Showing papers in "Journal of Human Resources in 2021"

Theory and Evidence on Employer Collusion in the Franchise Sector

Abstract: In this paper we study the role of covenants in franchise contracts that restrict the recruitment and hiring of employees from other units within the same franchise chain in suppressing competition for workers. Based on an analysis of 2016 Franchise Disclosure Documents, we find that "no-poaching of workers agreements" are included in a surprising 58 percent of major franchisors' contracts, including McDonald's, Burger King, Jiffy Lube and H&R Block. The implications of these no-poaching agreements for models of oligopsony are also discussed. No-poaching agreements are more common for franchises in low-wage and high-turnover industries.

Distinguishing barriers to insurance in Thai villages

Abstract: In both developing and developed countries, consumption insurance is incomplete: consumption co-moves with income. Models with limited commitment, moral hazard, and hidden income have been proposed to explain this lack of full insurance. Limited commitment and moral hazard have generally been found to fit the data better than full insurance or permanent income models, but these models have not been tested against the alternative of hidden income. I show that the way history matters in forecasting consumption can be used to distinguish the hidden income model from other models of incomplete insurance. I also argue that accounting for measurement error in consumption is important in identifying barriers to insurance. In a ten-year panel from rural Thailand, neither limited commitment or moral hazard can fully explain the relationship between income and consumption--the need to give households incentives to truthfully reveal their income appears to play a role in constraining insurance.

Selection into Identification in Fixed Effects Models, with Application to Head Start

Abstract: Many papers use fixed effects (FE) to identify causal impacts of an intervention. In this paper we show that when the treatment status only varies within some groups, this design can induce non-random selection of groups into the identifying sample, which we term selection into identification (SI). We begin by illustrating SI in the context of several family fixed effects (FFE) applications with a binary treatment variable. We document that the FFE identifying sample differs from the overall sample along many dimensions, including having larger families. Further, when treatment effects are heterogeneous, the FFE estimate is biased relative to the average treatment effect (ATE). For the general FE model, we then develop a reweighting-on-observables estimator to recover the unbiased ATE from the FE estimate for policy-relevant populations. We apply these insights to examine the long-term effects of Head Start in the PSID and the CNLSY. Using our reweighting methods, we estimate that Head Start leads to a 2.6 percentage point (p.p.) increase (s.e. = 6.2 p.p.) in the likelihood of attending some college for white Head Start participants in the PSID. This ATE is 78% smaller than the traditional FFE estimate (12 p.p). Reweighting the CNLSY FE estimates to obtain the ATE produces similar attenuation in the estimated impacts of Head Start.

Leveraging Parents through Low-Cost Technology The Impact of High-Frequency Information on Student Achievement

Abstract: We partnered a low-cost communication technology with school information systems to automate the gathering and provision of information on students' academic progress to parents of middle and high school students. We sent weekly automated alerts to parents about their child's missed assignments, grades, and class absences. The alerts reduced course failures by 27 percent, increased class attendance by 12 percent, and increased student retention, though there was no impact on state test scores. There were larger effects for below-median GPA students and high school students. More than 32,000 text messages were sent at a variable cost of $63. [End Page 125] [ABSTRACT FROM AUTHOR]

Closing Routes to Retirement for Women: How Do They Respond?

Abstract: We study the employment effects of a large increase in the early retirement age (ERA) of women. Raising the ERA has the potential to extend contribution periods and to reduce the number of pensioners at the same time. However, workers may not be able to work longer or may choose other social support programs as exit routes from employment. Results suggest that the reform increases employment, unemployment, and inactivity rates of women aged 60 and older. However, this is mainly because women remain longer in their respective labor market status, rather than active substitution from employment into unemployment or inactivity. [ABSTRACT FROM AUTHOR]

The Effects of Local Industrial Pollution on Students and Schools

Abstract: Using detailed education data for 1996–2012 from the state of Florida, we examine whether pollution from local Toxic Release Inventory (TRI) sites affects student achievement and high-stakes accountability school rankings. Using event study and difference-in-differences designs, we compare students attending schools within one mile of a TRI site that opens or closes to students attending schools between one and two miles away. We find that being exposed to air pollution is associated with 0.024 of standard deviation lower test scores, increased likelihood of suspension from school, and increased likelihood that a school’s overall high-stakes accountability ranking will drop.

Gender Peer Effects on Students’ Academic and Noncognitive Outcomes Evidence and Mechanisms

Abstract: This study examines gender peer effects on students’ academic and noncognitive outcomes. We use a nationally representative survey of middle school students in China and focus on schools that randomly assign students to classrooms. Our findings show that having a higher proportion of female peers in class improves students’ test scores and noncognitive outcomes, which include their social acclimation and general satisfaction in school. A further decomposition of channels suggests that teacher behavior, greater student effort, and the improved classroom environment are the primary channels through which peers’ gender influences student outcomes.

