Browsing by Subject "Inequality"

Now showing 1 - 20 of 20

Dilemmas of political representation: antipoverty advocacy in the Post-Civil Rights Era
(2014-04) Forrest, Michael David
Dilemmas of Political Representation examines how urban antipoverty organizations in particular and advocacy organizations in general work as alternative sites of representation for marginalized interests. Drawing on extensive ethnographic fieldwork, it raises and addresses two interrelated sets of questions about these organizations' efforts, both of which also index broader concerns about the practice of democratic representation. The first set of questions is about how advocates use their representational efforts to articulate and disseminate different constructions of their constituents' interests: What are the different types of constructions that they use? How do they actually fashion these constructions? And how, in the process, do they construct themselves as legitimate representatives of the resulting interests? The second set of questions is about the challenges that advocates face as they represent and construct their constituents' interests: What are the sources and contours of these challenges? How do advocates negotiate them? And how, in the process, do their efforts aid and/or limit the struggle for equality in the post-civil rights United States? The dissertation traces how and with what consequences advocates organize their efforts and respond to their challenges through organizing meetings, internal communications, and public actions. In doing so, it advances theoretical discussions about the promise and dilemmas of democratic representation and advocacy on behalf of the urban poor and other marginalized groups.
Does the right hand know what the left hand is doing? General Assistance welfare crime, and punishment in the United States
(2013-07) Shannon, Sarah
Both the welfare state and the criminal justice system have undergone tremendous changes in the past 50 years. While the "right hand" carceral state has swelled through increased populations and spending, the "left hand" welfare state has simultaneously shifted caseloads and spending toward programs that support and reward the working poor and away from cash programs for those in deep poverty. This dissertation examines the theoretical and empirical connections between the changes in these two "hands" of the state using the particular case of General Assistance (GA) welfare programs from 1960 to 2010. In three sets of analysis, this study examines what factors account for major changes in GA policy since the late 1950s, as well as how GA welfare provision has affected state incarceration rates and crime rates at the state and county level over time and space. Results from these analyses highlight two important points: 1) the outlook for low-income men (and others not eligible for federal welfare programs) has become more dire over the last several decades as states have ended income supports for this population in conjunction with higher rates of incarceration; and 2) the loss of such income supports impacts public safety since greater provision of GA is associated with reductions in several types of crime.
Essays in family and labor economics.
(2012-08) Tanaka, Satoshi
This dissertation consists of two essays. The first essay explores the child support enforcement policies and their implications. The child support enforcement (CSE) policies, aimed at protecting out-of-wedlock children from financial disadvantages, brought unexpected changes in individuals' marriage and fertility behaviors during the 1980s and the 1990s. Our estimates from state-year panel data show that in states with strict CSE there has been a significant decrease in non-marital births and a significant increase in marital births. Taking into account all these changes, what are the effects of CSE on children's welfare? To answer this question, we build a heterogeneous-agent model that features endogenous marriage and child-investment decisions. Exploiting the state-level variation in enforcement, we estimate it using the National Vital Statistics Report data. We find that men's increased willingness to marry is the driving force behind the shift from non-marital births to marital births. As evidence for the mechanism, we show that the number of marriages has risen in the states with strict CSE during the same period, consistent with the model's implication. Our model predicts that a large increase in child investment comes through a secondary effect of CSE: the shift from non-marital births to marital births increases child investment through its income effect. In the second essay, we ask to what extent changes to the age and sex structure of the population account for the changes in the marriage behavior observed in the last century (from 1900 to 1980). The decrease in mortality, especially for women, and the changes in immigration patterns have increased the female to male ratio. With respect to marriage, there has been i) an increase in its incidence, ii) a reduction in the gender gap of the median age at first marriage, and iii) an increase in the divorce rate. We pose a model of marriage and divorce in which preferences over spouses depend on their age and on love (an idiosyncratic shock) and where frictions make it difficult to get new partners. We estimate our model using marital and population patterns of the 1950-1959 birth cohorts. Using the preference parameters estimated on the 1950's cohort and the population patterns of the 1870's cohorts, we find marriage patterns are quite similar to those observed in the earlier period. By making divorce costly for the 1870's cohort, the resemblance is more stronger. In particular, we find that these features account for i) 94.5% of the increase in the incidence of marriage ii) 140.8% of the shrink the gender age gap in the median age at first marriage.
