I - Health, Education, and Welfare
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A Macroeconomic Model of an Epidemic with Silent Transmission and Endogenous Self-isolation
We study the interaction between epidemics and economic decisions in a model that has silent transmission of the virus. We find that rational behaviour strongly diminishes the severity of the epidemic but worsens the economic recession. We also find that the detection and isolation of not only symptomatic individuals but also those who are infected and asymptomatic or mildly symptomatic can reduce the severity of the recession caused by the pandemic. -
Cyclicality of Schooling: New Evidence from Unobserved Components Models
What is the time-varying impact of economic cycles on decisions to invest in human capital? -
Inequality in Parental Transfers, Borrowing Constraints and Optimal Higher Education Subsidies
This paper studies optimal education subsidies when parental transfers are unequally distributed across students and cannot be publicly observed. After documenting substantial inequality in parental transfers among US college students with similar family resources, I examine its implications for how the education subsidy should vary with schooling level and family resources to minimize inefficiencies generated by borrowing constraints. -
Identification of Random Resource Shares in Collective Households Without Preference Similarity Restrictions
Resource shares, defined as the fraction of total household spending going to each person in a household, are important for assessing individual material well-being, inequality and poverty. They are difficult to identify because consumption is measured typically at the household level, and many goods are jointly consumed, so that individual-level consumption in multi-person households is not directly observed. -
Sheltered Income: Estimating Income Under-Reporting in Canada, 1998 and 2004
We use data from the Survey of Financial Security and the Survey of Household Spending to estimate the incidence and extent of income under-reporting in Canada in 1998 and 2004. We estimate that the proportion of households under-reporting income is roughly 35 to 50 per cent in both years. -
Does Financial Integration Increase Welfare? Evidence from International Household-Level Data
Despite a vast empirical literature that assesses the impact of financial integration on the economy, evidence of substantial welfare gains from consumption risk sharing remains elusive. While maintaining the usual cross-country perspective of the literature, this paper explicitly accounts for household heterogeneity and thus relaxes three restrictive assumptions that have featured prominently in the past. -
Heterogeneous Returns to U.S. College Selectivity and the Value of Graduate Degree Attainment
Existing studies on the returns to college selectivity have mixed results, mainly due to the difficulty of controlling for selection into more-selective colleges based on unobserved ability. -
Expansion of Higher Education, Employment and Wages: Evidence from the Russian Transition
This paper analyzes the effects of an educational system expansion on labour market outcomes, drawing upon a 15-year natural experiment in the Russian Federation. Regional increases in student intake capacities in Russian universities, a result of educational reforms, provide a plausibly exogenous variation in access to higher education. -
Education and Self-Employment: Changes in Earnings and Wealth Inequality
The author quantitatively studies the interaction between education and occupation choices and its implication for the relationship between the changes in earnings inequality and the changes in wealth inequality in the United States over the 1983–2001 period.