Knowledge that Transforms

Informational asymmetries between employers may inhibit optimal worker mobility. However, researchers rarely observe shocks to employers’ information. I exploit two school districts’ adoptions of value-added (VA) measures of teacher effectiveness—informational shocks to some, but not all, employers—to provide direct tests of asymmetric employer learning. I develop a learning model and test its predictions for teacher mobility. I find that adopting VA increases within-district mobility of high-VA teachers, while low-VA teachers move out of district to uninformed principals. These patterns are consistent with asymmetric employer learning. This sorting from widespread VA adoption exacerbates inequality in access to effective teaching.

This paper studies labor supply responses to transitory income, exploiting the differential timing of the 2008 tax rebates. While an influential literature finds that rebates encourage consumer spending, it has ignored the ramifications on labor supply. I estimate that each rebate dollar reduces monthly earnings by 9 cents with smaller but significant lagged effects. This responsiveness is primarily concentrated in the second quartile of the earnings distribution and among hourly workers. The results imply that the $96 billion in stimulus payments had a partial equilibrium effect of reducing short-term national labor earnings by more than $26 billion.

We study the labor market returns to a state-guaranteed loan used to finance university degrees in Chile. Using a regression discontinuity design, we show that marginally eligible students forgo vocational education in favor of university education but reduce their probability of graduation. Even though university loan takers accumulate more student debt, their labor market outcomes are not different from those of ineligible students. We find suggestive evidence that the lower quality of the receiving institutions accounts for these results. Finally, we extrapolate the effects away from the eligibility cutoff and show that supramarginal students benefit from this policy.

This paper examines the transmission of human capital from parents to children using variation in parental influence due to parental death, divorce, and the increasing specialization of parental roles in larger families. All three sources of variation yield strikingly similar patterns that show that the strong parent-child correlation in human capital is largely causal. In each case, the parent-child correlation in education is stronger with the parent who spends more time with the child and weaker with the parent who spends relatively less time parenting. These findings help us understand why educated parents spend more time with their children.

We investigate the effect of Head Start on education and wage income for individuals in their 30s in the NLSY79. We contribute to the existing literature by examining effects across outcome distributions, using an approach that relies on two weak stochastic dominance assumptions that can be checked using pre–Head Start cohorts. We find that Head Start has positive and statistically significant effects on years of education and wage income. We also uncover important heterogeneity in the program’s effectiveness; the effects are concentrated at the lower end of the distribution, and the effects are strongest for women, blacks, and Hispanics.

This paper examines the long-run impacts of income shocks by exploiting variation in coffee cultivation patterns within Colombia and world coffee prices during cohorts’ school-going years. The results indicate that cohorts that faced higher returns to coffee-related work in childhood completed fewer years of schooling and have lower adult earnings scores. Several pieces of evidence suggest that these results reflect changes in educational decisions induced by temporary changes in the opportunity cost of schooling. These findings are consistent with the possibility that students may ignore or heavily discount the future consequences of dropout decisions when faced with immediate income gains.

We study how parental leave benefit levels affect household labor supply, family income, and child outcomes, exploiting the speed premium (SP) in the Swedish leave system. The SP grants mothers higher benefits for a subsequent child without reestablishing eligibility through market work if two births occur within a prespecified interval. We use the spacing eligibility cutoffs in a regression discontinuity framework and find that the SP improves educational outcomes of the older child but not those of the younger. Impacts are likely driven by increased maternal time and the quality of maternal time relative to the counterfactual mode of care.

We use population-level data on all Florida children born between 1994 and 2002 to examine the long-term effects of prenatal exposure to environmental toxicants from a Superfund (toxic waste) site. We compare siblings who faced different toxic exposures during gestation because of Superfund site cleanup (or, in other specifications, because of a family move). Children exposed to toxic waste while gestating have substantially worse cognitive and behavioral outcomes than do their unaffected siblings. These results are much larger than what would have been predicted were the effects of Superfund site exposure operating solely through standard measures of birth outcomes.

This paper examines whether the introduction of birthright citizenship in Germany affected immigrant children’s educational outcomes at the first three stages of the education system: preschool, primary school, and secondary school. Using a birth date cutoff as a source of exogenous variation, we find that the policy (i) increased immigrant children’s participation in noncompulsory preschool education, (ii) had positive effects on key developmental outcomes measured at the end of the preschool period, (iii) caused immigrant children to progress faster through primary school, and (iv) increased the likelihood of them attending the academic track of secondary school.

The fraction of the US workforce identified as involuntary part-time workers rose to new highs during the US Great Recession and came down only slowly in its aftermath. We assess the determinants of involuntary part-time work using an empirical framework that accounts for business cycle effects and persistent structural features of the labor market. We conduct regression analyses using state-level panel data for the years 2003–16. The results indicate that structural factors, notably shifts in the industry composition of employment, have held the incidence of involuntary part-time work slightly more than 1 percentage point above its prerecession level.