Search Results
Working Paper
Cross-border Patenting, Globalization, and Development
We build a quantitative model that captures the relationships between cross-border patenting, globalization, and development. Our theory delivers a ‘structural gravity’ equation for cross-border patents. To test the model’s predictions, we compile a new dataset that tracks patents within and between countries and industries over time. The econometric analysis reveals a strong, positive impact of policy and globalization on cross-border patent flows between 1995 and 2018, especially from North to South. A counterfactual analysis shows these North-to-South flows benefited both regions, ...
Working Paper
Digital Adoption, Automation, and Labor Markets in Developing and Emerging Economies
We document a strong negative link between self-employment and the rate of digital adoption by firms in developing and emerging economies. No link between digital adoption and the unemployment rate is found, however. To explain this evidence, we build a general equilibrium search-and-matching model with endogenous labor force participation, self-employment, endogenous firm entry, and information-and-communications technology adoption. The main finding is that changes in the cost of technology adoption per se cannot rationalize the evidence. Instead, changes in firms' barriers to entry ...
Working Paper
Industrial Composition and Intergenerational Mobility
Using the National Longitudinal Surveys of Youth (NLSY), this article examines the influence of a region’s industrial composition on the educational attainment of children raised by parents who do not have college degrees. The NLSY’s geo-coded panel allows for precise measurements of the local industries that shaped the parents’ employment opportunities and the labor market that the children directly observed. For cohorts finishing school in the 1990s and early 2000s, concentrations of manufacturing are positively associated with both high school and college attainment. Concentrations ...
Working Paper
Cross-border Patenting and the Margins of International Trade
This paper investigates the impact of cross-border patenting on the margins of international trade using disaggregated data on international patenting and trade flows. We develop a theoretical framework of trade and firms' patenting decisions that motivates our empirical analysis. The main results reveal that cross-border patenting has a larger effect on the extensive margin of trade compared to the intensive margin. This finding suggests that firms tend to seek patent protection in international markets prior to entering those markets with new products, rather than with their existing ...
Working Paper
Minimum wages and firm employment: evidence from China
This paper studies how minimum wage policies affect firm employment in China using a unique county level minimum wage data set matched to disaggregated firm survey data. We investigate both the effect of imposing a minimum wage, and the effect of the policies that tightened enforcement in 2004. We find that the average effect of minimum wage changes is modest and positive, and that there is a detectable effect after enforcement reform. Firms have heterogeneous responses to minimum wage changes which can be accounted for by differences in their wage levels and profit margins: firms with high ...
Working Paper
Renewable Technology Adoption Costs and Economic Growth
We develop a dynamic general equilibrium integrated assessment model that incorporates costs due to new technology adoption in renewable energy as well as externalities associated with carbon emissions and renewable technology spillovers. We use world economy data to calibrate our model and investigate the effects of the technology adoption channel on renewable energy adoption and on the optimal energy transition. Our calibrated model implies several interesting connections between technology adoption costs, the two externalities, policy, and welfare. We investigate the relative effectiveness ...
Working Paper
The Expansion of Varieties in the New Age of Advertising
The last decades have seen large improvements in digital advertising technology that allowed firms to better target specific consumer tastes. This research studies the relationship among digital advertising, the rise of varieties, and economic welfare. We develop a model of advertising and varieties where firms choose the intensity of digital ads directed at specific consumers as well as traditional ads that are undirected. The calibrated model shows that improvements in digital advertising have driven the rise in varieties over time. Empirical evidence is presented using detailed micro data ...
Working Paper
Learning, Prices, and Firm Dynamics
We document new facts about the evolution of firm performance and prices in international markets, and propose a theory of firm dynamics emphasizing the interaction between learning about demand and quality choice to explain the observed patterns. Using data from the Portuguese manufacturing sector, we find that: (1) firms with longer spells of activity in export destinations tend to ship larger quantities at lower prices; (2) older exporters tend to use more expensive inputs; (3) revenue growth within destinations (conditional on initial size) tends to decline with market experience; and (4) ...
Working Paper
Cross-border Patenting and the Margins of International Trade
This paper investigates the impact of cross-border patenting on the margins of international trade using disaggregated data on international patenting and trade flows. We develop a theoretical framework of trade and firms' patenting decisions that motivates our empirical analysis. The main results reveal that cross-border patenting has a larger effect on the extensive margin of trade compared to the intensive margin. This finding suggests that firms tend to seek patent protection in international markets prior to entering those markets with new products, rather than with their existing ...
Working Paper
Industrial Composition and Intergenerational Mobility
For five decades, the share of adults employed in college-degree-intensive industries, such as health care and education, has been rising. Industries that provided employment for workers without degrees, especially manufacturing, have been reducing their payrolls. This economic transition could impact the probability of children obtaining higher levels of education than their parents achieved. In this analysis, measures of the local industrial composition from the Current Population Survey are merged with the National Longitudinal Surveys of Youth using the confidential geo-coded records. ...