Resumen de Essays in macroeconomics and economic geography /
In this thesis I study how barriers and distortions inherent in labor and housing markets affect aggregate productivity of a national economy.
In Chapter 1 of this thesis, “The Rise of Housing Supply Regulation in the U.S.: Local Causes and Aggregate Implications”, I investigate effects of the rise of regulatory restrictions on the supply of housing in recent decades in the United States. I build an equilibrium model with multiple locations, heterogeneous workers and endogenous regulation. Regulation is decided by voting: renters want less regulation and owners want more. In locations with faster exogenous productivity growth, labor supply and house prices also grow more rapidly. Homeowners in these places vote for stricter regulation, which raises prices further and leads to greater price dispersion. High-skilled workers, being less sensitive to housing costs, sort into productive places, which leads to larger wage dispersion. That is, wage and house price differences are amplified by regulation choices. To quantify this amplification effect, I calibrate the model to the U.S. economy and find that the rise in regulation accounts for 23% of the increase in wage dispersion and 85% of the increase in house price dispersion across metro areas from 1980 to 2007. I find that if regulation had not increased, more workers would live in productive areas and output would be 2% higher. I also show that policy interventions that weaken incentives of local governments to restrict supply could reduce wage and house price dispersion, and boost productivity.
In Chapter 2, “Opportunity to Move: Macroeconomic Effects of Relocation Subsidies”, I introduce relocation subsidies as a supplement to unemployment benefits, and study their effects on unemployment, productivity and welfare. I build a job search model with heterogeneous workers and multiple locations, in which migration is impeded by moving costs, cross-location search frictions, and borrowing constraints. I calibrate the model to the U.S. economy, and then introduce a subsidy that reimburses a part of the moving expenses to the unemployed. During the Great Recession, a relocation subsidy that pays half of the moving expenses would lower unemployment rate by 0.36 percentage points (or 4.8%) and increase productivity by 1%. Importantly, the subsidies cost nothing to the taxpayer: the additional spending on the subsidies is offset by the reduction in spending on unemployment benefits.
In Chapter 3, “Managers and Productivity Differences”, (with Nezih Guner and Gustavo Ventura) we investigate the determinants of productivity differences across countries. We document that for a group of high-income countries (i) mean earnings of managers tend to grow faster than for non managers over the life cycle; (ii) the life-cycle earnings growth of managers relative to non managers is positively correlated with output per worker. We interpret this evidence using an equilibrium life-cycle, span-of-control model where managers invest in their skills. We parameterize this model with observations from the U.S. We then quantify the relative importance of exogenous productivity differences and the firm size-dependent distortions. Our findings indicate that such distortions are critical to generate the observed differences in the growth of relative managerial earnings across countries. We find that cross-country variation in distortions accounts for about 42% of the cross-country productivity differences.
