Research

Quota vs. Quality? Long-Term Gains from an Unusual Gender Quota

joint with Ville Mankki (CESifo Working Paper No. 9811)

Revise & Resubmit (2nd round) at American Economic Review

We evaluate equity-efficiency trade-offs from admissions quotas by examining effects on output once beneficiaries start producing in the relevant industry. In particular, we document the impact of abolishing a 40% quota for male primary school teachers on their pupils’ long-run outcomes. The quota had advantaged academically lower-scoring male university applicants, and its removal cut the share of men among new teachers by half. We combine this reform with the timing of union-mandated teacher retirements to isolate quasi-random variation in the local share of male quota teachers. Using comprehensive register data, we find that pupils exposed to a higher share of male quota teachers during primary school transition more smoothly to post-compulsory education and have higher educational attainment and labor force attachment at age 25. Pupils of both genders benefit similarly from exposure to male quota teachers. Evidence suggests that the quota improved the allocation of talent by mending imperfections in the unconstrained selection process.

Press coverage: The Economist: Quotas on it

Distinguished CESifo Affiliate Award , Labor Economics

(Not) Thinking about the Future: Inattention and Maternal Labor Supply

joint with Ana Costa-Ramón, Michaela Slotwinski, and Anne Brenøe (AEA RCT Registry 0010399)

Reject & Resubmit at Quarterly Journal of Economics

The “child penalty” significantly reduces women’s lifetime earnings and pension savings, but it remains unclear whether these gaps are the deliberate result of forward-looking decisions. This paper provides novel evidence on the role of information constraints in mothers’ labor supply decisions. We first document descriptively that mothers are largely inattentive to the long-term financial consequences of reduced hours. In a large-scale field experiment that combines rich survey and administrative data, we then provide mothers with objective, individualized information about the long-run costs of reduced labor supply. The treatment increases demand for financial information and future labor supply plans, in particular among women who underestimate the long-term costs. Leveraging linked employer administrative data one year post-intervention, we observe that mothers who underestimate the long-term costs increase their labor supply by 6 percent over the mean

Press coverage: Soziale Sicherheit

Mothers’ Labor Force Participation and the Availability of Part-Time Jobs

joint with Andrea Hofer and Andreas Beerli

How do the characteristics of jobs in the labor market shape mothers’ participation in the workforce? In this paper, we show that mothers’ labor force participation declines following a labor market shock that reduces the availability of part-time jobs, while men and women without children remain unaffected. We examine an immigration reform that markedly increased the supply of full-time workers in a pre-defined set of border localities in Switzerland. Using social security registers and business census data covering the universe of establishments in a difference-in-differences design, we show that the reform leads to a drop in mothers’ labor force participation by 3.2 percentage points. We provide evidence that mothers’ drop-out is primarily driven by changes in the structure of local labor markets with firms reducing their demand for part-time workers following the reform. The main channel of competition with immigrant labor in our setting thus manifests itself through the number of hours that workers are willing to supply. Our results are consistent with low hours constituting a job-specific amenity that may be costly for firms to provide.

The Long Run Effects of Funding for Public Education

joint with Cory Smith

Public education is attributed a key role in the development of modern economies. In this paper, we trace out both the immediate and long run effects of investment in human capital through funding for local public schools. We leverage a natural experiment in Illinois that endowed survey townships at the beginning of settlement with a fixed plot of land (Section 16) to finance expenditures for local schools. By exploiting the granular spatial distribution of a particularly undesirable land feature, frequent flooding, we isolate exogenous variation in township schooling endowments while keeping overall township resource endowments fixed. We first document that conditional on overall flooding propensity in a township, relatively more flooding on Section 16 has a negative impact on both township schooling expenditures and school endowments by 1858. Linking residents from full count Census data from 1860 – 1940 to their townships of residence and across Census years, we find that “school-poor” townships quickly and persistently fall behind: They experience lower population growth and the occupation transformation away from a mostly agriculturally oriented local economy proceeds more slowly. We show that these effects are partly driven by school poor townships being unable to attract settlers moving to Illinois from within the United States, and by suffering brain drain from younger generations.

Work in progress:

Divorce, Investment in the Labor Market and Household Income Pooling (RCT)

joint with Ana Costa-Ramón, Michaela Slotwinski, and Johannes Stupperich (Baseline and Follow Up completed. AEA RCT Registry 0012494)

We document several stylized facts about divorce perceptions and household specialization: First, women are over-optimistic about their own divorce likelihood and over-estimate claims to their partner’s income post-divorce, suggesting that current specialization patterns are not optimal. Second, lower own divorce expectations correlate with lower career aspirations. Third, women who have been exposed to divorce and its financial implications in their close environment are better informed and specialize less in home production. Based on these insights, we develop a testimonial intervention that emulates learning from a divorce experience and measure its impact on household bargaining and career investment.