tourism and economic development evidence from mexico s coastline tourism is a fast growing services sector in developing countries this paper combines a rich collection of mexican microdata with a quantitative spatial equilibrium model and a new empirical strategy to study the long term economic consequences of tourism both locally and in the aggregate we find that tourism causes large and significant local economic gains relative to less touristic regions that are in part driven by significant positive spillovers on manufacturing in the aggregate however these local spillovers are largely offset by reductions in agglomeration economies among less touristic regions so that the national gains from trade in tourism are mainly driven by a classical market integration effect

marshall s scale economies using panel data this paper estimates plant level production functions for machinery and high tech industries that allow for scale externalities from other plants in the same industry locally and from the scale or diversity of local economic activity outside the own industry the paper finds that the count of other own industry plants representing a count of local information spillover sources has strong productivity effects in high tech but not machinery industries single plant firms both benefit more from and generate greater external benefits than corporate plants given their greater reliance on external environments on dynamic externalities high tech single plant firms benefit also from the scale of past own industry activity i find little evidence of economies from the diversity or scale of local economic activity outside the own industry

reconciling the old and new census bureau education questions recommendations for researchers beginning with the 1990 census and the january 1992 current population survey cps the bureau of the census changed the emphasis of its educational attainment question from years of education to degree receipt using a matched sample from the 1991 and 1992 march cps this article addresses how to reconcile the old and new questions the effects of those methods on the estimated return s to education are then examined both the estimated linear return and the estimated college high school wage differential are slightly larger using information from the new question

joint confidence intervals for income shares and lorenz curves in a recent paper beach and davidson 1983 extended the principles of statistical inference to lorenz curves and income shares by establishing the asymptotic distribution and covariance structure of a vector of lorenz curve ordinates corresponding to a set of quantile abscissae one can thus use the lorenz curve and income shares no longer just as descriptive devices for summarizing distribution information but now also as analytical tools for comparing alternative distributions and carrying out conventional statistical inference on them it would clearly be desirable however to extend and complement this work by providing a method for computing a set of joint confidence intervals about these income shares and for illustrating graphically a joint confidence band about a set of estimated lorenz curve ordinates the present paper provides a new and simple technique for doing this when analyzing differences between sets of income shares or lorenz curves one typically wants to elicit more detailed information than is provided by a standard joint chi square test on the overall set of shares that is when the hypothesis of two sets of shares being the same is rejected we generally want to know further which particular differences in shares are different from zero and of these nonzero differences which are positive and which negative savin 1980 a natural way of providing such information is through multiple comparison procedures developed in this paper in a recent work richmond 1982 has developed a general method of finding multiple comparison intervals that is particularly suited to the present problem and in this situation appears to dominate other conventional alternatives in contrast for example to scheff s s projection method richmond s approach focuses on a set of primary points of interest income shares among a more general set of points including the lorenz curve ordinates and optimizes the joint confidence interval lengths on this primary set of points since estimated lorenz curve ordinates are built up from underlying income shares these shares perhaps further supplemented are natural choices for the primary set the method however also provides a joint confidence band that geometrically bounds the set of lorenz curve ordinates and interpolated segments between them the present

on the optimal design of place based policies a structural evaluation of eu regional transfers we quantify general equilibrium effects of place based policies in a multi region framework with population mobility trade and agglomeration economies using detailed data on eu transfers we infer the local effects of different transfer types on productivity income and transportation cost based on these estimates and the general equilibrium model we derive the spatial distribution of economic activity and the resulting aggregate welfare effects if i no transfers were paid and taxes set to zero ii transfers were distributed uniformly iii transfers were welfare optimally distributed characterizing the optimal distributions we reveal complementarities between transfer types and between transfers and local endowments

who benefits from local job growth migrants or the original residents bartik t j 1993 who benefits from local job growth migrants or the original residents reg studies 27 297 311 this paper surveys research on whether the new jobs resulting from growth in a local economy e g a metropolitan area go to inmigrants or the original local residents the empirical evidence suggests that around one quarter of the new jobs from local growth increases the labour force participation rates of local residents in the long run these long run effects may occur because local growth provides residents with valuable employment experience research also suggests that minorities benefit most from growth and that higher wage industries provide greater employment benefits for local residents bartik t j 1993 qui est ce qui beneficie de la croissance d emploi locale les migrants ou la population autochtone reg studies 27 297 311 cet article etudie la recherche effectuee dans le but d evaluer si les nouveaux emplois dus a la croissance d une economic locale par exemple une

