Economics 350, Winter 2023: Lecture Notes

Week 1, January 3, 2023: Inequality and Social Mobility:  Surprising Facts and Measures That Challenge Conventional Claims

1. Overview and Plan of the Course
2. Syllabus
3. Problem Set 1
4. Inequality in What? Income Measures and Wage Measures
5. Guest Lecture, Thomas Coleman
   • Three Narratives on Income Inequality: Importance of Good Data Analysis, Methodology, and Theory
6. The Distribution of Household Income, 2018
7. Part 2: Role of Skills and Skill Prices in Explaining Inequality
8. Part 3: Role of Taxes and Transfers in Post Tax-Transfer Outcomes
   1. Blundell Extract
9. Social Mobility: Geography and Demography
10. The Decline in Intergenerational Mobility After 1980 (Extract), Davis and Mazumder
11. Inequality in Health
12. Mortality Inequality in the United States and Europe, Janet Currie, Princeton University and NBER: Hannes Schwandt, Northwestern University and NBER
13. Notes on the Roy Model and the Generalized Roy Model (Extract)

Week 1, January 5, 2023: Inequality and Social Mobility:  Surprising Facts and Measures That Challenge Conventional Claims

1. Slides from Lecture 1
   1. Inequality in What? Income Measures and Wage Measures
   2. Guest Lecture, Thomas Coleman
      • Three Narratives on Income Inequality: Importance of Good Data Analysis, Methodology, and Theory
   3. The Distribution of Household Income, 2018
   4. Part 2: Role of Skills and Skill Prices in Explaining Inequality
   5. Part 3: Role of Taxes and Transfers in Post Tax-Transfer Outcomes
      1. Blundell Extract
   6. Social Mobility: Geography and Demography
   7. The Decline in Intergenerational Mobility After 1980 (Extract), Davis and Mazumder
   8. Inequality in Health
   9. Mortality Inequality in the United States and Europe, Janet Currie, Princeton University and NBER: Hannes Schwandt, Northwestern University and NBER
   10. Notes on the Roy Model and the Generalized Roy Model (Extract)
2. Guest Lecture, Bruce Meyer
   • • The Anti-Poverty and Labor Supply Effects of Replacing a Child Tax Credit with a Child Allowance, Corinth, Meyer, Stadnicki, Wu
     • Poverty in the United States, Meyer and Wu

Week 2, January 10, 2023: Skill, Schools, and Learning-by-Doing

1. Inequality in What? Income Measures and Wage Measures
2. The Distribution of Household Income, 2018
3. Part 2: Role of Skills and Skill Prices in Explaining Inequality
4. Part 3: Role of Taxes and Transfers in Post Tax-Transfer Outcomes
   1. Blundell Extract
5. Social Mobility: Geography and Demography
6. The Decline in Intergenerational Mobility After 1980 (Extract), Davis and Mazumder
7. Inequality in Health
8. Mortality Inequality in the United States and Europe, Janet Currie, Princeton University and NBER: Hannes Schwandt, Northwestern University and NBER
9. The Rate of Return to Schooling: The Mincer Equation and Beyond
10. Rate of Return Continuation Values and Option Values in a Simple Dynamic Model, Eisenhauer, Heckman, and Mosso (2015)
11. Two Interpretations of the Mincer Equation Learning-by-doing vs. On-the-job Training, Heckman, Lochner, and Cossa (2003)
12. 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)
13. Notes on “A Theory of Job Shopping”, by Johnson
14. The Career Decisions of Young Men, Keane and Wolpin (1997)
15. Credit Constraints and Education: Models and Analysis
16. Employer Learning and Statistical Discrimination by Altonji and Pierret, 2001
17. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions

