"Human Capital Adjustments and Labor Market Resilience: Evidence from Linked Education and Earnings Data"
Funding: 2022 AERA Dissertation Grant
Presentations: AEFP 2023 – 48th Annual Conference; SEA 2022 – 92nd Annual Meeting (missed due to illness)
Abstract: Negative labor demand shocks can have lasting consequences on the labor market outcomes of both prime-aged workers and recent labor market entrants, known as "scarring effects," but individuals coming of age may not suffer the same fate if they adjust their human capital investments. This paper studies the effects of exposure to a negative shock to local labor demand during youth and adolescence on human capital accumulation and later-life earnings. I use student-level administrative data from Texas and a difference-in-differences design that compares changes in outcomes across cohorts of students living in areas that were more or less exposed to Chinese import competition. Students exposed to larger shocks were 4% more likely to enroll in college and 8% more likely to earn a bachelor's degree. I provide evidence that these adjustments, along with shifts of fields of study away from those directly exposed to import competition in both high school and college, shielded students from 90% of the shock's scarring effects on later-life earnings. My results contribute a silver lining to the gloomy findings of prior work on the long-term effects of ``the China shock" and other negative labor demand shocks: if individuals coming of age sufficiently adjust their human capital investments, the costs of such shocks can largely be confined to a single generation.
"Rivers, Lakes, and Revenue Streams: The Heterogeneous Effects of Clean Water Act Grants on Local Spending"
with Patrick Flynn | Journal of Public Economics (published version)
Abstract: The Clean Water Act (CWA) provided $153 billion (2014$) to municipal governments for wastewater treatment upgrades. We leverage variation in the timing of grant receipt with a difference-in-differences design to estimate the effect of CWA grants on local spending. CWA grants caused a dollar-for-dollar increase in sewerage capital spending up to the amount needed to cover the costs of capital upgrades newly mandated by the CWA. After municipalities met these capital requirements, or if the capital mandate was not binding, they reduced their own spending on sewerage capital in response to grant receipt. Municipalities then redistributed grant money to local residents by reducing water bills. On average, each dollar of grant revenue caused a $0.45 increase in sewerage capital spending. Dividing previously estimated benefit to cost ratios of CWA grants by this estimate suggests that each CWA grant dollar that municipalities spent on sewerage capital generated an average return of $1.01.
"Turning around Schools (and Neighborhoods?): School Improvement Grants and Gentrification"
with Cameron Friday | Economics of Education Review (published version)
Abstract: Most funding intended to close gaps in K-12 education targets schools, rather than students directly. We investigate whether household sorting in response to changes in K-12 school funding inhibits spending from reaching targeted students with a case study in Metro-Nashville Public Schools of the School Improvement Grant (SIG) program, which invested $7 billion in the nation's lowest-achieving schools between 2009 and 2016. Using a boundary-discontinuity difference-in-differences design and home sales data, we estimate that households were willing to pay more than three times the average per-pupil grant award to live in SIG school zones. Neighborhoods zoned for SIG schools experienced moderate income and racial integration following funding receipt However, evictions in these neighborhoods increased by 35%, and non-white enrollment at SIG schools declined by 15%. Our findings illustrate a major limitation of place-based public good provision: sorting may displace the initially targeted population.
"Student Debt and Housing Wealth"
with Lesley J. Turner, Jeremy Burke, and Juan Saavedra.
"Slipping Through the Net: Childhood Access to the Safety Net and Educational Attainment"
with Samuel Mann and Laura Bellows
"Assessing the Property Tax with Property Tax Assessments"
with Cora Wigger