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Introduction: Essays in Honor of John E. DiNardo

Journal of Labor Economics 2021 39(S2), S317-S328
We are pleased to introduce this volume of papers, all of which were presented at a conference in honor of JohnDiNardo held in Ann Arbor, Michigan, in September 2018. After battling leukemia for close to a decade, John left us on August 26, 2017, at the age of 56. The conference was an opportunity for colleagues, coauthors, students, and friends to celebrate John’s life and academic achievements. The proud son of Italian immigrants, John was born and raised in Allen Park, Michigan. He spent most of his academic career at his alma mater, the University of Michigan, where he earned an undergraduate degree and a masters of public policy. After completing his PhD at Princeton in 1990, John spent a year at the RAND Corporation before joining the faculty at the University of California, Irvine, in 1991. He moved back to Michigan in 2001, where he spent the remainder of his career. At this point, convention calls for a discussion of the main research contributions of the scholar being honored, followed by a summary of the contributed papers. However, following convention is not what best describes John DiNardo’s life and career. Armed with a trademark irreverence, a

The Labor Market Impacts of Youth Training in the Dominican Republic

Journal of Labor Economics 2011 29(2), 267-300
We report the impacts of a job training program operated in the Dominican Republic. A random sample of applicants was selected to undergo training, and information was gathered 10–14 months after graduation. Unfortunately, people originally assigned to treatment who failed to show up were not included in the follow-up survey, potentially compromising the evaluation design. We present estimates of the program effect, including comparisons that ignore the potential nonrandomness of “no-show” behavior, and estimates that model selectivity parametrically. We find little indication of a positive effect on employment outcomes but some evidence of a modest effect on earnings, conditional on working.

Peer Effects and Multiple Equilibria in the Risky Behavior of Friends

The Review of Economics and Statistics 2013 95(4), 1130-1149 open access
We study social interactions in the initiation of sex and other risky behaviors by best friend pairs in the Add Health panel. Focusing on friends with minimal experience at the baseline interview, we estimate bivariate ordered-choice models that include both peer effects and unobserved heterogeneity. We find significant peer effects in sexual initiation: the likelihood of initiating intercourse within a year increases by almost 5 percentage points (on an 11% base rate) if one's friend also initiates intercourse. Similar effects are present for smoking, marijuana use, and truancy. We find larger effects for females and important asymmetries in nonreciprocated friendships.

Pension Plan Characteristics and Framing Effects in Employee Savings Behavior

The Review of Economics and Statistics 2011 93(1), 228-243
Defined contribution pensions in many postsecondary institutions are funded by a combination of an employer premium and a mandatory employee premium. Individuals can also contribute to a supplemental savings account. Holding constant total compensation, standard reasoning suggests that supplemental savings should depend negatively on the sum of the employer and employee pension contributions. Contrarily, we find that the supplementary savings of professors are significantly more sensitive to employee contributions than to employer contributions. This asymmetry is consistent with different marginal propensities to save out of the salary and pension components of compensation. Nevertheless, impacts on lifetime utility are relatively modest.

Does Voting Technology Affect Election Outcomes? Touch-screen Voting and the 2004 Presidential Election

The Review of Economics and Statistics 2007 89(4), 660-673
Critics argue that electronic voting is vulnerable to fraud. We test whether voting technology affected electoral outcomes in the 2000 and 2004 presidential elections. We find a positive correlation between use of electronic voting and George Bush vote share. The effect could have been large enough to influence the final results in some swing states. While this pattern would appear to be consistent with allegations of voting irregularities, a closer examination suggests this interpretation is unlikely. We find no evidence that electronic voting had a larger effect in swing states, or in states with a Republican secretary of state. We also find that electronic voting has a negative effect on turnout rates of Hispanics (who tend to favor Democrats). Electronic voting was more likely to be used in counties with a higher fraction of Hispanics; especially in swing states.

Family Violence and Football: The Effect of Unexpected Emotional Cues on Violent Behavior*

Quarterly Journal of Economics 2011 126(1), 103-143
We study the link between family violence and the emotional cues associated with wins and losses by professional football teams. We hypothesize that the risk of violence is affected by the “gain-loss” utility of game outcomes around a rationally expected reference point. Our empirical analysis uses police reports of violent incidents on Sundays during the professional football season. Controlling for the pregame point spread and the size of the local viewing audience, we find that upset losses (defeats when the home team was predicted to win by four or more points) lead to a 10% increase in the rate of at-home violence by men against their wives and girlfriends. In contrast, losses when the game was expected to be close have small and insignificant effects. Upset wins (victories when the home team was predicted to lose) also have little impact on violence, consistent with asymmetry in the gain-loss utility function. The rise in violence after an upset loss is concentrated in a narrow time window near the end of the game and is larger for more important games. We find no evidence for reference point updating based on the halftime score.

Firms and Labor Market Inequality: Evidence and Some Theory

Journal of Labor Economics 2018 36(S1), S13-S70 open access
We synthesize two related literatures on firm-level drivers of wage inequality. Studies of rent sharing that use matched worker-firm data find elasticities of wages with respect to value added per worker in the range of 0.05–0.15. Studies of wage determination with worker and firm fixed effects typically find that firm-specific premiums explain 20% of overall wage variation. To interpret these findings, we develop a model of wage setting in which workers have idiosyncratic tastes for different workplaces. Simple versions of this model can rationalize standard fixed effects specifications and also match the typical rent-sharing elasticities in the literature.

Estimating the Effects of a Time-Limited Earnings Subsidy for Welfare-Leavers

Econometrica 2005 73(6), 1723-1770
In the Self Sufficiency Project (SSP) welfare demonstration, members of a randomly assigned treatment group could receive a subsidy for full-time work. The subsidy was available for 3 years, but only to people who began working full time within 12 months of random assignment. A simple optimizing model suggests that the eligibility rules created an “establishment” incentive to find a job and leave welfare within a year of random assignment, and an “entitlement” incentive to choose work over welfare once eligibility was established. Building on this insight, we develop an econometric model of welfare participation that allows us to separate the two effects and estimate the impact of the earnings subsidy on welfare entry and exit rates among those who achieved eligibility. The combination of the two incentives explains the time profile of the experimental impacts, which peaked 15 months after random assignment and faded relatively quickly. Our findings suggest that about half of the peak impact of SSP was attributable to the establishment incentive. Despite the extra work effort generated by SSP, the program had no lasting impact on wages and little or no long-run effect on welfare participation.

On the Covariance Structure of Earnings and Hours Changes

Econometrica 1989 57(2), 411 open access
This paper presents an empirical analysis of changes in individual earnings and hours ov&r time. Using longitudinal data from three panel surveys, we catalogue the main features of the covariance structure of changes in earnings and hours. We then present an interpretation of these features in terms of both a life-cycle labor supply model and a fixed-wage labor contract nDdel. Our major findings are: (1) there is a remarkable similarity in the covariance structure of earnings and hours changes across the three surveys; and (2) apart from simple measurement error, the major component of variance in earnings and hours affects earnings and hours equi-proportionately.