Department Brown Bag Seminars

Wednesday 12:00 noon – 1:05 p.m.
499 Engineering II

2018-19

Fall 2018

October 10
Brenda Samaniego de la Parra
"How Much is Formality Worth?"

October 17
Jon Robinson
"The Effect of Multiple Savings Accounts: Evidence from Malawi"
Abstract:
We test whether providing people with multiple labeled savings accounts affects savings decisions and downstream outcomes in a field experiment with 480 entrepreneurs in urban Malawi. In the experiment, treatment respondents received either one account or multiple accounts (up to 3), while a control group received nothing. We find that multiple accounts increased savings in treatment accounts by about 30%, and find some evidence that total savings increased by more among those given multiple accounts. We also find that savings accounts had sizeable effects on a number of outcomes, including labor supply, farming decisions, household expenditures, land purchases, credit extended to customers, and interpersonal transfers. However, we find no evidence that multiple accounts had larger downstream effects than single accounts. We speculate that incremental effect of an additional account would likely appear over a longer time period.

October 24
Christopher Rauh, University of Montreal
"Is Marriage for White People? Incarceration, Unemployment, and the Racial Marriage Divide"
Abstract:
During the last few decades, there has been a dramatic decline in marriage among blacks in the US. About 89% of black women between ages 25 and 54 were ever married in 1970. Today only 51% of them are. Wilson (1987) suggests that the lack of marriageable black men due to incarceration and unemployment is responsible for low marriage rates among blacks. In this paper, we take a dynamic look at the Wilson Hypothesis. We argue that the current incarceration policies and labor market prospects make black men much riskier spouses than white men. They are not only more likely to be, but also to become, unemployed or incarcerated than their white counterparts. We develop an equilibrium search model of marriage, divorce and labor supply that takes into account the transitions between employment, unemployment and prison for individuals by race, education, and gender. We calibrate this model to be consistent with key statistics for the US economy. We then investigate how much of the racial divide in marriage is due to differences in the riskiness of potential spouses. We find that differences in incarceration and employment dynamics between black and white men can account for half of the existing black-white marriage gap in the data.

October 31
Dan Friedman
"Revealed Preferences and General Equilibrium: A Laboratory Study"
Abstract
Laboratory subjects choose from 25 different budget sets with a common endowment, and thereby reveal their preferences over bundles of goods (Arrow securities). Pair-replica economies constructed from these revealed preferences often have no (or have multiple) competitive equilibrium, as suggested by the classic Sonnenschein-Mantel-Debreu theorem. However, these ``pathologies" disappear when subjects are sorted into 12-person economies, including some which include only problematic (high convexity) revealed preferences. Actual trade in these economies using a tatonnement market institution closely tracks predictions in most markets, and the failures occur only in economies a priori deemed fragile to preference instability.

November 7
Rob Fairlie
"Experimental Evidence on Computer Assisted Learning in China"

November 14
Ariel Weinberger, University of Oklahoma
"The Welfare Benefits of Raising Your Standards"
Abstract:
Negotiations on modern trade agreements are increasingly focused on technical measures such as quality standards. We first examine the implications of quality standards on the reallocation of domestic sales. Guided by this evidence, we build a model of monopolistically competitive, heterogeneous firms, in which a quality standard forces low-quality firms to exit. Raising the quality standard can improve welfare if too many low-quality firms are present in the market allocation relative to the efficient allocation. We find that this is indeed the case in a general setting that encompasses various types of preferences, which provides a new rationale for technical measures that has not been accounted for in the previous literature. A reduction in trade costs reduces the optimal standard in a cooperative equilibrium across countries. We estimate the restrictiveness of standards across Chilean industries and find that in several instances the imposed standard is too restrictive relative to an upper bound for the standard predicted by the model. However, there is suggestive evidence that a rise in openness has reduced restrictiveness, which supports the efforts to improve agreements on technical measures along with traditional trade agreements.  

December 5
Bruce Meyer, University of Chicago
"TBA" 

Winter 2019

March 13
Jeffrey Butler, UC Merced
"Inequality as an Incentive"
Abstract: 
We study the incentive effects of wage and earnings inequality in a laboratory experiment. We randomly assign wage levels on a real-effort task.  Across treatments, we exogenously vary information about wage and (experimental) income inequality as well as work content. In all treatments, we provide participants with subsequent opportunities to behave pro- or anti-socially. We specifically design all tasks to be ecologically valid. We formulate a novel hypothesis in which salient inequality provides positive incentives by differentially activating well-known cognitive processes, reducing shirking but also pro-sociality.

Spring 2019

April 3
Ajay Shenoy
"Consolidating National Power through Local Government: Evidence from India"
Abstract:
We test whether and by what means political parties leverage control of local government to win national elections. We use a multidimensional regression discontinuity design to test whether the biggest regional party in the Indian State of West Bengal raises its vote share within villages where it controls the village council. This is [very!] preliminary work that would benefit enormously from your feedback. Our aim is to combine polling station-level election results with administrative records for how local governments allocate jobs under their control. We'll be able to test how they target benefits to better understand exactly how they exploit their local power to win higher office.

