Essays in Macroeconomics and Comparative Economics

This dissertation studies how institutions, policies, and macroeconomic events shape individual and aggregate outcomes, both from historical and present-day perspectives. The first chapter studies persistent effects of historical institutions on present-day outcomes in the case of a Soviet repressive policy that intended to eradicate market culture and distort social structure in Ukraine. The second chapter examines the interplay between historical and modern institutions and their effect on individual behavior. This chapter studies evidence about the persistence of a socialist-era norm for women to work “double shifts” throughout the market transition period. The third chapter focuses on the effect of current macroeconomic events on individual behavior. Based on novel experimental evidence about the effect of inflation expectations on labor supply, this chapter provides policy-relevant insights about the risk of wage-price spirals in a high inflation setting./nIn Chapter 1, I assemble a novel dataset to examine the long-term consequences of blacklisting, a Soviet policy used to deter market-oriented behavior through collective punishment of Ukrainian villages in 1932-33. Under blacklisting, all village residents could be banned from trade and provision of crucial goods, prohibited from moving, and imposed harsh in-kind fines. Formally, the policy was meant to punish the communities underperforming in terms of state food procurement (similar to in-kind taxation) because local procurement shortfalls supposedly were a consequence of intentional, profit-seeking behavior. Using a weather-based instrument for the locality’s blacklisting status, I document that blacklisting significantly reduced the present-day nightlight intensity (a proxy measure for economic development). Additional evidence points to entrepreneurship and trust as channels for this effect. My results support the notion that policies that suppress economic freedoms and disrupt social structure can have persistent negative effects on economic performance./nIn Chapter 2, I use survey data to analyze the division of household work in several post-socialist countries during their democratic transition period and compare them to the advanced economies in 1994-2012. The results indicate that, while there are signs of convergence in time allocation patterns across countries, some differences persist. Female time availability, a conventional determinant of time allocation to unpaid work at home, matters significantly less in post-socialist economies, suggesting that the socialist norm for women to be responsible for the majority of household work despite being employed full-time persists in post-soviet societies throughout the transition./nChapter 3 examines how individual labor supply responds to changes in (expected) inflation. In April-July 2022, in collaboration with ChaeWon Baek, we ran an experiment in an online labor market, Amazon Mechanical Turk, to establish a causal relationship between inflation expectations and individual labor supply in a high inflation setting. First, we use randomized information treatments to generate exogenous variation in subjective expectations about price inflation, wage inflation, and unemployment rate. Second, we investigate how these changes in expectations affect MTurk workers’ reservation wages and the desired employment duration. We find that the resulting increase in wage inflation expectation significantly increases reservation wages. Higher expected price inflation rates, on the other hand, decrease reservation wages. Higher unemployment expectation increases the desired duration of employment and decreases reservation wages. These results suggest that wage-price spiral risks appear limited in the U.S. despite the high current price inflation rates.

Advisor: Gorodnichenko, Yuriy