Research
Working Papers
On the Spatial Distribution of Colleges
(Job Market Paper)
Given the decentralized nature of American higher education, there is substantial cross-state heterogeneity in: (1) in-/out-of-state tuition, (2) spending per student, and (3) in-/out-of-state capacity. Empirically, I show that larger and wealthier states charge higher in-/out-of-state tuition, spend more per student, and offer fewer seats to out-of-state students. I develop a novel model that embeds a heterogeneous-agent lifecycle structure within a quantitative spatial framework, featuring an endogenous distribution of college quality and firm activity across locations, as well as migration-based sorting of students and workers. I estimate the model to replicate cross-state dynamics of migration and education choices, wages, and college characteristics. The model rationalizes key empirical observations and provides a clear economic understanding of why college policies differ across states. For a fixed level of college expenditures, optimal federal policy increases aggregate welfare by 3.3%. The federal solution guides a policy analysis, which shows that spatial policies are markedly more effective at increasing welfare than standard proposals.
While the United States and Canada share many similarities, there are stark differences in their levels of income inequality and intergenerational earnings persistence. This paper investigates college quality distributions, tuition subsidies, student loan systems, and tax policies as potential sources of these differences. A heterogeneous agent model is developed where human capital investments occur over the lifecycle and across generations. The model is calibrated to the U.S. economy and matches key moments on intergenerational mobility, lifetime inequality, and higher education. The benchmark exercise finds that the system of higher education accounts for approximately 22% of the differences in income inequality and 11% of the differences in intergenerational mobility between the U.S. and Canada. The distribution of college qualities drives the majority of the inequality difference attributable to the system of higher education, whereas its net effect on intergenerational mobility is small.
From Kindergarten to College:
The Impact of Education Policies over the Lifecycle
with Angela Zheng (submitted)
Policymakers have implemented a variety of reforms that expand enrollment of low-income students in high-quality public schools and colleges, with the aim of increasing intergenerational mobility. We show that the effects of these policies are not additive across stages of the lifecycle: at the college level, expanding access actually reduces mobility. We develop a lifecycle model with human capital accumulation at each stage of schooling, in which households sort into public school zones through residential location and into college via a competitive admissions process. The key mechanism is that increased college competition affects parental investment in children and sorting across school zones. Empirically, we provide causal evidence for this mechanism and use the estimates to identify model parameters governing child human capital production. A public school rezoning policy increases intergenerational mobility by 2.2%, weakening the link between school-zone house prices and school quality. Income-based college affirmative action, however, decreases mobility by 2.3% and, when combined with rezoning, offsets half of the mobility gains.
Declining Teen Employment: Causes and Consequences with Alex Wurdinger (submitted)
Employment among U.S. high school students has halved since 2000. We provide causal evidence that (1) crowding out by adults accounts for the majority of this decline and (2) high school work experience raises lifetime earnings for non-college workers. Disciplined by these findings, we develop a general equilibrium model where teenagers accumulate human capital through work and school and adults choose between ``teen'' and ``non-teen'' occupations. Of the decline caused by adult crowding out, 53% occurs as competition pushes teen wages below the minimum wage, 27% as lower wages reduce the immediate return to work, and 20% through stronger schooling incentives. Aggregate welfare falls, and the effects are highly heterogeneous, with the largest losses of 1.2% among non-college workers. A lower teen-specific minimum wage and a vocational training policy mitigate these losses, each raising aggregate welfare by 0.3%. More broadly, our results show how changes in adult labor markets can propagate to younger workers, with persistent consequences beginning before adulthood.
On the Changing Relationship
between Net Public Foreign Assets and Growth
with Juliana Gamboa-Arbelaez (submitted)
replication package
This paper documents novel stylized facts and illustrates a simple mechanism explaining patterns of net public foreign assets across countries and time. Previous literature found an unexpected negative correlation between growth and net public foreign assets from 1980 to the mid-2000s. Analyzing data up to 2019 we find that this result no longer holds. We document a significant reversal since 2004, with the correlation now zero or weakly positive. Empirically, we attribute this shift to a substantial substitution from public debt towards international reserves, particularly for slower-growing countries. Simultaneously, low-growth countries experienced heightened productivity volatility. Augmenting an open economy neoclassical growth model to include uncertainty, we demonstrate that this increased risk faced by low-growth economies explains 46% of the change in correlation.