Essays in Inequality and Gender in Developing Countries
(2015-10) Lovaton Davila, Rodrigo
This dissertation is comprised of three essays: two of which focus on the impacts of changes in maternity leave legislation on women's employment status and fertility, and the third concentrates on aggregation methods for the construction of asset-based proxy measures for household socioeconomic status in developing countries. In the first essay, I explore the effects of maternity leave on labor market outcomes in six countries in Latin America (Bolivia, Chile, Colombia, Ecuador, Peru, and Venezuela). The evidence shows that maternity leave has a positive effect on the labor force participation and unemployment-to-population ratio of women of childbearing age. In the second essay, I investigate the impact of maternity leave on fertility for the same set of six countries. Results suggest that maternity leave has small negative effects on higher order births for young adult women (18 and 30 years old), while it has small positive effects on fertility for older adult women (31 and 45 years old). If we consider these two effects, the evidence indicates that increases in maternity leave duration are associated to postponing some additional births. Finally, the third essay analyzes the performance of alternative methods to aggregate data for an asset-based wealth index using ordinal variables. Despite recommendations given by previous research, results suggest a relatively similar performance of principal components analysis on dichotomized data with respect to other methods that work with ordinal variables.
Essays in Inequality and Heterogeneity
(2019-07) Ocampo, Sergio
Recent trends in both developed and developing economies show increasing inequality in income and wealth. Technological change is reshaping the nature of work for many, as automation, offshoring and other practices are adopted by firms around the globe. These changes to the type of jobs workers have are linked to changes in wages and labor earnings, in particular the adoption of new (worker-replacing) technologies has been linked to decreases in wages and increases in income inequality. Simultaneously, the trend towards higher inequality has sparked questions about the desirability (optimality) of inequality and whether governments should use the tools at their disposal to try to curb these trends. My dissertation contributes to the discussion on these topics in two distinct ways. The first two chapters deal with the effects of technological change in the nature of occupations, and its effects for wage inequality, while the third chapter deals with the implications of fiscal policy (particularly capital income and wealth taxation) in the face of wealth inequality caused by differences in the rate of return across individuals. The first part of my dissertation develops a new theory of how the specific tasks carried out by workers are determined, providing a flexible framework in which to study the implications for workers of automation, offshoring, skill-biased technological change among others. I use this framework along with U.S. occupational data to study the recent adoption of automation and its effects on the wage structure. The final chapter shows how the determinants of inequality matter for determining the optimal policy in the face of inequality. In the presence of rate of return heterogeneity wealth taxes dominate capital income taxes. Relative to capital income taxes, wealth taxes benefit the individuals who are more productive, increasing the allocative efficiency in the economy, in turn leading to potentially large welfare gains despite increases in inequality.
Essays in Inequality and Public Economics
(2022-08) Malkov, Egor
This dissertation consists of three chapters which contribute to quantitative and theoretical understanding of inequality and associated public policies. The first essay studies how different should income taxation be across singles and couples. I answer this question using a general equilibrium overlapping generations model that incorporates single and married households, intensive and extensive margins of labor supply, human capital accumulation, and uninsurable idiosyncratic labor productivity risk. The degree of tax progressivity is allowed to vary with marital status. I parameterize the model to match the U.S. economy and find that couples should be taxed less progressively than singles. Relative to the actual U.S. tax system, the optimal reform reduces progressivity for couples and increases it for singles. The key determinants of optimal policy for couples relative to singles include the detrimental effects of joint taxation and progressivity on labor supply and human capital accumulation of married secondary earners, the degree of assortative mating, and within-household insurance through responses of spousal labor supply. I conclude that explicitly modeling couples and accounting for the extensive margin of labor supply and human capital accumulation is qualitatively and quantitatively important for the optimal policy design. In the second essay, I develop a framework for assessing the welfare effects of labor income tax changes on married couples. I build a static model of couples' labor supply that features both intensive and extensive margins and derive a tractable expression that delivers a transparent understanding of how labor supply responses, policy parameters, and income distribution affect the reform-induced welfare gains. Using this formula, I conduct a comparative welfare analysis of four tax reforms implemented in the United States over the last four decades, namely the Tax Reform Act of 1986, the Omnibus Budget Reconciliation Act of 1993, the Economic Growth and Tax Relief Reconciliation Act of 2001, and the Tax Cuts and Jobs Act of 2017. I find that these reforms created welfare gains ranging from -0.16% to 0.62% of aggregate labor income. A sizable part of the gains is generated by the labor force participation responses of women. Despite three reforms resulting in aggregate welfare gains, I show that each reform created winners and losers. Furthermore, I uncover two patterns in the relationship between welfare gains and couples' labor income. In particular, the reforms of 1986 and 2017 display a monotonically increasing relationship, while the other two reforms demonstrate a U-shaped pattern. Finally, I characterize the bias in welfare gains resulting from the assumption about a linear tax function. I consider a reform that changes tax progressivity and show that the linearization bias is given by the ratio between the tax progressivity parameter and the inverse elasticity of taxable income. Quantitatively, it means that linearization overestimates the welfare effects of the U.S. tax reforms by 3.6-18.1%. The third essay studies the policies that are aimed at mitigating COVID-19 transmission. Most economic papers that explore the effects of COVID-19 assume that recovered individuals have a fully protected immunity. In 2020, there was no definite answer to whether people who recover from COVID-19 could be reinfected with the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). In the absence of a clear answer about the risk of reinfection, it is instructive to consider the possible scenarios. To study the epidemiological dynamics with the possibility of reinfection, I use a Susceptible-Exposed-Infectious-Resistant-Susceptible model with the time-varying transmission rate. I consider three different ways of modeling reinfection. The crucial feature of this study is that I explore both the difference between the reinfection and no-reinfection scenarios and how the mitigation measures affect this difference. The principal results are the following. First, the dynamics of the reinfection and no-reinfection scenarios are indistinguishable before the infection peak. Second, the mitigation measures delay not only the infection peak, but also the moment when the difference between the reinfection and no-reinfection scenarios becomes prominent. These results are robust to various modeling assumptions.