does marriage really make men more productive this paper presents new descriptive evidence regarding marital pay premiums earned by white males longitudinal data indicate that wages rise after marriage and that cross sectional marriage premiums appear to result from a steepening of the earnings profile data from a company personnelfile that includes information on job grades and supervisor performance ratings reveal large marital status pay differences within a narrow range of occupations managers and professionals and environments a single firm married workers tend to be located in higher paying job grades there are very small pay differentials within grades married men receive higher performance ratings than single men as a result they are much more likely to be promoted controlling for rated performance however eliminates the promotion differential sanders korenman is an assistant professor of economics and public affairs at princeton university and is a faculty associate of the office of population research at princeton university and a research affiliate of the national bureau of economic research nber david neumark is an assistant professor of economics at the university of pennsylvania and a research affiliate of the nber korenman wishes to acknowledge the hewlett foundation and the harvard university center for population studies for financial support the authors are grateful to james medofffor making available an extract from the company personnelfile questions regarding data availability should be directed to professor james

benefits and ancillary costs of natural infrastructure evidence from the new jersey coast abstract this paper empirically estimates the economic impacts of a large scale public investment in natural infrastructure aimed at adapting to climate change and increasing coastal resilience i utilize temporal and spatial variation in investment in dunes to provide a hedonic property value estimate of the economic benefits i identify the net effect of treatment utilizing the doubly robust oaxaca blinder estimator and show that coastal housing price increases attributable to constructed dunes are approximately 3 6 a decomposition of the average impact suggests that the policy intervention generates ancillary costs related to impaired ocean views and privacy concerns that partially offset large protection benefits

changes in transportation infrastructure and commuting patterns in us metropolitan areas 1960 2000 population decentralization has been a salient feature of the landscape of most u s urban areas since 1950 nathaniel baum snow 2007 documents that the aggregate population of central cities of the 139 largest metropolitan areas henceforth msas declined by 17 percent between 1950 and 1990 while aggregate msa population growth was 72 percent during this period expansion of the highway network in urban areas accounts for about one third of the gap in central city and msa population growth rates while transport network expansions clearly generated urban population decentralization there is little evidence to date on how this decentralization manifested itself as changes in employment locations and commuting patterns in this paper i present evidence indicating that employment decentralization occurred apace with residential decentralization between 1960 and 2000 such that their relative spatial concentrations remained remarkably unchanged a byproduct has been that most commutes of msa residents no longer involve central cities at all central cities as defined by their geographies in 1960 were the origin and or destination of only 38 percent of commutes made by msa residents in 2000 down from 66 percent in 1960 using planned portions of the interstate highway system as a source of exogenous variation estimates reported in section iii indicate that urban highway construction played a pivotal role in generating this shift new highways primarily increased the number and fraction of commuting flows within suburban areas at the expense of commutes within central cities because within suburb commutes are longer than other types of commutes on average results are consistent with gilles duranton matthew turner s 2009 evidence that the elasticity of kilometers driven with respect to lane kilometers of highways in urban areas is one 1

dreams of urbanization quantitative case studies on the local impacts of nuclear power facilities using the synthetic control method this paper uses the synthetic control sc method to examine how the establishment of nuclear power facilities npfs in japan in the 1970s and 1980s has affected local per capita income levels in the municipalities in which they were localted npf municipalities eight quantitative case studies using the sc method clarify that the effects of npf establishment on per capita taxable income levels are highly heterogeneous the estimated effects are often economically meaningful and in some cases huge the income level was 11 higher on average and 62 higher in one municipality in 2002 when compared with counterfactual units on the other hand a few of the npf municipalities have received only weak or negligible effects from npf establishment the post estimation comparisons of employment between the npf municipalities and the sc units suggest that the size of the direct labor demand shocks and subsequent indirect employment effects on nontradable service sectors have contributed to the increase in per capita income levels

how successful was the new deal the microeconomic impact of new deal spending and lending policies in the 1930s the new deal during the 1930s was arguably the largest peace time expansion in federal government activity in american history until recently there had been very little quantitative testing of the microeconomic impact of the wide variety of new deal programs over the past decade scholars have developed new panel databases for counties cities and states and then used panel data methods on them to examine the impact of new deal spending and lending policies for the major new deal programs in most cases the identification of the effect comes from changes across time within the same geographic location after controlling for national shocks to the economy many of the studies also use instrumental variable methods to control for endogeneity the studies find that public works and relief spending had state income multipliers of around one increased consumption activity attracted internal migration reduced crime rates and lowered several types of mortality the farm programs typically aided large farm owners but eliminated opportunities for share croppers tenants and farm workers the home owners loan corporation s purchases and refinancing of troubled mortgages staved off drops in housing prices and home ownership rates at relatively low ex post cost to taxpayers the reconstruction finance corporation s loans to banks and railroads appear to have had little positive impact although the banks were aided when the rfc took ownership stakes

does household electrification supercharge economic development author s lee kenneth miguel edward wolfram catherine abstract in recent years electrification has re emerged as a key priority in low income countries with a particular focus on electrifying households yet the microeconomic literature examining the impacts of electrifying households on economic development has produced a set of conflicting results does household electrification lead to measurable gains in living standards or not focusing on grid electrification we discuss how the divergent conclusions across the literature can be explained by differences in methods interventions potential for spillovers and populations we then use experimental data from lee miguel and wolfram 2019 a field experiment that connected randomly selected households to the grid in rural kenya to show that impacts can vary even across individuals in neighboring villages specifically we show that households that were willing to pay more for a grid electrification may gain more from electrification compared to households that would only connect for free we conclude that access to household electrification alone is not enough to drive meaningful gains in development outcomes instead future initiatives may work better if paired with complementary inputs that allow people to do more with power

