The Intergenerational Transmission of Employers and Early Career Outcomes

  • This paper studies how the transmission of employers from parents to children affects early career outcomes. Using survey and administrative data from the U.S., I show that it is common for parents and children to share an employer. I then employ an instrumental variables strategy, which exploits intertemporal variation in job opportunities within the parents’ employer and find that working with a parent significantly increases earnings. Children with higher-earning parents are both more likely to share an employer with a parent and experience greater earnings benefits conditional on doing so, and thus the intergenerational transmission of employers amplifies the extent to which economic outcomes persist across generations. The results indicate that parents continue to meaningfully affect the earnings of their children even after they have grown up and entered the labor market.
  • Draft available upon request
  • Presented at: US Census Bureau CES Seminar Series (2019)

The Children of HOPE VI Demolitions: National Evidence on Labor Market Outcomes

(with John Haltiwanger, Mark Kutzbach, Gio Palloni, Henry Pollakowski and Daniel Weinberg)

  • We combine national administrative data on earnings and participation in subsidized housing to study how the demolition of 160 public housing projects—funded by the HOPE VI program—affected the adult labor market outcomes of 18,500 children. Our empirical strategy compares children exposed to the program to children from households drawn from thousands of non-demolished projects and adjusts for observable differences using a flexible estimator that combines features of matching and regression. We find that children in HOPE VI projects earn 14 percent more at age 26 relative to children in comparable non-HOPE VI projects. The differences are driven by demolitions in large cities, particularly in neighborhoods with higher pre-demolition poverty rates and lower job accessibility. Subsequent improvements in job accessibility represent a likely pathway for the results.
  • Draft available upon request
  • Presented at: Population Association of America (2018)

Disparities in Spousal Income and Inefficient Household Behavior

  • This paper argues that disparities in spousal income lead to inefficient behavior. I develop a non-cooperative model of the household characterized by limited commitment in which couples use the threat of future punishment to enforce a spending rule. Income is stochastic and an efficient spending rule provides full mutual insurance against idiosyncratic income risk. However, each period individuals have the option to deviate from the spending rule and keep their income for themselves. The spending rule is feasible only when the future expected costs from deviating exceed the current gains. The gains from deviating are increasing in current income. The costs of deviating are declining in expected income, since own income limits the severity of punishment. Thus, the gains of deviating are most likely to exceed the costs in periods in which there are large disparities between the current income of the spouses and for households in which there are large disparities between the expected income of spouses. In such cases the household allocates more resources to the spouse with relatively higher income, which represents a violation of full insurance. I find empirical support for the key predictions of the model by revisiting a field experiment conducted by Robinson (2012).
  • Link to paper

Job-to-Job Flows and the Consequences of Job Separations

(with Bruce Fallick, John Haltiwanger and Erika McEntarfer)

  • A substantial empirical literature documents large and persistent average earnings losses following job displacement. Our paper extends the literature on displaced workers by providing a comprehensive picture of earnings and employment outcomes for all workers who separate. We show that for workers not recalled to their previous employer, earnings losses follow separations in general, as opposed to displacements in particular. The key predictor of earnings losses is not displacement but the length of the nonemployment spell following job separation. Moreover, displaced workers are no more likely to experience a substantial spell of nonemployment than are other nonrecalled separators. Our results suggest that future research on the consequences of job loss should work to disentangle the strong association between nonemployment and earnings losses, as opposed to focusing specifically on displaced workers.
  • Link to paper
  • Presented at: 20th Anniversary LED Workshop (2019), BLS-Census Workshop (2019), Society of Labor Economics Conference (2019)

When Children Rule: Parenting in Modern Families

(with Sebastian Galiani and Gustavo Torrens. NBER Working Paper No. 23087)

  • During the 20th century there was a secular transformation within American families from a house hold dominated by the father to a more egalitarian one in which the wife and the children have been empowered. This transformation coincided with two major economic and demographic changes, namely the increase in economic opportunities for women and a decline in family size. To explain the connection between these trends and the transformation in family relationships we develop a novel model of parenting styles that highlights the importance of competition within the family. The key intuition is that the rise in relative earnings of wives increased competition between spouses for the love and affection of their children while the decline in family size reduced competition between children for resources from their parents. The combined effect has empowered children within the household and allowed them to capture an increasing share of the household surplus over the past hundred years.
  • Link to paper
  • Media Coverage: The Wall Street Journal, Slate, Marginal Revolution
  • Presented at: Society of Economic of the Household Annual Meeting (2017)