Industrial Organization.

• Position: Program and Working Group Meetings

NBER's Program on Industrial Organization, directed by Nancy Rose of MIT, met on February 2 and 3 at the NBER's California office. Catherine Wolfram and Florian Zettelmeyer, both of the University of California, Berkeley and NBER, organized the meeting. These papers were discussed:

William Adams, Citigroup, and Liran Einav and Jonathan Levin, Stanford University and NBER, "Liquidity Constraints and Their Causes: Evidence from Subprime Lending"

Discussant: Raj Chetty, University of California, Berkeley and NBER

Alessandro Gavazza, Yale University, "Asset Liquidity, Boundaries of the Firm and Financial Contracts: Evidence from Aircraft Leases"

Discussant: Mara Lederman, University of Toronto

Massimo Massa, INSEAD; Jonathan Reuter, University of Oregon; and Eric Zitzewitz, Stanford University, "The Rise of Anonymous Teams in Fund Management"

Discussant: Chad Syverson, University of Chicago and NBER

Stephen Ryan, MIT and NBER, and Catherine Tucker, MIT, "Heterogeneity and the Dynamics of Technology Adoption" Discussant: Marc Rysman, Boston University

Joseph Farrell and Carl Shapiro, University of California, Berkeley, "How Strong Are Weak Patents?"

Discussant: Robert Gertner, University of Chicago

Matt Gentzkow and Jesse M. Shapiro, University of Chicago and NBER, "What Drives Media Slant? Evidence from U.S. Daily Newspapers" (NBER Working Paper No. 12707)

Discussant: Joel Waldfogel, University of Pennsylvania and NBER

Meghan R. Busse, University of California, Berkeley; Duncan Simester, MIT; and Florian Zettelmeyer, "The Best Price You'll Ever Get: The 2005 Employee Discount Pricing Promotions in the U.S. Automobile Industry"

Discussant: Steve Berry, Yale University and NBER

Adams, Einav, and Levin present new evidence on consumer liquidity constraints and the credit market conditions that might give rise to them. Their analysis is based on unique data from a large auto sales and financing company that serves the subprime market. They first document the role of short-term liquidity in driving purchasing behavior, including sharp increases in demand during tax rebate season and a high sensitivity to minimum down payment requirements. They then explore the informational problems facing subprime lenders. They find that default rates rise significantly with loan size, providing a rationale for lenders to impose loan caps because of moral hazard. They also find that borrowers at the highest risk of default demand the largest loans, but the degree...