Job Market Paper
“Health Insuranceand the Supply of Entrepreneurs: Evidence from the ACA Medicaid Expansion," Presented at ASHEcon 2018 and APPAM Regional Student Conference 2018.
I examine whether the expansion of Medicaid eligibility under the Affordable Care Act increases the supply of entrepreneurs as measured by self-employment. Using the 2003–2017 Current Population Survey and focusing on childless adults in low-income households, I apply difference-in-differences, propensity score weighting, and instrumental variable (IV) methods. I find that expanding Medicaid eligibility raises the self-employment rate by 0.8 to 1.6 percentage points, without increasing self-employment exit. IV estimates imply that covered individuals have 8 to 11 percentage points higher probability to become self-employed. Exploiting additional variation by spousal coverage or poor health of individuals or their spouse within triple difference specifications, I also find evidence that the underlying mechanism of the effect was through the reduction of entrepreneurship lock. The results suggest that limited access to health insurance may be a barrier to entrepreneurship.
“Immigrant Entrepreneurs and Innovation in the U.S. High-tech Sector” (with J. David Brown, John S. Earle, and Mee Jung Kim), NBER Working Paper No. 25565. 2019. Forthcoming in The Roles of Immigrants and Foreign Students in US Science, Innovation and Entrepreneurship. Edited by Ina Ganguli, Shulamit Kahn, and Megan MacGarvie. University of Chicago Press.
We estimate differences in innovation behavior between immigrant- and native-owned firms in the high-tech sector. The data from the Annual Survey of Entrepreneurs comprise a random sample of firms with detailed information on owner characteristics and on innovation. We find uniformly higher rates of innovation in immigrant-owned firms for 24 of 26 different measures; the only exceptions are copyrights and trademarks. The immigrant advantage holds for older firms as well as for recent start-ups and for every level of education. The size of the estimated immigrant-native differences tends to fall in regressions including detailed controls for demographics, human capital, finance, motivations, and industry, but across specifications immigrants retain an advantage in innovation.
"High-Growth Entrepreneurship" (with J. David Brown, John S. Earle, and Mee Jung Kim), IZA Discussion Paper No. 11662, 2018, Presented at CAED 2017 and ASSA 2018, (Revised and Resubmitted, Industrial and Corporate Change).
Analyzing data on all U.S. employers in a cohort of entering firms, we document a highly skewed size distribution, such that the largest 5% account for over half of cohort employment at firm birth and more than two-thirds at firm age 7. Little of the size variation is accounted for by industry or amount of finance, but relative size is strongly persistent over time: at age 7, the probability of 20+ employees is about 40 times larger for those entering with 20+ than for those entering with one. We link administrative and survey data to study the role of founder characteristics in high growth, defined as the largest 5% of the cohort at ages 0 and 7. Female-founded firms are 50% less likely to be in this ventile at both ages, and 34% less likely when controlling for detailed demographic and human capital variables. A similar initial gap for African-Americans, however, disappears by age 7. Founder age is positively associated with high growth at entry, but the profile flattens and turns negative as the firm ages. The education profile is initially concave, with graduate degree recipients no more likely than high school graduates to found high growth firms, but the former nearly catch up to those with bachelor’s degrees by firm age 7, while the latter do not. Most other relationships of high growth with founder characteristics are highly persistent over time. Prior business ownership is strongly positively associated, and veteran experience negatively associated, with high growth. A larger founding team raises the probability of high growth, while, controlling for team size, diversity (by gender, age, race/ethnicity, or nativity) either lowers the probability or has little effect. Controlling for start-up capital raises the high-growth probability of firms founded by women, minorities, immigrants, veterans, smaller founding teams, and novice, younger, and less educated entrepreneurs. Perhaps surprisingly, female, minority, and less-educated entrepreneurs tend to choose high-growth industries, but fewer of them achieve high growth relative to their industry peers.
“The Impact of Employer Insurance Mandates on Employment by Small Business: Evidence from Massachusetts Reform," Working Paper, Presented at SOLE 2016.
This paper exploits the Massachusetts health care reform to study the impact of the employer health insurance mandate on employment in small business. Using a triple-difference method with the County Business Patterns (CBP) data from 2000 to 2011, I compare the number of employees in establishment size classes above and below 10, the threshold employment of the mandate. The specification includes two-way interacted fixed effects (state by year, size by year, state by size) as well as industry fixed effects. The results suggest that employment above the thresholds fell by about 2 to 4 percentage points and the number of establishments in the same size group decreased by about 1 to 4 percentage points.
"The Incidence of Healthcare Costs of Chronic Disease: Evidence from Older Workers" (with Chanup Jeung), Working Paper, Presented at APPAM 2016.
Who pays for costs of chronic conditions? In this paper, we examine whether workers (50 to 64 years old) covered by employer sponsored insurance bear the healthcare costs in the form of lower wages. Using a difference-in-difference approach with data from the Health and Retirement Study, we find that workers with chronic diseases receive significantly lower wages than healthy workers when they are covered by employer-sponsored insurance. A part of wage reduction in workers with chronic disease can be explained by their higher healthcare costs.