Introduction

Robert H. Topel

The Stigler Center is a university-wide research center founded by George Stigler in 1977 as the Center for the Study of the Economy and the State. Headquartered at Chicago Booth, the center’s mission is to carry on the intellectual tradition that George Stigler began—promoting research that deepens our understanding of the interaction between the private economy, government policy, and the law. Consistent with George’s scholarly approach and that of the university, the goal of Stigler Center research is not to help formulate policy or even to influence it, but rather to understand its implications and effects. If this understanding helps inform policy formation and debate, then all the better. This issue of Capital Ideas summarizes five papers by Stigler Center research associates.

Paulson's Gift

The Costs and Benefits of Government Intervention

Research by Pietro Veronesi and Luigi Zingales

The U.S. government's response to the financial crisis in the fall of 2008 created enormous value for banks and saved a few that were on the brink of bankruptcy.

Rewarding Research

Evaluating the War on Cancer

Research by Tomas J. Philipson and Eric C. Sun

The value to cancer patients of new treatment and detection techniques that allow them to live longer has been far greater than the money invested in finding those cures.

Truth in Media

Competition and Truth in the Market for News

Research by Matthew Gentzkow and Jesse M. Shapiro

Competition between news outlets can bring their audience closer to the truth, but consumers' own preference for news that is more entertaining than informative may push them further away.

Academic Carrots

Cash Incentives in Education

Research by Marianne Bertrand

A carefully designed conditional cash transfer program that pays students to attend school can be an effective way to improve educational outcomes.

Strategic Links

Why Firms Own Production Chains

Research by Ali Hortaçsu and Chad Syverson

Vertical integration does not necessarily mean that a company's upstream plants supply inputs to its downstream operations. In fact, it is more likely that they do not.