We show that skill requirements in job vacancy postings differentially increased in MSAs that were hit hard by the Great Recession, relative to less hard-hit areas. These increases persist through at ...least the end of 2015 and are correlated with increases in capital investments, both at the MSA and firm levels. We also find that effects are most pronounced in routine-cognitive occupations, which exhibit relative wage growth as well. We argue that this evidence is consistent with the restructuring of production toward routine- biased technologies and the more-skilled workers that complement them, and that the Great Recession accelerated this process.
Why do Borrowers Default on Mortgages? Ganong, Peter; Noel, Pascal
The Quarterly journal of economics,
05/2023, Letnik:
138, Številka:
2
Journal Article
Recenzirano
Abstract
There are three prevailing theories of mortgage default: strategic default (driven by negative equity), cash flow default (driven by negative life events), and double-trigger default (where ...both negative triggers are necessary). It has been difficult to compare these theories in part because negative life events are measured with error. We address this measurement error using a comparison group of borrowers with no strategic-default motive. Our central finding is that only 6% of underwater defaults are caused exclusively by negative equity, an order of magnitude lower than previously thought. We then analyze the remaining defaults. We find that 70% are driven solely by negative life events (i.e., cash flow defaults), while 24% are driven by the interaction between negative life events and negative equity (i.e., double-trigger defaults). Together, the results provide a full decomposition of the theories underlying borrower default and suggest that negative life events play a central role.
We study how political turnover in mayoral elections in Brazil affects public service provision by local governments. Exploiting a regression discontinuity design for close elections, we find that ...municipalities with a new party in office experience upheavals in the municipal bureaucracy: new personnel are appointed across multiple service sectors, and at both managerial and non-managerial levels. In education, the increase in the replacement rate of personnel in schools controlled by the municipal government is accompanied by test scores that are 0.05–0.08 standard deviations lower. In contrast, turnover of the mayor’s party does not impact local (non-municipal) schools. These findings suggest that political turnover can adversely affect the quality of public services when the bureaucracy is not shielded from the political process. (JEL D72, D73, H75, H76, J45, O17)
Using novel monthly data for 226 euro-area banks from 2007 to 2015, we investigate the causes and effects of banks' sovereign exposures during and after the euro crisis. First, in the vulnerable ...countries, the publicly owned, recently bailed out and less strongly capitalized banks reacted to sovereign stress by increasing their domestic sovereign holdings more than other banks, suggesting that their choices were affected both by moral suasion and by yield-seeking. Second, their exposures significantly amplified the transmission of risk from the sovereign and its impact on lending. This amplification of the impact on lending cannot be ascribed to spurious correlation or reverse causality
Abstract
I analyze the inter vivo transfers and bequest decisions of 700,000 individuals during a period when the decision maker receives negative news regarding their life expectancy. The event that ...initiates the news is a health outcome. Expected mortality increases both the likelihood of transferring wealth to the next generation and the amount transferred. The size of the inter vivo transfer and bequest are positively related to the wealth of the parent and the severity of the diagnosis, regardless of diagnosis-specific demand for informal care. Using a structural life cycle model, I estimate the bequest parameters that are consistent with the causal effect estimates.
Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
Ride-Sharing, Fatal Crashes, and Crime Dills, Angela K.; Mulholland, Sean E.
Southern economic journal,
April 2018, Letnik:
84, Številka:
4
Journal Article
Recenzirano
Odprti dostop
The advent of smart-phone based, ride-sharing applications has revolutionized the vehicle for hire market. Advocates point to the ease of use, lower prices, and shorter wait times compared to hailing ...a taxi or prearranging limousine service. Others argue that proper government oversight is necessary to protect ride-share passengers from driver error or vehicle parts failures and violence from unlicensed strangers. Using U.S. county-level data from 2007 through 2015, we investigate whether the introduction of the ride-sharing service Uber is associated with changes in fatal vehicle crashes and crime. We find that Uber's entry lowers the rate of DUIs and fatal accidents. For some specifications, we also find declines in arrests for assault and disorderly conduct. Conversely, we observe an increase in vehicle thefts.
Abstract
We study the effect of dividend taxes on the payout and investment policies of publicly listed firms. We exploit a unique setting in Switzerland where, following the corporate tax reform of ...2011, some but not all firms were suddenly able to pay tax-exempt dividends. We show that treated firms increase their dividend payout by around 30$\%$ after the tax cut. The effect on payout is less pronounced for firms prone to agency conflicts. We find a significant positive abnormal stock return after the announcement of the payment of a tax-exempt dividend. However, reducing dividend taxes does not boost investment.
This paper develops and applies a method to value water trading on a river network. The framework relies on regulatory variation in diversion caps to identify production functions for irrigated ...farms, then uses the estimated shadow values to assess the market’s reallocation. I apply this framework to the largest water market in human history, located in southeastern Australia. Observed water trading increased output by 4–6 percent from 2007 to 2015, equivalent to avoiding an 8–12 percent uniform decline in water resources. Reallocation and average surplus both increase substantially during drought, implying that water markets can be most valuable when climatic variability is most severe. (JEL D23, D24, Q12, Q15, Q25, Q54)
We use random assignment of role models to cadets at the United States Military Academy at West Point to investigate the effect of same-gender or same-race mentors on occupation choice in the United ...States Army. Women and racial minorities have traditionally been underrepresented in certain occupations in the Army, and these disparities seem to persist over time. We find that when a female cadet is assigned a female mentor, the cadet is 4.60 and 18.1 percentage points more likely to pick her officer's branch as her first or among her top three occupational preferences, respectively, than if she had interacted with a male mentor. These results are robust to controlling for a limited choice set for females and a host of alternative specifications. We find that black cadets paired with black officers are 6.1 percentage points more likely to pick their role model's branch than if the black cadet had worked with a white officer. These results show that having a same-gender or same-race mentor may influence the occupation choice of women or racial minorities.
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