Economics 350, Winter 2023:  Some Suggested Reading

 

 

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The Roy Model and the Generalized Roy Model Assumed as Background

• The Roy Model and its generalizations are basic tools of applied economics and econometrics. I will draw on and reinforce your knowledge of it in this course. Economics 312 and other courses teach this model, so I will assume it is known. The model enables you to interpret the statistical estimates reported in many applied papers estimate in terms of well-posed economic models instead of ill-defined “effects.” For background and review, see, for example:
  • Heckman, James J. 2010. “Building Bridges between Structural and Program Evaluation Approaches to Evaluating Policy.” Journal of Economic Literature, 48(2):356-98.
  • Heckman, James J., and Edward J. Vytlacil. (2007). “Econometric Evaluation of Social Programs, Part I: Causal Models, Structural Models and Econometric Policy Evaluation.” In Handbook of Econometrics, edited by James J. Heckman and Edward E. Leamer, 4779-4874. Elsevier.

  The following short documents covered in Econ 312 should explain key ideas with which students should familiarize themselves.

  1. Extract: Notes on Roy Models and Generalized Roy
  2. Roy Models of Policy Evaluation
  3. The Normal Generalized Roy Model
  4. Notes on Identification of the Roy Model and the Generalized Roy Model
  5. The Roy Model and the Generalized Roy Model
  6. Some Generalized Roy Math

Week 1 and part of Week 2: Inequality and Social Mobility: Surprising Facts and Basic Measures That Challenge Conventional Claims

Readings

• Elwell, James, Kevin Corinth, and Richard V. Burkhauser. (2019). “Income Growth and its Distribution from Eisenhower to Obama: The Growing Importance of In-Kind Transfers (1959-2016).” In United States Trends in Income, Wealth, Consumption, and Well-Being, edited by Diana Furchtgott-Roth, 90–124. Oxford: Oxford University Press.
• McLanahan, Sara, and Wade Jacobsen. (2015). “Diverging Destinies Revisited.” In Families in an Era of Increasing Inequality: Diverging Destinies, edited by Paul R. Amato, Alan Booth, Susan M. McHale and Jennifer Van Hook, 3-23. Springer International Publishing.
  • Diverging Destinies Revisited, McLanahan and Jacobsen (2015)
• Winship, Scott. 2018. “Economic Mobility in America a State of the Art Primer,” Archbridge Institute. Economic and Social Mobility Research.
  • Part 1: Economic Mobility in America a State of the Art Primer Part 1: Contemporary Levels of Mobility
    • Part 1: Contemporary Levels of Mobility, Winship (2021)
  • Part 2: Economic Mobility in America a State of the Art Primer Part 2: The United States in Comparative Perspective
    • Part 2: The United States in Comparative Literature, Winship (2021)
  • Part 3: Economic Mobility in America a State of the Art Primer Part 3: Trends in the United States
    • Part 3: Trends in the United States, Winship (2021)
• Corinth, Kevin, Bruce D. Meyer, Matthew Stadnicki, and Derek Wu. (2021, Revised 2022). “The Anti-Poverty, Targeting, and Labor Supply Effects of Replacing a Child Tax Credit with a Child Allowance.” National Bureau of Economic Research Working Paper Series, No. 29366.
• Corinth, Kevin, and Bruce D. Meyer. 2021. “The Child Tax Credit, Labor Supply, and Poverty.” The University of Chicago Harris School of Public Policy, Comprehensive Income Dataset Project. CID Research Note. 1.
• Jäntti, Markus and Stephen P. Jenkins. (2015). “Income Mobility,” in Handbook of Income Distribution, Volume 2, Chapter 10. A. B. Atkinson and F. Bourguignon, eds. Amsterdam: Elsevier. pp. 807-935.
  • Income Mobility, Jäntti and Jenkins (2013)
• Joint Economic Committee. 2019. “Measuring Income Concentration: A Guide for the Confused.” United States Congress. Last accessed March 3, 2022.
  • Measuring Income Concentration: A Guide for the Confused, Joint Economic Committee (2019)
• Berman, Yonatan and Milanovic, Branko. (2020). “Homoploutia: Top Labor and Capital Incomes in the United States, 1950—2020,” Stone Center on Socio-Economic Inequality Working Paper No. 28.
  • Homoploutia: Top Labor and Capital Incomes in the United States, 1950-2020 by Berman and Milanovic (2020)
• Reeves, Richard V. and Eleanor Krause. (2018). “Raj Chetty in 14 charts: Big findings on opportunity and mobility we should all know,” Brookings Institution Social Mobility Memos, Thursday, January 11, 2018.
  • Raj Chetty in 14 Charts: Big Findings on Opportunity and Mobility We Should All Know, Reeves and Krause (2018)
• Nybom, Martin, and Jan Stuhler. (2016). “Interpreting Trends in Intergenerational Mobility.” Journal of Political Economy, Revision requested.
• Burkhauser, Richard V., and Jeff Larrimore. (2014). “Median Income and Income Inequality: From 2000 and Beyond.” In Diversity and Disparities: America Enters a New Century, edited by John Logan, 105-138. New York, NY: Russell Sage Foundation.
  • Median Income and Income Inequality: From 2000 and Beyond by Burkhauser and Larrimore (2014)
• Dahl, Gordon B., Andreas Ravndal Kostøl, and Magne Mogstad. (2014). “Family Welfare Cultures.” The Quarterly Journal of Economics, 129(4):1711-1752.
• Dahl, Gordon B., and Anne C. Gielen. (2021). “Intergenerational Spillovers in Disability Insurance.” American Economic Journal: Applied Economics, 13(2):116-50.
• Bertrand, Marianne, Erzo F. P. Luttmer, and Sendhil Mullainathan. (2000). “Network Effects and Welfare Cultures.” The Quarterly Journal of Economics, 115(3):1019-1055.
• Fitzgerald, John, and Robert Moffitt. 2022. “The Supplemental Expenditure Poverty Measure: A New Method of Measuring PovertyLinks to an external site..” Brookings Papers on Economic Activity BPEA Conference, Washington, DC, March 24-25, 2022.
  • Comments on Fitzgerald and Moffitt, Meyer
• Chiappori, Pierre Andres, Costa-Dias, Monica and Costas Meghir. 2021. “The Measuring of Assortativeness in Marriage: A Comment.”
• Blanchet, Thomas, Lucas Chancel, and Amory Gethin. (2022). “Why Is Europe More Equal than the United States?” American Economic Journal: Applied Economics, 14(4):480-518.
• Nielsen Arendt  Jacob, and Mads Lybech Christensen. (2022). “Income Inequality and Public Income Redistribution,”  Rockwool Foundation Study Paper No. 178. September 2022.
• Davis, Jonathan M. V. and Bhashkar Mazumder. (2022). “The Decline in Intergenerational Mobility after 1980.” Federal Reserve Bank of Chicago Working Paper No. 2017-05.
• Youyou, Wu, Yang Yang, and Brian Uzzi. (2023). “A discipline-wide investigation of the replicability of Psychology papers over the past two decades.” Proceedings of the National Academy of Sciences, 120(6):e2208863120. Appendix.
• Additional Slides
  • Inequality in Health
  • Mortality Inequality in the United States and Europe, Janet Currie, Princeton University and NBER: Hannes Schwandt, Northwestern University and NBER
  • Social Mobility: Geography and Demography
  • Part 2: Role of Skills and Skill Prices in Explaining Inequality

