Research

Working Papers

Same Shock, Separate Channel: House Prices and Firm Performance in the Great Recession [pdf]

Combining confidential business-level microdata with housing and banking data, I document large and persistent effects of local house prices on employment at small businesses, and particularly young businesses, during the Great Recession. I show that the effect on entry is important for explaining the disproportionate effect on young businesses, while young firm exit is also disproportionately affected. I then explore the channels through which house prices affect business outcomes. I use local bank balance sheet information to show both young and old firms are sensitive to local credit shocks, with some evidence of a larger effect on young businesses. I then use survey data to show that reliance on either personal assets or home equity is associated with increased sensitivity to house prices. I develop a macroeconomic model that is consistent with these findings where house prices work through two channels: a bank credit supply channel and a housing collateral channel.

Productivity Dispersion and Structural Change in Retail Trade [CES working paper 23-60]

with Dominic Smith, Michael D. Giandrea, Cheryl Grim, Jay Stewart, and Zoltan Wolf

Official Bureau of Labor Statistics (BLS) estimates of productivity growth in the retail trade sector indicate that productivity has grown at a moderate rate of 2.8 percent per year between 1987 and 2017, and that there is considerable variation in growth rates across 4-digit industries. But the official data, which can be thought of as weighted averages of establishment-level productivity, tell us nothing about what goes on within industries. Given the transformation of retail trade over the past three decades, this information could provide more insight. In this paper, we present productivity dispersion statistics for industries in the retail trade sector. These statistics are similar to the BLS-Census Bureau Dispersion Statistics on Productivity (DiSP) for manufacturing industries and complement the official BLS industry-level productivity statistics. We find that from 1987 through 2017, productivity dispersion increased slightly on average. Surprisingly, the tails of the retail productivity distribution have similar dispersion as we find in the middle. Firm dispersion has increased more than establishment dispersion.

Collaborative Micro-productivity Project: Establishment-Level Productivity Dataset, 1972-2020 [CES working paper 23-65]

with Cheryl Grim, Rachel L. Nesbit, Cody Tuttle, and Zoltan Wolf

We describe the process for building the Collaborative Micro-productivity Project (CMP) microdata and calculating establishment-level productivity numbers. The documentation is for version 7 and the data cover the years 1972-2020. These data have been used in numerous research papers and are used to create the experimental public-use data product Dispersion Statistics on Productivity (DiSP).

Publications

Opening the Black Box: Task and Skill Mix and Productivity Dispersion

with Cindy Cunningham, Matthew Dey, Lucia Foster, Cheryl Grim, John C. Haltiwanger, Rachel L. Nesbit, Sabrina Pabilonia, Jay Stewart, Cody Tuttle and Zoltan Wolf. In: Technology, Productivity, and Economic Growth, 2025.

Financial Markets and Misallocation: The Long and Short of Leverage and Productivity Dispersion [pdf]     Macroeconomic Dynamics, vol. 29, e94, April 2025.

Macro and Micro Dynamics of Productivity: From Devilish Details to Insights [pdf]                                                           with Lucia Foster, Cheryl Grim, John Haltiwanger, and Zoltan Wolf. American Economic Journal: Macroeconomics, vol. 13, no. 3, pp. 142-172, July 2021.

Work in Progress

Allocating Misallocation: Decomposing Measures of Aggregate Allocative Efficiency [slides]             with John Haltiwanger and Zoltan Wolf

We explore sources of measured misallocation using establishment data from U.S. manufacturing industries. We decompose standard productivity dispersion statistics into contributions by revenue margins over costs and plants' input-mix, and establish a link between these components and measured allocative efficiency. The results indicate the components contribute similarly to misallocation. We investigate the following mechanisms that can potentially generate these patterns: heterogeneous production elasticities, changing responsiveness and adjustment costs, and changes in market dynamics. Finally, we show rising misallocation is pervasive, and yet a few industries account for over half of the aggregate decline.  

Do the Means Matter for the Ends? An Evaluation of Optimal Unemployment Assistance under Search Frictions preliminary work with Neil White

We document the prevalence of recall hiring in the wake of recessions, particularly during the recovery after the COVID-19 pandemic. Decompositions by industry and firm size provide suggestive evidence that the Paycheck Protection Program (PPP) may have influenced recall employment. Using a modified DMP model with a temporary layoff state, we explore the effects of different unemployment assistance schemes on aggregates and welfare when workers and firms cannot perfectly bargain over flow payments while on temporary layoff. We focus on whether funds are better channeled through firms, thereby maintaining incentives to remain "in touch" while not working, or given directly to workers. We show the potential for policy to replicate (approximately efficient) outcomes from a benchmark model where bargaining in the layoff state is possible. We use this framework to evaluate policies in response to standard business cycles and to the COVID pandemic in particular. We ask whether the structure of PPP and other unemployment assistance policies that encourage "mothballing" are well-designed to achieve the explicit goals of policymakers.