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Achieving Escape Velocity: Neighborhood and School Interventions to Reduce Persistent Inequality
This paper reviews the evidence on the efficacy of neighborhood and school interventions in improving the long-run outcomes of children growing up in poor families. We focus on studies exploiting exogenous sources of variation in neighborhoods and schools and which examine at least medium-term outcomes. Higher-quality neighborhoods improve family safety, adult subjective well-being and health, and girls' mental health. But they have no detectable impact on youth human capital, labor market outcomes, or risky behaviors. In contrast, higher-quality schools can improve children's academic achievement and can have longer-term positive impacts of increasing educational attainment and earnings and reducing incarceration and teen pregnancy.
Concentrating on the Fall of the Labor Share
The Polarization of the U.S. Labor Market
This paper analyzes a marked change in the evolution of the U.S. wage structure over the past fifteen years: divergent trends in upper-tail (90/50) and lower-tail (50/10) wage inequality. We document that wage inequality in the top half of distribution has displayed an unchecked and rather smooth secular rise for the last 25 years (since 1980). Wage inequality in the bottom half of the distribution also grew rapidly from 1979 to 1987, but it has ceased growing (and for some measures actually narrowed) since the late 1980s. Furthermore we find that occupational employment growth shifted from monotonically increasing in wages (education) in the 1980s to a pattern of more rapid growth in jobs at the top and bottom relative to the middles of the wage (education) distribution in the 1990s. We characterize these patterns as the %u201Cpolarization%u201D of the U.S. labor market, with employment polarizing into high-wage and low-wage jobs at the expense of middle-wage work. We show how a model of computerization in which computers most strongly complement the non-routine (abstract) cognitive tasks of high-wage jobs, directly substitute for the routine tasks found in many traditional middle-wage jobs, and may have little direct impact on non-routine manual tasks in relatively low-wage jobs can help explain the observed polarization of the U.S. labor market.
The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment
The Moving to Opportunity (MTO) experiment offered randomly selected families housing vouchers to move from high-poverty housing projects to lower-poverty neighborhoods. We analyze MTO's impacts on children's long-term outcomes using tax data. We find that moving to a lower-poverty neighborhood when young (before age 13) increases college attendance and earnings and reduces single parenthood rates. Moving as an adolescent has slightly negative impacts, perhaps because of disruption effects. The decline in the gains from moving with the age when children move suggests that the duration of exposure to better environments during childhood is an important determinant of children’s long-term outcomes.
What Does Performance in Graduate School Predict? Graduate Economics Education and Student Outcomes
What Does Performance in Graduate School Predict? Graduate Economics Education and Student Outcomes by Susan Athey, Lawrence F. Katz, Alan B. Krueger, Steven Levitt and James Poterba. Published in volume 97, issue 2, pages 512-520 of American Economic Review, May 2007
Can Online Learning Bend the Higher Education Cost Curve?
We examine whether online learning technologies have led to lower prices in higher education. Using data from the Integrated Postsecondary Education Data System, we show that online education is concentrated in large for-profit chains and less-selective public institutions. We find that colleges with a higher share of online students charge lower tuition prices. We present evidence of declining real and relative prices for full-time undergraduate online education from 2006 to 2013. Although the pattern of results suggests some hope that online technology can “bend the cost curve” in higher education, the impact of online learning on education quality remains uncertain.
The Value of Postsecondary Credentials in the Labor Market: An Experimental Study
We study employers' perceptions of the value of postsecondary degrees using a field experiment. We randomly assign the sector and selectivity of institutions to fictitious resumes and apply to real vacancy postings for business and health jobs on a large online job board. We find that a business bachelor's degree from a for-profit online institution is 22 percent less likely to receive a callback than one from a nonselective public institution. In applications to health jobs, we find that for-profit credentials receive fewer callbacks unless the job requires an external quality indicator such as an occupational license.
Concentrating on the Fall of the Labor Share
The recent fall of labor's share of GDP in numerous countries is well-documented, but its causes are poorly understood. We sketch a “superstar firm” model where industries are increasingly characterized by “winner take most” competition, leading a small number of highly profitable (and low labor share) firms to command growing market share. Building on Autor et al. (2017), we evaluate and confirm two core claims of the superstar firm hypothesis: the concentration of sales among firms within industries has risen across much of the private sector; and industries with larger increases in concentration exhibit a larger decline in labor's share.
Creating Moves to Opportunity: Experimental Evidence on Barriers to Neighborhood Choice
Low-income families often live in low-upward-mobility neighborhoods. We study why by using a randomized trial with housing voucher recipients that provided information, financial support, and customized search assistance to move to high-opportunity neighborhoods. The treatment increased the fraction moving to high-upward-mobility areas from 15 to 53 percent. A second trial reveals this treatment effect is driven primarily by customized search assistance. Qualitative interviews show that the intervention relaxed bandwidth constraints and addressed family-specific needs. Our findings imply many low-income families do not have strong preferences to stay in low-opportunity areas and that barriers in housing search significantly increase residential segregation by income.