Week 2: Skills and Schools

• Readings
  • (P)Heckman, James J.; Lochner, Lance J. and Todd, Petra E. (2006). “Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond.” in Handbook of the Economics of Education, E. A. Hanushek, and F. Welch, eds. Amsterdam: North-Holland. pp. 307-458.
  • Heckman, James J. and Jin Zhou. (2022). “Measuring Knowledge,” Unpublished manuscript, University of Chicago, Center for the Economics of Human Development.
  • Rubinstein, Yona and Yoram Weiss. (2006). “Post Schooling Wage Growth: Investment, Search and Learning,” In: E. Hanushek and F. Welch, (eds.), Handbook of the Economics of Education, Volume 1, Chapter 1. Amsterdam: Elsevier. pp. 1-67.
  • Eisenhauer, Philipp, James J. Heckman, and Stefano Mosso. (2015). “Estimation of Dynamic Discrete Choice Models by Maximum Likelihood and the Simulated Method of Moments,” International Economic Review, 56(2): 331-357.
  • Cossa, Ricardo, James J. Heckman, and Lance Lochner. (2003). “Learning-by-Doing versus On-the-Job Training: Using Variation Induced by the EITC to Distinguish between Models of Skill Formation.” In Designing Inclusion: Tools to Raise Low-End Pay and Employment in Private Enterprise, edited by Edmund S. Phelps, 74-130. New York, NY: Cambridge University Press.
  • Keane, Michael and Kenneth Wolpin. (1997). “The Career Decisions of Young Men,” Journal of Political Economy, 105(3):473-522.
  • Johnson, William R. (1978). “A Theory of Job Shopping,” Quarterly Journal of Economics, 92( 2): 261-278.
  • Heckman, James, and Edward Vytlacil. (1998). “Instrumental Variables Methods for the Correlated Random Coefficient Model: Estimating the Average Rate of Return to Schooling When the Return is Correlated with Schooling.” The Journal of Human Resources, 33(4):974-987.
  • Heckman, James J., Lance Lochner, and Christopher Taber. (1998). “General-Equilibrium Treatment Effects: A Study of Tuition Policy.” The American Economic Review, 88(2):381-386.
  • Heckman, James J., Lance Lochner, and Christopher Taber. (1998). “Explaining Rising Wage Inequality: Explorations with a Dynamic General Equilibrium Model of Labor Earnings with Heterogeneous Agents.” Review of Economic Dynamics, 1(1):1-58.
• Additional Slides
  • Ben Porath Notes
  • Sheshinski Specification
  • The Rate of Return to Schooling: The Mincer Equation and Beyond
  • Rate of Return Continuation Values and Option Values in a Simple Dynamic Model, Eisenhauer, Heckman and Mosso (2015)
  • Two Interpretations of the Mincer Equation: Learning-by-doing vs. On-the-job Training by Heckman, Lochner, and Cossa (2003)
  • Evidence on Learning-by-doing vs. On-the-job Training: Using variation induced by the EITC to test between models of skill formation, Heckman, Lochner and Cossa (2003)
  • Notes on “A Theory of Job Shopping”, by Johnson
  • The Career Decisions of Young Men, Keane and Wolpin (1997)
  • Credit Constraints and Education: Models and Analysis