Week 2, January 12, 2023: Skill, Schools, and Learning-by-Doing

1. Inequality in What? Income Measures and Wage Measures
2. The Distribution of Household Income, 2018
3. Part 2: Role of Skills and Skill Prices in Explaining Inequality
4. Part 3: Role of Taxes and Transfers in Post Tax-Transfer Outcomes
   1. Blundell Extract
5. Social Mobility: Geography and Demography
6. The Decline in Intergenerational Mobility After 1980 (Extract), Davis and Mazumder
7. Inequality in Health
8. Mortality Inequality in the United States and Europe, Janet Currie, Princeton University and NBER: Hannes Schwandt, Northwestern University and NBER
9. The Rate of Return to Schooling: The Mincer Equation and Beyond
10. Rate of Return Continuation Values and Option Values in a Simple Dynamic Model, Eisenhauer, Heckman, and Mosso (2015)
11. Two Interpretations of the Mincer Equation Learning-by-doing vs. On-the-job Training, Heckman, Lochner, and Cossa (2003)
12. 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)
13. Notes on “A Theory of Job Shopping”, by Johnson
14. The Career Decisions of Young Men, Keane and Wolpin (1997)
15. Credit Constraints and Education: Models and Analysis
16. Employer Learning and Statistical Discrimination by Altonji and Pierret, 2001

Week 3, January 17, 2023: Preferences: Preference and Habit Formation

1. The Rate of Return to Schooling: The Mincer Equation and Beyond
2. Instrumental Variables Methods for the Correlated Random Coefficient Model: Estimating fhe Average Rate of Return to Schooling When the Return is Correlated with Schooling, Heckman and Vytlacil (1998)
3. Rate of Return Continuation Values and Option Values in a Simple Dynamic Model, Eisenhauer, Heckman, and Mosso (2015)
   1. The Career Decisions of Young Men, Keane and Wolpin (1997)
4. Separating Heterogeneity from Uncertainty Decomposing Trends in Inequality in Earnings into Forecastable and Uncertain Components: Extract, Cunha and Heckman (2016)
5. Two Interpretations of the Mincer Equation Learning-by-doing vs. On-the-job Training, Heckman, Lochner, and Cossa (2003)
6. 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)
7. Human Capital Accumulation and Earnings Dynamics over the Life Cycle: the Ben-Porath Model and Beyond, García and Heckman
8. Rising Wage Inequality and the Effectiveness of Tuition Subsidy Policies: Explorations with a Dynamic General Equilibrium Model of Labor Earnings, Heckman, Lochner, and Taber (1998)
9. General-Equilibrium Treatment Effects: A Study of Tuition Policy, Heckman, Lochner and Taber (1998)
10. How Large is the Stock Component of Human Capital? Huggett and Kaplan
11. The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
12. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
13. Integrating Financial Markets with Human Capital Markets, Hai and Heckman (2018)

Week 3, January 19, 2023: Preferences: Preference and Habit Formation

1. The Rate of Return to Schooling: The Mincer Equation and Beyond: Extract
2. The Rate of Return to Schooling: The Mincer Equation and Beyond
3. Separating Heterogeneity from Uncertainty Decomposing Trends in Inequality in Earnings into Forecastable and Uncertain Components: Extract, Cunha and Heckman (2016)
4. Two Interpretations of the Mincer Equation Learning-by-doing vs. On-the-job Training, Heckman, Lochner, and Cossa (2003)
5. 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)
6. Human Capital Accumulation and Earnings Dynamics over the Life Cycle: the Ben-Porath Model and Beyond, García and Heckman
7. Rising Wage Inequality and the Effectiveness of Tuition Subsidy Policies: Explorations with a Dynamic General Equilibrium Model of Labor Earnings, Heckman, Lochner, and Taber (1998)
8. Instrumental Variables Methods for the Correlated Random Coefficient Model: Estimating fhe Average Rate of Return to Schooling When the Return is Correlated with Schooling, Heckman and Vytlacil (1998)
9. Rate of Return Continuation Values and Option Values in a Simple Dynamic Model, Eisenhauer, Heckman, and Mosso (2015)
   1. The Career Decisions of Young Men, Keane and Wolpin (1997)
10. Integrating Financial Markets with Human Capital Markets, Hai and Heckman (2018)
11. General-Equilibrium Treatment Effects: A Study of Tuition Policy, Heckman, Lochner and Taber (1998)
12. The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
13. How Large is the Stock Component of Human Capital? Huggett and Kaplan
14. Notes on “A Theory of Job Shopping”, by Johnson
15. Employer Learning and Statistical Discrimination by Altonji and Pierret, 2001
16. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions

