treatment in practice.

The Yale Labor Survey (YLS) uses online panels to estimate the state of the US labor market in real time. It is designed to parallel the US government’s monthly labor force survey and present weekly information rapidly and inexpensively. Using an experimental design, the YLS estimates that the US unemployment rate peaked in late April and improved substantially by mid-June. The YLS unemployment rate in mid-June is estimated to be 15%, down about 2 percentage points from mid-May.

The goal of antitrust policy is to protect and promote a vigorous competitive process. Effective rivalry spurs firms to introduce new and innovative products, as they seek to capture profitable sales from their competitors and to protect their existing sales from future challengers. In this fundamental way, competition promotes innovation. We apply this basic insight to the antitrust treatment of horizontal mergers and of exclusionary conduct by dominant firms. A merger between rivals internalizes business-stealing effects arising from their parallel innovation efforts and thus tends to depress innovation incentives. Merger-specific synergies, such as the internalization of involuntary spillovers or an increase in the productivity of R&D, may offset the adverse effect of a merger on innovation. We describe the possible effects of a merger on innovation by developing a taxonomy of cases, with reference to recent US and EU examples. A dominant firm may engage in exclusionary conduct to eliminate the threat from disruptive firms. This suppresses innovation by foreclosing disruptive rivals and by reducing the pressure to innovative on the incumbent. We apply this broad principle to possible exclusionary strategies by dominant firms.