Research

Job Market Paper ( Download here)

"Creative Destruction? The Effects of E-Commerce on Demand and Productivity for Department Stores"

During the last two decades, e-commerce has grown faster than any other retail subsector, while department stores have struggled. This paper quantifies the role of e-commerce diffusion in the decline of department store sales, and analyzes the productivity responses by retail chains operating brick-and-mortar stores. I develop an empirical model of supply and demand for retail goods at the firm-MSA level. This model captures economies of networks as well as adjustment in labor, while incorporating monopolistic competition and allowing for markups to vary in time. Since physical output is not observed, e-commerce provides me with demand shifters that are used to control for price variation. Using a novel dataset that combines confidential establishment-level data from the US Census of Retail Trade and private data on e-commerce diffusion from Forrester Research, I find a sizeable immediate effect of e-commerce on demand, and a small but significant productivity response to e-commerce diffusion. Productivity gains do not seem to come from market shares being reallocated towards more productive chains, suggesting that search costs are not a crucial factor in explaining productivity in the sector. Estimating the production parameters separately from the markups, I find evidence of increasing returns in the size of the local network of stores, which may be due to the ability of larger chains to reach a bigger pool of customers, or to economies of density generated by improved logistics, managerial spillovers, and the ability to share inventories, advertising and market knowledge. Finally, markups are increasing between 1992 and 1997 but decreasing after the introduction of e-commerce, which is consistent with a reduction in the market power of department store chains.

Work in Progress

"Productivity and Reallocation in the U.S. Retail Sector"

This article documents the evolution of various retail industries during the 1997-2012 period, which is characterized by the rapid growth of e-commerce, and compares it to the 1987-1997 period. I analyze the role of reallocation within and between industries on productivity growth using establishment-level data from the U.S Bureau's Census of Retail Trade (CRT) and the Longitudinal Business Database (LBD). For each industry, I compute job and output flows, analyze the role of entry and exit and the importance of chains, and perform labor productivity decompositions. Finally, I compare results for industries that were affected by an increase in e-commerce to those that were not.

"The Reproducibility of Economics Research", with Sylverie Herbert, Hautahi Kingi and Lars Vilhuber

Replication, reproduction, and falsification of published articles is an important part of the scientific endeavor. Apart from some notable exceptions, however, very few reproductions of economics articles are published or made available in any other public way. We describe and present the results of a large replication exercise. Of the 157 articles published in the American Economic Journal: Applied Economics for the years 2009-2013, 46 were successfully reproduced. Reproduced articles are found to have fewer citations than articles that use confidential data (and thus were not reproduced in this paper).