Essays in Macroeconomics and Labor Economics
(2024-05) Pedtke, Joseph
This dissertation studies topics at the intersection of macroeconomics and labor economics, focusing on three areas: (1) inequality and intergenerational mobility, (2) macroeconomic crises and labor markets, and (3) employment effects of expansions of public healthcare. In Chapter I, I evaluate driving forces of trends in inequality and intergenerational mobility in the United States. Parents devote considerable resources towards their children's development, making trade-offs between time and education investments and working, consumption, and leisure. In recent decades, families in the United States experienced rising rates of single parenthood, increasing education prices, and changes to taxes and transfers, which altered available resources and trade-offs to investments across families. This chapter explores the implications of these trends for inequality and intergenerational mobility. After documenting changes in family resources and parental investments over time, I develop a dynastic model of human capital investment to quantify the contributions of these trends to increases in inequality and intergenerational persistence. I find that single parenthood is a major contributor through two channels: (1) less available time for single parents limits work hours, family income, and investments for their children’s human capital development and (2) the resulting lower human capital comes with a greater probability of becoming a single parent as an adult, as single parents tend to have less education and lower wages. Education prices, on the other hand, had only minimal effects as families reduce investments at similar rates in response to price increases. Moreover, changes to taxes and transfers had heterogeneous impacts on parental investments by producing differing income and substitution effects depending on family characteristics. The results highlight the importance of considering parental investments when designing assistance programs. In Chapter II, in joint work with Kevin Donovan, Will Jianyu Lu, and Todd Schoellman, we characterize how labor markets transmit aggregate shocks to idiosyncratic earnings risk experienced by households. This chapter uses both aggregate and micro data from quarterly labor force surveys to document four new findings about how they do so. First, the distribution of unemployment responses to recessions includes a long tail. In the most severe decile of recessions, unemployment rates rise by 5--20 percentage points and take 16--33 quarters to begin to recover. Second, there is a close relationship between these severe crises and a small set of shocks, including financial crises, house price busts, and sudden stops. Third, manufacturing and construction play a key role in all recessions, including crises, accounting for more than half of employment losses. Fourth, crises fall most on young and less-educated workers, who are likely to have low income and wealth and hence be less able to self-insure against idiosyncratic earnings risk. Taking into account both the large aggregate shocks and their incidence, the welfare costs of business cycles are likely to be larger than standard calculations imply. In Chapter III, in joint work with Sean Bassler, we measure the effect of Medicaid Expansion on the work arrangements of low-income adults. Before the expansion, many of these individuals only had access to subsidized health insurance through a traditional full-time job. After the expansion, they also had access to Medicaid, potentially allowing them to change their labor supply decisions. Using American Community Survey data, we built a sample of low-income adults who only had access to subsidized health plans through a typical full-time job or the Medicaid Expansion. Adults in the sample are childless, spouseless, non-disabled, and reside in states without confounding state-level policies. To identify the effect of newly-found Medicaid access on this sample, we use a difference-in-difference design from Callaway and Sant’Anna (2021). We find that the expansion had a statistically insignificant effect on the share of our sample in several labor market arrangements: traditional full-time employment, part-time employment, self-employment, unemployment, and not participating in the labor force. These results are robust to including pre-treatment covariates and adjustments to our underlying sample framework. We further decompose treatment effects into short- and long-term effects and find both are statistically insignificant. We conclude that Medicaid Expansion had a negligible impact on both the work arrangements for low-income workers.