The Lost Generation? Labor Market Outcomes for Post Great Recession Entrants

Abstract: I study cohort patterns in the labor market outcomes of recent college graduates, examining changes surrounding the Great Recession. Recession entrants have lower wages and employment than those of earlier cohorts; more recent cohorts’ employment is even lower, but the newest entrants’ wages have risen. I relate these changes to "scarring" effects of initial conditions. I demonstrate that adverse early conditions permanently reduce new entrants’ employment probabilities. I also replicate earlier results of medium-term scarring effects on wages that fade out by the early 30s. But scarring cannot account for the employment collapse for recent cohorts. There was a dramatic negative structural break in college graduates’ employment rates, beginning around the 2005 entry cohort, that shows no sign of abating.

Congestion Pricing, Air Pollution, and Children’s Health

Abstract: This study examines the effects of a congestion tax in central Stockholm on ambient air pollution and the health of local children. We demonstrate that the tax reduced ambient air pollution by 5–15 percent and the rate of acute asthma attacks among young children. We do not see corresponding changes in accidents or hospitalizations for nonrespiratory conditions. As the change in health was more gradual than the change in pollution, it may take time for the full health effects of changes in pollution to materialize if the mechanism is pollution. Hence, short-run estimates of pollution reduction programs may understate long-run health benefits.

The Effects of the Kalamazoo Promise Scholarship on College Enrollment and Completion

Abstract: We estimate the effects on postsecondary education outcomes of the Kalamazoo Promise, a generous, place-based college scholarship. We identify Promise effects using two forms of difference-in-differences: (i) comparing eligible to ineligible graduates before and after the Promise's initiation and (ii) comparing the treated district to comparison districts before and after the Promise's initiation. According to our estimates, the Promise increases college enrollment and credential attainment. Stronger effects occur for women. The results also provide suggestive but less precise evidence that Promise effects extend to disadvantaged groups. [End Page 269] [ABSTRACT FROM AUTHOR]

Monopsony in Movers: The Elasticity of Labor Supply to Firm Wage Policies

Abstract: We provide new estimates of the separations elasticity, a proximate determinant of the labor supply facing a firm with respect to hourly wage, using matched Oregon employer-employee data. Existing estimates using individual wage variation may be biased by mismeasured wages and use of wage variation unrelated to firm choices. We estimate the impact of the firm component of wage variation on separations using both firm fixed effects estimated from a wage equation as well as a matched IV event study around employment transitions between firms. Separations are a declining function of firm wage policies: we find that the implied firm-level labor supply elasticities generated are around 4, consistent with recent experimental and quasi-experimental evidence, and that they are approximately 3 to 4 times larger that those using individual wages. Further, we find lower separations elasticities for low wage workers, high turnover sectors, and periods of economic downturn but with little heterogeneity by urban status or labor market concentration. We conclude that monopsonistic competition is pervasive, and largely independent of forces driving classical monopsony.

Increasing Workplace Diversity Evidence from a Recruiting Experiment at a Fortune 500 Company

Abstract: While many firms have set ambitious goals to increase diversity in their ranks, there is a dearth of empirical evidence on effective ways to reach them. We use a natural field experiment to test several hypotheses on effective means to attract minority candidates for top professional careers. By randomly varying the content in recruiting materials of a major financial services corporation with more than 10,000 employees, we find that signaling explicit interest in employee diversity more than doubles the interest in openings among racial minority candidates, as well as the likelihood that they apply and are selected. Impacts on gender diversity are less sharp and generally not significant. [End Page 73] [ABSTRACT FROM AUTHOR]

The Effect of Advanced Placement Science on Students’ Skills, Confidence and Stress

Abstract: The AP program has been widely adopted by secondary schools, yet the evidence on the impacts of taking AP courses has been entirely observational. We report results from the first experimental study of AP, focusing on whether AP endows students with greater human capital than other regular and honors courses. We find suggestive evidence that taking an AP science course increases students' science skill and their interest in pursuing a STEM major in college. AP course-takers also have lower confidence in their ability to succeed in college science, higher levels of stress, and worse grades than their control counterparts. [End Page 93] [ABSTRACT FROM AUTHOR]

The Effect of School Rank on Personality Traits

Abstract: We study the effect of classroom rank on high-school students’ Big Five personality traits. We exploit idiosyncratic differences in the class distribution of earlier academic achievement. Such differences generate quasi-random variation in class rank for students with the same initial achievement. We find a positive and sizeable effect of rank on conscientiousness, but we find no effects on the other four personality traits. A thorough analysis of the mechanism suggests that the primary channels through which class rank improves conscientiousness are perceived ability and academic motivation.