Week 4, January 24, 2023: Tasks, Occupations, and Skills

1. Notes on Identification of the Roy Model and the Generalized Roy Model
2. The Normal Generalized Roy Model
3. Factor Models: A Review
   • Factor Models: Extract
4. Notes on Frisch Demands
5. Ordering Marshallian, Hicks, Frisch Responses to a Price Change
6. Two Interpretations of the Mincer Equation Learning-by-doing vs. On-the-job Training, Heckman, Lochner, and Cossa (2003)
7. 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)
8. Human Capital Accumulation and Earnings Dynamics over the Life Cycle: the Ben-Porath Model and Beyond, García and Heckman
9. Rising Wage Inequality and the Effectiveness of Tuition Subsidy Policies: Explorations with a Dynamic General Equilibrium Model of Labor Earnings, Heckman, Lochner, and Taber (1998)
10. General-Equilibrium Treatment Effects: A Study of Tuition Policy, Heckman, Lochner and Taber (1998)
11. How Large is the Stock Component of Human Capital? Huggett and Kaplan
12. Integrating Financial Markets with Human Capital Markets by Hai and Heckman (2018)
13. Notes on “A Theory of Job Shopping”, by Johnson
14. Employer Learning and Statistical Discrimination by Altonji and Pierret, 2001
15. The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
16. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
17. Skills and Firms
18. Skill vs. Task: Task Approach by Zhou (2022)
19. Skills and Tasks in the Labor Market
20. Tasks, Automation, and the Rise in U.S. Wage Inequality by Acemoglu and Restrepo (2021)
21. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
22. Preferences, Personality Psychology, and Economics: Some New Results
    • Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
23. On Interpreting Stereotype Threat as Accounting for African American–White Differences on Cognitive Tests by Sackett, Hardison, and Cullen (2004).

Week 4, January 26, 2023: Tasks, Occupations, and Skills

1. Skills and Firms
2. Rising Wage Inequality and the Effectiveness of Tuition Subsidy Policies: Explorations with a Dynamic General Equilibrium Model of Labor Earnings, Heckman, Lochner, and Taber (1998)
3. General-Equilibrium Treatment Effects: A Study of Tuition Policy, Heckman, Lochner and Taber (1998)
4. Integrating Financial Markets with Human Capital Markets by Hai and Heckman (2018)
5. How Large is the Stock Component of Human Capital? Huggett and Kaplan
6. Notes on “A Theory of Job Shopping”, by Johnson
7. Employer Learning and Statistical Discrimination by Altonji and Pierret, 2001
8. Skills and Tasks in the Labor Market
9. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
10. The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality
11. Notes on “Differential Rents and the Distribution of Earnings” by Sattinger (1979)
12. Preferences, Personality Psychology, and Economics: Some New Results
    1. Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
13. On Interpreting Stereotype Threat as Accounting for African American–White Differences on Cognitive Tests by Sackett, Hardison, and Cullen (2004).
14. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)

Supplement

• Human Capital Accumulation and Earnings Dynamics over the Life Cycle: the Ben-Porath Model and Beyond, García and Heckman
• The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
• Skill vs. Task: Task Approach by Zhou (2022)
• Tasks, Automation, and the Rise in U.S. Wage Inequality by Acemoglu and Restrepo (2021)
• Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)

Week 5, January 31, 2023: Labor Supply and Work Incentives

1. Integrating Financial Markets with Human Capital Markets by Hai and Heckman (2018)
2. How Large is the Stock Component of Human Capital? Huggett and Kaplan
3. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
4. The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality
5. Notes on “Differential Rents and the Distribution of Earnings” by Sattinger (1979)
6. Notes on “Assignment Problems and the Location of Economic Activities” by Koopmans and Beckmann
7. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
8. Skills and Tasks in the Labor Market
9. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)
10. Preferences, Personality Psychology, and Economics: Some New Results
    1. Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
11. Firms and Labor Market Inequality: Evidence and Some Theory by Card, Cardoso, Heining, and Kline
12. Imperfect Competition, Compensating Differentials, and Rent Sharing in the US Labor Market by Lamadon, Mogstad, and Setzler
13. The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
14. Tasks, Automation, and the Rise in U.S. Wage Inequality by Acemoglu and Restrepo (2021)
15. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
16. Skill vs. Task: Task Approach by Zhou (2022)
17. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)

