Department Brown Bag Seminars

Wednesday 12:00 noon 1:05 p.m.
E2, 499 / Zoom

Spring Quarter 2022

March 30
David Sungho Park
"The Enduring Effects of Cash Transfers on Household Food Security: Evidence from Rural Liberia and Malawi"

April 6
Brian Dillon, Cornell
"Yellow Pages: Experiment Evidence on Household-Firm Connections"
Mobile phones reduce communication costs with known parties, but may not reduce search costs for new contacts. We describe a two-sided randomized control trial in Tanzania, centered on a “Yellow Pages” phone directory. Listed enterprises saw increases in customer contact, sales, and employment. We find positive enterprise spillovers within villages, and no spillovers between villages. Recipient households were more likely to rent land and hire labor, had lower rates of crop failure, and sold crops for weakly higher prices. Contact information has a unique role to play in facilitating search and increasing investment in economies recently transformed by mobile phones.

April 13
Jeremy West
"Who Benefits from Surface Water Pollution Programs?"
The U.S. Clean Water Act provides around 180 million dollars annually for nonpoint source pollution programs, allocating a fixed proportion to each state. We study how pollution levels and states' deployment of these funds vary across areas with differing racial and socioeconomic characteristics. We find that subwatersheds with wealthier and more white populations have less water pollution but are more likely to receive grants, even within state-year and controlling for rural status. In addition, we show that these disparities are larger during periods of decreasing funding, suggesting that injustice concerns may be more pronounced when pollution programs face budget cuts.

April 19
Chenyue Hu
"Spacial Consumption Risk Sharing"
This paper examines how frictions in bilateral economic linkages shape the consumption pattern across economies. Using state-level data from the US, we find that the degree of bilateral consumption risk sharing across economies decreases in geographic distance. To explain this novel fact, we develop a DSGE model that incorporates trade, migration, and finance as channels of risk sharing which are subject to frictions that covary with distance. Calibrated to the US data, the model not only enables us to quantify the magnitude of the frictions in each channel, but also allows us to examine the interplay among the channels and disentangle their effects on the level, volatility, and comovement of consumption across states. Counterfactual analyses based on the model shed light on the design of macroeconomic policies that aim to reduce cross-region consumption disparity.

April 27
Andreas Kleiner, Arizona State
"Sequential Veto Bargaining with Incomplete Information"
Host: Dong Wei
We study sequential bargaining between a proposer and a veto player. Both have single-peaked preferences, but the proposer is uncertain about the veto player’s ideal point. The proposer cannot commit to future proposals. When players are patient, there can be equilibria with Coasian dynamics: the veto player's private information can largely nullify proposer's bargaining power. Our main result, however, is that there are also equilibria in which the proposer obtains the high payoff that he would with commitment power. The driving force is that the veto player's single-peaked preferences give the proposer an option to “leapfrog”, i.e., to secure agreement from only low-surplus types early on to credibly extract surplus from high types later. Methodologically, we exploit the connection between sequential bargaining and static mechanism design.

May 11
Grace Gu
"Climate Risk and FDI" 
Climate-related risks have increased in recent decades, both in terms of the frequency of extreme weather events (physical risk) and implementation of climate-change mitigation policies (transition risk).  This paper explores whether multinational firms react to such risks by altering their presence in countries that are more affected.  We measure this by looking at foreign direct investment (FDI) dynamics in the aggregate as well as at firm level.   We propose a theoretical framework for firm production location choice that explicitly incorporates transition and physical risks.  The model predicts a reduction in FDI resulting from physical risks, but ambiguous effect of transition risks.  These predictions are consistent with our empirical findings.  We find that climate-related natural disasters generally reduce net FDI inflows in affected countries in the following year.  These effects are amplified by transition risks and by firms' exposure and attention to climate risks.

May 18
Bruce Wydick, University of San Francisco
"Mortality from the Marketing of Nestlé Infant Formula in Low and Middle-Income Countries"

June 1
Dario Pozzoli
"Hours Constraints and the Gender Wage Gap
The lack of flexibility on hours worked is often mentioned as a fundamental factor limiting the ability of female workers to earn higher wages in certain jobs. To date, however, little job- level evidence exists to support this view. We use linked employer-employee data on hours worked in Denmark to measure hours constraints at the firm-occupation level and to shed light on how these constraints relate the gender wage gap. We document that women tend to sort in low-paying firm-occupation characterized by looser constraints on hours worked. We also find that only male workers earn compensating wage differentials for hours constraints at the job level. Our findings indicate that hours constraints on the job contribute to explain around 8 percent of the gender wage gap, of which 2 percent goes through compensating wage differentials while the rest is explained by sorting. Finally we rule out that the gender wage gap is explained by productivity differentials.

Fall Quarter 2021

October 20
Dohyeon Lee
"Selective Accumulation of Ideas: Accounting for the Decline in Entry Rate and Productivity Growth"
This paper proposes a novel explanation for the decline in the entry rate of new firms and aggregate productivity growth. Improvement in the pool of incumbent firms over time reduces the profitability of potential entrants, making it harder for entrants to find profitable ideas for business and thus lowering the entry rate. This mechanism cannot be captured in stationary models, which implicitly impose disadvantages on incumbent firms relative to entrants. To overcome this limitation, I propose a novel framework that achieves a fair comparison between incumbents and entrants. I show that entrants in the U.S. have kept up with the incumbents on average over the past 40 years.

