Browsing by Subject "Labor economics"

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Essays in macroeconomics
(2024-05) Herriford, Trenton; Mueller, Andreas I., 1979-; Andres Drenik; Brent Bundick; Stefano Eusepi
This dissertation consists of three independent chapters, spanning several subfields within macroeconomics. Chapter 1 explores the connection between workers' search for new jobs and their wage expectations. In standard models, workers' expectations about their future real wages determine how much they search for new jobs. But using a panel survey, I show that predicted job search doubles for individuals who expect nominal-wage cuts—even after controlling for their expected real wages. I then develop a search-and-matching model with on-the-job search. The model's main feature is a dynamic game of search and wage setting between matched workers and firms. Adding behavioral worker preferences to the model reproduces the sharp increase in search when workers expect wage cuts, and this mechanism endogenously generates downward nominal wage rigidity. When I calibrate the model to match workers’ job-search response to expecting wage cuts, I find this behavior can explain 2/3 of observed wage freezes. Chapter 2 examines the macroeconomic effects of data releases. Existing research finds that a macroeconomic indicator's first released/announced estimate has effects independent of the indicator’s actual value. However, I find observations from the Great Inflation drive these results, and this finding is especially pronounced for inflation announcements. Specifically, announcing last quarter’s inflation was one percentage point higher than its actual value increased prices two percent over the subsequent year during the Great Inflation—but had no significant effects in the time after. I show this can theoretically be explained by data releases causing self-fulfilling fluctuations, a possibility predicted by the New Keynesian model when I add to it information frictions and when monetary policy does not sufficiently respond to economic conditions. I then calibrate a quantitative New Keynesian model and find nearly all the price response to inflation announcements can indeed be explained by this self-fulfilling mechanism, as opposed to standard effects implied by imperfect information. Chapter 3, which is joint with Brent Bundick and A. Lee Smith, studies the transmission of Federal Reserve communication to financial markets and the economy using new measures of the term structure of policy rate uncertainty. Movements in the term structure of interest rate uncertainty around Federal Open Market Committee (FOMC) announcements cannot be summarized by a single measure but, instead, are two dimensional. We characterize these two dimensions as the level and slope factors of the term structure of interest rate uncertainty. These two monetary policy uncertainty factors significantly help to explain changes in Treasury yields and forward real interest rates around FOMC announcements, even after accounting for changes in the expected path of policy rates. Moreover, we demonstrate that focusing in just a single dimension of monetary policy uncertainty provides an inaccurate description of how policy uncertainty shapes the transmission of FOMC announcements. Finally, our policy uncertainty factors provide stronger first-stage instruments in a proxy structural vector autoregression setting, which implies more expansionary macroeconomic effects of forward guidance than those estimated only using the expected path of policy rates.
Essays on public and labor economics
(2024-05) Son, Jinyeong; Cabral, Marika; Tuttle, Cody; Magdalena, Bennett; Murphy, Richard
This dissertation comprises three chapters in the fields of public and labor economics. Specifically, they address questions in two areas: (i) the determinants of children’s human capital accumulation, particularly from the perspective of health status, and (ii) the consequences of public policy interventions in health insurance markets. Chapter 1 examines the effects of pregnancy timing among teenagers aged 15–18 on their short- and long-run educational and labor market outcomes. Specifically, I estimate the marginal impact of a one-year difference in pregnancy timing for each age interval—15–16, 16–17, and 17–18—leveraging linked administrative data from Texas. To identify the effect of pregnancy timing, I examine both within-individual changes in outcomes surrounding pregnancy and across-individual comparisons in outcomes after pregnancy, among matched individuals who are balanced on a wide range of characteristics but differ in the timing of pregnancy. The results indicate that experiencing pregnancy one year earlier increases absences and the likelihood of leaving school, particularly during the postpartum year. Further, the results indicate that becoming pregnant one year earlier has adverse long-term consequences: it reduces high school graduation by age 20, decreases college enrollment and completion in the early 20s, and leads to lower employment and earnings in the mid-20s, with these detrimental effects being most pronounced for the youngest group. Finally, I present suggestive evidence that providing parental support to teenage mothers during the postpartum year could mitigate the short-term disruptions they face, such as increased absences and higher dropout rates. Chapter 2, previously published in the Journal of Public Economics, explores whether and to what extent state-mandated health insurance benefits improve health outcomes in the context of diabetes mandates. Specifically, in Chapter 2, I use data from the restricted-use Multiple Cause of Death Mortality database and the Behavioral Risk Factor Surveillance System to investigate the effects of diabetes mandates on diabetes-related mortality rates, along with the underlying mechanisms behind the estimated effects. Using a difference-in-differences framework that leverages variation in the enactment of mandates both across states and over time, I find that approximately 3.1 fewer diabetes-related deaths per 100,000 occur annually in mandate states than in non-mandate states. The mechanism analysis suggests higher utilization of the mandated medical benefits caused these mortality improvements. These findings can inform the ongoing policy debate on strengthening or weakening coverage mandates, including Essential Health Benefits under the Affordable Care Act. Chapter 3, co-authored with Marika Cabral and Colleen Carey, investigates the determinants of health insurance choice in Medicare—a setting with vast geographic variation in the share of individuals selecting the public option versus private alternative. We analyze insurance decisions among individuals who move to quantify the relative importance of individual-specific factors (such as preferences or income) and place-specific factors (such as local health insurance options) on insurance decisions. We find roughly 40% of the geographic variation in the share selecting private coverage is due to place-based factors, while the remainder is explained by individuals. Our findings highlight the importance of individual factors in these decisions and may inform discussions about the use of policy to address geographic disparities.