April 10
Jeremy West
"Product Quality Disclosure with Uninformed Sellers"
Abstract:
This study examines markets in which both buyers and sellers may not fully observe transacted product quality. Using a behavioral model, we illustrate how ignorance can influence sellers' quality disclosure decisions. Empirically, we leverage a natural policy experiment that encourages homeowners to provide potential buyers with certified measurements of energy efficiency. Using similar nearby homes to form a counterfactual, we find that credible disclosure significantly increases price capitalization of and investments in energy efficiency. Despite very heterogeneous price benefits from disclosure, we show that properties' relative energy efficiency only weakly predicts disclosure propensities. Connecting our empirical findings to the model, we demonstrate using a computational simulation that a substantial share of homeowners are apparently uninformed about the relative energy efficiency of their own properties. Our findings yield insights about the energy efficiency gap and hold implications for disclosure policies in real estate markets and in other settings.

April 17
Carlos Dobkin
"Health Insurance and Access to Care for the Near Elderly"
Abstract:
Even after the recent expansion in health insurance coverage seven percent of the near-elderly lack insurance. Despite having higher illness rates than the general population the near-elderly uninsured have lower levels of health care utilization and about 34 percent re-port foregoing care due to cost. We use the sharp change in insurance coverage that occurs when people become eligible for Medicare to estimate the effect of insurance on access to care. We find that getting insurance results in a 35 percentage point decline in the probability of reporting foregoing health care due to costs. We also document that insurance coverage results in a 23 percentage point increase in hospital admissions with the majority of the increase due to elective admissions.

May 1
Jon Robinson
"The Effect of Mobile Money for Entrepreneurs in Urban Malawi"
Abstract:
We present results from the first RCT on access to mobile money. The experiment included 480 entrepreneurs in urban Malawi. Treated individuals received assistance with opening mobile money accounts, were trained on how to use the accounts, and were encouraged to use mobile money for savings. Accounts were identical to those that are commercially available other than that withdrawal fees were waived for the length of the experiment. Seventy-five percent of treatment respondents made at least one deposit and 53% made at least 5, and we observe a strong first stage – treatment increased mobile money savings by 65-120%. We find several downstream effects, including a reallocation of labor supply from business towards agriculture, an increase in business credit, and an increase in several expenditure categories. Evidence suggests that treatment effects were driven by savings rather than by interpersonal transfers.

May 8
Justin Marion
"Conflicts of Interest and Privatizing Environmental Enforcement: Evidence from Hazardous Waste Site Cleanup"

May 15
Dario Pozzoli (joint with Grace Gu)
"Workers' Reallocation, Innovation and Import Competition"
Abstract:
We study how Chinese import competition affects firms' share of R&D workers and innovation. Using administrative data for Denmark (1995--2012), we find that import competition triggers an increase in the firms' share of R&D workers. Less than a third of this increase is due to the reallocation of "trapped" workers to R&D activities within the same firm. These results are confirmed by a broad set of the worker level analyses. We then show that Chinese import competition indeed induces Danish firms to innovate. Around 30 percent of this increase channels through the overall increase in the share of R&D workers resulting from import competition. We then extend our analysis to Portugal, using its administrative data (1995--2012), to shed light on the potential role the firing costs in establishing workers' reallocation in response to import competition.

May 22
Ana Gazmuri, Toulouse
"Peer Learning in College Applications"
Abstract:
When making college application decisions students face complicated choices and may lack sufficient information to navigate the application process. An important potential source of information about college characteristics and admission chances is an applicant’s peer group. In this paper, we use data from Ontario, Canada to study the role of social influence on college application decisions through the diffusion of information across cohorts within high schools. We examine how students applying and matriculating to college in a given year influence students application decisions in subsequent years. We use a rich set of fixed effects to control for unobserved differences across schools and types of majors. Our empirical strategy leverages across-cohort variation to more cleanly identify these effects, mitigating identification concerns related to simultaneity. We find that the probability of a student applying to a particular undergraduate program increases between 20 and 50% when having a student in the preceding cohort applying to a program to which no one from that high school applied previously. Additionally, having someone from a preceding cohort admitted to a program further increases the probability of application. These findings are consistent with students learning about the existence, characteristics, and admissions chances of various college programs from the experiences of their older-cohort peers. This type of informational peer effects could imply additional costs of school segregation as low-income students may lack the rich-information environment needed for making post-secondary education decisions. Furthermore, from a policy perspective, peer influence may change the evaluation of interventions to provide information to students, as it can create social multiplier effects. 

May 29 - Cancelled
Kristian Lopez Vargas
"TBA"

June 5
Michael Gelman, Clarmont McKenna
"Rational Illiquidity and Excess Sensitivity: Theory and Evidence from Income Tax Withholding and Refunds"
Abstract:  
There is a tight relationship between having low liquidity and a high marginal propensity to consume both in theoretical models and in econometric evidence about behavior.  This paper analyzes the theory and behavior surrounding income tax withholding and refunds. It develops a model where rational cash management with asymmetric cost of increasing or decreasing liquidity endogenizes the relationship between illiquidity and excess sensitivity. The analysis accounts for the finding that households tend to spend tax refunds as if they were liquidity constrained despite the fact that they could increase liquidity by reducing withholding. The model’s predictions are supported by evidence from a large panel of individuals.