Essays in Political Economy
(2018-08) Pelaez-Campomanes Guibert, Ignacio
How does the interaction between inequality and social mobility affect the choice of fiscal policy? I analyze this question in a model of democratic poli- tics with imperfect tax enforcement, where the ability of individuals to evade taxes limits the amount of redistribution in the economy. Social mobility creates an insurance motive that increases voluntary compliance, favoring the tax enforcement process. In such an environment, redistributive pressures brought about by an increase in inequality are only implementable in highly mobile societies. On the contrary, when mobility is low, higher inequality reduces tax rates and redistribution. I empirically test this prediction using data on absolute upward mobility for the 50 US states and the District of Columbia, and measuring redistribution as state and local government expenditure per capita. I find a strong, positive and highly significant relation between inequality and redistribution for states with relatively high levels of social mobility: A one Gini-point increase in inequality is associated to roughly $800 higher expenditure per capita. This effect dissipates in states with low levels of mobility. Finally, I embed the politico-economic environment of the paper in a simple endogenous growth model, in order to analyze how inequality directly and indirectly affects the growth process when social mobility and tax evasion are taken into account.
Essays on Fiscal Policies in Open Economies
(2020-07) Tran Xuan, Monica
This dissertation consists of three chapters. A unifying theme across all chapters is the interaction between government's motive for redistribution and its commitment to repay debt. The first chapter studies optimal taxation in an open economy in which the government has a redistributive motive and faces self-enforcing debt constraints that arise from its limited commitment. Redistributive policies are proportional taxes on labor and domestic saving. Optimal labor taxes decrease over time and eventually converge to a non-zero limit, and the optimal capital tax is positive in the limit. The efficient contract features front-loading distortion and back-loading efficiency, allowing the government to borrow more in the future. The model's numerical exercise shows that a stronger redistributive motive requires greater tax distortions at the beginning of time as well as a higher external debt level in the long run. The second chapter, in turn, proposes a theory of external debt sustainability based on the government’s motive for redistribution. Given the endogenous debt constraints, the value of financial autarky determines the sustainable level of debt. Financial autarky is endogenously costly because redistribution requires high labor taxes, which distort labor supply and reduce the economy's efficiency. Having access to external financing allows the government to have more redistribution, measured as the differences in individual utilities than in financial autarky at the same level of efficiency cost. Quantitatively, the theory can account for the external debt’s recent buildup in Italy and is consistent with the positive correlation between pre-tax income inequality and external debt across countries and time periods. In response to a negative productivity shock, the optimal austerity policies are increasing external borrowing and redistribution while reducing redistribution to repay debt in the future. The magnitude of these responses varies with the underlying wage inequality. The third chapter examines how income inequality affects the sovereign default risk. I study fiscal policies in a sovereign default model with heterogeneous agents and distortionary taxation. I quantify the model in the case of Spain and find that inequality worsens the debt crisis by increasing the government's incentive to default.
Essays on International Trade, Inequality, and Fiscal Policies
(2023-04) Siameh, Celestine
This dissertation consists of two distinct chapters, studying the impact of geopolitical tensions on International Trade; and the connection between fiscal policies and inequality. The current state of geopolitical tensions is on the rise, and this has caused a significant decline in the global economy, particularly in international trade and finance. Geopolitical tensions refer to a wide range of political issues between two or more countries that induce tension and unrest, ranging from military conflict to climate change, the USA-China trade war, and Brexit. For this reason, one of the major drivers of trade policy has progressively been geopolitical conflicts. The first chapter of my dissertation provides research-driven facts and valuable contributions toward answering questions on how geopolitical tension, like Brexit, affects trade policies and global trade. This chapter studies the effect of Brexit due to trade policy shock not limited to only the United Kingdom (UK) and the European Union (EU), but with a much focus on third countries that have the UK as their major trading partner. I built a multi- country multi-sector general equilibrium Armington model with trade policy shock that features input-output linkage. Then, I calibrated this model to match the 2015 Eora multi-region input-output data. I then quantify the overall impact of Brexit by comparing the calibrated model with five different potential post-Brexit scenarios that may occur sometime in the future due to changes in trade costs. The findings show that Brexit affects other countries’ welfare, trade, and production patterns besides the UK and the EU. But the magnitude of these effects may depend on the type of trade agreement the UK agrees on with these other countries. Economic inequality is one of the severest problems in the 21st century, with significant long-term and unexpected existential implications. It has long been recognized as one of the biggest threats to the development and performance of the global economy. Fiscal policy is the most powerful tool governments use in addressing high levels of inequality. This is because it affects individual consumption directly through taxes and transfers and indirectly via other means, such as providing public goods, incentives for work, etc. In the second chapter of my dissertation, I provide empirical evidence on how fiscal policies like universal basic income (UBI), targeted cash transfers, and progressive taxation can reduce income inequality in South Africa. I compare the magnitude by which UBI versus TCT funded through progressive taxation can reduce income inequality in South Africa. The results reveal that a UBI or a TCT implemented alongside progressive taxation will reduce income inequality significantly; overall, TCT reduces inequality more than UBI.