Supplement

1. Labor Supply
2. Notes on Frisch Demands
3. Ordering Marshallian, Hicks, Frisch Responses to a Price Change
4. Labor Supply and the Two-Step Estimator
5. The Career Decisions of Young Men, Keane and Wolpin (1997)
6. Modeling the Income Process, Extract from Meghir and Pistaferri (2011)
7. The Technology of Skill Formation, Cunha and Heckman (2007)
8. Work and Welfare Dependence
9. Employment by industry, monthly changes, with confidence intervals, Bureau of Labor Statistics (2022)
10. Employment–population ratio, Bureau of Labor Statistics (2022)
11. Female Labor Supply, Human Capital, and Welfare Reform by Blundell, Costa Dias, Meghir, and Shaw (2016)
12. Income Dynamics and Life-cycle Inequality: Mechanisms And Controversies by Blundell (2014)
13. The Role of Labor and Marriage Markets, Preference Heterogeneity, and The Welfare System in the Life Cycle Decisions of Black, Hispanic, and White Women Keane and Wolpin (2010)
14. Life-Cycle Labour Supply with Human Capital: Econometric and Behavioural Implications, Keane (2016)
15. Labor Supply and Taxes: A Survey, Keane (2011)
16. Reconciling Micro and Macro Labor Supply Elasticities: A Structural Perspective, Keane and Rogerson (2015)
17. Recent research on labor supply: Implications for tax and transfer policy, Keane (2022)
18. Lifecycle Labor Supply: The Intertemporal Substitution Hypothesis (ISH) and the “λ Constant” Functions
19. Career and Family Decisions: Cohorts Born 1935-1975 Eckstein, Keane, and Lifshitz (2019)

Week 5, February 2, 2023:

1. Guest Lecture, Kevin Thom
   1. Slides
      • Genetics and Economic Outcomes
   2. Reading List
      • Barth, Daniel, Nicholas W. Papageorge, and Kevin Thom. (2020). “Genetic Endowments and Wealth Inequality.” Journal of Political Economy, 128(4):1474-1522.
      • Barth, Daniel, Nicholas W. Papageorge, Kevin Thom, and Mateo Velasquez-Giraldo. 2022. “Genetic Endowments, Income Dynamics, and Wealth Accumulation over the Lifecycle.” National Bureau of Economic Research. NBER Working Papers. 30350.
      • Beauchamp, Jonathan P., David Cesarini, Magnus Johannesson, Matthijs J. H. M. van der Loos, Philipp D. Koellinger, et al. (2011). “Molecular Genetics and Economics.” Journal of Economic Perspectives, 25(4):57-82.
      • Belsky, Daniel W., Benjamin W. Domingue, Robbee Wedow, Louise Arseneault, Jason D. Boardman, et al. (2018). “Genetic analysis of social-class mobility in five longitudinal studies.” Proceedings of the National Academy of Sciences, 115(31):E7275-E7284.
      • Benjamin, Daniel J., David Cesarini, Christopher F. Chabris, Edward L. Glaeser, David I. Laibson, et al. (2012). “The Promises and Pitfalls of Genoeconomics.” Annual Review of Economics, 4(1):627-662.
      • Branigan, Amelia R., Kenneth J. McCallum, and Jeremy Freese. (2013). “Variation in the Heritability of Educational Attainment: An International Meta-Analysis.” Social Forces, 92(1):109-140.
      • Cronqvist, Henrik, and Stephan Siegel. (2015). “The Origins of Savings Behavior.” Journal of Political Economy, 123(1):123-169.
      • Demange, Perline A., Margherita Malanchini, Travis T. Mallard, Pietro Biroli, Simon R. Cox, et al. (2021). “Investigating the genetic architecture of noncognitive skills using GWAS-by-subtraction.” Nature Genetics, 53(1):35-44.
      • Grotzinger, Andrew D., Mijke Rhemtulla, Ronald de Vlaming, Stuart J. Ritchie, Travis T. Mallard, et al. (2018). “Genomic SEM Provides Insights into the Multivariate Genetic Architecture of Complex Traits.” bioRxiv:305029.
      • 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.
      • Lee, James J., Robbee Wedow, Aysu Okbay, Edward Kong, Omeed Maghzian, et al. (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.
      • Okbay, Aysu, Yeda Wu, Nancy Wang, Hariharan Jayashankar, Michael Bennett, et al. (2022). “Polygenic prediction of educational attainment within and between families from genome-wide association analyses in 3 million individuals.” Nature Genetics, 54(4):437-449.
      • Papageorge, Nicholas W., and Kevin Thom. (2020). “Genes, Education, and Labor Market Outcomes: Evidence from the Health and Retirement Study.” Journal of the European Economic Association, 18(3):1351-1399.
2. Slides
   1. The Inheritance of Inequality, Bowles and Gintis (2002)
   2. Heritability
   3. Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
   4. Genetics and Economics: Models, Methods and Findings by Ronda (2022)
   5. Some Contributions of Economics to the Study of Personality by Heckman, Jagelka, Kautz (2019)
   6. Dynamic Female Labor Supply, Eckstein and Lifshitz (2011)
   7. Labor Supply and Taxes: A Survey, Keane (2011)
   8. From January 31, 2023
      1. Integrating Financial Markets with Human Capital Markets by Hai and Heckman (2018)
      2. How Large is the Stock Component of Human Capital? Huggett and Kaplan
      3. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
      4. The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality
      5. Notes on “Differential Rents and the Distribution of Earnings” by Sattinger (1979)
      6. Notes on “Assignment Problems and the Location of Economic Activities” by Koopmans and Beckmann
      7. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
      8. Skills and Tasks in the Labor Market
      9. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)
      10. Preferences, Personality Psychology, and Economics: Some New Results
          • Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
      11. Firms and Labor Market Inequality: Evidence and Some Theory by Card, Cardoso, Heining, and Kline
      12. Imperfect Competition, Compensating Differentials, and Rent Sharing in the US Labor Market by Lamadon, Mogstad, and Setzler
      13. The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
      14. Tasks, Automation, and the Rise in U.S. Wage Inequality by Acemoglu and Restrepo (2021)
      15. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
      16. Skill vs. Task: Task Approach by Zhou (2022)
      17. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)