Week 3: Preferences as Skills: Preference and Habit Formation

• Readings
  • Borghans, Lex, Angela L. Duckworth, James J. Heckman, and Bas ter Weel. (2008). “The Economics and Psychology of Personality Traits.” Journal of Human Resources, 43(3):972-1059.
  • Almlund, Mathilde, Duckworth, Angela Lee, Heckman, James J., and Kautz, Timothy. (2011). “Personality Psychology and Economics,” In Handbook of the Economics of Education, E. Hanushek, S. Machin, and S. Woessman, eds. Amsterdam: Elsevier. pp. 1-181.
  • (P)Heckman, James J., Tomáš Jagelka, and Tim Kautz. (2019). “Some Contributions of Economics to the Study of Personality.” In Handbook of Personality: Theory and Research, edited by Oliver P. John and Richard W. Robins, 853-892. New York, NY: Guilford Press.
  • Kosse, Fabian, and Michela M. Tincani. (2020). “Prosociality predicts labor market success around the world.” Nature Communications, 11(1):5298.
  • Zelazo, Philip David, and Stephanie M. Carlson. (2020). “The neurodevelopment of executive function skills: Implications for academic achievement gaps.” Psychology & Neuroscience, 13(3):273-298.
  • Edin, Per-Anders, Peter Fredriksson, Martin Nybom, and Björn Öckert. (2022). “The Rising Return to Noncognitive Skill.” American Economic Journal: Applied Economics, 14(2):78-100.
  • Soto, Christopher J., Christopher M. Napolitano, Madison N. Sewell, Hee J. Yoon, and Brent W. Roberts. (2022). “An integrative framework for conceptualizing and assessing social, emotional, and behavioral skills: The BESSI.” Journal of Personality and Social Psychology, 123(1): 192-222
  • Blanton, Hart, James Jaccard, Jonathan Klick, Barbara Mellers, and Gregory Mitchell. 2009. “Strong Claims and Weak Evidence: Reassessing the Predictive Validity of the IAT.” University of Pennsylvania Carey Law School. Faculty Scholarship at Penn Law. 1532.
  • Demetriou, Andreas, George Spanoudis, Constantinos Christou, Samuel Greiff, Nikolaos Makris, Mari-Pauliina Vainikainen, Hudson Golino, and Eleftheria Gonida. (2022). “Cognitive and personality predictors of school performance from preschool to secondary school: An overarching model.” Psychological Review. Online early access.
  • Huggett, Mark, and Greg Kaplan. (2016). “How large is the stock component of human capital?” Review of Economic Dynamics, 22:21-51.
  • Anglim, Jeromy, Patrick D. Dunlop, Serena Wee, Sharon Horwood, Joshua K. Wood, and Andrew Marty. (2022). “Personality and intelligence: A meta-analysis.” Psychological Bulletin, 148(5-6): 301-336.
  • Sackett, Paul R., Chaitra M. Hardison, and Michael J. Cullen. (2004). “On Interpreting Stereotype Threat as Accounting for African American-White Differences on Cognitive Tests.” American Psychologist, 59:7-13.
  • Sackett, Paul R., Ann Marie Ryan, Michael Inzlicht, and Toni Schmader. (2012). “Concerns About Generalizing Stereotype Threat Research Findings to Operational High-stakes Testing.” In Stereotype Threat: Theory, Process, and Application, edited by Michael Inzlicht and Toni Schmader, 246-259. New York, NY: Oxford University Press.
  • Tomeh, Dana H., and Paul R. Sackett. (2022). “On the Continued Misinterpretation of Stereotype Threat as Accounting for Black-White Differences on Cognitive Tests.” Personnel Assessment and Decisions, 8(1):1-14.

Week 4: Tasks, Occupations, and Skills

• Slides
  • Skills and Firms
  • Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
  • Simple Model of Human Capital Formation
•  Readings
  • (P)Acemoglu, Daron and David Autor. (2011). “Skills, Tasks and Technologies: Implications for Employment and Earnings,” In: Orley Ashenfelter and David Card, (eds.), Handbook of Labor Economics, Volume 4, Part B, Chapter 12. Amsterdam: Elsevier. pp. 1043-1171. Review the theory portion.
  • Caines, Colin, Florian Hoffman, and Gueorgui Kambourov (2016). “Complex-Task Biased Technological Change and the Labor Market,” Review of Economic Dynamics, 25: 298-319.
  • Yamaguchi, Shintaro. (2012). “Tasks and Heterogeneous Human Capital,” Journal of Labor Economics, 30(1): 1-53.
  • Todd, Petra E., and Weilong Zhang. (2020). “A dynamic model of personality, schooling, and occupational choice.” Quantitative Economics, 11(1):231-275.
  • Lise, Jeremy, and Fabien Postel-Vinay. (2020). “Multidimensional Skills, Sorting, and Human Capital Accumulation.” American Economic Review, 110(8): 2328-2376.
  • Birchenall, Javier A., Weerachart T. Kilenthong, and David Wiczer. (2023). “Skill Bunding and Skill-Price Inequality.” Unpublished manuscript, University of California at Santa Barbara, Department of Economics.