Essays On Labor Market Dynamics
(2018-05) Xu, Ming
This dissertation consists of three chapters. The first chapter investigates the factors which drive workers' occupation switching decisions. The process of workers switching from occupation to occupation is a vital part of career development and self-discovery. Using the CPS and SIPP, I show that occupational switching rates have declined significantly over the past 25 years. This decline has been robust for each consecutive cohort and is more pronounced for younger workers than older workers. The decline could imply that it is becoming more difficult and costly for workers to find better jobs (due to increases in switching costs), leaving people increasingly stuck in poorly matched and unfulfilling careers. Paradoxically, it could also mean that finding better jobs is becoming easier (thanks to advances in ICT), since workers with good job matches are less likely to switch. This paper develops a dynamic discrete choice life-cycle model to separately identify and quantify how changes in switching costs and information over time contribute to the observed declines in occupation switching. The result is that increased switching costs drive about 72% of the decline, while better information drives about 8%. The increases in switching costs have led to less productive occupational matches for workers and thus significant welfare losses. On average, workers have lost 3% of their total lifetime income from increases in switching costs over this period. In the second chapter, my coauthor, Mons Chan, and I investigate how trade costs and firm make-or-buy decisions have an impact on the aggregate wage distribution. Firms react to changes in factor prices with intensive and extensive-margin employment adjustments at the occupational-level. We study the distributional and aggregate consequences of this make-or-buy dynamic by developing a novel network model of heterogeneous firm-to-firm trade where the boundary of each firm depends on factor prices and firm-occupation comparative advantage in input-production. We show that the model can be easily aggregated and taken to industry-level data, and use the calibrated model to examine recent trends in employment, wages and trade in the USA. We use public OES and CPS data to show empirical evidence that a significant fraction of the growth in wage inequality in the USA is due to changes in firm/industry specialization and occupation sorting. To understand and measure the underlying causes of these trends, we calibrate the model to occupation and industry data from the OES and input-output tables. The results suggest that 1/3rd of the increases in wage inequality stem from decreases in inter-industry trade frictions with the remaining 2/3rds stemming from changes in technology and labor supply. Falling trade frictions are also responsible for all of the increases in occupational sorting and concentration. Had trade frictions been held at their 2002 level, productivity growth would have led to an increase in vertical integration, rather than the decrease observed in the data. The third chapter investigates the link between student debt and post-graduation job market outcomes. Using a combination of survey and administrative data on graduates in two cohorts, I show that there is a significant negative correlation between the amount of debt upon graduation and the probability of finding a job which matches your education. I use evidence from Equifax to motivate a model of job search and long-term debt where the cost of consumer credit depends on your student loan balance. I successfully calibrate the model to the data and show that this debt constraint mainly binds for high and medium human capital graduates, as it affects the amount of time they are able to spend searching for a good job. I then show that alternative repayment and interest rate policies would have improved labor market outcomes for graduates in 07/08 by allowing extended search times, increasing match quality and possibly lifetime productivity.
Essays On Racial Inequality In The Labor Market
(2024-04) Treanor, Caitlin
This dissertation studies issues related to racial inequality in the labor market. The first two chapters focus on the impact of racially segregated referral networks on inequality and aggregate welfare, while the final chapter focuses on differences in returns to work experience and the supply of labor between black and white workers in recent decades. The first chapter shows that there are racial differences in the composition of referral networks and the use of referral networks by occupation. In particular, non-college black and white workers in the United States who obtain a job via referral display substantial social segregation, using same-race contacts around 90% of the time. While non-college black and white workers use referrals at a similar rate overall, black workers use referrals for higher-skill and higher-paying occupations at a lower rate than white workers. I also document racial differences in occupational choice, with white workers sorting into higher-skill occupations. The following chapter connects and rationalize these observations by incorporating a referral-based matching function into a standard search and match model with occupational choice, heterogeneous ability levels, free entry, and wages determined by Nash bargaining. Social segregation can lead to differences in occupational choice by race, and thus wage and employment inequality, in the steady state. After calibrating the model to examine black and white workers in the United States, the estimates show that racially biased networks alone can generate a black-white wage gap of 1.66 percent and an employment gap of 0.74 percentage points. Moving from the segregated to the desegregated steady state harms the majority white workers while helping the minority black workers, resulting in a decrease in aggregate welfare. In the final chapter I utilize individual fixed effects combined with an instrumental variables approach to document the extent to which returns to work experience differ for black and white workers; I then use a life-cycle model with a learning-by-doing human capital production function to assess the consequences of these differences for the supply of labor. Returns to an extra thousand hours of work experience for the typical white worker are 23 cents per hour in 2012 USD (amounting to an additional $478 per year of full time work), compared to 12 cents for an otherwise identical black worker (amounting to an additional $250 per year). Using a life-cycle model, differences in returns to experience combined with simulated differences in choices of hours worked can account for approximately 10 percent of the measured difference in average wages over the life-cycle between black and white workers.
