1 The Market for Lemons (Akerlof) | Information economics | Used car market as a simple model of how asymmetric info can wreck markets. | 1970 | Medium – short but you reread the logic a few times. | Feels almost too simple and then you realize it explains like half the sketchy stuff in real markets. Pure econ meme material: everything is a lemon now. |
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2 Job Market Signaling (Spence) | Labor / information | Education as a signal of ability, not just skill-building, in hiring decisions. | 1973 | Medium-high – clean math, but you need to track types and incentives. | Every time I’m dying in a 300-level class I hear Spence whispering “relax, it’s just a signal.” Explains the whole “why am I even here” college crisis. |
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3 Prospect Theory (Kahneman & Tversky) | Behavioral economics | People value gains and losses relative to a reference point, with loss aversion and weird probability weighting. | 1979 | High – lots of experiments and function shapes. | This is the “humans are not expected-utility robots” manifesto. After this, every risky choice your friends make looks like a lab experiment. |
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4 The Economic Lives of the Poor (Banerjee & Duflo) | Development economics | Household-level data on how people living under about $2/day actually spend, earn, and cope. | 2007 | Medium – lots of tables but super readable narrative. | Kills a bunch of lazy stereotypes in one shot. You walk away realizing “the poor” is not one category and policy takes need to stop acting like it is. |
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5 Does Airbnb Hurt Local Housing Markets? (Barron, Kung, Proserpio) | Urban / housing economics | Uses data on Airbnb listings to see how platform growth links to rents and house prices. | 2021 (working paper versions earlier) | High – empirical strategy and robustness checks galore. | Anytime someone says “Airbnb ruined housing” I mentally scroll through this one. Not perfect, but a nice blueprint for how to attack big policy questions with data. |
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6 The Colonial Origins of Comparative Development (Acemoglu, Johnson, Robinson) | Political economy / development | Uses settler mortality as an instrument to show how colonial institutions shape modern income levels. | 2001 | High – instrumental variables plus long historical detour. | The exact moment when IVs went from “annoying exam topic” to “ok, that’s kind of powerful.” Also, impossible to unsee once you look at those scatterplots. |
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7 The Labor Market Impacts of Immigration (Card’s Mariel Boatlift paper) | Labor economics | Looks at Miami after the Mariel Boatlift to test how a sudden migrant inflow affects wages and employment of natives. | 1990 | Medium – classic difference-in-differences, not too scary. | The reason every immigration debate eventually turns into “but what about Card (1990).” Great template for thinking about natural experiments in real life. |
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8 Rational Fools (Sen) | Welfare economics / philosophy | Critiques the idea that people are just self-interested utility maximizers and brings in commitment and ethics. | 1977 | Medium – more words than equations, but conceptually loaded. | Reads like that one friend who keeps asking annoying but necessary questions in class. Makes standard homo economicus feel very… NPC. |
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9 A Behavioral Model of Rational Choice (Simon) | Decision theory | Introduces bounded rationality and satisficing instead of full-on optimization. | 1955 | Medium – older language but not super mathy. | Basically the OG “no one actually solves these utility maximization problems” rant, except formal and smart. Makes every toy model we do feel a bit sus. |
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10 Why Doesn’t Capital Flow from Rich to Poor Countries? (Lucas paradox paper) | International finance / macro | Shows that capital doesn’t flood into poor countries the way simple models say it should, and asks why. | 1990 | Medium – some theory, some calibration, not insane. | The moment you realize “perfect capital markets” is doing way too much work. Also low-key teaches you how to think about puzzles in macro. |
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TheLysts