Week 5: Labor Supply and Incentives

• Readings
  • Arroyo, Cristino R., and Junsen Zhang. (1997). “Dynamic Microeconomic Models of Fertility Choice: A Survey.” Journal of Population Economics, 10(1):23-65.
  • (P)Becker, Gary S. (1992). “Fertility and the Economy.” Journal of Population Economics, 5(3):185-201.
  • Gayle, George-Levi, Limor Golan, Mehmet A. Soytas. (2015). “What Accounts for the Racial Gap in Time Allocation and Intergenerational Transmission of Human Capital?,” Federal Reserve Bank of St. Louis Working Paper 2015-018.
  • Keane, Michael P., and Kenneth I. Wolpin. (2010). “The Role of Labor and Marriage Markets, Preference Heterogeneity, and the Welfare System in the Life Cycle Decisions of Black, Hispanic, and White Women.” International Economic Review, 51(3):851-892.
  • Keane, Michael P. (2016). “Life-cycle Labour Supply with Human Capital: Econometric and Behavioural Implications.” The Economic Journal, 126(592):546-577.
  • Keane, Michael P. (2011). “Labor Supply and Taxes: A Survey.” Journal of Economic Literature, 49(4):961-1075.
  • Keane, Michael, and Richard Rogerson. (2015). “Reconciling Micro and Macro Labor Supply Elasticities: A Structural Perspective.” Annual Review of Economics, 7(1):89-117.
  • Keane, Michael P. (2022). “Recent research on labor supply: Implications for tax and transfer policy.” Labour Economics, 77. Early online edition.
  • Eckstein, Zvi, Michael Keane, and Osnat Lifshitz. (2019). “Career and Family Decisions: Cohorts Born 1935–1975.” Econometrica, 87(1):217-253.
  • Eckstein, Zvi, and Osnat Lifshitz. (2011). “Dynamic Female Labor Supply.” Econometrica, 79(6):1675-1726.
  • Keane, Michael P., and Kenneth I. Wolpin. (2010). “The Role of Labor and Marriage Markets, Preference Heterogeneity, and the Welfare System in the Life Cycle Decisions of Black, Hispanic, and White Women.” International Economic Review, 51(3):851-892.
  • van der Klaauw, Wilbert. (1996). “Female Labour Supply and Marital Status Decisions: A Life-Cycle Model.” The Review of Economic Studies, 63(2):199-235.
  • Blundell, Richard, Monica Costa Dias, Costas Meghir, and Jonathan Shaw. (2016). “Female Labor Supply, Human Capital, and Welfare Reform.” Econometrica, 84(5):1705-1753.
  • Blundell, Richard, Luigi Pistaferri, and Itay Saporta-Eksten. (2016). “Consumption Inequality and Family Labor Supply.” American Economic Review, 106(2):387-435.
  • Adda, Jérôme, Christian Dustmann, and Katrien Stevens. (2017). “The Career Costs of Children.” Journal of Political Economy, 125(2):293-337.
  • Albanesi, Stefania, and María José Prados. (2022). “Slowing Women’s Labor Force Participation: The Role of Income Inequality.” National Bureau of Economic Research Working Paper Series, No. 29675.
  • Chetty, Raj. (2009). “Is the Taxable Income Elasticity Sufficient to Calculate Deadweight Loss? The Implications of Evasion and Avoidance.” American Economic Journal: Economic Policy, 1(2):31-52.
  • Feldstein, Martin. (1999). “Tax Avoidance and the Deadweight Loss of the Income Tax.” The Review of Economics and Statistics, 81(4):674-680.
  • Card, David, Ana Rute Cardoso, Joerg Heining, and Patrick Kline. (2018). “Firms and Labor Market Inequality: Evidence and Some Theory.” Journal of Labor Economics, 36(S1):S13-S70.
  • Lamadon, Thibaut, Magne Mogstad, and Bradley Setzler. (2022). “Imperfect Competition, Compensating Differentials, and Rent Sharing in the US Labor Market.” American Economic Review, 112(1):169-212. Appendix. Replication Package.
  • Alan, Manning. (2011). “Imperfect Competition in the Labor Market.” In Handbook of Labor Economics, Volume 4B, Chapter 11, edited by David Card and Orley Ashenfelter, 973-1041. Elsevier.
  • Lee, Dain, Jinhyeok Park, and Yongseok Shin. 2023. “Where are the Workers? From Great Resignation to Quiet Quitting.” NBER Working Papers. 30833.
  • Additional Slides
    • Work and Welfare Dependence

