Tastes in the United States: Convergence or Divergence?
This study investigates how tastes for consumption goods across the United States have changed in the presence of increasing cultural polarization. Using Nielsen Homescan Consumer Panel data for over 77 million transactions at the Universal Product Code (UPC) level and tastes defined by an Almost Ideal Demand System, I find evidence of an overall divergence in food tastes between households across regional markets from 2007-2016. Evidence of divergence is also present across households of different income, education, and race groups, including non-Hispanic blacks and whites showing divergence in tastes for every broad food product category in the study. Conversely, there is evidence of taste convergence between rural households. Urban/rural groups and other race groups do not show an overall change in taste differences between them. Overall, political distance explains taste differences better than geographical distance. The dynamics of taste differences are important for understanding consumption inequality and its connection to topics including nutritional inequality, the distributional effects of trade, and price indexes.
Human Capital and Quality Choice (with Volodymyr Lugovskyy and Alexandre Skiba)
This paper argues that human capital increases a consumer's ability to evaluate and appreciate the quality of a good. We introduce human capital into a random-utility framework by allowing it to increase the marginal utility of quality. We show theoretically that, in a random-utility model with a quality-differentiated good, consumers with more human capital have steeper Engel curves for higher-quality varieties. We test this prediction on Nielsen Homescan data at the Universal Product Code transaction level and focus on the organic milk consumption in the US. Using education as a proxy for human capital, we show that households with college-educated heads have steeper Engel curves for organic milk than those without college-educated heads. The effect is statistically and economically significant. This result has broad implications for the literatures on consumer choice, price indexes, vertical differentiation, and international trade.
Risk Aversion in Lending Following the Financial Crisis
Following the 2007-2008 financial crisis, bank lending dropped dramatically, and the decline persisted well into the recovery period. This paper attempts to explain the drop in lending using a consumer default model with risk-aversion in loan pricing, based on the default model of Arellano (2008). The version of the model with risk-aversion is compared with one that uses the standard assumption of risk-neutral financial intermediaries to see which is more consistent with U.S. data in the period 1985:Q1-2016:Q4. Both versions are then recalibrated for the pre-financial crisis period, and endowment shocks matching observed output shocks are generated to see if a model with risk-aversion more accurately predicts lending in the post-crisis recovery period. The results have implications for monetary policy, including how to set the interest rate on excess reserves following sudden declines in lending.
China’s Tax Burden and Economic Growth (with Joyce Yanyun Man)
We estimate the effect of taxes on economic growth at the provincial level in China using a panel data vector autoregressive (VAR) model. We find that the business, enterprise, and individual income taxes Granger-cause lower provincial-level economic growth, while greater reliance on the value-added tax (VAT) is associated with higher provincial-level economic growth.
The University of Akron
‘Economic Forecasting’ --- Fall 2020
‘Principles of Macroeconomics’ --- Fall 2020
‘Introduction to Microeconomics’ (Large Lecture, ~300 Students) --- Spring 2020, Fall 2019
‘Money & Banking’ --- Spring 2019, Fall 2018
‘Survey of Public Finance’ --- Spring 2018, Fall 2017, Spring 2017, Fall 2016
‘Intermediate Microeconomics’ --- Summer 2018
‘Introduction to Microeconomics’ (Online) --- Summer 2018
‘Introduction to Macroeconomics’ --- Spring 2016
‘Statistical Analysis for Business and Economics’ --- Fall 2015
University of Pittsburgh, Graduate School of Public and International Affairs (GSPIA)
‘Economics of Development’ --- Spring 2011