Eventos pasados | Universidad de los Andes

Seminario CEDE - Víctor González-Jiménez

This paper shows that well-established biases in decision making under uncertainty generate poverty traps. A theoretical framework is developed to show that: i) probability weighting and ambiguity attitudes can lead individuals to systematically undervalue profitable investments, and ii) poverty exacerbates the consequences of these investment errors. The model predicts that poverty persists because these biases disproportionately discourage investment among poor individuals, while rich individuals continue to invest regardless. These theoretical predictions are validated using data from two experiments conducted on representative samples of American households.

12:30 pm

Universidad de los Andes

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Seminario CEDE - Danilo Aristizabal

There is a close relationship between poverty and social and labor exclusion. I evaluated two ALMPs that targeted people who have difficulties in finding a formal job in a developing country. First, I analyze the effect of a training component of a labor intermediation policy (LIP) called Boost to Employment (BE) on the probability of finding a formal job for vulnerable job seekers in a developing country. I exploit the variation in the leniency among labor counselors as an instrument to approximate the probability that job seekers receive the training component. I also test which courses are the ones that helped job seekers to find formal jobs. I find that those workers who received the training component increased the probability of working in the formal sector by 21 percentage points one year after the implementation of the program compared to those workers who did not. The formal job benefits course seems to be driving my results. Second, I study the effect on labor market outcomes of a payroll tax cut for new hires of young workers under the age of 28 in an economy with a high binding minimum wage. I use exposure to wage rigidities to identify the effect. I measure an individual's exposure to wage rigidities as the gap between the median salary, in the city in which the individual lives, and the minimum wage set at the national level. I use a difference-in-difference model. I find that the effect of a payroll tax cut is asymmetric for youth who face labor markets with a binding minimum wage and those who do not.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Nicole Fleskes

This paper studies how dealers provide liquidity in over-the-counter (OTC) markets during an acute crisis when they can choose their capacity: how fast they can execute orders and their inventories. I develop a search model of an OTC market in which trade between homogeneous dealers is centralized, but trade with investors is subject to search frictions proportional to dealer order execution rates. Dealers have positive bargaining power and charge intermediation fees to investors: dealers face a trade-off when choosing their capacity between their income from intermediation fees and capital gains, and the flow costs of their order execution rate and inventories. The model features a one time aggregate adverse liquidity shock to investors' private valuations. The more severe the liquidity shock, the lower the order execution rate dealers choose and the longer they wait to begin taking on inventories. Compared to a constrained planner, the existence of dealer bargaining power results in a double-sided hold-up problem that can be resolved in the steady state in a knife-edge case, but not out of the steady state following an aggregate liquidity shock. A calibration to the U.S. secondary corporate bond markets suggests that inefficiencies in dealer capacity results in larger welfare losses following a shock compared to the steady state.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Brigitte Castañeda

Do the macroeconomic effect of a carbon tax differ between countries, according to the primary energy source? I answer this question with a theoretical model of directed technical change and test empirically the main results. I find four main results: (i) In the absence of subsidies, carbon taxes have a negative effect on economic growth, (ii) this negative effect is a decreasing function of the proportion of clean energy sources. (iii) subsidies for clean inputs have a positive effect on economic growth, and (iv) the magnitude of this effect grows with the proportion of clean energy sources. The empirical results are consistent with the predictions of the theoretical model and suggest that policymakers could consider this relationship between the energy mix and the economic effect of a carbon tax when creating environmental regulations.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Juliana Jaramillo Echeverri

Can radio campaigns affect fertility? This paper examines the impact of a national radio campaign promoting family planning clinics in late 1960s Colombia on the country's rapid fertility decline. The campaign, initiated by Profamilia in 1969, provided information about the location of clinics without providing detailed contraceptive information. Using data from the full count 1973 census and information on clinic locations and radio programs, the study leverages exogenous variation in radio signal strength to estimate the campaign's effect on fertility. I follow a difference-in-differences strategy to compare fertility before and after the start of the radio campaign at the individual level. The findings indicate that the radio campaign reduced between 4% to 14% the probability of having a child one year after the campaign. The effects are stronger for women living close to a Profamilia clinic. However, by 1973 motherhood was still almost universal. This research contributes to the understanding of the effects of family planning programs and media exposure on fertility decline, highlighting the role of media in overcoming geographical barriers and driving social change.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Paul Soto