the unequal geographic burden of federal taxation in the united states workers in cities offering above average wages cities with high productivity low quality of life or inefficient housing sectors pay 27 percent more in federal taxes than otherwise identical workers in cities offering below average wages according to simulation results taxes lower long run employment levels in high wage areas by 13 percent and land and housing prices by 21 and 5 percent causing locational inefficiencies costing 0 23 percent of income or 28 billion in 2008 employment is shifted from north to south and from urban to rural areas tax deductions index taxes partially to local cost of living improving locational efficiency

demographic change and income inequality in the united states 1976 1989 the u s economy experienced significant increases in the degree of income inequality over the past two decades in this paper we consider the effects of race age female headship and college education on the distribution of family income by developing a multivariate methodology that allows us to gauge the influence of one factor while holding other determinants of family incomes constant over the period studied we find that race had only a minor effect on the overall size distribution of income age had a somewhat greater effect than race in contrast the impact of female heads and college education were quite substantial the multivariate estimates reveal that the effects of female heads and college education both increase the gini to a much greater extent than the progressivity of federal income taxes decreases it the effects of college education and female headed families on inequality have grown larger across time while the influence of age has declined we find that the effects of race on inequality have changed little over the 1976 to 1989 period excerpt

a tale of an unwanted outcome transfers and local endowments of trust and cooperation abstract transfers can do good however they can also result in massive failures this paper presents a model that highlights the ambiguous nature of the impact of transfers on local endowments of social capital it then describes an empirical investigation that illustrates that the receipt of eu structural funds causes a deterioration of the endowments of trust and cooperation in the subsidized regions

size and distribution of incomes as determinants of social welfare abstract the paper is concerned with the relationship between the inequality of income distributions and the social welfare they imply starting point is an ordering of income distributions in terms of inequality based on explicit value judgments about the trade off between size and distribution of incomes an ordering in terms of social welfare is derived the welfare functions representing this ordering allow a size distribution split up it is shown that the procedure can be reversed this ordinal approach is considerably more flexible and less arbitrary than most methods proposed in the literature

market externalities of large unemployment insurance extension programs we provide evidence that unemployment insurance affects equilibrium conditions in the labor market which creates significant market externalities we provide a framework for identification of such equilibrium effects and implement it using the regional extension benefit program rebp in austria which extended the duration of ui benefits for a large group of eligible workers in selected regions of austria we show that non eligible workers in rebp regions have higher job finding rates lower unemployment durations and a lower risk of long term unemployment we discuss the implications of our results for optimal ui policy jel e24 j64 j65 r23

the making of the modern metropolis evidence from london modern metropolitan areas involve large concentrations of economic activity and the transport of millions of people each day between their residence and workplace we use the revolution in transport technology from the invention of steam railways newly constructed spatially disaggregated data for london from 1801 1921 and a quantitative urban model to provide evidence on the role of these commuting flows in supporting such concentrations of economic activity steam railways dramatically reduced travel times and permitted the first large scale separation of workplace and residence we show that our model is able to account for the observed changes in the organization of economic activity both qualitatively and quantitatively in counterfactuals we find that removing the entire railway network reduces the population and the value of land and buildings in greater london by 20 percent or more and brings down commuting into the city of london from more than 370 000 to less than 60 000 workers

skill transferability migration and development evidence from population resettlement in indonesia we use a natural experiment in indonesia to provide causal evidence on the role of location specific human capital and skill transferability in shaping the spatial distribution of productivity from 1979 1988 the transmigration program relocated two million migrants from rural java and bali to new rural settlements in the outer islands villages assigned migrants from regions with more similar agroclimatic endowments exhibit higher rice productivity and nighttime light intensity one to two decades later we find some evidence of migrants adaptation to agroclimatic change overall our results suggest that regional productivity differences may overstate the potential gains from migration

unique equilibrium in a model of self fulfilling currency attacks even though self fulfilling currency attacks lead to multiple equilibria when fundamentals are common knowledge we demonstrate the uniqueness of equilibrium when speculators face a small amount of noise in their signals about the fundamentals this unique equilibrium depends not only on the fundamentals but also on financial variables such as the quantity of hot money in circulation and the costs of speculative trading in contrast to multiple equilibrium models our model allows analysis of policy proposals directed at curtailing currency attacks

