"The long-run effects of government spending on structural change: Evidence from Second World War defense contracts" (with Zhimin Li). Economics Letters. Volume 178, May 2019: 66-69. (Link)


This paper studies the long-run effects of the largest government spending program in U.S. history – Second World War defense spending – on structural change in local economies. We link a dataset of war supply contracts with economic data at the county level spanning from 1930 to 2000. Using counties that received no defense spending as a comparison group and controlling for prewar characteristics, we find that wartime defense spending led to sustained reallocation of labor to manufacturing and other non-agricultural sectors in war production centers, contributing to the long-term population growth in those regions.

"What Do Big Data Tell Us About Why People Take Gig Economy Jobs?" Forthcoming. AEA Papers and Proceedings, Vol 109 (pdf)


The gig economy is widely regarded to be a source of secondary or temporary income, but little is known about economic activity outside of the gig economy. Using data from a large, online personal finance application, I document the evolution of non-gig income and household balance sheets surrounding the participation decision for gig economy jobs. This simple analysis reveals striking pretrends in income and assets. In addition to providing insight into the reasons why households enter the gig economy, these findings have potentially important implications for the external validity of previous studies focusing on gig economy activity only.

Figure 1. Event Studies Around Starting a Gig Job: Income in and Outside of Gig Economy
Figure 2A. Event studies around starting a gig job: Assets
Figure 2B. Event studies around starting a gig job: Liquidity

"Consumption Insurance and Multiple Jobs: Evidence from Rideshare Drivers" (pdf)


Emerging rideshare jobs promise workers more choice over their hours. Does this increased flexibility help workers smooth income shocks? A sample of approximately 18,000 rideshare drivers is analyzed from a large, online personal financial service containing information on rideshare income, outside income, spending, and liquid assets. Debt and high credit card utilization are key predictors of participation in ridesharing. In the period after starting ridesharing, rideshare income replaces 73 percent of income losses from main payroll jobs. Sensitivity of spending to main income falls by 82 percent, suggesting substantial increases in consumption smoothing. Matching these empirical findings to a structural intertemporal labor supply model with credit and labor frictions implies benefits from flexible second jobs of over $1,800 per year. The results suggest the value of leisure is relatively low for this group of workers, which has important implications for understanding the welfare costs of income fluctuations.

"Consumption Inequality and the Frequency of Purchases" (with Olivier Coibion and Yuriy Gorodnichenko) NBER Working Paper No. 23357, July 2017. (pdf, Appendix)


We document a decline in the frequency of shopping trips in the U.S. since 1980 and consider its implications for the measurement of consumption inequality. A decline in shopping frequency as households stock up on storable goods (i.e. inventory behavior) will lead to a rise in expenditure inequality when the latter is measured at high frequency, even when underlying consumption inequality is unchanged. We find that most of the recently documented rise in expenditure inequality in the U.S. since the 1980s can be accounted for by this phenomenon. Using detailed micro data on spending which we link to data on club/warehouse store openings, we directly attribute much of the reduced frequency of shopping trips to the rise in club/warehouse stores.

"The Response of Consumer Spending to Changes in Gasoline Prices" (with Michael Gelman, Yuriy Gorodnichenko, Shachar Kariv, Matthew D. Shapiro, Dan Silverman, and Steven Tadelis). NBER Working Paper No. 22969, December 2016. (pdf) (appendix pdf)


This paper estimates how overall consumer spending responds to changes in gasoline prices. It uses the differential impact across consumers of the sudden, large drop in gasoline prices in 2014 for identification. This estimation strategy is implemented using comprehensive, daily transaction-level data for a large panel of individuals. The estimated marginal propensity to consume (MPC) is approximately one, a higher estimate than estimates found in less comprehensive or well-measured data. This estimate takes into account the elasticity of demand for gasoline and potential slow adjustment to changes in prices. The high MPC implies that changes in gasoline prices have large aggregate effects.

