Junjie Guo


Center for Research on the Wisconsin Economy (CROWE)

Department of Economics

University of Wisconsin - Madison

1180 Observatory Drive

Madison, WI 53706

Email: jguo27[at]wisc.edu

Education: Ph.D. in Economics, University of Wisconsin-Madison

Research Fields: Labor; Macro

Peer-Reviewed Articles

[2] Students' Heterogeneous Preferences and the Uneven Spatial Distribution of Colleges, with Chao Fu, Adam Smith and Alan Sorensen. Journal of Monetary Economics, Forthcoming

[1] The Persistent Impact of Multiple Offers, Labour Economics, January 2022

Previously titled "Multiple Offers"

Working Papers

[6] Sequential Job Posting and Equilibrium Wage Dispersion with Bunching, March 2022

In a labor market where new jobs cannot start until some time in the future, firms post vacancies in advance when productivity is high, and they post more vacancies but lower wages as the job starting time gets closer. An equilibrium wage distribution with both a continuous component and a mass point exists even with identical and rational agents on both sides of the market. Wage dispersion is generated by the inter-temporal competition between vacancies posted at different times, and a mass point emerges due to the lack of wage competition among vacancies posted at the same time.

[5] The Dynamics of Multiple Offers and the Frictional Wage Distribution, February 2022

Previously titled "The Cyclicality of Job Creation with Multiple Offers"

This paper studies the dynamics of the frictional wage distribution by exploring the interaction between multiple offers and job creation. The model predicts that an increase in aggregate productivity raises the probability for an unemployed worker to receive multiple offers, which pushes firms to post a larger share of high-wage vacancies and leads to a larger increase in the upper than the lower end of the wage distribution. In contrast, an increase in the minimum wage reduces the probability of multiple offers for an unemployed worker, which induces firms to post a larger share of low-wage vacancies and leads to a smaller increase in the upper than the lower end of the wage distribution. I provide evidence consistent with both predictions, which contribute to our understanding of the sullying effect of recessions and the impact of minimum wages on the wage distribution. Moreover, with the composition of vacancies varying endogenously over the business cycle, I show that the cyclical behavior of aggregate unemployment and vacancies is independent of the degree of wage rigidity for a typical firm, and models focusing on a stationary wage distribution could significantly understate the magnitude of frictional wage dispersion.

[4] Identification of the Wage Offer Distribution using Order Statistics, updated, April 2022

This paper shows how to identify the wage offer distribution using novel data on the number and observed wages of the offers received by a sample of workers in a short period of time. We provide assumptions for nonparametric identification using order statistics, and a test of the assumptions. Empirically, we find a normal distribution with a standard deviation of 0.137 is consistent with the data on log wage offers. This implies search frictions account for about 10% of overall wage inequality, smaller than most of the estimates in the literature. Moreover, we find the dispersion of wage offers for workers without a bachelor's degree is increasing in the unemployment rate, causing it to be larger than the dispersion for workers with a bachelor's degree when the unemployment rate is high. On the other hand, the dispersion is not significantly related to a worker's age or employment status.

[3] Estimating Aggregate Human Capital Externalities, with Nicolas Roys and Ananth Seshadri. January 2018

This paper estimates human capital externalities formulated in Lucas (1988). We incorporate externalities into an overlapping generations model of human capital accumulation with Compulsory Schooling Laws (CSL). The model implies that human capital externalities can be estimated from the effect of CSL affecting the schooling decision of one generation on the wage of other generations. Using an instrumental variable strategy deduced from the model, we find that one more year of average schooling at the U.S. state level raises individual wage by about 6-8%. Taking this reduced form estimate into account, we estimate that the elasticity of a typical firm's productivity with respect to the average human capital of an economy is 0.121.

[2] Human Capital Externalities and the Geographic Variation in Returns to Experience, available upon request

This paper provides evidence that the average human capital of a labor market has a positive effect on individual human capital accumulation and wage growth over the life cycle. Returns to experience in a labor market are found to be increasing in the share of workers with a bachelor’s degree or more (college share) in the market. An instrumental variable and panel data with individual fixed effects are used to address the potential endogeneity of college share and the sorting of workers across labor markets respectively. The effect of the college share of a labor market is shown to persist after workers leave the market, suggesting that a larger college share raises returns to experience through the accumulation of human capital valuable in all markets. The findings provide an explanation for the higher returns to experience in large cities and rich countries documented recently in the literature.

[1] Search Capital and Migration, available upon request

CROWE Publications

[20] Job Openings and Labor Market Tightness During the COVID-19 Pandemic, February 2022

[19] Forecasting the U.S. and Wisconsin Economies in 2022, with Noah Williams. January 2022

[18] The Evoluation and Impacts of the State Corporate Tax Structure: 2011-2020, with Noah Williams, Zhuoer Ren and Qi Yang. September 2021

[17] Middle Income Tax Reform Options for Wisconsin: Evaluating a Proposal by the Joint Committee on Finance, with Noah Williams. June 2021

[16] Middle Income Tax Reform Options for Wisconsin, with Noah Williams. June 2021

[15] The Impact of Increased Unemployment Benefits During the COVID-19 Pandemic, with Noah Williams, Arwa Alalwani, Zhi Jiang, Jiashun Pang, Stefan Smutny and Linhua Zeng. April 2021

[14] Forecasting the U.S. and Wisconsin Economies in 2021, with Noah Williams. January 2021

[13] The Economic Impact of the Wisconsin Supreme Court Ruling Invalidating the State's Safer at Home Order. July 2020

[12] The Impact of Statewide Stay-at-Home Orders: Estimating the Heterogeneous Effects Using GPS data from Mobile Devices. April 2020

[11] The Geographic Distribution of Workers Most At Risk When Ordered to Stay At Home. March 2020

[10] Covid-19, Industry Mix and the Growth of Initial UI Claims across States. March 2020

[9] The Revenue and Incentive Effects of AB 910 and Alternative Reforms in Wisconsin, with Noah Williams. Febuary 2020

[8] Forecasting the U.S. and Wisconsin Economies in 2020, with Noah Williams. January 2020

[7] Jobs, Skills and the Prison-to-Work Transition, with Ananth Seshadri and Christopher Taber. August 2019

[6] Potential Medicaid Expansion in Wisconsin: New Estimates of Costs and Benefits for Health Care Providers and the Privately Insured, with Noah Williams. June 2019

[5] Marginal Tax Rates and Individual Income Tax Reforms in Wisconsin, with Noah Williams. May 2019

[4] Forecasting the US and Wisconsin Economies in 2019, with Noah Williams. January 2019

[3] The Impact of Income Tax Reductions in Wisconsin, with Noah Williams. December 2018

[2] Business Formation in Wisconsin During and After the Great Recession. Feburary 2018

[1] Forecasting the US and Wisconsin Economies in 2018, with Noah Williams. January 2018

Other Publications

[2] Estimating the Impact of Missing Totalization Agreements, with Ananth Seshadri. MRDRC Working Paper. December 2021

[1] Estimating the Macroeconomic Effects of Each Totalization Agreement, with Ananth Seshadri. MRDRC Working Paper. September 2020