gibrat s law for all cities two empirical regularities concerning the size distribution of cities have repeatedly been established zipf s law holds the upper tail is pareto and city growth is proportionate census 2000 data are used covering the entire size distribution not just the upper tail the nontruncated distribution is shown to be lognormal rather than pareto this provides a simple justification for the coexistence of proportionate growth and the resulting lognormal distribution an equilibrium theory of local externalities that can explain the empirical size distribution of cities is proposed the driving force is a random productivity process of local economies and the perfect mobility of workers

where does an industry locate abstract this paper presents an econometric model of industrial location and estimates the model for two industries in brazil based on a comprehensive data set the model predicts which cities will or will not have the industry and for these cities with the industry what the scale of operation will be the parameters estimated in a full information context represent the technology of production supply of entrepreneurs and equilibrating error in markets the results are strong and very suggestive and the explanatory power of the model is relatively high the results are used to simulate the impact of industry subsidies on locational patterns

do special economic zones induce developmental spillovers evidence from india s states abstract do special economic zones induce local development research drawing on the case of china s special economic zones suggests that subnational polities can target the location of export zones in order to catalyze local and regional socioeconomic development since 2006 a number of indian states have pushed forward similar zones in the face of accusations of land grabbing arguing that the zones will be engines for improvement in exports employment and infrastructure i argue that local development spillovers are an important albeit previously understudied dimension by which to evaluate the effects of special economic zones i then present the first systematic analysis of the developmental effects of india s sezs leveraging an original dataset on their locations together with 2001 and 2011 census data containing a host of social and economic developmental variables the findings show these sezs have failed to bring about local socioeconomic development to explain this absence of developmental spillovers i provide a theoretical framework based on the crucial role of political economy incentive structures facing local politicians i outline the mechanism through which indian state politicians use state owned development corporations for rent capture undermining the potential effectiveness of sezs and leading to their developmental failures the combination of available means for extracting rents and the limited political constraints on such rent extraction leads to a lack of developmental spillovers this framework can also help to explain the difference in the effects of sezs in india and in china these findings have theoretical importance for understanding the conditions under which subnational polities can use export zones and other export policies to catalyze development and practical implications for understanding the mixed pattern of sez success across the world

the economics of density evidence from the berlin wall this paper develops a quantitative model of internal city structure that features agglomeration and dispersion forces and an arbitrary number of heterogeneous city blocks the model remains tractable and amenable to empirical analysis because of stochastic shocks to commuting decisions which yield a gravity equation for commuting flows to structurally estimate agglomeration and dispersion forces we use data on thousands of city blocks in berlin for 1936 1986 and 2006 and exogenous variation from the city s division and reunification we estimate substantial and highly localized production and residential externalities we show that the model with the estimated agglomeration parameters can account both qualitatively and quantitatively for the observed changes in city structure we show how our quantitative framework can be used to undertake counterfactuals for changes in the organization of economic activity within cities in response for example to changes in the transport network

industrial policy evaluation in the presence of spillovers the shortage of studies on spatial spillovers of capital subsidy policies is rather surprising considering that such policies are usually designed to generate spatial externalities we propose a new framework that allows positive agglomeration effects to be contrasted with the negative cross sectional substitution and the crowding out effect the global evaluation of the att and the spillover parameters shifts the spotlight from the policy effect on subsidised firms to the global effect of capital subsidy policies on the targeted territory the empirical evaluation of a policy in italy mainly directed towards small and medium sized firms shows that the impact on investments turnover and employment is positive and large but is negative on tfp however the employment growth is partially determined to the detriment of the untreated firms

explaining the decline of the u s saving rate the role of health expenditure between 1980 and 2007 the u s personal saving rate declined from 11 percent to 3 percent in this paper we provide evidence that most of the decline can be explained by rising health expenditures we rst employ reduced form methods and exogenous variation in medical expenses generated by fda drug approvals to document that a 1 percentage point increase in health expenditure generated a decline in the saving rate that is between 0 73 and 0 89 percentage points using this result we calculate that the rise in health expenditure explains about 90 percent of the drop in the saving rate we then develop and estimate a model of consumption saving and health decisions to evaluate which mechanisms are behind the decline using the estimated model we document that the rise in medical expenses and drop in the saving rate are driven mainly by progress in health technology during the years 1995 2010 by the reduction in co payment rates in the period 1986 1994 and by improvements in income processes for the years 1980 1985

does welfare play any role in female headship decisions abstract previous studies have examined whether the welfare system has contributed to the dramatic increase in single parent families this paper explores why the results in this literature are sensitive to the presence of state fixed effects it considers one natural explanation namely that the composition of the population differs across states in ways that are related to welfare program generosity after controlling for individual effects the results provide no evidence that welfare raises the propensity to form female headed households for either whites or blacks these results illustrate the potential pitfalls of assuming that state factors are fixed over a long period of time they also suggest that previous studies may have overstated the effect of welfare programs on family structure

