Job Market Paper
“Hartz in the Right Place: Trade shocks and labor mobility in Germany” (Job Market Paper).
Gains from trade are rarely distributed evenly across workers and local labor markets. This paper presents a model where policies that reduce frictions in the labor market affect the distribution of welfare changes stemming from trade. I evaluate this mechanism in the context of a set of labor market policies between 2003-2005 in Germany known as the Hartz Reforms. Using establishment-level data from the German Federal Employment Agency, I show how the intersectoral mobility of workers rose in the period following these reforms. I use a multi-sector trade model with heterogeneous workers and intersectoral mobility to quantify the welfare changes from increased Chinese import pressure between 2005-2012. I find that, in the absence of the reforms, the gap in welfare gains between the worst-off and best-off labor markets would have more than doubled.
Other Working Papers
“Sectoral Input Multipliers, Income Per Capita, and Real Exchange Rate Levels” (With Javier Cravino; Accepted at The Review of Economics and Statistics).
This paper evaluates an alternative mechanism linking real exchange rates to GDP per capita that relies on sectoral differences in input intensities rather than on cross-country differences in sectoral productivities, and hence can be easily quantified using data on sectoral input shares. We propose that sectoral differences in intermediate input shares can affect real exchange rates through the following channel. As productivity and income grow, so do wages relative to intermediate input prices, which increases the relative price of non-tradables if tradable sectors use intermediate inputs more intensively. We show that sectoral differences in input intensities can account for about half of the observed elasticity of the aggregate price level with respect to GDP per capita.
This paper provides empirical support for the notion that the growth in the Internet has directly led to an increase in services trade. While previous empirical work has shown the correlation between broad measures of Internet connectivity and local services exports, I measure this relationship bilaterally by constructing a novel dataset based of the undersea fiber-optic cable network responsible for 99% of international data traffic. I measure the degree of bilateral connectivity using information on the capacities of these cables in order to more accurately capture the nature of international data transfer. When added to a familiar gravity model, I estimate a positive relationship between Internet connectivity and bilateral exports in data-intensive industries with an elasticity of 0.25 to 2.25 over a variety of possible settings.
"The credit crunch and fall in employment during the Great Recession," with Seung Lee and Viktors Stebunovs. Journal of Economic Dynamics and Control 43 (2014): 31-57.