"Amerisclerosis? The Puzzle of Rising U.S. Unemployment Persistence" (with Olivier Coibion and Yuriy Gorodnichenko), Brookings Papers on Economic Activity (2013). (pdf) (Longer NBER Working Paper)


The persistence of U.S. unemployment has risen with each of the last three recessions, raising the specter that future U.S. recessions might look more like the Eurosclerosis experience of the 1980s than traditional V-shaped recoveries of the past. In this paper, we revisit possible explanations for this rising persistence. First, we argue that financial shocks do not systematically lead to more persistent unemployment than monetary policy shocks, so these cannot explain the rising persistence of unemployment. Second, monetary and fiscal policies can account for only part of the evolving unemployment persistence. Therefore, we turn to a third class of explanations: propagation mechanisms. We focus on factors consistent with four other cyclical patterns which have evolved since the early 1980s: a rising cyclicality in long-term unemployment, lower regional convergence after downturns, rising cyclicality in disability claims, and missing disinflation. These factors include declining labor mobility, changing age structures, and the decline in trust among Americans. To determine how these factors affect unemployment persistence, this paper exploits regional variation in labor market outcomes across Western Europe and North America during 1970-1990, in contrast to most previous work focusing either on cross-country variation or regional variation within countries. The results suggest that only cultural factors can account for the rising persistence of unemployment in the U.S., but the evolution in mobility and demographics over time should have more than offset the effects of culture.

In the Press

Al Jazeera, American Enterprise Institute, Business Insider, The Economist, Marginal Revolution, Slate, The Washington Post

"Ownership Dispersion and the London Stock Exchange's `Two-Thirds' Rule: An Empirical Test" (with David Chambers and Brian Cheffins), Business History, Volume 55, Issue 4 (2013), 670-693.


In the UK, in contrast to most other countries, a hallmark of corporate governance is a separation of ownership and control. There is evidence suggesting that this pattern may have been the norm in Britain as far back as the late nineteenth century. This paper investigates the extent to which law, in the form of a London Stock Exchange listing rule that prohibited the quotation of a class of securities unless two-thirds of the securities quoted had been subscribed for by and allotted to the public, contributed to this outcome. This paper tests the impact of the two-thirds rule by analysing for domestically based companies that carried out initial public offerings between 1900 and 1911 data compiled from prospectuses, a UK investors' guide and documents filed in accordance with UK companies legislation. The results indicate that the two-thirds rule did not influence ownership and control to the extent that might have been anticipated.

Work in Progress

"Growth in Supply and Demand for Contingent Work: Evidence from Tax Returns" (with David Card, Andrew Garin and Lawrence Katz)


Contingent work has grown rapidly in the U.S. in recent years, but the sources of this growth remain largely unknown. We use longitudinally linked tax data combining individual returns (1040s) and firm-issued information returns on both non-employment labor earnings (1099s) and employment earnings (W-2s) to study how individuals and households transition into and out of alternative work. We document pathways leading both individuals and firms into alternative work arrangements and examine whether tax policy may have contributed to these changes.

"Dividing the Indivisible: How Homesharing Affects Defaults" (with Mike Egesdal, Amir Kermani, and Igor Popov)


Homeownership is the largest component of household net worth. With the exception of home equity lines of credit, housing is largely illiquid due to its indivisibility. Recent technological change has enabled the average household to rent out underutilized housing assets, without restrictions on space type and duration. Can this new flexibility lower default risk? We merge information from a popular housing rental platform with loan servicing information to examine links between the availability of rental income and household debt.

"Temporary Work Contracts, Parental Leave and Female Labor Market Outcomes" (with Yukiko Asai)


Does it matter if workers start at a firm on a temporary or a permanent contract? From 1994-1997, an entire industry in Japan changed hiring policy so that all new female workers were hired on temporary employment contracts. We compare job continuity of affected workers to previous cohorts hired on permanent contracts. Workers starting on temporary contracts are 5% less likely to stay with the firm after 10 years. Women who remain in the company delay birth by 1.2 years compared to women who are hired on permanent contracts initially. Temporary workers are not eligible for parental leave, which we posit is an important factor driving these results. Our findings have important implications for the structure of optimal maternity leave policies and for within-firm inequality.

Other Publications

Energy Policy Opportunities: Continuing Challenges in the Presence of Increased Supplies of Natural Gas and Petroleum (with Michael Greenstone, Karen Li, and Adam Looney), A Hamilton Project Framing Memo (June 2012). (PDF)

A Dozen Economic Facts About Taxes (with Michael Greenstone, Karen Li, and Adam Looney), A Hamilton Project Framing Memo (May 2012). (PDF)