Week 6, February 7, 2023: Income Dynamics within the Lifecycle

1. DNA Methylation Extract, Fraga, et al. (2005)
2. Firms and Labor Market Inequality: Evidence and Some Theory by Card, Cardoso, Heining, and Kline
3. Imperfect Competition, Compensating Differentials, and Rent Sharing in the US Labor Market by Lamadon, Mogstad, and Setzler
4. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
5. The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality
6. Notes on “Differential Rents and the Distribution of Earnings” by Sattinger (1979)
7. Notes on “Assignment Problems and the Location of Economic Activities” by Koopmans and Beckmann
8. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
9. Skills and Tasks in the Labor Market
10. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)
11. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
12. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)
13. Skill vs. Task: Task Approach by Zhou (2022)

Week 6, February 9, 2023:

1. Increasing Differences Between Firms: Market Power and the Macroeconomy, Van Reenen (2018)
2. Monopsony in the Labor Market: New Empirical Results and New Public Policies,  Ashenfelter, Card, Farber, and Ransom (2021)
3. Theory and Evidence on Employer Collusion in the Franchise Sector, Krueger and Ashenfelter (2019)
4. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
5. Notes on “Assignment Problems and the Location of Economic Activities” by Koopmans and Beckmann
6. Mating Markets  Chiappori and Salanié. (2022)
7. The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality
8. Notes on “Differential Rents and the Distribution of Earnings” by Sattinger (1979)
9. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
10. Skills and Tasks in the Labor Market
11. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)
12. Skill vs. Task: Task Approach by Zhou (2022)
13. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
14. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)

Supplement:

1. DNA Methylation Extract, Fraga, et al. (2005)
2. Firms and Labor Market Inequality: Evidence and Some Theory by Card, Cardoso, Heining, and Kline
3. Imperfect Competition, Compensating Differentials, and Rent Sharing in the US Labor Market by Lamadon, Mogstad, and Setzler
4. Theory and Evidence on Employer Collusion in the Franchise Sector by Krueger and Ashenfelter, 2018
5. Monopsony in the Labor Market: New Empirical Results and New Public Policies by Ashenfelter, Card, Farber, Ransom (2021)
6. Theory and Evidence on Employer Collusion in the Franchise Sector by Krueger and Ashenfelter, 2018
7. It’s Not Just Monopoly and Monopsony How Market Power Has Affected American Wages by Bivens, Mishel, and Schmitt (2018)
8. Labor Market Power, Berger, Herkenhoff and Mongey (2021)
   • [need updated handout]