Essays on the political economy of taxation in dynamic settings.
(2009-08) Piguillem, Juan Facundo
In this thesis we explore the relationship between changes in labor income inequality and movements in labor taxes over the last decades in US. In order to do so, we model this link through a political economy channel by developing a median voter result over sequence of taxes. We consider an infinite horizon economy in which agents are heterogeneous with respect to both initial wealth and labor skills. We study indirect preferences over redistributive fiscal policies - sequences of affine taxes on labor and capital income - that can be supported as a competitive equilibrium. The thesis assumes balanced growth preferences and full commitment. The first result is the following: if initial capital holdings are an affine function of skills, then the best fiscal policy for the agent with the median labor skill is preferred to any other policy by at least half of the individuals in the economy. The second result provides the characterization of the most preferred tax sequence by the median agent: marginal taxes on labor depend directly on the absolute value of the distance between the median and the mean value of the skill distribution. In order to analyze the co-movement properties of labor taxes, we extend the above results to an economy in which the distribution of skills evolves stochastically over time. We find that a temporary increase in inequality could imply either higher or lower labor taxes, depending on the sign and level of the correlation between inequality and aggregate labor. We also numerically calculate a calibrated version of the model and we compare the results with the data. The model does a good job on fitting the increasing trend of labor taxes in the last decades and also on matching some short run co-movements. Regarding capital taxation, the bang-bang result holds as in Bassetto and Benhabib (2006). We also generalize the median voter theorem when there is no commitment by adopting the same equilibrium definition as in Bernheim and Slavov (2008).
Essays On Trade And Productivity
(2018-05) Chan, Mons
This dissertation consists of two chapters. The first chapter extends economic theory and empirical methods to examine firm outsourcing decisions. Empirical models of production often impose input complementarity and rule out an extensive margin in the decision to "make or buy" inputs. This paper develops a simple model of production which generalizes the standard Cobb-Douglas approach and allows labor and intermediates of similar types (or "tasks") to be complements, substitutes, or (importantly) outsourced entirely. Modeling this make-or-buy decision directly allows me to correct for the selection bias resulting from the endogenous outsourcing decision and to characterize the extensive margin of factor demand. I take the model to unique Danish data on task-level purchases of disaggregated labor (e.g., truck drivers), goods, and services (e.g., shipping) and find that labor and intermediates are gross substitutes. Estimated elasticities of substitution range from 1.5 to 4, with positive cross-price elasticities between 0 to 2 across inputs and industries. These results also hold in standard firm data using total labor and intermediate expenditure variables. Aggregating across firms, I show that demand for labor is becoming increasingly price elastic over time, driven by growing outsourcing and specialization. To illustrate the importance of allowing for flexible substitutability, I examine the effect of an increase in minimum wages in the Danish manufacturing industry, finding that ignoring outsourcing underestimates disemployment by 40%. This finding also has important implications for estimating productivity. I estimate the effect of recent decreases in Danish import tariffs on firm productivity and show that controlling for substitution triples the results relative to benchmark models which only control for price effects. In the second chapter, my coauthor, Ming Xu, and I investigate how trade costs and firm make-or-buy decisions have an impact on the aggregate wage distribution. Firms react to changes in factor prices with intensive and extensive-margin employment adjustments at the occupational-level. We study the distributional and aggregate consequences of this make-or-buy dynamic by developing a novel network model of heterogeneous firm-to-firm trade where the boundary of each firm depends on factor prices and firm-occupation comparative advantage in input-production. We show that the model can be easily aggregated and taken to industry-level data, and use the calibrated model to examine recent trends in employment, wages and trade in the USA. We use public OES and CPS data to show empirical evidence that a significant fraction of the growth in wage inequality in the USA is due to changes in firm/industry specialization and occupation sorting. To understand and measure the underlying causes of these trends, we calibrate the model to occupation and industry data from the OES and input-output tables. The results suggest that 1/3rd of the increases in wage inequality stem from decreases in inter-industry trade frictions with the remaining 2/3rds stemming from changes in technology and labor supply. Falling trade frictions are also responsible for all of the increases in occupational sorting and concentration. Had trade frictions been held at their 2002 level, productivity growth would have led to an increase in vertical integration, rather than the decrease observed in the data.