Week 6: Family Influence: Genes, Parenting, and Credit Constraints

• Readings
  • Bowles, Samuel and Herbert Gintis. (2002). “The Inheritance of Inequality,” Journal of Economic Perspectives 16(3): 3-30.
  • Lee, James J., Robbee Wedow, Aysu Okbay, Edward Kong, Omeed Maghzian, etal. (2018). “Gene discovery and polygenic prediction from a genome-wide association study of educational attainment in 1.1 million individuals.” Nature Genetics, 50(8):1112-1121.
  • Houmark, Mikkel Aagaard, Victor Ronda, and Michael Rosholm. 2020. “The Nurture of Nature and the Nature of Nurture: How Genes and Investments Interact in the Formation of Skills.” Institute of Labor Economics. IZA Discussion Paper. DP No. 13780.
  • Sanz-de-Galdeano, Anna, and Anastasia Terskaya. 2019. “Sibling Differences in Educational Polygenic Scores: How Do Parents React?” Institute of Labor Economics. IZA DP No. 12375.
  • Ronda, Victor, Esben Agerbo, Dorthe Bleses, Preben Bo Mortensen, Anders Børglum, Ole Mors, Michael Rosholm, David M. Hougaard, Merete Nordentoft, and Thomas Werge. (2022). “Family disadvantage, gender, and the returns to genetic human capital.” The Scandinavian Journal of Economics, 124(2):550-578.
  • Barth, Daniel, Nicholas W. Papageorge, and Kevin Thom. (2020). “Genetic Endowments and Wealth Inequality.” Journal of Political Economy, 128(4):1474-1522.
  • Papageorge, Nicholas W, and Kevin Thom. (2019). “Genes, Education, and Labor Market Outcomes: Evidence from the Health and Retirement Study.” Journal of the European Economic Association, 18(3):1351-1399.
  • Rustichini, Aldo, William G. Iacono, James Lee, and Matt McGue. (2020). “Educational Attainment and Intergenerational Mobility: A Polygenic Score Analysis.” Unpublished manuscript, University of Minnesota, Department of Economics
  • Kohler, Hans-Peter, Jere R. Behrman, and Jason Schnittker. (2011). “Social Science Methods for Twins Data: Integrating Causality, Endowments, and Heritability.” Biodemography and Social Biology, 57(1):88-141.
  • Goodman, Alissa, Robert Joyce, and James P. Smith. (2011). “The long shadow cast by childhood physical and mental problems on adult life.” Proceedings of the National Academy of Sciences, 108(15):6032-6037.
  • Cunha, Flavio and James J. Heckman (2007). “The Technology of Skill Formation,” American Economic Review, 97(2):31-47.
  • Becker, Gary S., Scott Duke Kominers, Kevin M. Murphy, and Jörg L. Spenkuch. (2018). “A Theory of Intergenerational Mobility.” Journal of Political Economy,126(S1):S7-S25.
  • Pollak, Robert A. (2019). “How Bargaining in Marriage Drives Marriage Market Equilibrium.” Journal of Labor Economics, 37(1):297-321.
  • Doepke, Matthias, Giuseppe Sorrenti, and Fabrizio Zilibotti. (2019). “The Economics of Parenting.” Annual Review of Economics, 11(1):55-84.
    • The Economics of Parenting, Doepke, Sorrenti, and Zilibotti (2019)
  • Heckman, James J. and Stefano Mosso. (2014). “The Economics of Human Development and Social Mobility,” Annual Review of Economics, 6(1):689-733.
  • Becker, Gary S., Kevin M. Murphy, and Jörg L. Spenkuch. (2016). “The Manipulation of Children’s Preferences, Old-Age Support, and Investment in Children’s Human Capital.” Journal of Labor Economics, 34(S2):S3-S30.
  • Del Boca, Daniela, Christopher J. Flinn, Ewout Verriest, and Matthew J. Wiswall. (2019). “Actors in the Child Development Process.” National Bureau of Economic Research Working Paper Series, No. 25596.
  • Becker, Gary S., and Nigel Tomes. (1986). “Human Capital and the Rise and Fall of Families.” Journal of Labor Economics, 4(3):S1-S3
  • Lizzeri, Alessandro and Marciano Siniscalchi. (2008). “Parental Guidance and Supervised Learning.” Quarterly Journal of Economics 123(3): 1161-1195.
  • Doepke, Mattias and Zilibotti, Fabrizio. (2017). “Parenting With Style: Altruism and Paternalism in Intergenerational Preference Transmission.” Econometrica, 85(5): 1331-1371.
  • Cunha, Flávio, Irma Elo, and Jennifer Culhane. (2022). “Maternal subjective expectations about the technology of skill formation predict investments in children one year later.” Journal of Econometrics, 231(1):3-32.
  • Caucutt, Elizabeth M., and Lance Lochner. (2020). “Early and Late Human Capital Investments, Borrowing Constraints, and the Family.” Journal of Political Economy, 128(3):1065-1147.
  • Del Boca, Daniela, Christopher Flinn, and Matthew Wiswall. (2013). “Household Choices and Child Development.” The Review of Economic Studies, 81(1):137-185.
  • Kim, Jun Hyung, Wolfgang Schulz, Tanja Zimmermann, and Kurt Hahlweg. (2018). “Parent–child interactions and child outcomes: Evidence from randomized intervention.” Labour Economics, 54:152-171.
  • Carneiro, Pedro, Lucy Kraftman, Giacomo Mason, Lucie Moore, Imran Rasul, and Molly Scott. (2021). “The Impacts of a Multifaceted Prenatal Intervention on Human Capital Accumulation in Early Life.” American Economic Review, 111(8):2506-49.
  • Akee, Randall K. Q., William E. Copeland, Gordon Keeler, Adrian Angold, and E. Jane Costello. (2010). “Parents’ Incomes and Children’s Outcomes: A Quasi-experiment Using Transfer Payments from Casino Profits.” American Economic Journal: Applied Economics, 2(1):86-115.
  • Akee, Randall, William Copeland, E. Jane Costello, and Emilia Simeonova. (2018). “How Does Household Income Affect Child Personality Traits and Behaviors?” American Economic Review, 108(3):775-827.
  • Guryan, Jonathan, Jens Ludwig, Monica P. Bhatt, Philip J. Cook, Jonathan M. V. Davis, Kenneth Dodge, George Farkas, Roland G. Fryer, Jr., Susan Mayer, Harold Pollack, and Laurence Steinberg. (2021). “Not Too Late: Improving Academic Outcomes Among Adolescents.” National Bureau of Economic Research Working Paper Series, No. 28531.
  • Lise, Jeremy, and Shannon Seitz. (2011). “Consumption Inequality and Intra-household Allocations.” The Review of Economic Studies, 78(1):328-355.
  • Nybom, Martin and Jan Stuhler. (2022). “Interpreting Trends in Intergenerational Mobility,” Under review, Journal of Political Economy.
  • Solon, Gary. (2004). “A model of intergenerational mobility variation over time and place.” In Generational Income Mobility in North America and Europe, edited by Miles Corak, 38-47. Cambridge: Cambridge University Press.
  • Chiappori, Pierre-André and Bernard Salanié. (2022). “Mating Markets,” Unpublished manuscript, Columbia University, Department of Economics.
  • Hennefield, Laura, and Lori Markson. (2017). “Four-year-old Children Align their Preferences with those of their Peers.” Collabra: Psychology, 3(1).
  • Icenogle, Grace, Laurence Steinberg, Natasha Duell, Jason Chein, Lei Chang, et al. (2019). “Adolescents’ cognitive capacity reaches adult levels prior to their psychosocial maturity: Evidence for a ‘maturity gap’ in a multinational, cross-sectional sample.” Law and Human Behavior, 43(1):69-85.
  • Gilbert, Caitlin. 2023. “How does the brain age across the lifespan? New studies offer clues.” The Washington Post, February 28, 2023.
  • Dumornay, Nathalie M., Lauren A.M. Lebois, Kerry J. Ressler, and Nathaniel G. Harnett. (2023). “Racial Disparities in Adversity During Childhood and the False Appearance of Race-Related Differences in Brain Structure.” American Journal of Psychiatry, 180(2):127-138.

