DEMM SEMINAR: Immigrants' Residential Choices and their Consequences
SPEAKER: Joan Monras (UPF)
ABSTRACT: This paper investigates the causes and effects of the spatial distribution of immigrants across US cities. We document that: a) immigrants concentrate in large, high-wage, expensive cities, b) the earnings gap between immigrants and natives is higher in larger, more expensive cities, and c) immigrants consume less locally than natives. In order to explain these findings, we develop a quantitative spatial equilibrium model in which immigrants consume a fraction of their income in their countries of origin.
Thus, immigrants care not only about local prices, but also about price levels in their home countries. This gives them a comparative advantage relative to natives for living in high-wage, high-price, high-productivity cities, where they also accept lower wages than natives. These incentives are stronger for immigrants coming from lower-price index countries of origin. We rely on immigrant heterogeneity to estimate the model. With the estimated model, we show that current levels of immigration have reduced economic activity in smaller, less productive cities by around 5 percent, while they have expanded it in large, productive cities by around 6 percent. This has increased total aggregate output per worker by around 0.3 percent. We also discuss the welfare implications of these results
BROWN BAG SEMINAR
Elena Siletti (Post-doc)
TITLE: Italian well-being indices: purposes, limitations, and evolutions
DEMM SEMINAR: Male Earnings, Marriageable Men, And Non-Marital Fertility: Evidence From The Fracking Boom
SPEAKER: Melissa Kearney (University of Maryland)
DEMM SEMINAR: Revealing Stereotypes: Evidence from Immigrants in Schools
SPEAKER: Michela Carlana (Harvard Kennedy School)
DEMM SEMINAR: Testing rational addiction: When lifetime is uncertain, one lag is enough
SPEAKER: Davide Dragone (Universita' di Bologna)
ABSTRACT: The rational addiction model is usually tested by estimating a linear second-order difference Euler equation, which may produce unreliable estimates. We show that a linear first-order difference equation is a better alternative. This empirical specification is appropriate under the reasonable assumption that people are uncertain about the time of their death, it is based on the same structural assumptions used in the literature, and it retains all policy implications of the deterministic rational addiction model. It is also empirically convenient because it is simple, it allows using efficient estimation strategies that do not require instrumental variables, and it is robust to the possible non-stationarity of the data. As an application we estimate the demand for smoking in the US from 1970 to 2016, and we show that it is consistent with the rational addiction model.