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Working Paper
Markets, Externalities, and the Dynamic Gains of Openness
Inflows of foreign knowledge are the key for developing countries to catch up with the world technology frontier. In this paper, I construct a simple tractable model to analyze (a) the incentives of foreign firms to bring their know-how to a developing country and (b) the incentives of domestic firms to invest in their own know-how, given the exposure to foreign ideas and competition. The model embeds two diffusion mechanisms typically considered separately in the literature: externalities and markets. The dynamic gains of openness can be substantial under either mechanism, but their relative ...
Report
Preference for the workplace, investment in human capital, and gender
We use a hypothetical choice methodology to estimate preferences for workplace attributes and quantify how much these preferences influence pre-labor-market human capital investments. This method robustly identifies preferences for various job attributes, free from omitted variable bias and free from considering the equilibrium job match. Women on average have a higher willingness to pay (WTP) for jobs with greater work flexibility and job stability, and men have a higher WTP for jobs with higher earnings growth. These job preferences relate to college major choices and actual job choices, ...
Working Paper
The Gender Pay Gap: Micro Sources and Macro Consequences
Using linked employer-employee data from Brazil, we document a large gender pay gap due to women working at lower-paying employers with better amenities. To interpret these facts, we develop an equilibrium search model with endogenous firm pay, amenities, and employment. We provide a constructive proof of identification of all model parameters. The estimated model suggests that amenities are important for men and women, that compensating differentials explain half of the gender pay gap, and that there are significant output and welfare gains from eliminating gender differences. However, ...