local economic development agglomeration economies and the big push 100 years of evidence from the tennessee valley authority we study the long run eects of one of the most ambitious place based economic development policies in u s history the tennessee valley authority using a rich panel dataset of counties we conduct an evaluation of the dynamic eects of the tva on local economies in the seventy years following the program s inception we nd that the tva led to short run gains in agricultural employment that were eventually reversed while impacts on manufacturing employment continued to intensify well after the program s subsidies had lapsed a pattern consistent with the presence of strong agglomeration economies in the manufacturing sector economists have long cautioned that the local gains created by place based policies may be oset by losses elsewhere yielding ambiguous eects on the u s as a whole building on the framework in glaeser and gottlieb 2008 we develop a novel approach to assessing the aggregate consequences of shifting the spatial distribution of manufacturing employment our ndings suggest the aggregate productivity gains associated with relocating manufacturing activity to the tva region were probably minimal

the enduring impact of the american dust bowl short and long run adjustments to environmental catastrophe the 1930 s american dust bowl was an environmental catastrophe that greatly eroded sections of the plains analyzing new data collected to identify low medium and high erosion counties the dust bowl is estimated to have immediately substantially and persistently reduced agricultural land values and revenues during the depression and through at least the 1950 s there was limited reallocation of farmland from activities that became relatively less productive agricultural adjustments such as reallocating land from crops to livestock recovered only 14 to 28 of the initial agricultural cost the economy adjusted predominately through migration rather than through capital inows and increased industry

understanding young women s marriage decisions the role of labor and marriage market conditions using the 1970 1980 1990 censuses the authors investigate the impact of labor and marriage market conditions on the incidence of marriage of young women age 16 24 they first estimate the effects on marriage of personal characteristics and metropolitan statistical area msa indicators separately by race and education group they then regress the first stage msa effects on msa level labor and marriage market conditions and welfare benefits taking account of fixed effects and time trends specific to each msa better female labor markets worse female marriage markets worse male labor markets are found to lower marriage rates fr whites in all education groups results for these variables for blacks are sensitive to estimation technique although stronger results are obtained for an older age group 25 34 while welfare benefits have a negative effect in cross sectional analyses the association becomes considerably weaker in fixed effects specifications

nature versus nurture the environment s persistent influence through the modernization of american agriculture technological innovation in agriculture was substantial during the 20th century is modern technological control of the environment replacing a primitive dependency on natural advantages and disadvantages or has agricultural production remained persistently dependent on the environment this paper estimates how the 20th century modernization of united states plains agriculture changed the impact of environmental characteristics on agricultural land values despite substantial technological innovation and rising land values from 1945 to 2002 counties environmental characteristics largely maintained influence on land values environmental change has become no less costly as technological innovation has not reduced the importance of natural advantages or disadvantages

barbed wire property rights and agricultural development this paper examines the impact on agricultural development of the introduction of barbed wire fencing to the american plains in the late nineteenth century without a fence farmers risked uncompensated damage by others livestock from 1880 to 1900 the introduction and near universal adoption of barbed wire greatly reduced the cost of fences relative to the predominant wooden fences especially in counties with the least woodland over that period counties with the least woodland experienced substantial relative increases in settlement land improvement land values and the productivity and production share of crops most in need of protection this increase in agricultural development appears partly to reflect farmers increased ability to protect their land from encroachment states inability to protect this full bundle of property rights on the frontier beyond providing formal land titles might have otherwise restricted agricultural development

trade liberalization and regional dynamics abstract we study the evolution of trade liberalization s effects on brazilian local labor markets regions facing larger tariff cuts experienced prolonged declines in formal sector employment and

wages rents and the quality of life this study focuses on the role of wages and rents in allocating workers to locations with various quantities of amenities the theory demonstrates that if the amenity is also productive then the sign of the wage gradient is unclear while the rent gradient is positive the theory is extended to include the housing market and nontraded goods these extensions require little modification of the conclusion the empirical work on wages shows that the regional wage differences can be explained largely by these local attributes with the use of site price data implicit prices are estimated and quality of life rankings for the cities are computed

dynamic responses to labor demand shocks evidence from the financial industry in delaware abstract this paper analyzes an important shock to local labor demand in financial services firm relocation to delaware following a supreme court ruling and state legislation in the 1980s using synthetic controls and bordering states i find large effects on employment unemployment and participation in the first decade wage effects and in many cases employment spillovers to the nontradable sector appear larger than estimates from shocks to the tradable sector effects persist for ten to twenty years after delaware loses its original policy induced advantage the shift towards a low unemployment sector explains this persistence rather than direct productivity effects or agglomeration

do place based tax incentives create jobs abstract in this paper we evaluate the effectiveness of place based payroll taxes in stimulating local employment by exploiting a unique policy setting in norway where a system of geographically differentiated payroll taxes was suddenly abolished due to an eu regulation the reform was enforced independently of the regional labor market developments creating arguably exogenous variation in the payroll tax rates that firms in different local labor markets faced over time we find evidence of partial shifting of payroll tax increases on to worker wages as well as a significant decline in local employment these findings suggest that in settings with some degrees of wage rigidity place based payroll tax incentives can be effective in stimulating local employment