Week 7: February 14, 2023: Family Influence: Genes, Parenting, and Credit Constraints

1. The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality
2. Skills and Tasks in the Labor Market
3. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
4. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)
5. Skill vs. Task: Task Approach by Zhou (2022)
6. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)
7. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
8. Tasks, Automation, and the Rise in U.S. Wage Inequality by Acemoglu and Restrepo (2021)
9. Preferences, Personality Psychology, and Economics: Some New Results
   1. Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
10. On Interpreting Stereotype Threat as Accounting for African American–White Differences on Cognitive Tests by Sackett, Hardison, and Cullen (2004).

Supplement

1. Increasing Differences Between Firms: Market Power and the Macroeconomy, Van Reenen (2018)
2. Monopsony in the Labor Market: New Empirical Results and New Public Policies,  Ashenfelter, Card, Farber, and Ransom (2021)
3. Theory and Evidence on Employer Collusion in the Franchise Sector, Krueger and Ashenfelter (2019)
4. Efficiency Units, Elementary Hedonic Models (Gorman and Lancaster) With and Without Bundling Restrictions
5. Notes on “Assignment Problems and the Location of Economic Activities” by Koopmans and Beckmann
6. Mating Markets  Chiappori and Salanié. (2022)
7. Notes on “Differential Rents and the Distribution of Earnings” by Sattinger (1979)

Week 7: February 16, 2023

1. Modeling the Income Process, Extract from Meghir and Pistaferri (2011)
2. Skills, Tasks and Technologies Beyond the Canonical Model, Acemoglu and Autor (2011)
3. Tasks, Automation, and the Rise in U.S. Wage Inequality by Acemoglu and Restrepo (2021)
4. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)
5. Skill vs. Task: Task Approach by Zhou (2022)
6. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
7. Preferences, Personality Psychology, and Economics: Some New Results
   • Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
8. On Interpreting Stereotype Threat as Accounting for African American–White Differences on Cognitive Tests by Sackett, Hardison, and Cullen (2004).
9. The Rising Return to Non-Cognitive Skill  by Edin, Fredriksson, Nybom, Ockert
10. Robots and Jobs: Evidence from US Labor Markets, Acemoglu and Restrepo (2020)

Week 8, February 21, 2023: Neighborhood and Peer Effects

1. Skills vs. Tasks: How Important Are Occupations? by Caines, Hoffman, and Kambourov (2016)
2. Tasks and Heterogeneous Human Capital by Yamaguchi. (2012)
3. Preferences, Personality Psychology, and Economics: Some New Results
   • Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
4. Studying Personality and Preferences
5. The Rising Return to Non-Cognitive Skill  by Edin, Fredriksson, Nybom, Ockert
6. On Interpreting Stereotype Threat as Accounting for African American–White Differences on Cognitive Tests by Sackett, Hardison, and Cullen (2004).
7. Measuring Knowledge by Heckman and Zhou (2023)
8. The Causal Effects of Youth Cigarette Addiction and Education, Hai and Heckman (2022)
9. Adolescents’ Cognitive Capacity Reaches Adult Levels Prior to Their Psychosocial Maturity: Evidence for a “Maturity Gap” in a Multinational, Cross Sectional Sample, Icenogle, Grace, Laurence Steinberg, Natasha Duell, Jason Chein, Lei Chang, et al. (2019).