November 10
Jianan Liu
"The Effects of Labor Market Expansion: Evidence from High-Speed Rail in Germany"
There is growing interest in understanding the role of firms in wage determination. This study examines how connecting labor markets through improved transportation infrastructure affects establishment entry, exit and size, and individual employment and wages. The expansion of High-Speed Rail in Germany connected medium-sized districts located on existing lines, providing a natural experiment to study the effects of labor market expansion. Using establishment and linked employer-employee data and a difference-in-differences design, I find increased establishment entry into treated districts but greater exit among smaller establishments. Within treated districts, the number of establishments in industries with higher wages and greater reliance on skills increases. Average size and wage of establishments increase. Smaller establishments are more likely to grow in size and large ones are more likely to increase wages. Treated districts that are larger or pay higher wages or are connected with districts that pay lower wages are more likely to attract workers. Establishments hire workers from further away, especially young, male, high-educated commuters. To separate establishment wage effects from changes in worker composition and match quality, I examine the wages of stayers, and find that they increase, especially among high-educated workers. The results suggest that improvements in transportation infrastructure increase competition among firms and reduce monopsony power, especially among workers who are more likely and able to commute. This paper sheds light on the potential source of labor market frictions from limited labor mobility.

November 24 - CANCELLED
Luka Kocic
"Old Habits Die Hard: The Impact of Negative Experimental Evidence on the Continued Practice of Medical Procedures"

December 1
Grace Weishi Gu
"Social Unrest and Sovereign Spread"

Winter Quarter 2022

January 5
Brenda Samaniego
"Is the school-enrollment cutoff date a random tax? Child birth date and maternal labor supply"
Cutoff dates for school enrollment—a ubiquitous feature of educational systems worldwide—produce different possibility sets for households with children born on different dates. Using survey data from Mexico we examine whether school-enrollment cutoffs affect labor supply. Our results are imprecise but suggest that mothers whose youngest child was born before the cutoff (and therefore were able to enroll their child in school one year earlier) are 0.8-1.2 percentage points more likely to work. This is equivalent to a 5-8% increase among the group of marginal mothers. We conclude that the school-enrollment cutoff is a random tax with little deadweight loss because most mothers are infra- or supramarginal.

January 12
Ajay Shenoy
"A Model of Managerial Ability: An Input Managements Approach"
Models of production treat firm-level TFP as a black box. I propose a micro-foundation for TFP derived from a model of input management. Talented managers are those with more precise beliefs about the marginal product of each input. This framework is general enough to accommodate many forms of managerial ability. I show evidence from a secondary analysis of a randomized controlled trial that managerial training changes the selection of inputs chosen, which is consistent with my assumption input management is a form of managerial ability. I then take the model as given and derive sufficient conditions for the model to produce the Hicks-Neutral model of TFP that is standard in the literature on productivity estimation.

 January 26
Gerelt Tserenjigmid
"Price Heterogeneity as a Source of Heterogeneous Demand"
We explore heterogenous prices as a source of heterogenous or stochastic demand. Heterogenous prices could arise either because there is actual price variation among consumers or because consumers (mis)perceive prices differently. Our main result says the following: if heterogenous prices have a distribution among consumers that is (in a sense) stable across observations, then a model where consumers have a common utility function but face heterogenous prices has precisely the same implications as a heterogenous preference/random utility model (with no price heterogeneity).

February 2
Pablo Peña, U of Chicago
"Choosing Season of Birth: A Fresh Look"
We present a theoretical model where mothers choose season of birth under pregnancy uncertainty. The model produces implications about seasonality of unintended births and seasonality differences across maternal human capital. We test those implications using U.S. birth certificates and find that environmental factors at conception create seasonality. In some states, births to high-human capital mothers show less seasonality than unintentional births. Importantly, high-human capital mothers aren't more likely to repeat season of birth across successive births than low-human capital mothers. The widespread notion that high-human capital mothers have strong preferences for season of birth seems misplaced.

February 9 - In-Person
Luis Bauluz, University of Bonn (visiting Berkeley)
"The Wealth of Generations"
This paper studies the wealth accumulation of different cohorts in the U.S. and France since 1950 and 1970, respectively. We provide a set of new stylized facts that shows a stark divergence between the wealth holdings of old and young adults since the 1980s, most strongly in the U.S. Using microdata for the U.S., we explore the reasons for this divergence by decomposing wealth accumulation into three components: saving, capital gains, and inheritances. While saving was the single most important component of wealth accumulation for cohorts born at the beginning of the 20th century, capital gains have started to play a much more prominent role for more recent generations. Our findings indicate that positive capital gains in recent decades are the main driver of the rising wealth differences between young and old adults. Moreover, we also document stark changes in the life-cycle saving profile of old and new cohorts. Out of their lifetime incomes, different cohorts saved approximately the same, but younger cohorts saved more at middle ages and dissaved more when old. Larger dissaving after retirement in recent years critically shaped, in turn, the decline in the aggregate household saving rate happened in recent decades. 

March 9
Dan Friedman and Galina Hale
Earth Futures Institute: "Financing green transitional investments and other public goods"