oaxaca blinder as a reweighting estimator the classic regression based estimator of counterfactual means studied by ronald oaxaca 1973 and alan blinder 1973 is shown to constitute a propensity score reweighting estimator based upon a linear model for the conditional odds of being treated

zipf s law for cities an explanation zipf s law is a very tight constraint on the class of admissible models of local growth it says that for most countries the size distribution of cities strikingly fits a power law the number of cities with populations greater than s is proportional to 1 s suppose that at least in the upper tail all cities follow some proportional growth process this appears to be verified empirically this automatically leads their distribution to converge to zipf s law

lorenz dominance and welfare changes in the u s distribution of income 1967 1986 this paper examines income inequality in the untied states over the period 1967 86 using recently developed tests for differences in lorenz curves the authors are able to rank eighteen of nineteen annual comparisons in contrast standard techniques are able to rank only twelve these results suggest that the lorenz dominance principle is more empirically relevant than previously thought the tests reveal a sharp rise in u s inequality between 1978 and 1982 as well as a shift toward greater inequality over the entire period the authors also examine changes in economic welfare using the joint mean lorenz dominance principle copyright 1991 by mit press

evaluating the efficiency and equity of federal fiscal equalization abstract theoretically federal transfers that make household location decisions efficient should ignore local cost differences subsidize positive externalities and offset differences in federal tax payments and local taxes levied on non residents but not local tax revenues from residents transfers that redistribute resources equitably across regions will likely target areas with individuals of low earnings potential or low real incomes applying these criteria empirically canadian equalization policy appears neither efficient nor equitable but exacerbates pre existing inefficiencies and underfunds minorities locational inefficiencies cost canada 0 41 of income annually and cause over funded provinces to have populations of 30 beyond their efficient long run levels

the craft of labormetrics using a wide array of examples from the literature and from original estimates the author examines the pitfalls that make good empirical research in labor economics at least as much craft as statistical technique among the subjects discussed are the appropriateness and cleanliness of data problems of extreme observations the validity of attempts to produce exogeneity using instrumental variables natural experiments and structural models and the treatment of selectivity and unobservable individual effects the author stresses the importance of testing empirical results to ensure that they make sense and of presenting them clearly and economically

the local socio economic impacts of large hydropower plant development in a developing country abstract despite extensive discussion in the literature about the socio economic impacts of hydropower development on surrounding communities there is 1 a lack of quantitative studies that look at impacts over extended periods of time and 2 a lack of studies including multiple projects in the context of a developing country here we use econometric methods to evaluate the relationship between county level socio economic indicators and hydropower development for 56 brazilian hydropower plants built between 1991 and 2010 we find that counties that built hydropower plants had greater gdp and tax revenues during their first few years of development than a control group that consisted of counties with hydropower projects planned but not yet built however those positive economic effects were short lived

can fiscal rules constrain the size of government an analysis of the crown jewel of tax and expenditure limitations abstract fiscal rules attempt to alter budget outcomes by constraining policy makers they have been one of the primary responses to the recent string of fiscal crises around the globe we ask if these rules succeed in altering fiscal outcomes by examining what is arguably the most stringent set of fiscal rules in the u s colorado s taxpayer bill of rights tabor as tabor attempts to constrain both taxes and expenditures we develop a novel approach of estimating treatment effects for multiple outcomes simultaneously using the synthetic control methodology of abadie et al 2010 although there will always be a degree of uncertainty over external validity when a policy is enacted in only a single state our results provide no evidence that tabor affected the level of taxes or spending in colorado and are precise enough to rule out large negative effects thus no support is found for the contention that fiscal rules alter budget outcomes instead tabor appears to have been partly evaded by policy makers and voters despite its stringency and partly nothing more than a ratification of the state s preference over the size of its public sector

nonparametric instrumental variables estimation abstract in many economic models objects of interest are functions which satisfy conditional moment restrictions economics does not restrict the functional form of these models motivating nonparametric methods in this paper we review identification results and describe a simple nonparametric instrumental variables npiv estimator we also consider a simple method of inference in addition we show how the ability to uncover nonlinearities with conditional moment restrictions is related to the strength of the instruments we point to applications where important nonlinearities can be found with npiv and applications where they cannot

assessing the incidence and efficiency of a prominent place based policy abstract this paper empirically assesses the incidence and efficiency of round i of the federal urban empowerment zone ez program using confidential microdata from the decennial census and the longitudinal business database using rejected and future applicants to the ez program as controls we find that ez designation substantially increased employment in zone neighborhoods and generated wage increases for local workers without corresponding increases in population or the local cost of living the results suggest the efficiency costs of first round ezs were relatively modest jel h26 h77 j31 r23 r58