Essays on the determinants of worker productivity and labor market outcomes
(2019-06-20) LoPalo, Melissa Christine; Youngblood, Sandra Black; Spears, Dean E.; Geruso, Michael L; Coffey, Diane L
This dissertation examines determinants of worker productivity, labor market outcomes, and population health. The ﬁrst chapter, previously published in the Journal of Public Economics, examines the impacts of cash assistance on refugee labor market outcomes. I exploit variation across states and over time in the generosity of cash assistance available to refugees upon arrival in the U.S. and study the impacts on wages and employment. I argue that cash assistance is randomly assigned to refugees conditional on characteristics such as education and country of origin, as refugee placement is decided by a committee that does not meet with the refugees or learn their preferences. I ﬁnd that refugees resettled with more generous cash assistance go on to earn higher wages, with no signiﬁcant change in the probability of employment. The eﬀects are largest for highly-educated refugees. The second chapter examines the impact of temperature on the productivity and job performance of outdoor workers in developing countries. I overcome data challenges with studying individual-level productivity by studying household survey interviewers as workers. Using data from Demographic and Health Survey interviewers in 46 countries, I ﬁnd that interviewers complete fewer interviews per hour worked on hot and humid days, driven by an increase in working hours. I also ﬁnd evidence that suggests that workers allocate their eﬀort towards tasks that are more easily observed by supervisors on hot days. The third chapter, previously published in Social Justice Research and co-authored with Diane Coﬀey and Dean Spears, examines the role of social inequality in population health outcomes in India, focusing on the case of casteism and child height in India. We describe evidence from the India Human Development Survey showing that children in villages with more strongly casteist attitudes are shorter on average, an association that is statistically explained by the association between casteism and the prevalence of open defecation.
Essays on the economics of higher education
(2015-05) Denning, Jeffrey Todd; Youngblood, Sandra Black; Manoli, Dayanand; Abrevaya, Jason; Linden, Leigh; Heinrich, Carolyn
This dissertation contains three chapters that examine the effect of price in higher education. The first chapter considers the effect of community college tuition on college enrollment using a natural experiment in Texas where discounts for community college tuition were expanded over time and across geography. Additionally, the long-term effects of community college are examined including transfer to universities and graduation with a bachelor's degree. This chapter uses Texas administrative data from 1994-2012 on the universe of high school graduates and their college enrollment and graduation. For high school graduates, community college enrollment in the first year after high school increased by 7.1 percentage points for a \$1,000 decrease in tuition. Lower tuition also increased transfer from community colleges to universities. There is also marginally statistically significant evidence that attending a community college increased the probability of earning a bachelors degree within eight years of high school graduation by 23 percentage points. The second chapter examines whether students respond to immediate financial incentives when choosing their college major. From 2006-07 to 2010-11, low-income students in technical or foreign language majors could receive up to \$8,000 in Federal Science and Mathematics Access to Retain Talent (SMART) Grants. Since income-eligibility was determined using a strict threshold, this chapter determines the causal impact of the grant on student major with a regression discontinuity design. Using administrative data from public universities in Texas, it is estimated that income-eligible students were 3.2 percentage points more likely than their ineligible peers to major in targeted fields. Brigham Young University had a larger impact of 10.1 percentage points. The third chapter considers the effect of financial aid arising from students being declared financially independent on educational outcomes including reenrollment, credits attempted, and graduation. Students who are 24 at the end of the calender year cannot be declared dependent while students who are 23 at the end of the year can be. This sharp change in eligibility is leveraged to compare dependent students to independent students in a regression discontinuity framework. The analysis uses administrative data from from all public universities and colleges in Texas from 2003-04 to 2013-14. Financial independence is associated with modest changes in educational outcomes.
Three essays in labor economics and public finance
(2009-08) Rodriguez Zamora, Carolina; Trejo, Stephen J., 1959-
This dissertation consists of three essays. The first one brings together the areas of public and labor economics by developing a hypothesis that relates optimal taxation and time use. Using Mexican data on household time use and consumption, we find significant substitution between goods and time in home production and different elasticities of substitution for different house-hold commodities. Adding these findings to the optimal tax problem, we show it is optimal to impose higher taxes on market goods used in the production of commodities with a lower elasticity of substitution between goods and time. This is an analog of the classical Corlett and Hague (1953) result, differing in that we allow for the possibility of substitution between goods and time in the production of commodities. The second chapter is about international migration, in the area of labor economics. On one hand, surveillance of the border between Mexico and the United States by the U.S. government has increased dramatically over the last two decades. On the other hand, undocumented Mexican migrants often make multiple trips between the two countries. Thus, my hypothesis is that these migrants respond to heightened surveillance by increasing the length of stay of the current trip. I estimate a semi-parametric hazard model following Meyer (1990). Using data from the Mexican Migration Project I find no evidence that border enforcement affects the hazard of leaving the U.S. by undocumented Mexican Immigrants. The last essay is about mother's time and children related expenditures. Using data from the Mexican Time Use Survey and the National Household Survey of Income and Expenditure from 2002, I examine the time Mexican mothers dedicate to taking care of their children and the amount of money spent by the household in raising children. The main contribution of this paper is that it analyzes child care time use and child care expenditures simultaneously. The age of the youngest child is the most important determinant of both child care time and money expenditures. It is the case that more educated mothers spend more money on their children. With respect to child care time use, more educated mothers spend more or less time with their children depending on whether they are working or non-working mothers. At all levels of non-mother's income, working mothers spend significantly more money relative to time in child care than non-working mothers. For both groups the ratio of money over time increases at a decreasing rate; however, for non-working mothers the income expansion path is much flatter.