Frictions in the Social and Economic Lives of Underprivileged People
(2021-05) Ordaz Reynoso, Natalia
In the last century, standards of living around the world have improved. However, thisprogress has not been equal across, nor within countries. This dissertation consists of threechapters that aim to contribute to answering the question of why this has been the case, inthree separate contexts.Chapter 1: I test whether the implementation of the California Paid Family Leave Actincreased young women’s human capital investment, specifically college enrollment. Using asynthetic control approach, I estimate that the policy increased the probability that womenenroll in college by about 2 percentage points. This effect is statistically significant at the5% level and persists for at least several years. I present a simple human capital modelof women’s schooling choices that characterizes these results as the effect of an expecteddecrease in the effects of motherhood on labor supply. Finally, I present evidence fromsurvey data and Internet searches that provides support to the hypothesized mechanism:women are more likely to enroll in college because they expect that the policy will increasetheir future labor supply.Chapter 2: Directly eliciting individuals’ subjective beliefs via surveys is increasinglypopular in social science research, but doing so via face-to-face surveys has an importantdownside: the interviewer’s knowledge of the topic may spill over onto the respondent’srecorded beliefs. Using a randomized experiment that used interviewers to implement aninformation treatment, we show that reported beliefs are significantly shifted by interviewerknowledge. Trained interviewers primed respondents to use the exact numbers used in thetraining, nudging them away from higher answers; recorded responses decreased by about0.3 standard deviations of the initial belief distribution. Furthermore, respondents withstronger prior beliefs were less affected by interviewer knowledge.Chapter 3: Governments across the world subsidize soup kitchen programs, but thereis little evidence on whether these improve food security. I study a soup kitchen programfunded by the Mexican government in 2013 to examine whether it has caused an improve-ment in food security. I find no mean municipal effects for six different measures of foodsecurity. I analyze a sub sample of the most food insecure and identify some positive effectswithin that sector of the population. My results suggest that the effect of the programon food security is concentrated in the lower end of the food security distribution, butchallenge the assumption that subsidizing prepared food will mechanically improve meanfood security significantly. I also estimate that the presence of soup kitchens in the mostex-ante food insecure municipalities decreases average food expenditures. This result pointsto diverse effects of soup kitchen programs
Funk the Clock: Transgressing Time While Young, Prescient and Black
(2019-08) Mahadeo, Rahsaan
In this dissertation, I explore how racialized youth in urbanized space reckon with time. I specifically study how race, racialization and racism condition the time perspectives of black youth in urbanized space. I draw on data from thirty in-person interviews and ethnographic fieldwork conducted over the course of one year with youth at Run-a-Way – a shelter and outreach center for youth in the Twin Cities. I make the case that whiteness and white life prefigure time, thus denying the coevalness of racialized youth, particularly black youth. Thus, “time use” among racialized youth is a misnomer. Racialized youth are more likely to owe time than own it. In using time that does not belong to them, several black youth in this project detailed the way their “time use” is read as “time theft” and thus criminalized. Youth’s accounts suggest that racialized violence is responsible for significant time theft. In other words, racialized violence takes time. Racialized violence proved to be less of a life course transition and more of a life course constant. Despite the overrepresentation of white time as time itself, I show how racialized youth at Run-a-Way turn the tables on time, ensuring their temporalities were most culturally relevant and “up to date,” while casting whiteness into a “played-out” past. I make the case that urban ethnographic representations of racialized youth in poor urbanized space as “present oriented” elide their prescience. Because they choose not to entertain liberal futurities directed towards “freedoms” associated with whiteness and a “post racial era” did not make them present oriented. It made them prepared. In sum, my research forges new directions in the study of race and time by examining how time is racialized, how race is temporalized, and how racialization and racism condition youth’s perspectives on time.
Individual, family, and community factors that predict economic self-sufficiency: An analysis of Minnesotans who receive community action agency services.
(2011-09) MartinRogers, Nicole
The research question addressed by this dissertation is: What household (individual and family) characteristics and community-level factors contribute to continued material hardship and welfare dependence and inhibit economic self-sufficiency among low-income families? The individuals who participated in this study are clients of one of the 28 community action agencies in Minnesota. Community action agencies are nonprofit organizations that receive funding from the federal Community Services Block Grant to address poverty at the community level. Here the term economic self-sufficiency is used to define a state of being for individuals and families that meet two criteria. The first component is income source. To be self-sufficient, a household must be receiving more than half of their income from sources other than public assistance. The second component is income adequacy. To be economically self-sufficient a household also must not be experiencing material hardship, meaning that they are able to afford both food and housing expenses. To examine the relationship between economic self-sufficiency and various individual/family and county-level variables, multilevel regression modeling techniques were used. The key findings are that: demographic characteristics are generally related to self-sufficiency and the impact of these variables on self-sufficiency is reduced when cash and non-cash supports are controlled in the models; participants' access to and use of cash-and non-cash supports are strong predictors of self-sufficiency, even after controlling for the impact of county-level factors; and nonprofit density is the only county-level factor that is significantly related to individual participants' self-sufficiency, and the nature of this relationship is still unclear. The results of this dissertation suggest that public programs geared toward promoting self-sufficiency should focus on increasing access to non-cash resources and supports, especially in the areas of transportation and housing. Also, community action agencies should make it a goal to register their clients who are eligible for the Earned Income Tax Credit. These agencies should also address major barriers to self-sufficiency by assessing and responding to needs for transportation, housing, and child care. More research is needed on the cost effectiveness of various policy and program solutions to improve self-sufficiency.