persistence in industrial policy impacts evidence from depression era mississippi this paper studies the effects of a large scale industrial policy implemented in 1930s mississippi on contemporaneous and modern day labor market outcomes attracted by unprecedented government incentives under mississippi s balance agriculture with industry bawi program 13 large manufacturing plants established operations in the state between 1936 and 1940 using difference in differences and synthetic control matching techniques i find that counties that received these plants experienced an over 15 increase in female labor force participation on average in the short run moreover these effects persisted decades into the future well after many of the original companies shut down i also find suggestive evidence of an increase in educational attainment among women in counties where bawi investment occurred the results highlight the potential for even transitory government interventions to have long lived effects on labor markets

swimming upstream trends in the gender wage differential in the 1980s using michigan panel study of income dynamics data for 1979 and 1988 we analyze how a falling gender wage gap occurred despite changes in wage structure unfavorable to low wage workers the decrease is traced to gender specific factors which more than counterbalanced changes in measured and unmeasured prices working against women supply shifts net of demand were unfavorable for women generally and hurt high skilled more than middle and low skilled women by analyzing wages we find support for the notion of a gender twist in supply and demand having its largest negative effect on high skilled women

place based policies heterogeneity and agglomeration place based policies though hardly new have just begun to attract serious attention from econ omists as evidence on the effects of these pro grams begins to trickle in it is useful to revisit the theoretical rationale for spatially targeted subsidies why after all should governments pay firms to move to less productive areas and incentivize workers to live in neighborhoods they don t like and who ultimately benefits from these subsidies in a general equilibrium environment i study here some stylized models of spatial equilibrium designed to answer these questions my conclusions are shown to depend critically upon the degree of preference hetero geneity in the population and the structure of any agglomeration economies

government programs can improve local labor markets evidence from state enterprise zones federal empowerment zones and federal enterprise communities 1 abstract federal and state governments spend well over a billion dollars a year on programs that encourage employment development in disadvantaged labor markets through the use of subsidies and tax credits in this paper we use an estimation approach that is valid under relatively weak assumptions to measure the impact of state enterprise zones entzs federal empowerment zones empzs and federal enterprise community entc programs on local labor markets we find that all three programs have positive statistically significant impacts on local labor markets in terms of the unemployment rate the poverty rate the fraction with wage and salary income and employment further the effects of empz and entc designation are considerably larger than the impact of entz designation we find that our estimates are robust to allowing for a regression to the mean effect we also find that there are positive but statistically insignificant spillover effects to neighboring census tracts of each of these programs thus our positive estimates of these program impacts do not simply represent a transfer from the nearest non treated census tract to the treated census tract our results are noteworthy for several reasons first our study is the first to jointly look at these three programs thus allowing policy makers to compare the impacts of these programs second our paper along with a concurrent study by neumark and kolko 2008 is the first to carry out the estimation accounting for overlap between the programs third our estimation strategy is valid under weaker assumptions than those made in many previous studies we consider three comparison groups and let the data determine the appropriate group fourth in spite of our conservative estimation strategy by looking at national effects with disaggregated data we show that entz designation generally has a positive effect on the local labor market while most previous research on entzs much of which used more geographically aggregated data to look at state specific effects did not find any significant impacts fifth we note that there is little or no previous work on entcs overall our results strongly support the efficacy of these labor market interventions

the employment impact of poland s special economic zones policy abstractin 1994 poland launched a special economic zones experiment to maintain employment structures outside the major cities using difference in difference estimations this paper evaluates whether the policy has been successful in its primary objective which is to sustain employment in gminas communes more likely to be negatively affected by the economic transition a significant and positive effect of the policy on employment is documented but with some negative spillovers at the policy level as zones start to spread rapidly accounting for covariates timing policy spillovers and reducing imbalance through matching the average treatment effect for employment is estimated to be 60