Week 7: Income Dynamics within the Lifecycle

• Readings
  • Moffitt, Robert, and Sisi Zhang. (2018). “Income Volatility and the PSID: Past Research and New Results.” AEA Papers and Proceedings, 108:277-80.
  • Blundell, Richard. (2014). “Income Dynamics and Life‐cycle Inequality: Mechanisms and Controversies.” The Economic Journal, 124(576):289-318.
  • Hryshko, Dmytro. (2009). “RIP to HIP: The Data Reject Heterogenous Labor Income Profiles,” Unpublished manuscript, University of Alberta.
  • (P)Meghir, Costas and Luigi Pistaferri. (2011). “Earnings, Consumption and Life Cycle Choices,” In: Orley Ashenfelter and David Card, eds., Handbook of Labor Economics, Vol. 4, Part B. Amsterdam: Elsevier. pp. 773-854.
  • Cunha, Flávio and James J. Heckman. (2016). “Decomposing Trends in Inequality in Earnings into Forecastable and Uncertain Components,” Journal of Labor Economics, 34(S2): S31-S65.
  • Hoffmann, Florian. (2019). “HIP, RIP, and the Robustness of Empirical Earnings Processes.” Quantitative Economics, 10(3):1279-1315.
  • (R)Guvenen, Fatih, Greg Kaplan, Jae Song, and Justin Weidner. (2022). “Lifetime Earnings in the United States over Six Decades.” American Economic Journal: Applied Economics, 14(4):446-79.
  • (R)Guvenen, Fatih, Fatih Karahan, Serdar Ozkan, and Jae Song. (2021). “What Do Data on Millions of U.S. Workers Reveal About Lifecycle Earnings Dynamics?” Econometrica, 89(5):2303-2339.
  • De Nardi, Mariacristina. (2004). “Wealth Inequality and Intergenerational Links.” The Review of Economic Studies, 71(3):743-768.
  • Altonji, Joseph G., Disa M. Hynsjö, and Ivan Vidangos. (2022). “Individual earnings and family income: Dynamics and distribution.” Review of Economic Dynamics, early online.
  • Blundell, Richard. (2022). “Inequality, Redistribution and Wage Progression.” Economica, 89(S1):S160-S177.
  • Gihleb, Rania, and Kevin Lang. (2016). “Educational Homogamy and Assortative Mating Have Not Increased.” National Bureau of Economic Research Working Paper Series, No. 22927.
  • Hryshko, Dmytro. (2012). “Labor income profiles are not heterogeneous: Evidence from income growth rates.” Quantitative Economics, 3(2):177-209.
• Additional Slides
  • Income Processes/Shocks, Market Structure, and Information, Lise
  • Changes in Assortative Matching: Theory and Evidence for the US

