Research

While romantic relationships between coworkers are common, intimate relationships between managers and subordinates have increasingly come under scrutiny. This article uses administrative data covering the universe of cohabiting couples in Finland to explore the career implications of dating and breaking up with a manager and the spillovers of these relationships on the broader workforce. Using an event study design, we find that starting a relationship with a manager leads to a 7% increase in earnings. When a manager and subordinate break up, the subordinate's earnings abruptly fall by 18%. Last, we examine the spillovers of these relationships on the broader workforce. We document a 6 percentage point decrease in retention of other workers from these relationships, with larger effects for smaller establishments and establishments where the subordinate had larger earnings gains. We conclude that these relationships impose negative externalities on colleagues, including but not limited to exit from the firm.

"The Costs of Gender-Based Violence" with Abi Adams, Invited submission at Annual Review of Economics

"Who’s Hurt the Most? Graduating Into a Recession and Transmission of Inequality Across Generations" with Martti Kaila and Jerry Montonen, submitted

Does graduating into a recession increase or decrease the transmission of inequality across generations? This paper examines this question through two innovations. First, given most people from low-income backgrounds do not attend university, we examine all education groups. We find large and persistent negative impacts of graduating into a recession for university graduates. In contrast, we only find short-run negative impacts for secondary and advanced-vocational graduates. Second, we examine the role of parental income and find little evidence wealthier parents mitigate these income losses for their graduating children; small significant differences by parental background only appear for secondary graduates. Together, these results suggest that bad economic conditions at graduation do not increase the persistence of incomes between parents and children. To understand these results, we write a simple model of differential human capital accumulation on-the-job, building on Deming and Noray (2020). We take the model to the data and show it is consistent with our main empirical results.

"How Asylum Seekers in the United States Respond to Their Judges: Evidence and Implications" with Thomas Ash, submitted

Judges in United States immigration courts exhibit extreme variability in their decisions, with a 20 percentage point gap in grant rates between the least and most lenient judges within a court on average from 2009 to 2015. We show that this variability has an important unintended consequence: Asylum seekers quasi-randomly assigned to less lenient immigration judges are more likely to be absent for their immigration hearings. Our estimates of the absentia response combined with the existing literature estimating the impact of illegal status on immigrant outcomes suggest that the variation in judicial behavior in U.S. immigration courts could lead to just over 11 million dollars in lost earnings for migrants and 144 extra crimes committed yearly.

"Black-White Income Inequality During Jim Crow: Evidence from 'Passing' for White" with Ricardo Dahis and Nancy Qian

In the press: The Weeds (starts at 38:28), Kellogg Insights

"Learning Spillovers in the Firm"

To produce output for a firm, coworkers often interact. This paper examines the possibility that as a by-product of these interactions, there are learning spillovers: coworkers learn general skills from each other that increase future productivity. In the first part of the paper, I show that learning spillovers imply externalities in the return to human capital, which firms may not internalize when there is asymmetric information. As a result, individuals may inefficiently invest in their own education. Next, I show that learning spillovers are empirically relevant. Using matched administrative data from Sweden and a combination of fixed effects and controls to address bias from worker sorting and firm heterogeneity, I find that increasing the average education of a given worker's coworkers by 10 percentage points increases that worker's wages in the following year by 0.3%, which is significant at the 1% level. The effect is persistent, decreases with age, and is higher for workers in occupations where they interact more regularly with their coworkers.

In the press: LSE Business Review

"The Crime Ladder: Estimating the Impact of Different Punishments on Defendant Outcomes" with Kristiina Huttunen and Martti Kaila

Most criminal justice systems use a "ladder of punishments" that starts with less severe punishments and progress to more severe punishments according to crime severity and criminal history. Using random assignment to judges, we estimate causal impacts of three common punishments on the ladder-fines, probation, and prison-on defendants' criminal and labor market outcomes. We find that fines increase recidivism. However, this increase is concentrated among those committing less severe crimes. Probation decreases recidivism for those committing less severe crimes and first offenders. Neither fines nor probation affect earnings. Prison has a mixed impact, decreasing future charges but also decreasing earnings.