Working Papers

Political Beliefs and Compliance with Health Policies: Implications for Small Business Labor Markets (with Tannista Banerjee)

During the COVID-19 pandemic, policymakers at all levels implemented social distancing policies to limit the spread of the virus. These policies have direct and indirect effects on the labor market, which have not been thoroughly explored. Our analysis used a unique dataset of hourly employee information for over one million U.S. small businesses to examine the impact of state-level emergency declarations and business closure orders on hourly employment, wages, and hours worked. Our results show that these policies significantly reduced the number of employees, weekly hours worked, and percentage of weekly wages in a company. Additionally, we found that the longer social distancing policies were implemented, the fewer workers in small businesses engaged in voluntary stay-at-home behavior. Interestingly, our findings highlight that Republican-leaning counties show no difference in compliance based on the political affiliation of the state governor. The results suggest that the average level of political mismatch affects outcomes, and how blue or red a county is, does not matter. Despite potential endogeneity issues, our findings imply that social distancing policies impact labor market outcomes and that political beliefs influence compliance with health policies. Public policies are required to increase employment and protect small businesses from exiting the market.

The Impact of the Paycheck Protection Program on the Recovery of Small Businesses: Evidence from Scheduling Data (with Tannista Banerjee)

During the ongoing COVID-19 pandemic, small businesses were severely impacted by employment contractions and closures. In response, the United States federal government passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act on March 27, 2020, which authorized the Small Business Administration (SBA) to establish a Paycheck Protection Program (PPP) to help mitigate the adverse effects of the pandemic on small businesses. This study uses a dynamic difference–in–difference (DDID) event study methodology to evaluate the impact of PPP on the recovery of small businesses. I use loan-level microdata for all PPP loans combined with company-level data to estimate the impact of loans on employment, wages, and the operational status of establishments and firms in the county. This study finds evidence of a positive effect of PPP on employment, wages, and the operational status of establishments in the county by business size. Specifically, the study shows a 13.3% increase in establishments (new franchises), 11.9 increase in firms (new companies), and 6.8 percent decrease in the probability of closure within one month of PPP approval. The results indicate that PPP have both immediate and long-lasting consequences for businesses and their survival. Our research contributes to the literature on the economic effects of COVID-19 relief efforts by demonstrating the positive spillover effects of PPP funds on local business activities. In addition to supporting existing businesses, PPP also encouraged new business formation, playing a vital role in stabilizing and revitalizing the small business sector during and after the pandemic. This study highlights the importance of targeted policy interventions in addressing economic shocks and promoting economic resilience and growth.

Paper in Progress

Effects of Marketing Authorization Holder System: Evidence from China's Medical Device Industry (with Tannista Banerjee and Yiyu Xing) (Draft on request)

The Impact of Child Tax Credit on Household Health Recovery

Publication

DUTTA, S., BOSE, M. and RUNGTA, R., Discourse on Ambulatory Healthcare in Uttar Pradesh, India: A Study Based on NSS Data. BUSINESS, ECONOMICS AND SUSTAINABLE DEVELOPMENT, p.218