Research

Abstract

This study explores how temporary increases in the demand for service jobs impact educational choices in Italy. We identify exogenous variation in the demand for service jobs using shocks to the tourism industry caused by terrorist attacks abroad. We find that an exogenous increase in tourism exposure decreases college enrollment and completion in the year after the shock. The decline in enrollment is driven by fewer students choosing fields related to humanities and social sciences. Both men and women respond by reducing college enrollment and completion. The effect for men is temporary, while it is permanent for women. We then investigate the mechanism and find that tourism shocks increase employment in the tourism industry as well as overall labor force participation, consistently with a story of increased opportunity costs of college education. Finally, using an IV approach, we quantify these results and find that the average annual increase in tourist arrivals in our sample - 21,000 additional tourists - leads to an increase of 18 workers in tourism while reducing college enrollment and completion by 4 and 6 students, respectively.

Keywords: tourism, human capital, college enrollment, major choice.

JEL Codes: I25, J24, L83, Z32.

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Abstract

This paper investigates how debtor protection laws influence health insurance coverage, medical expenditures, and healthcare utilization in the United States. Using the difference-in-differences variation introduced by the 2005 personal bankruptcy reform, we find that the reform increased health insurance coverage among middle-income households unlikely to lose assets under Chapter 7. The effect was particularly pronounced for married couples and less educated households. Racial heterogeneity in the results reveals that the reform primarily influenced the insurance decisions of White households, suggesting racial disparities in bankruptcy. Furthermore, households impacted by the reform exhibited increased healthcare utilization and higher medical expenditures, mostly driven by greater private insurance contributions rather than out-of-pocket spending.

Keywords: Health insurance, bankruptcy reform, consumer protection

JEL Codes: D14, H51, I13, K35.

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Abstract

Despite the growing economic relevance of tourism, we know little about its long-term economic impact in industrialized countries. How does tourism shape labor markets and local economic activity? I address this question by analyzing the case of Italy, using exogenous variation in outbound tourism by country of origin, interacted with historical destination preferences within Italy, as an instrument for tourist inflows. I find that exposure to tourism reduces employment-to-population and labor force participation rates while increasing the local population. Tourism also reshapes the employment structure, expanding jobs in hospitality and entertainment at the expense of manufacturing and non-tourism-related services. It leads to a decline in the average size of business establishments, particularly in manufacturing, suggesting negative effects on productivity. Tourism is also associated with lower average labor and per capita incomes, and rising property income and housing prices. These findings suggest that tourism may hinder long-run economic development by shifting resources from more to less productive sectors.

Keywords: Tourism, Structural transformation, Local economic shocks, Dutch disease.

JEL Codes: D31, E24, J21, L60, L83, O14, O18, R11, Z32.

[Link to paper]