Economica最新文献

We estimate the importance of local labour structure in the spread of COVID-19 during the first year of the pandemic. We build a unique dataset across 6791 English neighbourhoods that distinguishes between people living (residents) and people working (workers) in a neighbourhood, and differentiate between jobs that can be done from home (homeworkers), jobs that likely continued on-site (keyworkers), and non-essential on-site jobs. We find that a 10 percentage points increase in keyworker jobs among residents is associated with 3.15 more cases per 1000 (4.8% relative to the mean), while a 10 percentage points increase in homeworker jobs among residents is associated with a decrease of 7.74 cases per 1000 (11.8% relative to the mean). Results for the composition of workers show the same sign, but smaller magnitudes. A dynamic analysis of the monthly incidence of reported cases shows that these relationships are particularly strong during lockdown periods. These results are heterogeneous across neighbourhoods, with larger positive effect of keyworkers, and lower protective effect of homeworkers, in higher deprivation areas. We explore the role of occupation skill intensity in driving these neighbourhood differences. These findings highlight important asymmetries in the distributional impact of the policy response to COVID-19.

This paper identifies how a rise in the deficit/debt impacts interest rates by looking at the high-frequency response of interest rates to fiscal surprises. The fiscal surprises are the unexpected components of deficit releases and the changes in official forecasts by the Congressional Budget Office and by the Office of Management and Budget. The paper estimates that a rise in the deficit-to-GDP ratio of 1 percentage point raises the 10-year nominal interest rate by 8.1 basis points. The response is similar quantitatively for other Treasury maturities and for corporate debt interest rates. The paper also investigates which theoretical channel drives this relationship, and whether surprises affect interest rate expectations or the term premium. These results are used to estimate how recent spending may have affected interest rates.

Further education and sixth form colleges are key institutions for facilitating skill acquisition among 16–19 year olds in the UK. They enrol half a school cohort after completion of their lower secondary education, and this includes a disproportionate number from low-income backgrounds. Yet little is known about what could improve performance in these institutions. We conduct the world's first management practices survey in such institutions, and match this to administrative longitudinal data on over 40,000 students. Value-added regressions with rich controls suggest that structured management matters for educational outcomes, especially for students from low-income backgrounds. For this group, in a hypothetical scenario where an individual is moved from a college at the 10th percentile of management practices to the 90th, this would be associated with 8% higher probability of achieving a good high school qualification, nearly half of the educational gap between those from poor and non-poor backgrounds. Hence improving management practices may be an important channel for reducing inequalities.

The private sector contributes the majority of China's GDP, with family firms responsible for most of the contribution. Prior studies find that firms' family control is influenced by certain cultural norms, such as family ties. This study explores the underlying historical and agricultural roots of these cultural norms that influence modern businesses. Combining a set of high-quality, nationally representative Chinese firm and household surveys with prefectural data, we first show the positive impact of rice farming on family control of local firms. We establish robust causal inferences by exploring the impact of historical agricultural legacies and discussing alternative measures, spatial autocorrelations, omitted variables, instrumental variables and self-selection. More importantly, our results demonstrate that the rice cultivation practice enhances the local people's preferences for strong family ties. Instead of claiming a direct role of these cultural traits as in the existing literature, we recast them as cultural mediators and persistent channels through which historical rice farming can shape contemporary corporate structure.

This paper examines the impact of oil price and quantity shocks on income inequality in the USA. Using micro income data, we construct measures of pre-tax money income inequality at the state level for the period 1980–2017. We find that a $10 increase in oil price increases inequality, measured by the ratio of pre-tax income of the 90th percentile to 10th percentile (p90/p10), by 3.8 percentage points in states with high levels of oil endowments per capita. The increase in capital income to households at the top of the distribution drives the observed change in inequality. In addition to price shocks, we study the impact of quantity shocks that arise from oil discoveries. Quantity shocks have no effect on the overall income distribution.

This paper examines the link between a mother's autonomy—the freedom and ability to think, express, make decisions and act independently—and the nutritional status of her children. We treat ‘autonomy’ as a latent variable, and design a novel statistical framework to measure this. This method allows us to separate the direct associations of maternal and family characteristics in our model for nutrition, from their indirect associations that work through maternal autonomy. Using data from India, we explore the sensitivity of our estimates to endogeneity caused by sample selection in the presence of son preference. We find: (i) a one standard deviation (SD) higher autonomy score is associated with a 0.16 SD higher height-for-age z-score (HAZ score); and (ii) a 10% lower prevalence of stunting (HAZ < −2 SD). The latter is equivalent to the prevention of approximately 300,000 children stunting, indicating the important role of maternal autonomy.

Information on both wages and job quality is needed in order to understand the occupational dispersion of wellbeing. We analyse subjective wellbeing in a large UK sample to construct a measure of ‘overall reward’, the sum of wages and the value of job quality, in 90 different occupations. If only wages are included, then labour market inequality is underestimated: the dispersion of overall rewards is one-third larger than the dispersion of wages. Our findings are similar, and stronger, in data on US workers. We find a positive correlation between job quality and wages in all specifications, both between individuals in the cross-section and within individuals in panel data. The gender and ethnic gaps in the labour market are larger than those in wages alone, and the overall rewards to education on the labour market are underestimated by earnings differentials alone.

We show that firms' market power dampens the response of their output to monetary policy shocks, using firm-level data for the USA and a large cross-country firm-level dataset for 14 advanced economies. We also find some evidence that the role of markups in monetary policy transmission, while independent from other channels, is greater for firms whose characteristics—notably size and age—are likely to be associated with greater financial constraints.

We document the spiral of populism in Europe and the direct and indirect role of economic insecurity shocks. Using survey data on individual voting, we make two contributions to the literature. (i) Economic insecurity shocks have a significant impact on the populist vote share, directly as demand for protection, and indirectly through the induced changes in trust and attitudes. (ii) A key consequence of increased economic insecurity is a drop in turnout. The impact of this largely neglected turnout effect is substantial: conditional on voting, when economic insecurity increases, almost 40% of the induced change in the vote for a populist party comes from the turnout channel.

Most economists maintain that the labour market in the USA (and elsewhere) is ‘tight’ because unemployment rates are low, and the Beveridge curve (the vacancies-to-unemployment ratio) is high. They infer from this that there is potential for wage-push inflation. However, real wages fell rapidly in 2022, and prior to that, real wages had been stagnant for some time. We show that unemployment is not key to understanding wage formation in the USA, and has not been since the Great Recession. Instead, we show that rates of underemployment (the percentage of workers with part-time hours who would prefer more hours) and the rate of inactivity (the percentage of the civilian adult population who are out of the labour force) reduce wage pressure in the USA. This finding holds in panel data with state and year fixed effects in both annual and quarterly data for the period 1980–2022, and is supportive of a wage curve that fits the data much better than a Phillips curve. The unemployment rate no longer enters significantly negative in wage equations, however specified, in the years since 2008.