Supplement

1. Skill vs. Task: Task Approach by Zhou (2022)
2. Other Ways to Define Occupations (Paretian Distributions and Income Maximizations) Extract from Mandelbrot (1962)
3. Models for Social Mobility and Skill Formation
4. Work and Welfare Dependence

Week 8, February 23, 2023

1. Preferences, Personality Psychology, and Economics: Some New Results
   • Preferences, Personality Psychology, and Economics: Some New Results EXTRACT
2. Studying Personality and Preferences
3. The Rising Return to Non-Cognitive Skill  by Edin, Fredriksson, Nybom, Ockert
4. Measuring Knowledge by Heckman and Zhou (2023)
5. The Causal Effects of Youth Cigarette Addiction and Education by Hai and Heckman (2022)
6. Models for Social Mobility and Skill Formation
7. Parenting Promotes Social Mobility Within and Across Generations by García and Heckman
8. A Theory of Intergenerational Mobility by Becker, Kominers, Murphy, and Spenkuch (2018)
9. The Implications of Dynamic Complementarity for Investments across Children with Different Initial Endowments
10. Six Facts: The Technology of Skill Formation (EXTRACT from Cunha and Heckman 2007)
11. The Human Quest for Fairness & Equity by Ernst Fehr (2022)

• Graphics for Economic News Releases from The U.S. Bureau of Labor Statistics
  • Employment by industry, monthly changes, with confidence intervals, Bureau of Labor Statistics (2022)
  • Employment–population ratio, Bureau of Labor Statistics (2022)
• The Role of Labor and Marriage Markets, Preference Heterogeneity, and The Welfare System in the Life Cycle Decisions of Black, Hispanic, and White Women Keane and Wolpin (2010)
• Income Dynamics and Life-cycle Inequality: Mechanisms And Controversies by Blundell (2014)
• Recent research on labor supply: Implications for tax and transfer policy, Keane (2022)
• Female Labor Supply, Human Capital, and Welfare Reform by Blundell, Costa Dias, Meghir, and Shaw (2016)
• Recent research on labor supply: Implications for tax and transfer policy, Keane (2022)
• Career and Family Decisions: Cohorts Born 1935-1975 Eckstein, Keane, and Lifshitz (2019)

Week 9, March 2, 2023

1. Item Response Theory
2. The Causal Effects of Youth Cigarette Addiction and Education by Hai and Heckman (2022)
3. Where are the Workers? From Great Resignation to Quiet Quitting, Lee, Park and Shin (2023)
4. Work and Welfare Dependence
5. 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.
   • Raising Children to Work Hard: Altruism, Work Norms, And Social Insurance
6. Figures from “Evaluating the Success of President Johnson’s War on Poverty: Revisiting the Historical Record Using an Absolute Full Income Poverty Measure” by Burkhauser, Corinth, Elwell, and Larrimore (2022)
7. Models for Social Mobility and Skill Formation
8. The Implications of Dynamic Complementarity for Investments across Children with Different Initial Endowments
9. Six Facts: The Technology of Skill Formation (EXTRACT from Cunha and Heckman 2007)
10. Parental Guidance and Supervised Learning, Lizzeri and Siniscalchi, 2008
11. Parenting Promotes Social Mobility Within and Across Generations by García and Heckman
12. A Theory of Intergenerational Mobility by Becker, Kominers, Murphy, and Spenkuch (2018)
13. How the Welfare State Affects Inequality and Social Mobility: A Comparison of the U.S. and Denmark, Heckman and Landersø (2022)
14. Intergenerational Transmission of Family Influence, Eshaghina, Heckman, Landersø and Qureshi
15. Heckman, James J. (2018). “Comments on ‘Race and Economic Opportunity in the United States: An Intergenerational Perspective’,” Tanner Lectures on Human Values, Princeton University, March 28, 2018.
    • Lecture I Video: “The Intergenerational Persistence of Racial Disparities“
    • Lecture II Video: “Neighborhood Effects: Childhood Environment and Upward Mobility” with commentary from Prudence Carter (UC Berkeley), William Galson (Brookings Institution), James J. Heckman (University of Chicago), and William Julius Wilson (Harvard University).
16. Guest Lecture: Sadegh Eshaghina
    • Is Zip Code Destiny? Re-visiting Long-run Neighborhood Effects
17. Neighborhood Effects and Child Outcomes: Evaluating the Recent Empirical Literature by Michael Galperin
18. Racial Disparities in Adversity During Childhood and the False Appearance of Race Related Differences in Brain Structure by Dumornay et al., (2023)
19. Evidence of Purposive Sorting by Families to Neighborhoods
20. Exploiting Incentives of the Moving to Opportunity Experiment, Pinto (2023)

