details

ARASH NEKOEI

Assistant Professor, IIES, Stockholm University

Research Affiliate of the Centre for Economic Policy Research (CEPR)

arash.nekoei@iies.su.se

RESEARCH CV TEACHING

RESEARCH

Seven Facts about Temporary Layoffs with Andrea Weber, June 2020,

(1) Short Summary (2)CEPR WP

Mandatory Advance Notice of Layoff: Evidence and Efficiency Considerations with J. Cederlof, P. Fredriksson, D. Seim, March 2020

"Risk-based Selection in Unemployment Insurance: Evidence and Implications" with C. Landais, P. Nilsson, D. Seim, J. Spinnewijn

This paper studies whether adverse selection can rationalize a universal mandate for unemployment insurance (UI). Building on a unique feature of the unemployment policy in Sweden, where workers can opt for supplemental UI coverage above a minimum mandate, we provide the first direct evidence for adverse selection in UI and derive its implications for UI design. We find that the unemployment risk is more than twice as high for workers who buy supplemental coverage. Exploiting variation in risk and prices to control for moral hazard, we show how a substantial share of this correlation (25-30%) is driven by risk-based selection. Despite the severe adverse selection, mandating the supplemental coverage would be dominated by a design leaving the choice to workers. In this design, using a subsidy for supplemental coverage is optimal and complementary to the use of a minimum mandate. Our findings raise questions about the desirability of the universal mandate of generous UI in other countries.

Close abstract

How do Inheritances Shape Wealth Inequality? Theory and Evidence from Sweden, with David Seim

Inheritances reduce relative measures of wealth inequality according to recent evidence from several countries. Using a theoretical model and Swedish administrative data, we first show that this counter-intuitive finding can be explained by high intergenerational wealth mobility and low inheritance inequality relative to wealth inequality. We then exploit two quasi-experiments: randomness in the timing of death and an inheritance tax repeal. We find that the equalizing effect of inheritances is short-lasting and reverted within a decade since less wealthy heirs deplete their inherited wealth rapidly in contrast to more affluent heirs. This depletion represents a constant reduction in annual savings equivalent in size to 10% of the average inheritances amount. 70% of this additional an- nual non-labor income are allocated to consumption (half of it is car purchases) in the first years, compared to 90% in later years. The remaining 30% (or 10%) reflect a considerable albeit declining labor supply elasticity with respect to inheritances. Taken together, our findings suggest that inheritance taxation can reduce long-run wealth inequality solely through the taxation of very large inheritances. Close abstract

"Does Extending Unemployment Benefits Improve Job Quality?", with Andrea Weber, American Economic Review, 107(2), 527-61, 2017.

(1) Manuscript (2) Published paper (3) Slides (4) Data/Code

Coverage VOXeu, Center for American Progress (Slides - Report), National Employment Law Project

Close abstract

Contrary to standard search models predictions, past studies have not found a positive effect of unemployment insurance (UI) on reemployment wages. We estimate a positive UI wage effect exploiting an age-based regression discontinuity design in Austria. A search model incorporating duration dependence predicts two countervailing forces: UI induces workers to seek higher-wage jobs, but reduces wages by lengthening unemployment. Matching-function heterogeneity plausibly generates a negative relationship between the UI unemployment-duration and wage effects, which holds empirically in our sample and across studies, reconciling disparate wage-effect estimates. Empirically, UI raises wages by improving reemployment firm quality and attenuating wage drops.

“Recall Expectations and Duration Dependence“ with Andrea Weber, American Economic Review, Papers and Proceedings, 105(5), 142-46, 2015.

(1) Manuscript (2) Data

Close abstract

Using novel administrative data from Austria, we investigate the nature of temporary layoffs and recalls. We find that on average jobs ending in temporary layoffs lasted shorter but paid higher wages. The majority of temporarily laid-off workers return to their previous employer, but also one-fifth of those permanently laid-off are recalled. Compared to job switchers, recalls have shorter unemployment spells and do not experience wage losses. Negative duration dependence of unemployment only appears once recall exits are excluded for temporary and permanent layoffs. However, for temporary layoffs, the aggregate pattern masks significant heterogeneity by pre-unemployment tenure. Additional survey evidence suggests a lower average search level for temporary layoffs.

Negative duration dependence once separate new jobs from recalls

Hazard rates for permanent (left) and temporary layoffs (right)

“Immigrants' Labor Supply and Exchange Rate Volatility”, American Economic Journal: Applied Economics 5(4): 144-64, 2013.

(1) Manuscript (2) Data/Code (3) SSRN

Close abstract

Are an immigrant's decisions affected in real time by her home country's economy? I examine this question by exploiting exchange rate variations as exogenous price shocks to immigrants' budget constraints. I find that in response to a 10 percent dollar appreciation, an immigrant decreases her earnings by 0.92 percent, mainly by reducing hours worked. The exchange rate effect is greater for recent immigrants, married immigrants with absent spouses, Mexicans close to the border, and immigrants from countries with higher remittance flows. A neoclassical interpretation of these findings suggests that the income effect exceeds the cross-substitution effect. Remittance targets offer an alternative explanation.

WORK IN PROGRESS

Waiting for recall? Evidence from temporary layoffs in Austria, with Andrea Weber

Consequences of mandatory advance layoff notice for workers and firms, with J. Cederlof, P. Fredriksson, D. Seim

A Note on the Measurement of Labor Supply Using March-CPS Data

TEACHING

Current teaching at IIES-Stockholm University-Stockholm School of Economics joint Ph.D. program

(Graduate) Public Economics I and II

Previous Experience at Harvard University

Sophomore Tutorial (Ec970), “Inequality, Justice and Economics”

(Graduate) Public Economics (Ec2450A), Teaching Fellow for Raj Chetty

(Graduate) Public Economics (Ec2450A), Teaching Fellow for Jeffrey Liebman

Microeconomic Theory (Ec1011a), Teaching Fellow for Edward Glaeser

Previous Experience

Introduction to Econometrics, Lecturer, Kabul University

Applied Statistics, Teaching Fellow, University Paris 1-Sorbonne

RA inquiries If you are looking for RA work in public/labor economics, please contact me with your resume and other credentials.

Materials provided are for educational use only. All articles are the sole copyright of their respective publishers.