Week 8: Neighborhoods and Peers

• Readings
  • Benabou, Roland. (1996). “Equity and Efficiency in Human Capital Investment: The Local Connection,” Review of Economic Studies, 62:237-264.
  • Durlauf, Steven. (1996). “Neighborhood Feedback, Endogenous Stratification, and Income Inequality,” in W. Barnett, G. Gandolfo, and C. Hillinger, Dynamic Disequilibrium Modeling. Cambridge, UK: Cambridge University Press. pp. 505-534
  • (P)Chetty, Raj, and Nathaniel Hendren. (2018). “The Impacts of Neighborhoods on Intergenerational Mobility I: Childhood Exposure Effects.” Quarterly Journal of Economics, 133(3):1107-1162.
  • (P)Chetty, Raj, and Nathaniel Hendren. (2018). “The Impacts of Neighborhoods on Intergenerational Mobility II: County-Level Estimates.” Quarterly Journal of Economics, 133(3):1163-1228.
  • Chetty, Raj, Nathaniel Hendren, and Lawrence F. Katz. (2016). “The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment.” American Economic Review, 106(4):855-902.
  • (P)Chetty, Raj, Nathaniel Hendren, Maggie R Jones, and Sonya R Porter. (2020). “Race and Economic Opportunity in the United States: an Intergenerational Perspective.” The Quarterly Journal of Economics, 135(2):711-783.
  • Eshaghnia, S. M. Sadegh. (2022). “Is Zip Code Destiny? Re-visiting Long-Run Neighborhood Effects.” Unpublished manuscript, The University of Chicago, Center for the Economics of Human Development.
  • Pinto, Rodrigo. (2022). “Beyond Intention-to-Treat: Using the Incentives of Moving to Opportunity to
    Identify Neighborhood Effects,” Unpublished manuscript, University of California at Los Angeles.
    • Appendix
  • Lindbeck, Assar, and Sten Nyberg. (2006). “Raising Children to Work Hard: Altruism, Work Norms, and Social Insurance.” The Quarterly Journal of Economics, 121(4):1473-1503.
  • Lindbeck, Assar, Sten Nyberg, and Jorgen W. Weibull. (1999). “Social Norms and Economic Incentives in the Welfare State.” The Quarterly Journal of Economics, 114(1):1-35.
  • Harding, David J., Lisa Sanbonmatsu, Greg J. Duncan, Lisa A. Gennetian, Lawrence F. Katz, Ronald C. Kessler, Jeffrey R. Kling, Matthew Sciandra, and Jens Ludwig. 2021. “Evaluating Contradictory Experimental and Non-Experimental Estimates of Neighborhood Effects on Economic Outcomes for Adults.” Becker Friedman Institute Working Papers. 2021-22.