Measuring Social and Externality Benefits of Influenza Vaccination

Abstract: Vaccination represents a canonical example of externalities in economics, yet there are few estimates of their magnitudes. I estimate social and externality benefits of influenza vaccination in two settings. First, using a natural experiment, I estimate the impacts of aggregate vaccination rates on mortality and work absences in the United States. Second, I examine a setting with large potential externality benefits: vaccination mandates for healthcare workers. I find that the social benefits of vaccination are substantial, most of benefits operate through an externality, and the benefits of healthcare worker vaccination are particularly large.

Disparities and Discrimination in Student Discipline by Race and Family Income

Abstract: Black and poor students are suspended from U.S. schools at higher rates than White and nonpoor students. While the existence of these disparities has been clear, the causes of the disparities have not. We use a novel data set to examine how and where discipline disparities arise. By comparing the punishments given to Black and White (or poor and nonpoor) students who fight one another, we address a selection challenge that has kept prior studies from identifying discrimination in student discipline. We find that Black and poor students are, in fact, punished more harshly than the students with whom they fight.

The sources of the wage losses of displaced workers: the role of the reallocation of workers into firms, matches, and job titles

Abstract: We evaluate the sources of wage losses of workers displaced due to firm closure by comparison of workers’ wages before and after displacement. We decompose the sources of the wage losses into the contribution of firm, match quality, and job title fixed effects. Sorting into lower paying job titles represents the largest component of the monthly wage loss of displaced workers, accounting for 37 percent of the total average monthly wage loss compared to 31 percent for the firm and 32 percent for the match effects. With respect to the hourly wage losses, job title effects account for 46 percent of the total loss, while firm and match effects contribute in equal shares representing each 27 percent of the loss.

Multigrading and Child Achievement.

Abstract: We exploit Italian law DPR 81/2009, which determines class composition, as an instrument to identify the causal effect of grouping students of different grades into a single class (multigrading) on children cognitive achievement. This article focuses on 7-year-old students—those at the beginning of their formal education. Results suggest that attendance in multigrade classes versus single-grade classes increases students’ performance on standardized tests by 15–20 percent of a standard deviation. The positive impact of multigrading only appears for children sharing their class with peers from higher grades and is relatively stronger for students from disadvantaged backgrounds.

Engaging Teachers Measuring the Impact of Teachers on Student Attendance in Secondary School

Abstract: On average, secondary school students in the United States are absent from school three weeks per year. For this study, we are able to link middle and high school teachers to the class-attendance of students in their classrooms and create measures of teachers’ contributions to student class-attendance. We find systematic variation in teacher effectiveness at reducing unexcused class absences. These differences across teachers are as stable as those for student achievement, but teacher effectiveness on attendance only weakly correlates with their effects on achievement. A high value-added to attendance teacher has a stronger impact on students’ likelihood of finishing high school than does a high value-added to achievement teacher. Moreover, high value-added to attendance teachers can motivate students to pursue higher academic goals. These positive effects are particularly salient for low-achieving and low-attendance students.

Depression, Risk Preferences and Risk-taking Behavior

Abstract: Depression affects the way that people process information and make decisions, including those involving risk and uncertainty. Our objective is to analyze the way that depressive episodes shape risk preferences and risk-taking behaviors. We are the first to address this issue using large-scale, representative panel data that include both behavioral and stated risk preference measures and a theoretical framework that accounts for the multiple pathways through which depression affects risk-taking. We find no disparity in the behavioral risk preferences of the mentally well vs. depressed; yet depression is related to people’s stated risk preferences and risk-taking behaviors in ways that are context-specific. Those who are likely to be experiencing a depressive episode report less willingness to take risks in general, but more willingness to take health risks, for example. We investigate these patterns by developing a conceptual model — informed by the psychological literature — that links depression to risk-taking behavior through the key elements of a standard intertemporal choice problem (e.g., time preferences, expectations, budget constraints). This motivates a mediation analysis in which we show that differences in risk-taking behavior are largely explained by depression-related disparities in behavioral traits such as locus of control, optimism and trust. Overall, we find that there is no overarching tendency for those who are depressive to engage in either more or less risk-taking. Instead, the decision-making context matters in ways that largely align with our theoretical expectations.

Distributional Effects of Education on Health

Abstract: This paper studies distributional effects of education on health. In 1972, England, Scotland, and Wales raised their minimum school-leaving age from 15 to 16 for students born after 9/1/1957. Using a regression discontinuity design and objective health measures for 0.27 million individuals, we find that education reduced body size and increased blood pressure in middle age. The reduction in body size was concentrated at the upper tail of the distribution with a 7.5 percentage point reduction in obesity. The increase in blood pressure was concentrated at the lower tail of the distribution with no effect on stage 2 hypertension.

