From 1980 to 2000, the rise in the US college/high school graduate wage gap coincided with increased geographic sorting as college graduates concentrated in high wage, high rent cities. This paper ...estimates a structural spatial equilibrium model to determine causes and welfare consequences of this increased skill sorting. While local labor demand changes fundamentally caused the increased skill sorting, it was further fueled by endogenous increases in amenities within higher skill cities. Changes in cities' wages, rents, and endogenous amenities increased inequality between high school and college graduates by more than suggested by the increase in the college wage gap alone.
Using a 1994 law change, we exploit quasi-experimental variation in the assignment of rent control in San Francisco to study its impacts on tenants and landlords. Leveraging new data tracking ...individuals’ migration, we find rent control limits renters’ mobility by 20 percent and lowers displacement from San Francisco. Landlords treated by rent control reduce rental housing supplies by 15 percent by selling to owner-occupants and redeveloping buildings. Thus, while rent control prevents displacement of incumbent renters in the short run, the lost rental housing supply likely drove up market rents in the long run, ultimately undermining the goals of the law.
We nonparametrically estimate spillovers of properties financed by the Low Income Housing Tax Credit (LIHTC) onto neighborhood residents by developing a new difference-in-differences style estimator. ...LIHTC development revitalizes low-income neighborhoods, increasing house prices 6.5 percent, lowering crime rates, and attracting racially and income diverse populations. LIHTC development in higher-income areas causes house price declines of 2.5 percent and attracts lower-income households. Linking these price effects to a hedonic model of preferences, LIHTC developments in low-income areas cause aggregate welfare benefits of $116 million. Affordable housing development acts like a place-based policy and can revitalize low-income communities.
Governments may extract rent from private citizens by inflating taxes and spending on projects benefiting special interests. Using a spatial equilibrium model, I show that less elastic housing ...supplies increase governments' abilities to extract rents. Inelastic housing supply, driven by exogenous variation in local topography, raises local governments' tax revenues and causes citizens to combat rent seeking by enacting laws limiting the power of elected officials. I find that public sector workers, one of the largest government special interests, capture a share of these rents through increased compensation when collective bargaining is legal or through corruption when collective bargaining is outlawed.
Spatial Sorting and Inequality Diamond, Rebecca; Gaubert, Cecile
Annual review of economics,
01/2022, Letnik:
14, Številka:
1
Journal Article
Recenzirano
Odprti dostop
The spatial segregation of college-educated and non-college-educated workers between commuting zones in the United States has steadily grown since 1980. We summarize prior work on sorting and ...location and document new descriptive patterns on how sorting and locations have changed over the past four decades. We find that there has been a shift in the sorting of college-educated workers from cities centered primarily around production in 1980 to cities centered around consumption by 2017. We develop a spatial equilibrium model to understand these patterns and highlight key places where further research is needed. Our framework helps understand the causes and consequences of changes in spatial sorting; their impact on inequality; and how they respond to, and feed into, the changing nature of cities.
Abstract
We study the causes of “nutritional inequality”: why the wealthy eat more healthfully than the poor in the United States. Exploiting supermarket entry and household moves to healthier ...neighborhoods, we reject that neighborhood environments contribute meaningfully to nutritional inequality. We then estimate a structural model of grocery demand, using a new instrument exploiting the combination of grocery retail chains’ differing presence across geographic markets with their differing comparative advantages across product groups. Counterfactual simulations show that exposing low-income households to the same products and prices available to high-income households reduces nutritional inequality by only about 10%, while the remaining 90% is driven by differences in demand. These findings counter the argument that policies to increase the supply of healthy groceries could play an important role in reducing nutritional inequality.
Abstract
The growth of the “gig” economy generates worker flexibility that, some have speculated, will favour women. We explore this by examining labour supply choices and earnings among more than a ...million rideshare drivers on Uber in the U.S. We document a roughly 7% gender earnings gap amongst drivers. We show that this gap can be entirely attributed to three factors: experience on the platform (learning-by-doing), preferences and constraints over where to work (driven largely by where drivers live and, to a lesser extent, safety), and preferences for driving speed. We do not find that men and women are differentially affected by a taste for specific hours, a return to within-week work intensity, or customer discrimination. Our results suggest that, in a “gig” economy setting with no gender discrimination and highly flexible labour markets, women’s relatively high opportunity cost of non-paid-work time and gender-based differences in preferences and constraints can sustain a gender pay gap.
The early care and education caregivers with whom children interact can play an important role in the children’s cognitive, social, and emotional development. This report examines how caregivers with ...licensed providers in Shelby County, Tennessee, gain relevant knowledge and skills, specifically through ongoing professional development opportunities, for working with infants, toddlers, and preschool-age children.
It is a standard practice in regression analyses to allow for clustering in the error covariance matrix if the explanatory variable of interest varies at a more aggregate level (e.g., the state ...level) than the units of observation (e.g., individuals). Often, however, the structure of the error covariance matrix is more complex, with correlations not vanishing for units in different clusters. Here, we explore the implications of such correlations for the actual and estimated precision of least squares estimators. Our main theoretical result is that with equal-sized clusters, if the covariate of interest is randomly assigned at the cluster level, only accounting for nonzero covariances at the cluster level, and ignoring correlations between clusters as well as differences in within-cluster correlations, leads to valid confidence intervals. However, in the absence of random assignment of the covariates, ignoring general correlation structures may lead to biases in standard errors. We illustrate our findings using the 5% public-use census data. Based on these results, we recommend that researchers, as a matter of routine, explore the extent of spatial correlations in explanatory variables beyond state-level clustering.
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