John Grigsby

• Study settings where labor demand gradually declines for one sector and rises in another

• How does pace of shift affect workers?

• Model w/ life cycles + heterogeneous skills + job ladders + sectoral shift

• Workers' lifetime earnings highly non-linear in transition horizon: accelerating by 1, 5, or 10 years carries v. different implications

• Lifetime earnings even U-shaped in horizon! Be wary of medium-speed transitions: fast enough to suffer all displacement, too slow to create good job opportunities elsewhere

• Accelerating transition: more and more winners on extensive margin, but thicker tail of losers on intensive margin

• Application to climate transition: 

  • Workers attached to polluting jobs lose ~5% of lifetime earnings from status quo

  • Accelerating transition by 10 years leads average losses to fall, but losses in tail rise by around one-fifth.

• We develop a framework to measure the effects of price movements on well-being, accounting for consumption prices, labor income, asset income, capital gains, and government transfers.

• Inflation caused by oil price shocks disproportionately hurt low-education households

  • Driven by motor fuel prices, unemployment, and equity price responses

• But inflation caused by monetary expansions are progressive

  • Labor income rises more for low-education, and increases in asset prices from expansion hurts high-education wealth accumulators

• Source of inflation matters for distributional consequences!

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