Research

Schipper, T.C., & Vecchia, A. (2022). Bus ridership and the minimum wage: Evidence from bus stops near fast-food restaurants. Applied Economics Letters. 

• [Preprint]

• [Gated Version]

Check, A.J., Nolan, A.K., & Schipper, T.C. (2019). Forecasting GDP Growth using Disaggregated GDP Revisions. Economics Bulletin, 39(4).

• [Open Source] 

Schipper, T.C. (2019). Informality, Innovation, and Aggregate Productivity Growth. Review of Development Economics. Review of Development Economics, 24(1), 125-143. 

• [Preprint]

• [Gated Version] 

Allen, J., Nataraj, S., & Schipper, T.C. (2018). Strict Duality and Overlapping Productivity Distributions between Formal and Informal Firms. Journal of Development Economics, 135, 534-554. 

• [Preprint] 

• [Gated Version] 

"Information and Efficiency: Forecasting with Disaggregated GDP Revisions," with Adam Check (U.S. Bank) and C. Richard Higgins (Colgage Univerity) [Working Paper] Under Submission

 We investigate the informational content and forecasting potential of disaggregated GDP revisions. Using dynamic linear regression models, we show that revisions to consumption growth predict future consumption growth, improving forecast accuracy by 3.3%. As a consequence, consumption growth revisions also have explanatory power for GDP growth, improving forecasting accuracy by 5.2% relative to an AR(1) baseline model. This is despite the fact that GDP growth revisions typically do little to improve forecast performance. We show that the information contained in consumption growth revisions goes beyond information already captured by the Survey of Professional Forecasters.

"Minneapolis by Bus: Short-Run Impacts of the Minimum Wage Ordinance on Bus Ridership," with Natalie Del Ponte (IPUMS)  [Working Paper]

Despite a vast literature on the labor market effects of the minimum wage, there is no research on its impacts on public transit. To study this issue, we use bus ridership data encompassing Minneapolis' increase of its minimum wage through a local ordinance. We estimate several variants of a difference in differences (DD) model which compares changes in Minneapolis ridership to changes in surrounding cities. The relatively high frequency and comprehensive nature of the data, coupled with ideal comparison groups, provide ideal conditions to causally identify the impact of the minimum wage change on bus boardings. We estimate that Minneapolis' Minimum Wage Ordinance caused an increase in boardings of between 790 and 2,576 per day relative to non-treated cities. This modest effect accounts for 1.0% to 3.2% of daily post-treatment boardings in Minneapolis. We find evidence that boardings increased more in below-median income neighborhoods in Minneapolis. These results underscore both important changes in the demand for public transit and the far reaching impacts of changes in the minimum wage.

"Informality, Entry Costs, and Differential Access to Public Goods," with Jeffrey Allen (Convergence International) 

The literature on the causes of informality often cites barriers to entry in the formal sector as a key contributor to high rates of informality; however, the empirical evidence shows that reforms to these barriers have had mixed impacts on rates of informality. We construct a general equilibrium model with endogenous firm entry into either the formal or informal sector. The model highlights two important mechanisms that limit the effectiveness of  reforms that lower the cost of formalization. We focus on a novel explanation in which differential access to productive public goods determines sectoral choice. Specifically, when entry costs into the formal sector are correlated with access to productive public goods, reforms that reduce entry costs may increase informal firms' access to these previously restricted goods, offsetting the relative benefits of entering the formal sector. Our model also shows how tax policy can undermine the effectiveness of lower entry costs, suggesting the need for multi-faceted policy reforms to reduce informality. We perform several empirical exercises that are consistent with the predictions of the model.

"What Predicts Informality?: A Bayesian Model Averaging Approach" with Adam Check (St. Thomas)

This paper estimates a robust set of firm and country-level determinants for firm informality. To do so, we construct a new data set composed of formal, informal, and micro firms from the World Bank Group's Enterprise surveys. We augment this data with common predictors of informality across countries including regulation, taxes, and education. We analyze the data using Bayesian Model Averaging (BMA) to estimate probit models for whether a given firm is informal. BMA also allows us to rigorously address the issue of model uncertainty that may explain conflicting results within the literature. Our analysis implies a large set of included predictors; however, the coefficient estimates include a wide range of values such that many indicators plausibly have no effect on informality. In totality, the paper highlights the fact that many variables may have an effect on informality, and there are many potential policy levers to coax firms into operating formally.

"Developing Consumers of Economic Data: A Classroom Forecasting Exercise"

This paper outlines a simple classroom exercise that encourages students to think critically about the applicability of data. I ask students to make repetitive forecasts for the rupee/dollar exchange rate. In each round of the game, I release additional data.  Some of this data is pertinent while some of it is irrelevant or misleading. Classroom applications yield illustrative examples of how more data usually improves forecasts, but not all data is equally helpful. The exercise provides the groundwork for a productive conversation about how to utilize data in our increasingly data-rich world. Surveys indicate increases in students' self-reported levels of understanding  of the role of information as well as for forecasting-specific learning objectives.

"Informal Competition and Productivity Growth: Evidence from Firm-Level Data," with Yaser Sattari (Canadian Western Bank)

"Informational Content of Disaggregated GDP Revisions," with Adam Check (St. Thomas)