This paper examines the link between industrial production and the sentiment expressed in natural language survey responses from U.S. manufacturing firms. We compare several natural language processing (NLP) techniques for classifying sentiment, ranging from dictionary-based methods to modern deep learning methods. Using a manually labeled sample as ground truth, we find that deep learning models--partially trained on a human-labeled sample of our data--outperform other methods for classifying the sentiment of survey responses. Further, we capitalize on the panel nature of the data to train models which predict firm-level production using lagged firm-level text. This allows us to leverage a large sample of "naturally occurring" labels with no manual input. We then assess the extent to which each sentiment measure, aggregated to monthly time series, can serve as a useful statistical indicator and forecast industrial production. Our results suggest that the text responses provide information beyond the available numerical data from the same survey and improve out-of-sample forecasting; deep learning methods and the use of naturally occurring labels seem especially useful for forecasting. We also explore what drives the predictions made by the deep learning models, and find that a relatively small number of words--associated with very positive/negative sentiment--account for much of the variation in the aggregate sentiment index.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Guido Alfani

Recent research in economic history has unearthed previously unknown facts about the long-term trends in inequality. We now have, for at least some areas of Europe, continuous time series of key inequality indicators from ca. 1300. Most of these series have resulted from the research conducted by the ERC-funded project EINITE Economic Inequality across Italy and Europe 1300-1800 and by its follow-up project, SMITE Social Mobility and Inequality across Italy and Europe 1300-1800. These new data are changing the way in which we perceive economic inequality not only in the past, but even today as a key lesson from history, is that economic inequality (especially, but not only, of wealth) has a marked tendency for increasing over time, and only catastrophes on the scale of the Black Death or the World Wars managed to bring it down, albeit temporarily. Additionally, the new historical evidence is also relevant to the debate about the long-term determinants of inequality growth. This seems to be independent, to a large degree at least, from economic growth. Other factors seem to have played a crucial role, including institutional factors and in particular (in the early modern period) the rise of the fiscal-military state. The seminar will provide an overview of recent research on inequality in preindustrial Europe, with a particular focus on some areas on which research is currently ongoing, in particular the southern Italian regions of Apulia and Sicily.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Kirill Borusyak

We examine how to interpret estimates from a commonly used migration regression relating changes in local population to exogenous local labor demand shocks. Using a simple model of local labor markets with mobility costs, we find that most conclusions drawn from migration regression estimates are likely to be substantially misleading. Intuitively, the conventional migration regression is misspecified due to the bilateral nature of location choices. Workers choose where to live based not only on the shock to their current location, but also on the shocks to potential alternative locations, which are omitted from the regression. Analytical results and simulations based on Brazilian data show that conventional migration regression estimates are inaccurate for the local population effects of either shocks to individual locations or all observed shocks taken together and often substantially understate the amount of worker reallocation driven by observed shocks. These problems are particularly acute when workers face industry switching costs in addition to geographic mobility costs. Simple alternative approaches leveraging the models structure exhibit far better performance.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Diego Ramos

We examine perceptions of the history of race in the United States and its impact on present-day political polarization. Based on survey data from 14,044 US respondents, we examine historical narratives surrounding key racial events among both white and Black individuals. Our analysis unveils notable discrepancies in beliefs regarding the causes of the Civil War, the achievements of the Civil Rights Movement, and the enduring legacy of slavery on Black Americans today. Ideological divisions in historical interpretations, particularly among white respondents, emerge prominently, while differences across race and generation are less pronounced. Moreover, we investigate the political ramifications of these historical viewpoints through two experimental interventions. Participants were randomly prompted to contemplate their own perspectives on these issues and to confront the views of others. The results of our experiments indicate that historical narratives about race can exacerbate polarization in institutional satisfaction. Liberals exhibit heightened pessimism and dissatisfaction with the current institutional framework as a result of the treatments, while conservatives remain largely unaffected. This study underscores the significance of understanding the origins and repercussions of historical accounts concerning intergroup tensions, which may contribute to contemporary political divisions.

12:30 pm

Universidad de los Andes