using the pareto distribution to improve estimates of topcoded earnings i introduction the public use march current population survey cps is the primary source of data for tracking levels and trends in u s labor earnings and for understanding the factors which influence these trends literatures that have used cps earnings data are vast and include research on the changing returns to education or college major in the labor market autor 2014 gemici and wiswall 2014 earnings differentials across occupations glied ma and pearlstein 2015 earnings volatility hardy and ziliak 2014 elasticity of taxable income burns and ziliak forthcoming and more generally the causes of changes in wage structures and earnings inequality see e g autor katz and kearney 2008 card and dinardo 2002 goldin and katz 2007 juhn murphy and pierce 1993 acemoglu 2002 altonji and blank 1999 and katz and autor 1999 provide reviews of this literature however these literatures that use the public use cps data have been hampered by an attenuated view of the right tail of the labor earnings distribution due to the topcoding of high earnings in the public use cps data 1 importantly the failure to properly correct for inconsistent topcoding has been found to result in biased estimates for a range of outcomes including returns to education hubbard 2011 the size of the earnings gaps between gender and race groups burkhauser and larrimore 2009a the relative economic resources of individuals with and without disabilities burkhauser and larrimore 2009b and population level income inequality burkhauser et al 2012 to correct for topcoding biases public use cps based researchers have generally pursued one of four paths 1 ignoring the topcoding problem 2 making an ad hoc adjustment to topcoded earnings values 3 using a pareto distribution to estimate earnings at the top of the distribution or 4 using cell means or rank proximity swapped data that is based on the still censored internal cps data for example a common ad hoc technique based on estimates from pareto imputations of top earnings is to replace topcoded earnings with a multiple of the topcode threshold so all individuals with topcoded earnings in a year are assumed to have earnings at 1 3 1 4 or 1 5 times the topcode threshold autor katz and kearney 2008 juhn murphy and pierce 1993 katz and murphy 1992 lemieux 2006 however such an approach may misstate top earnings if the wrong multiple is used or if the appropriate multiple changes over time similarly researchers using a pareto imputation of top earnings may misstate those earnings if they are unable to obtain a reasonable fit for the pareto distribution when using available public use data making use of internal march cps files with their much higher censoring levels we show that previous ad hoc estimates and pareto estimations of top earnings based on public use data understate mean earnings at the top of the earnings distribution and hence also understate earnings inequality however as this internal data are also censored albeit at higher levels any results based purely on the internal data will also fail to capture a portion of the income at the very top of the distribution and therefore will also understate inequality hence while cell means based on internal data such as those produced by larrimore et al 2008 and the rank proximity swapped data series which the census began providing in 2010 each allow researchers to replicate results from the internal census data findings using these series will be subject to the same limitations and understatement of true top incomes as the internal values recognizing the limitations of the existing options to correct for topcoding we proceed by using a continuous maximum likelihood estimator along with internal cps data to produce a series of more accurate estimates of top earnings in the cps data our estimates start with actual top earnings from the internal cps combined with a pareto estimate using these data for internally censored observations

recent trends in top income shares in the usa reconciling estimates from march cps and irs tax return data although the majority of research on us income inequality trends is based on public use march cps data a new wave of research using irs tax return data reports substantially higher levels of inequality and faster growing trends we show that these apparently inconsistent estimates are largely reconciled if the inequality measure and the income distribution are defined in the same way using internal cps data for 1967 2006 we closely match irs data based estimates of top income shares reported by piketty and saez 2003 our results imply that any inequality increases since 1993 are concentrated among the top 1 percent of the distribution

the effect of the u s welfare system on marital status abstract an issue of long standing importance in the u s welfare system has been its lack of neutrality with respect to family composition which generally provides payments only to female headed families that is families with no able bodied male present using data from 1969 to 1985 to examine the issue this study finds that 1 the simple cross sectional correlations between marital status and welfare benefits are almost always in the expected direction but are generally weak in significance 2 that the magnitude and significance of the correlations have nevertheless grown over time and 3 that the correlations for men are no weaker and usually stronger especially for blacks than those for women

truncation bias and the measurement of income inequality 1988 truncation bias and the measurement of income inequality journal of business economic statistics vol 6 no 3 pp 335 337

industrial shifts skills levels and the labor market for white and black males in this paper we estimate the effects of industrial shifts in the 1970s and 1980s on the wages and employment of black and white males we use micro census data for 52 msa s and estimate effects separately by age and education group the results show that industrial shifts did reduce demand for blacks and for less skilled males in the 1970s and 1980s demand shifts away from manufacturing in particular reduced employment and wages for black and white males while the magnitudes of these effects are fairly small for many groups they can account for one third to one half of the employment decline for less educated young blacks in the 1970s these results imply fairly large effects on the earnings of less skilled males in the 1980s as well authors

truncation bias and the ordinal evaiuation of income inequality lorenz dominance analysis is used to examine the effect of top coding on the ordinal evaluation of u s income inequality across time current population survey microdata are adjusted for truncation bias and statistical inference procedures are used to examine biennial changes in unadjusted and adjusted lorenz curves beginning in 1985 the truncation bias has a significant effect on ordinal rankings of income inequality

temporary protection and technology adoption evidence from the napoleonic blockade this paper uses a natural experiment to assess whether temporary protection from trade with industrial leaders can foster development of infant industries in follower countries using a new dataset compiled from primary sources i find that in the short run regions departements in the french empire which became better protected from trade with the british for exogenous reasons during the napoleonic wars 1803 15 increased capacity in a new technology mechanised cotton spinning to a larger extent than regions which remained more exposed to trade temporary protection had long term effects in particular by exploiting the fact that the post war location of the cotton industry was determined to a large extent by the historical accident of the wars i first show that the location of cotton spinning within france was persistent and firms located in regions with higher post war spinning capacity were more productive 30 years later second i find that after the restoration of peace exports of cotton goods from france increased substantially consistent with evolving comparative advantage in cottons third i show that as late as 1850 france and belgium both part of the french empire prior to 1815 had larger cotton spinning industries than other continental european countries which were not protected from british trade during the wars this suggests that adoption of the new technology was far from inevitable