Working Papers
(with Christine Dobridge and Joanne Hsu)
We estimate the effects of personal income tax decreases on subjective financial well-being and consumer credit outcomes. A plausibly causal design shows that tax decreases in the Tax Cuts and Jobs Act made survey respondents more likely to say they were ``living comfortably'' financially, with null effects at lower levels of subjective financial well-being. Estimates from a similar design using credit bureau data show that people who had larger tax decreases were modestly more likely to open new accounts, more likely to have higher consumer credit balances, and less likely to have a delinquency. Tax decreases had precisely estimated effects on credit scores that are indistinguishable from zero. Results suggest that tax decreases improve financial well-being in ways not fully proxied by expenditures.
Under revisions
(with Katherine Lim)
Changes in pay and benefits alone incorrectly predict self-assessed changes in overall job quality 30 percent of the time, according to survey evidence from job changers. Job changers also place more emphasis on their interest in their work than they do on pay and benefits in evaluating whether their new job is better. Parents particularly emphasize work-life balance, and we find some indications that mothers value it more than fathers. Improvements in pay are highly correlated with improvements in other amenities for workers with less education but not for workers with a bachelor's degree or more. The higher positive correlation implies that differences in pay and benefits understate differences in total job quality to a greater degree among workers with less education.
Under revisions
(With Aditya Aladangady and David Albouy)
Inequality in U.S. housing prices and rents both declined in the mid-20th century, even as home-ownership rates rose. Subsequently, housing-price inequality has risen to pre-War levels, while rent inequality has risen less. Combining both measures, we see inequality in housing consumption equivalents mirroring patterns in income across both space and time, according to an income elasticity of housing demand just below one. These patterns occur mainly within cities, and are not explained by observed changes in dwelling characteristics or locations. Instead, recent increases in housing inequality are driven most by changes in the relative value of locations, seen especially through land.
Press (selected): Washington Post, Atlantic: City Lab
Under revisions
Publications
Someone who lives in an economically depressed place was probably born there. And having workers with local ties – who prefer to live in their birthplaces – leads to smaller migration responses in depressed places. Smaller migration responses lead to lower real incomes and make incomes more volatile, a form of hysteresis. Local ties can also persist for generations. Additionally, subsidies to economically depressed places cause smaller distortions, since few people want to move to depressed places. Finally, subsidies to productive places increase aggregate productivity, since they induce more migration.
(With Katie Lim)
Increases in labor force exits during the COVID-19 pandemic were larger for Black women, Latinas, and women living with children. After controlling for detailed job and demographic characteristics, we estimate larger increases in labor force exits among women living with children under age 6 and among lower-earning women living with school-age children. Women of color also had larger increases in labor force exits during the pandemic. A decomposition shows that differences in education and job characteristics explain a large portion of the racial differences in exits. The presence of children also predicted larger increases in exits during the pandemic among Latina and Black women. Overall, results suggest that childcare interruptions led to excess pandemic labor force exits with larger effects for women of color.
Press (selected): The Atlantic
Parental Proximity and Earnings After Job Displacements - Labour Economics (2020)
(With Pawel Krolikowski and Patrick Coate)
The earnings of young adults who live in the same neighborhoods as their parents completely recover after a job displacement, unlike the earnings of young adults who live farther away, which permanently decline. Nearby workers appear to benefit from help with childcare since grandmothers are less likely to be employed after their child’s job displacement and since the earnings benefits are concentrated among young adults who have children. The result also suggests that parental employment networks improve earnings. Differences in job search durations, transfers of housing services, and geographic mobility, however, are too small to explain the result.
Published version, pre-print version, replication code
FEDS Working Paper, Cleveland Fed Working Paper
Non-technical summaries: 2018 Economic Commentary, 2017 Economic Commentary
Press (selected): Wall Street Journal, The Atlantic, Time, Business Insider, MarketWatch
Formerly: Family Ties and Worker Displacement
Work in progress
Transfer spending and local labor markets: Evidence from welfare reform
(With Brian Asquith and Andrew Samwick)
We investigate the local labor market effects of changes in the social safety net stemming from the 1996 Personal Responsibility and Work Opportunity Reconcilliation Act (PRWORA), commonly referred to as welfare reform. The PRWORA significantly altered the social safety net in ways that affected some areas more than others. In particular it ended Aid for Families with Dependent Children program, replacing it with a much less generous Temporary Aid for Needy Families program. Additionally, several other programs were de-coupled, leading to significant differences across local areas. This local variation offers us an opportunity to better understand how governmental supports impact local employment and local jobs more generally. While the programs were designed to increase employment rates among people who were previously receiving assistance, their effects on local employment are ambiguous due to the lower level of federal expenditures and the possibility of crowding out.
Public draft expected in 2024