Week 9: Monopoly and Monopsony as Sources of Inequality

• Readings
  • Koopmans, Tjalling C., and Martin Beckmann. (1957). “Assignment Problems and the Location of Economic Activities.” Econometrica, 25(1):53-76.
  • (P)Sattinger, Michael. (1979). “Differential Rents and the Distribution of Earnings.” Oxford Economic Papers, 31(1):60-71.
  • Robert M. Costrell, and Glenn C. Loury. (2004). “Distribution of Ability and Earnings in a Hierarchical Job Assignment Model.” Journal of Political Economy, 112(6):1322-1363.
  • Humlum, Anders. (2021). “Robot Adoption and Labor Market Dynamics,” Unpublished manuscript, University of Chicago, Department of Economics.
  • (R)Van Reenen, John. (2018). “Increasing Differences Between Firms: Market Power and the Macro-Economy.” CEP Discussion Paper No. 1576.
  • Caines, Colin, Florian Hoffmann, and Gueorgui Kambourov (2017). “Does Automation Drive the Labor Market?,” IFDP Notes. Washington: Board of Governors of the Federal Reserve System.
  • Acemoglu, Daron, Claire Lelarge, and Pascual Restrepo. 2020. “Competing with Robots: Firm-Level Evidence from France.” AEA Papers and Proceedings, 110:383-88.
  • (B)Acemoglu, Daron, and Pascual Restrepo. (2020). “Robots and Jobs: Evidence from US Labor Markets.” Journal of Political Economy, 128(6):2188-2244.
  • Acemoglu, Daron, and Pascual Restrepo. (2022). “Tasks, Automation, and the Rise in U.S. Wage Inequality.” Econometrica, 90(5):1973-2016.
  • Acemoglu, Daron, and Pascual Restrepo. 2018. “The Race between Man and Machine: Implications of Technology for Growth, Factor Shares, and Employment.” American Economic Review, 108 (6):1488-1542.
  • Acemoglu, Daron, and Jonas Loebbing. 2022. “Automation and Polarization.” National Bureau of Economic Research. NBER Working Papers. 30528.
  • Krueger, Alan B., and Orley Ashenfelter. (2018). “Theory and Evidence on Employer Collusion in the Franchise Sector.” National Bureau of Economic Research Working Paper Series, No. 24831.
  • Card, David. (2022). “Who Set Your Wage?” American Economic Review, 112(4):1075-90.
  • U. S. Department of the Treasury. 2022. “The State of Labor Market Competition.” U. S. Department of the Treasury. https://home.treasury.gov/system/files/136/State-of-Labor-Market-Competition-2022.pdf
  • Bivens, Josh, Lawrence Mishel, and John Schmitt. (2018). “It’s Not Just Monopoly and Monopsony.” Economic Policy Institute. Report. 145564.
  • Berger, David, Kyle Herkenhoff, and Simon Mongey. (2022). “Labor Market Power.” American Economic Review, 112(4):1147-93.
  • Farmer, Leland and Roger Farmer (2022). ” Zoomers and Boomers: Asset Prices and Intergenerational Inequality,” NBER Working Paper No. 30419.
  • Caplin, Andrew, Minjoon Lee, Søren Leth-Petersen, Johan Sæverud, and Matthew D. Shapiro. (2022).  “How Worker Productivity and Wages Grow with Tenure and Experience: The Firm Perspective.” University of Copenhagen Dept. of Economics Discussion Paper No. 11/22.
  • Ashenfelter, Orley, David Card, Henry Farber, and Michael R. Ransom. (2022). “Monopsony in the Labor Market: New Empirical Results and New Public Policies.” Journal of Human Resources, 57(S):S1-S10.
  • Heckman, James J., and Colleen P. Loughlin. (2021). “Are Student Athletes Exploited?”, Unpublished manuscript, The University of Chicago, Center for the Economics of Human Development. Appendix

Week 10: Public Policy

•  Readings
  • Heckman, James, and Rasmus Landersø. (2021). “Lessons for Americans from Denmark about Inequality and Social Mobility.” Labour Economics, 77:early online edition.
  • Landersø, Rasmus, and James J. Heckman. (2017). “The Scandinavian Fantasy: The Sources of Intergenerational Mobility in Denmark and the US.” The Scandinavian Journal of Economics, 119(1):178-230.
  • Lindbeck, Assar, Sten Nyberg, and Jörgen W. Weibull. (1999). “Social Norms and Economic Incentives in the Welfare State.” The Quarterly Journal of Economics, 114(1):1-35.
  • Lindbeck, Assar. (1995). “Welfare State Disincentives with Endogenous Habits and Norms.” The Scandinavian Journal of Economics, 97(4):477-494.
  • Lindbeck, Assar. (1995). “Hazardous Welfare-State Dynamics.” The American Economic Review, 85(2):9-15.
  • Bondar, Mariia, and Fuchs-Schündeln. (2022). “Good Bye Lenin Revisited: East-West Preferences Three Decades After Reunification.” Unpublished manuscript. Goethe University Frankfurt.
  • Fang, Hanming, and Michael Keane. 2004. “Assessing the Impact of Welfare Reform on Single Mothers.” The Brookings Institution. Brookings Papers on Economic Activity, No. 1
  • Moffitt, Robert. (2006). “Welfare work Requirements with Paternalistic Government Preferences.” The Economic Journal, 116(515):F441-F458.
  • Moffitt, Robert A., ed. 2016. Economics of means- tested transfer programs in the United States. Vol. 1. Chicago, IL: The University of Chicago Press.
  • Ziliak, James P. 2013. “Why are so Many Americans on Food Stamps? The Role of Economy, Policy, and Demographics.” University of Kentucky, Center for Poverty Research. Discussion Paper Series. DP 2013-01.
  • Deshpande, Manasi. (2016). “Does Welfare Inhibit Success? The Long-Term Effects of Removing Low-Income Youth from the Disability Rolls.” American Economic Review, 106(11):3300-3330.
  • Tertilt, Michèle, Matthias Doepke, Anne Hannusch, and Laura Montenbruck. (2022). “The Economics of Women’s Rights.” National Bureau of Economic Research. Working Papers No. 30617
  • Larrimore, Jeff, Jacob Mortenson, and David Splinter. 2023. “Earnings Business Cycles: The COVID Recession, Recovery, and Policy Response.” Board of Governors of the Federal Reserve System. Finance and Economics Discussion Series. 2023-004.

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