Research

“Two-Sided Sorting and Spatial Inequality in Cities” , Revise & Resubmit at Journal of Political Economy

This paper studies how two-sided sorting of firms and households drives inequality within cities. I develop a quantitative model that features skill heterogeneity, non-homothetic demand for local consumption sectors and varying skill intensity in production. As a neighborhood become more skilled, firms catering to the rich and employing skilled workers enter, further reinforcing skill sorting. To validate the model’s mechanisms, I replicate the estimated impact of Empowerment Zones on household and firm sorting in model counterfactuals. I apply the model to explore how alternative policies employing two-sided sorting as a tool to reach targeted populations more effectively and direct neighborhood change.

“Scaling Agricultural Policy Interventions” (with Lauren Bergquist, Benjamin Faber, Thibault Fally, Edward Miguel, Andres Rodriguez-Clare), Revise & Resubmit at Econometrica

We propose a new approach for quantifying large-scale policy counterfactuals that can both complement and be informed by evidence from field and quasi-experiments in agricultural settings. We develop a quantitative model of farm-level agricultural trade that captures important, but typically neglected features of this setting, including homogeneous goods and additive trade costs. We propose a new solution method in this environment that relies on rich but widely available microdata.  We harness field and quasi-experiments for parameter estimation, and showcase our approach in the context of subsidies for modern inputs in Uganda. We find that the average welfare gain from treatment, for the same sample of households, falls by 20% when implemented at scale.  At the same time, the poorest households on average fair better at scale as the gains shift from land onto labor, reducing the regressivity of the local intervention by more than half. We further document how these forces are shaped by the granular economic geography often missing in existing quantitative models and by the geographical scale of implementation, with new implications for randomized saturation designs. Finally, we discuss practical considerations for combining our toolkit with evidence from field and quasi-experiments.

“Efficiency, Risk and the Gains from Trade in Interbank Markets” (with Marc Dordal i Carreras, Jens Orben), submitted 

Bank-to-bank markets play a central role in efficient liquidity provision. However, by propagating granular shocks between banks, they may also be a source of aggregate risk. In this paper, we develop a quantitative trade framework of the interbank market and embed it into a DSGE model to capture the trade-off between efficiency and risk accompanying interbank market integration. In the model, we derive analytical approximations for welfare that depend on features of the interbank network and a few key elasticities. Using microdata on bilateral asset positions for the population of German banks, we estimate the key elasticities with plausibly exogenous variation in banks' exposure to the US financial crisis via interbank connections. Our findings indicate that the current level of interbank market integration improves welfare by 1.33%, while active provision of credit to distressed banks by the lender-of-last-resort reduces the welfare costs of idiosyncratic short-term financial shocks.

"The Gentrification Effect of Retail Amenities: Evidence from Whole Foods Market" (with Sam Miller), submitted

We study the effect of premium grocery store openings, i.e., Whole Foods Market, on their surrounding communities. To identify this amenity premium, we compare narrowly defined neighborhoods that host a Whole Foods Market with similar communities that receive non-premium grocery stores. We find that neighborhoods experience significant increases in high-income, prime age, and skilled residents over five years following the opening of a premium store. Whole Foods openings also lead to higher house prices and shifts toward income-elastic retail and services in surrounding areas. We argue that individual businesses can generate amenities that significantly affect neighborhood dynamics and trigger gentrification.

Work in Progress:

“Spatial Taxes and Commuting”

"The Long-run Consequences of Zoning on Racial Wealth Gaps" (with David Schoenholzer)

"Of Boom and Ghost Towns: Early City Formation in the California Gold Rush"