Journal of Health Economics, Volume 80, December 2021, 102538
Abstract: Recent research in the U.S. links trade-induced job displacement to deaths of despair. Should we expect the same mortality response in developing countries? This paper analyzes the effect of a trade-induced negative shock to manufacturing employment on leading causes of mortality in Mexico between 1998 and 2013. I exploit cross-municipality variation in trade exposure based on differences in industry specialization before China's accession to the WTO in 2001 to identify labor-demand shocks that are concentrated in manufacturing. I find trade-induced job loss increased mortality from diabetes, raised obesity rates, reduced physical activity, and lowered access to health insurance. These deaths were offset by declines in mortality from ischemic heart disease and chronic pulmonary disease. These findings highlight that negative employment shocks have heterogeneous impacts on mortality in developing countries, where falling incomes lead to less access to health care and nutritious food, but also reduce alcohol and tobacco use.
World Bank Economic Review, Volume 37, Issue 2, May 2023
Abstract: This paper examines the effect of trade-induced changes in Mexican labor demand on population growth and migration responses at the local level. It exploits cross-municipality variation in exposure to a change in trade policy between the U.S. and China that eliminated potential tariff increases on Chinese imports, negatively affecting Mexican manufacturing exports to the U.S.. Municipalities more exposed to the policy change, via their industry structure, experienced greater employment loss. In the five years following the change in trade policy, more exposed municipalities experience increased population growth, driven by declines in out-migration. Conversely, six to ten years after the change in trade policy, exposure to increased trade competition is associated with decreased population growth, driven by declines in in-migration and return migration rates, and increased out-migration. The sluggish regional adjustment is consistent with high moving costs and transitions across sectors in the short term.
Flexible Wages and the Costs of Job Displacement (with Ilan Tojerow) [New draft, February 2023]
Abstract: This paper investigates whether flexible pay increases the wage costs of job displacement. We use quasi-exogenous variation in the timing of job loss due to mass layoffs spanning over an institutional reform that restricted single-employer bargaining, the Belgian Wage Norm in 1996. We find that average earnings losses over a ten-year period after displacement are 10 percentage points larger under flexible pay. Workers displaced from jobs with higher employer-specific wage premium—service sector and white-collar—benefit the most from restricted single-employer bargaining as their earnings fully converge to non-displaced workers' earnings within three years. We show that the differences in earnings losses across wage-setting systems are not driven by fluctuations in the business cycle. Our results suggest that reduced pay flexibility may help displaced workers catch up faster to non-displaced workers' pay premium ladder conditional on re-employment.
[IZA Discussion Paper No. 14942, December 2021]
Abstract: This paper studies the effect of e-commerce on local labor markets. We exploit cross-market variation in e-commerce price advantage stemming from the enactment of the Amazon Tax—state-level legislation that mandates state sales taxes collection to out-of-state online retailers. Introducing out-of-state sales taxes lowered employment and reduced wages in transportation and warehousing, industries complementary to e-commerce. Within the in-state retail sector, the decline in brick-and-mortar employment is somewhat offset by an increase in employment in warehouse clubs and supercenters. Our results are consistent with a general equilibrium model in which consumers substitute e-commerce for big-box purchases, crowding out brick-and-mortar retail.
[IZA Discussion Paper No. 16345, July 2023]
Selected Work in Progress
Exports, Quality, and Product Differentiation: Evidence from Argentine Manufacturing Firms
Abstract: This paper explores the relationship between quality adoption, product differentiation, and export performance. Through tax identification numbers, I match firm-level survey data to administrative customs records containing information about each firm’s total value of exports by product type and country of destination. I classify products into differentiated and non-differentiated, and I use ISO 9001 certification as proxy for firms' ability to produce high quality products. First, I show that firm-product-destination-year unit values are higher for high-quality firms on average. Second, using the 2002 Argentine exchange rate devaluation as a source of variation in export demand, I find that initially high-quality firms increased total export value, export value of differentiated goods to high-income destinations, and investments in R&D more than low-quality firms after the devaluation. These results imply that policies promoting quality adoption may increase firms’ exports to high-income markets and help develop a comparative advantage in differentiated products.