Members by design: how U.S. Immigration policies shape mass public beliefs about American membership.
(2011-11) Udani, Adriano A.
To what extent and in what ways do public policies on the treatment of noncitizens in America shape mass public beliefs and perceptions about membership in a democratic republic? This dissertation uses an intersectional framework that redeploys the construction of target population theory to better capture the hierarchy of power relations which structure noncitizen membership in America. I depart from dominant works that commonly analyze noncitizen membership by identifying individual-level characteristics that promote integration; studying policy decisions as outputs of unique social contexts; and, using static binary distinctions of deservingness and undeservingness. Instead, I examine the ways in which U.S. immigration policies rearticulate racism and the relationships that race has with other axes of disadvantage involving ethnicity, class, gender, and citizenship. By using a unique dataset of state immigration policies between 1997 and 2010 and national public opinion studies, I investigate how four dominant policy designs that construct American membership send political messages about noncitizens as foreign entrants with criminal intents; as applicants who are required to prove their value in America; as cultural minorities who are deprived and needy; and, as embattled people who must contest and remain resilient against institutionalized inequalities.
Multicultural Community Building in an Urban Neighborhood
(2015-06) Champe, John
This is an anthropological ethnography of multicultural community-building among the almost all-white activists in Minneapolis' largest neighborhood, Whittier. It shows the effects that the discourses, theories, and activities of these neighborhood activists have on the social structures that reproduce class, racial, and ethnic inequality. The first chapter analyzes the acrimonious battle over the opening of an apartment building for homeless. It shows the construction of the symbols at play, including Stability, Burden, Stakeholders, Gentrification, and Over-concentration of the poor. Chapter two explains how politics in Whittier became so polarized between competing factions of white, liberal, middle-class homeowners, who all share a love of their neighborhood's diversity. The study also illuminates how the faction representing "homeowner interests"� achieved dominance. Chapter three shows that while many paint Whittier as very dangerous, statistically it is not. The chapter explains the role that fear, exaggerated talk of crime, citizen crime patrols, media sensationalism, personal identity, and class conflict play in the creation of place and racial segregation. Chapter four explains how ethnic identities and class hierarchies are socially constructed through neighborhood campaigns, and also how the meaning of "diversity"� itself gets produced. The chapter details how white and Somali ethnicities are manufactured by struggles over a Somali mall and the parking around it. Chapter five reveals the failures of democracy in Whittier politics, and argues that not only has elected, democratic governance failed, but that attempting it on the neighborhood scale is probably futile and destructive. Chapter six discovers that while the academic literature argues that Americans are largely ignorant of social structures that reproduce inequality, white Whittier activists of many viewpoints are actually cognizant of them, and of their own privilege. This study finds that the key to understanding the multiplicity of thought and policy on poverty and multiculturalism, is by investigating Whittier activists' theories on neighborhood development. For example, activists opposing more subsidized housing in Whittier espouse that Whittier's health requires more homeowners, fewer renters, and fewer residents needing housing subsidies. This activism modified class hierarchy, by re-imagining it along the lines of the housing one inhabits.
Three Essays on Economic Applications Using Satellite Imageries of Nighttime Lights
(2023-12) Maldonado Salazar, Leonardo
This dissertation aims to unravel applications in the economic field derived from analyzing nighttime light data. The dissertation comprises three essays, each delving into distinct aspects of the relationship between nighttime lights and economic phenomena. The first essay investigates the relationship between nighttime lights and economic activity in oil-dependent countries, exploring whether that relationship differs in oil-producing and non-oil-producing regions. The main findings highlight differences in the predictive power of night light emissions by region, emphasizing the potential of light data to enhance economic growth measures. The second essay uses nighttime light imagery to estimate rural poverty rates in Venezuela from 2000 to 2020. The analysis reveals a significant increase in rural poverty rates between 2014 and 2020, shedding light on the impact of the Venezuelan economic collapse in recent years. Finally, the third essay examines regional inequality in the Andean countries using nighttime lights and population datasets, accounting for temporal and spatial dimensions (based on a multiple-stage nested Theil decomposition approach). The study identifies changes in overall inequality, driven by both between-country and within-country factors, providing insights for targeted initiatives to address inequality at the local level.

University Digital Conservancy

Browse by Subject

Browsing by Subject "Inequality"