Supplement

• The Speed of Employer Learning by Lange, 2007
• Correspondence on Ashenfelter and Krueger Paper by Heckman (1992)
• Economic Mobility in America a State of the Art Primer, Winship (2021)
  • Part 1: Contemporary Levels of Mobility
  • Part 2: The United States in Comparative Literature
  • Part 3: Trends in the United States
• Estimation of a Roy/Search/Compensating Differential Model of the Labor Market, Taber and Vejlin (2020)
• Understanding the Heterogeneity of Intergenerational Mobility across Neighborhoods: A Case Study of Denmark, Cholli, Durlauf, Heckman and Landersø (2022)
• Robot Adoption and Labor Market Dynamics by Humlum (2019)
• Notes on “Assignment Problems and the Location of Economic Activities” by Koopmans and Beckmann
• Interpreting Personality Measurement by Heckman and Galaty (2022)
• Supply of Personality Traits
  1. [handout to be made–where is the source for this?]
• 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.
• Barth, Daniel, Nicholas W. Papageorge, and Kevin Thom. (2020). “Genetic Endowments and Wealth Inequality.” Journal of Political Economy, 128(4):1474-1522.
• Social Science Methods for Twins Data… by Kohler, Behrman, and Schnittker (2011)
• Changes in Assortative Matching: Theory and Evidence for the US Pierre-André Chiappori, Mónica Costa-Dias, Costas Meghir
• 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.
  • [handout to be made]
• 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.
  • [handout to be made]
• Dynamic Microeconomic Models of Fertility Choice: A Survey, Arroyo and Zhang (1997)
• Fertility and the Economy, Becker (1992)
• A model of intergenerational mobility variation over time and place. Solon (2004).
• Models for Social Mobility and Skill Formation
• A Theory of Intergenerational Mobility. Becker, Kominers, Murphy, and Spenkuch. (2018).
• Social Mobility Within and Between Generations
• Garcia and Heckman Annual Review 2022
  • [handout to be made]
• 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.
  • [handout to be made]
• How Bargaining in Marriage Drives Marriage Market Equilibrium, Pollak (2019)
• Career and Family Decisions: Cohorts Born 1935-1975, Eckstein, Keane, and Lifshitz (2019)
• What Accounts for the Racial Gap in Time Allocation and Intergenerational Transmission of Human Capital? by Gayle, Golan, and Soytas (2022)
• Labor Supply
• Notes on Frisch Demands
• Ordering Marshallian, Hicks, Frisch Responses to a Price Change
• Modeling the Income Process, Extract from Meghir and Pistaferri (2011)
• The Rising Return to Non-Cognitive Skill  by Edin, Fredriksson, Nybom, Ockert
• Labor Supply and Taxes: A Survey, Keane (2011)
• Lifecycle Labor Supply: The Intertemporal Substitution Hypothesis (ISH) and the “λ Constant” Functions
• Genetics and Economics: Models, Methods and Findings by Ronda (2022)
• Some Contributions of Economics to the Study of Personality by Heckman, Jagelka, Kautz (2019)
• Welfare State Disincentives with Endogenous Habits and Norms, Lindbeck (1995b)
• Hazardous Welfare State Dynamics, Lindbeck (1995a)
• Eshaghnia, Sadegh, James J. Heckman, and Goya Razavi. (2022). “The Willingness to Pay for School Quality, Neighborhood Attributes, and Later Life Outcomes,” Unpublished manuscript, The University of Chicago, Center for the Economics of Human Development.
  • [handout to be made]
• Neighborhood Feedback, Endogenous Stratification, and Income Inequality, Durlauf (1996)
• The Effects of Exposure to Better Neighborhoods on Children’s Long-Term Outcomes, Chetty, Hendren, Katz [handout from 2018]
• Race and Economic Opportunity in the United States: an Intergenerational Perspective, Chetty, Hendren, Jones, Porter (2020)

2022 Notes

Lecture I, March 30, 2022

1. Overview and Plan of the Course
2. Reading List , Slides, Problem Set 1
3. Inequality in What? Income Measures and Wage Measures
4. Guest Lectures, Thomas Coleman
   • Three Narratives on Income Inequality: Importance of Good Data Analysis, Methodology, and Theory
5. Role of Taxes and Transfers in Post Tax-Transfer Outcomes
6. The Distribution of Household Income, 2018, Congressional Budget Office, 2021