Job Market Paper
The Effect of Relaxation in Labor Laws on Youth Employment: Evidence from Wisconsin, with Xiaoyin Li
This study examines the effect of loosening labor laws on employment of youth aged 16 and 17 in Wisconsin. We apply the synthetic control method (SCM) to American Community Survey (ACS) data to identify the causal relationship between the relaxation of labor laws and youth labor market outcomes. We find that the relaxation has a positive impact on the extensive margin of the youth labor supply, while it has little effect on the intensive margin. The empirical results also suggest that relaxation in labor laws has a heterogeneous impact on subsamples stratified by gender, race, and income quartiles in the household.
A draft is available here.
This study examines the effect of loosening labor laws on employment of youth aged 16 and 17 in Wisconsin. We apply the synthetic control method (SCM) to American Community Survey (ACS) data to identify the causal relationship between the relaxation of labor laws and youth labor market outcomes. We find that the relaxation has a positive impact on the extensive margin of the youth labor supply, while it has little effect on the intensive margin. The empirical results also suggest that relaxation in labor laws has a heterogeneous impact on subsamples stratified by gender, race, and income quartiles in the household.
A draft is available here.
Publications
Does Education Enhance Entrepreneurship?, with John V. Winters
Forthcoming at Small Business Economics [pre-publication version]
Formal education is correlated with entrepreneurial activity and success, but correlation does not indicate causation. Education and entrepreneurship are both influenced by other related factors. The current study estimates the causal effects of formal education on entrepreneurship outcomes by instrumenting for an individual’s years of schooling using cohort mean years of maternal schooling observed decades prior. We differentiate self-employment by industry employment growth and firm incorporation status. Policymakers are especially interested in entrepreneurship with the potential to create substantial employment growth. We find that an additional year of schooling increases self-employment in high-growth industries by 1.12 percentage points for women and by 0.88 percentage points for men. Education reduces the probability of male self-employment in shrinking industries. Education also increases incorporated self-employment for women and men and reduces unincorporated self-employment among men but not women. The overall probability of self-employment increases with education for women but is unaffected by education for men. The results suggest that formal education enhances entrepreneurship.
Forthcoming at Small Business Economics [pre-publication version]
Formal education is correlated with entrepreneurial activity and success, but correlation does not indicate causation. Education and entrepreneurship are both influenced by other related factors. The current study estimates the causal effects of formal education on entrepreneurship outcomes by instrumenting for an individual’s years of schooling using cohort mean years of maternal schooling observed decades prior. We differentiate self-employment by industry employment growth and firm incorporation status. Policymakers are especially interested in entrepreneurship with the potential to create substantial employment growth. We find that an additional year of schooling increases self-employment in high-growth industries by 1.12 percentage points for women and by 0.88 percentage points for men. Education reduces the probability of male self-employment in shrinking industries. Education also increases incorporated self-employment for women and men and reduces unincorporated self-employment among men but not women. The overall probability of self-employment increases with education for women but is unaffected by education for men. The results suggest that formal education enhances entrepreneurship.
Working Papers
Causal Effects of Education on Marriage, with John V. Winters
Many nations have experienced both rising education levels and declining marriage rates in recent decades. However, cross-sectional comparisons within countries often indicate that more highly educated individuals are more likely to be married. Economic theory suggests ambiguous causal effects of education on marriage rates. We use individual-level data from the American Community Survey combined with cohort-level maternal education data from prior decennial censuses to estimate causal effects of education on marriage outcomes via two-stage least squares regression. We find that formal education significantly decreases the probability of being married for younger persons but not for older persons. However, education does significantly increase the probability of never marrying even by ages 45-54. We also provide some evidence that education reduces the likelihood of being divorced or separated, which partially offsets effects on the probability of being never married in overall marriage rates.
“Employment Opportunities and High School Completion during the COVID-19 Recession”, with Jun Yeong Lee and John V. Winters,
COVID-19 created major disruptions for young people including health concerns, school closures, reduced social opportunities, and a wilting economy. We examine the effect of COVID-19 on high school completion in the United States. We find that high school completion rates increased considerably in 2020 compared to previous years. We investigate various mechanisms and find that worse employment conditions were the driving force. The lower opportunity costs of schooling because of the pandemic recession encouraged more young people to complete high school. The pandemic created extensive problems in education, but fortunately it did not reduce overall high school completion rates.
Many nations have experienced both rising education levels and declining marriage rates in recent decades. However, cross-sectional comparisons within countries often indicate that more highly educated individuals are more likely to be married. Economic theory suggests ambiguous causal effects of education on marriage rates. We use individual-level data from the American Community Survey combined with cohort-level maternal education data from prior decennial censuses to estimate causal effects of education on marriage outcomes via two-stage least squares regression. We find that formal education significantly decreases the probability of being married for younger persons but not for older persons. However, education does significantly increase the probability of never marrying even by ages 45-54. We also provide some evidence that education reduces the likelihood of being divorced or separated, which partially offsets effects on the probability of being never married in overall marriage rates.
“Employment Opportunities and High School Completion during the COVID-19 Recession”, with Jun Yeong Lee and John V. Winters,
COVID-19 created major disruptions for young people including health concerns, school closures, reduced social opportunities, and a wilting economy. We examine the effect of COVID-19 on high school completion in the United States. We find that high school completion rates increased considerably in 2020 compared to previous years. We investigate various mechanisms and find that worse employment conditions were the driving force. The lower opportunity costs of schooling because of the pandemic recession encouraged more young people to complete high school. The pandemic created extensive problems in education, but fortunately it did not reduce overall high school completion rates.
Work in progress
“Assortative Mating and College Wage Premium”
“The Effect of Student Loans on Job Switching”
“Unilateral Divorce Law, Returns to Education, and Gains from Marriage”
“The Effect of Student Loans on Job Switching”
“Unilateral Divorce Law, Returns to Education, and Gains from Marriage”