The Impact of Advisor Gender on Female Students’ STEM Enrollment and Persistence

Abstract: To reduce the gender gap in science fields, policymakers often propose providing women with mentoring by female scientists. However, there is no clear evidence on whether one-on-one mentor gender influences women’s STEM participation. We exploit a unique setting where students are randomly assigned to academic advisors—who are also faculty members—in their freshman year of college. Advisors help students select courses and decide on a major. We find that having a female rather than a male science advisor substantially increases the likelihood that women enroll and graduate with STEM degrees. A non-science advisor’s gender has no impact on students’ major choice. JEL Classification: I23, I24, J16

Workfare and Human Capital Investment: Evidence from India

Abstract: We examine the effect of India's National Rural Employment Guarantee Scheme (NREGS), one of the largest workfare programs in the world, on human capital investment. Since NREGS increases labor demand, it could increase the opportunity cost of schooling, lowering human capital investment even as incomes increase. We exploit the staged rollout of the program across districts for causal identification. Using a household survey of test scores and schooling outcomes for approximately 2.5 million rural children in India, we show that each year of exposure to NREGS decreases school enrollment by 2 percentage points and math scores by 2% of a standard deviation amongst children aged 13-16. In addition, while the impacts of NREGS on human capital are similar for boys and girls, adolescent boys are primarily substituting into market work when they leave school while adolescent girls are substituting into unpaid domestic work. We find mixed results for younger children. We conclude that anti-poverty programs which raise wages could have the unintended effect of lowering human capital investment.

The impact of health on labor supply near retirement

Abstract: Estimates of effect of health on employment differ from study to study due to differences in methods, data, institutional background and health measure. We assess the importance of these differences, using a unified framework to interpret and contrast estimate for the US and England. We find that subjective and objective health measures, and subjective measures instrumented by objective measures produce similar estimates but only if a sufficiently large number of objective measures is used. Otherwise, objective measures produce downward biased estimates. Failure to account for initial conditions produces upward biased estimates. We find that a single subjective health index yields similar estimates to multiple measures. Overall, declines in health explain up to 15% of the decline in employment between ages 50 and 70. The effects drop with education and are larger in the US than in England. Cognition has little added explanatory power once we control for health.

High-Stakes Grades and Student Behavior

Abstract: High-stakes exams carry important consequences for the prospects of reaching university. This study examines whether the incentives associated with exam grades affect educational investments. Exploiting a reform-induced recoding of high school students’ grade point averages, we identify the effect of highstakes grades on student behavior. The results show that students who were downgraded by the recoding performed better on subsequent assessments. The increase in academic performance in high school translated into an increased likelihood of university enrollment. As the recoding did not convey information about actual performance, these results emphasize that incentives are important in understanding students’ educational investments.

The Role of Parental Wealth and Income in Financing Children's College Attendance and Its Consequences

Abstract: This paper examines the influence of parental wealth and income on children's college attendance and parental financing decisions, graduation, and quality of college attended, and whether parental financing affects the subsequent indebtedness of parents and children. We find that higher levels of parents' wealth and income increase the likelihood that children attend college with financial support relative to not attending college, and that parental wealth increases the likelihood that children graduate from college. We show descriptive evidence that parental support for college increases the subsequent level of housing debt that parents hold but does not reduce student debt for children.

First and Second Generation Impacts of the Biafran War

Abstract: We analyze long-term impacts of the 1967-1970 Nigerian Civil War, providing the first evidence of intergenerational impacts. Women exposed to the war in their growing years exhibit reduced adult stature, increased likelihood of being overweight, earlier age at first birth, and lower educational attainment. Exposure to a primary education program mitigates impacts of war exposure on education. War exposed men marry later and have fewer children. War exposure of mothers (but not fathers) has adverse impacts on child growth, survival, and education. Impacts vary with age of exposure. For mother and child health, the largest impacts stem from adolescent exposure.

Can Introducing Single-Sex Education into Low-Performing Schools Improve Academics, Arrests, and Teen Motherhood?

Abstract: In 2010, the Ministry of Education in Trinidad and Tobago converted 20 low-performing secondary schools from coeducational to single-sex. I exploit these conversions to identify the policy-relevant causal effect of introducing single-sex education into existing schools (holding other school inputs constant). After accounting for student selection, boys in single-sex cohorts at conversion schools score higher on national exams taken around age 15, both boys and girls take more advanced coursework, and girls perform better on secondary school completion exams. There are also important nonacademic effects. All-boys cohorts have fewer arrests as teens, and all-girls cohorts have lower teen pregnancy rates. Survey evidence suggests that these single-sex conversion effects reflect both direct gender peer effects, due to interactions among classmates, and indirect effects generated through changes in teacher behavior. [End Page 1] [ABSTRACT FROM AUTHOR]