Working Papers
Distributional Impacts of Centralized School Choice, with Jaewon Lee, Reject & Resubmit, Journal of Political Economy
Informational frictions in centralized school choice can significantly influence its distributional consequences. Recognition of such frictions is also necessary to accurately measure welfare. We build a model of school applications, allowing applicants to consider only a limited set of schools and to have mistaken beliefs about their admission chances. Quasi-experimental variation and rich information in students’ rank-ordered lists enable identification. Utilizing this model, we evaluate the impacts of centralized school choice in New York City on racial segregation and equity in welfare, decomposing the contributions of the frictions and the preferences of students and schools. We also quantify matching stability and deviations from truthful reporting. Our results show that while school choice improves welfare across races, limited consideration substantially compromises these gains, particularly for Black and Hispanic students. A counterfactual policy involving personalized school recommendations designed using our model is projected to recover 20–36% of the welfare losses.
Transit Subsidies in an Aging Society: Mobility, Disparities, and Congestion, with Kanghyock Koh, Jungsuk Lee, and Jintaek Song
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 Jintaek Song
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.
Work in Progress
Disentangling School and Peer Effects: A Non-linear Approach with School Lotteries, with Mariana Laverde and Minseon Park
Monopsony in a Two-sided Matching Market, with Daisuke Adachi and Shintaro Yamaguchi
Pre-doctoral Publication
(In Korean) Parental Wealth, Children’s Ability and Entering Prestigious Colleges, with Se-Jik Kim and Keunkwan Ryu, Korean Economic Journal 54.2 (2015): 356-383. [paper]