Research Projects

Childhood Environment and Gender Gaps in Adulthood (American Economic Review Papers and Proceedings 106(5): 282-88, 2016), w/ Raj Chetty, Nathan Hendren, Frina Lin, and Ben Scuderi
Paper, Executive Summary, and Slides

• We show that differences in childhood environments play an important role in shaping gender gaps in adulthood by documenting three facts using population tax records for children born in the 1980s. First, gender gaps in employment rates, earnings, and college attendance vary substantially across the parental income distribution. Notably, the traditional gender gap in employment rates is reversed for children growing up in poor families: boys in families in the bottom quintile of the income distribution are less likely to work than girls. Second, these gender gaps vary substantially across counties and commuting zones in which children grow up. The degree of variation in outcomes across places is largest for boys growing up in poor, single-parent families. Third, the spatial variation in gender gaps is highly correlated with proxies for neighborhood disadvantage. Low-income boys who grow up in high-poverty, high-minority areas work significantly less than girls. These areas also have higher rates of crime, suggesting that boys growing up in concentrated poverty substitute from formal employment to crime. Together, these findings demonstrate that gender gaps in adulthood have roots in childhood, perhaps because childhood disadvantage is especially harmful for boys.

Does Ethnic Fractionalization Matter for Development?
Paper and Slides

• Awarded Firestone Medal for Undergraduate Research and Kennedy Thesis Prize
• An existing literature finds that ethnic fractionalization (a measure of ethnic diversity) is negatively correlated with various development outcomes, including growth and public goods provision (Alesina and La Ferrara, 2005). This paper attempts to deal with issues of endogeneity in work related to ethnic fractionalization. I use the recent literature on growth and political economy in order to identify a set of potential omitted variables, and I examine how controlling for these variables affects the estimated effect of fractionalization on growth. I also develop an instrument for fractionalization based on the arbitrary construction of African borders. Both methods generate evidence that the endogeneity of ethnic fractionalization causes substantial bias in regressions of growth on fractionalization, and the true effect is substantially smaller, although very difficult to estimate precisely. I develop a game theoretic model to explain how to reconcile micro-level evidence of harmful ethnic favoritism with macro-level effects of ambiguous sign.

What can we learn from the financial flows of the 2008-2009 crisis?, w/ Saki Bigio and Juliane Begenau
Slides, (Working Paper Coming Soon!)

• • We study bank microdata during the financial crisis of 2007-2009 and its aftermath, in order to better understand. We collect the following facts: [1] Between 2007 Q3 and 2014 Q4, bank holding companies lost $710 billion in market capitalization. At the same time, there was a slowdown and eventual decline in the stock of loans. [2] Book values and market values diverged during the crisis. Market values capture information that book values do not, and book values do not fully respond to shocks. [3] Neither regulatory nor market constraints appear to be strictly binding for most banks. However, these constraints may still influence the bank’s decisions indirectly. [4] Banks appear to operate with a target leverage, which they only slowly return to after shocks. This suggests banks may face adjustment costs. [5] Prior to the crisis, banks adjusted their leverage in response to shocks primarily by reducing assets. Post-crisis, banks also raised equity through retained earnings and issuances. We provide a reduced form model that fits these facts, and discuss microfoundations that can explain what constraints banks faced during the crisis.