Working papers
A Sin Ban, Not a Sin Tax? Consumption and Incidence of SNAP Soda Restrictions with Crossan Cooper and Katja Seim
We study the first statewide SNAP restrictions on sweetened beverages and candy. Restricted spending falls 11 percent; calories and sugar fall 5–8 percent. Substitution is asymmetric: eligible fruit drinks partly offset soda declines, while candy restrictions reduce purchases of eligible snacks. Retailers barely change shelf prices. Losing SNAP’s sales-tax exemption raises tax-inclusive prices only 1.9 percent. Spending declines are larger at retailers with greater SNAP use and remain large online, where checkout stigma is less salient. Nationwide adoption would impose 13 percent of the out-of-pocket burden of an equivalent excise tax, while welfare gains reach roughly \$1.1 billion annually.
Transit Subsidies in an Aging Society: Mobility,Disparities, and Congestion with Kanghyock Koh, Suk Joon Son, and Jung-suk Lee
The world spends billions of dollars on senior transit subsidies. Is this spending worth it? We exploit Korea's age-65 cutoff for free subway rides and novel cellphone mobility data to answer this question. The subsidy increases seniors' peak-hour subway ridership and overall mobility without reducing car use, and the benefits accrue disproportionately to wealthier seniors. Our model attributes 70% of total welfare costs to congestion, mostly borne by non-seniors. An equal-discount policy for buses and subways dominates the current policy across distributional preferences and reduces the welfare loss by one-third ($0.08 per dollar).
Externality of Driving Luxury Vehicles and Optimal Taxation with Jaewon Lee, and Suk Joon Son
Under tort law, where the at-fault driver is responsible for covering the repair costs of another party, driving a luxury vehicle with higher repair costs creates a negative externality. A Pigouvian tax on luxury vehicles, or a vehicle-value-based premium, can help internalize this externality. Using novel micro-level data on automobile sales and repair costs, and leveraging the introduction of a luxury vehicle tax in British Columbia, we demonstrate that a typical luxury vehicle generates an externality of $0.10 per dollar of vehicle cost. We estimate a structural model showing that the optimal tax would increase welfare by 0.8% of the British Columbia automobile industry's value, extrapolating to an $8 billion increase in the U.S. automobile market.
Propensity to Consume Food Out of SNAP and its Welfare Implications (Revision & Resubmitted, Journal of Public Economics)
Using new consumer-panel data across multiple grocery retailers, I estimate that the marginal propensity to consume food out of SNAP benefit dollars is 47.8 cents. This is lower than the 59 cents reported by Hastings and Shapiro (2018), who used data from a single retailer. I find that providing in-kind benefits rather than cash results in an increase of 921 calories per day in total food purchased, while dietary quality remains unaffected. Assuming in-kind transfers induce a choice mistake due to mental accounting, I estimate an efficiency loss of 12 cents per dollar of in-kind transfers compared to cash.
Insurance with Multiple Agents with Jason Abaluck and Oren Sarig
We analyze how social-planner insurers split cost-sharing between consumers and firms (e.g. patients and doctors, or drivers and car mechanics). With no contracting frictions, firm cost-sharing can replace consumer cost-sharing other than “visit copays.” Optimal firm contracts depend on the marginal rate of substitution between consumer and firm cost-sharing. For Medicare physician services, paying physicians more up front but less as spending increases reduces risk for both patients and providers; in our calibration, net benefits are twice those from eliminating Medigap externality. For prescription drugs, a dollar of physician paperwork costs is 45–110 times more impactful than a dollar of consumer cost-sharing.
Work in Progress
Revisiting SNAP’s Impact on Birth Outcomes with Mohit Agrawal, Kinsey Dinan and Kacie Seil
(Received data from NYC DSS and DOHMH, grant supported by Policy Impacts)
Optimal Insurance for GLP-1 for Overconfident Consumers with Michael Darden and Yaa Akosa Antwi
(First pilot survey completed)