Eventos pasados | Universidad de los Andes

Seminario CEDE - Paula Beltran

In this paper, I study the transmission of an aggregate funding supply shock in a lending network and quantitatively assess the implications for the allocative efficiency of funding pro-vision of the US Money Markets Funds Industry. I build a tractable model that features bank sand funds that bargain over the terms of trade subject to an incomplete network of existing counter parties and bilateral bargaining. I discipline the model using data on the funds port-folio. I show how to identify the key parameters of the model by exploiting granular shocks of connected agents. Taking as primitives the observed changes in assets under the management of prime funds at the onset of the COVID-19 crisis, the model accounts for 85% of the drop in total lending and 70% of the increase in price dispersion. I show that the allocation is inefficient. Faced with the same drop in asset under management and taking as given the network of bilateral counterparties, a central planner would reduce lending by 9% instead of 14% in equilibrium. Finally, I use the model to examine the effectiveness of the Overnight Repo Repurchase Facility.

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Seminario CEDE - Dario Romero

This paper studies how changes in access to international markets affect the direction of technical change. I use two historical trade shocks that transformed markets for the Spanish textile industry at the end of the 19th century, along with newly digitized data on textile patents and production in Spain. First, after Spain effectively forced its colonies to buy manufactured cotton goods in 1891, I document an increase in cotton textile innovation relative to other fabrics. Second, after the Spanish-American war and the unexpected loss of these captive markets, I find that innovation in cotton textiles changed towards new weaving patents relative to other parts of the cotton textile production process such as threading. After 1898, cotton industrialists entered and competed in international markets where more sophisticated fabrics were in demand. Using novel archive data from a big cotton firm, I provide price and quantity-based evidence of the strength of each type of technical change. Finally, I show that these new incentives to innovation translated directly into adopting new mechanized tools in the sector. I find evidence of an expansion in industrial technology due to an increase in mechanized cotton looms used in Spain after 1900. Together, these results provide some of the first causal evidence on how international trade shapes the direction of the technical change. Although each shock meant access to new markets for Spanish cotton textiles, their effect on innovation varied because the composition of textile demand was different.

12:30 pm

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Seminario CEDE - José Gallegos

A vast literature has documented that US inflation persistence has fallen in recent decades. However, this empirical finding is difficult to explain in monetary models. Using survey data on inflation expectations, I document a positive co-movement between ex-ante average forecast errors and forecast revisions (suggesting forecast sluggishness) from 1968 to 1984, but no co-movement afterwards. I extend the New Keynesian (NK) setting with noisy and dispersed information about the aggregate state, and show that inflation is more persistent in periods of greater forecast sluggishness. My results show that the change in firm forecasting behavior, documented in survey data, explains around 90% of the fall in inflation persistence since the mid 1980s. I also find that the disconnect between inflation and the real side of the economy in recent decades can be explained by the change in information frictions. Contrary to the literature which has emphasized a flattening of the NK Phillips curve in recent data, I do not find any evidence of the change in the structural slope of the Phillips curve once I control for the change in information frictions.

12:30 pm

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Seminario CEDE - Tatiana Velasco Rodríguez

How does the desegregation of elite schools impact academic achievement? And does desegregation affect students' interactions with different types of peers within their school? In this paper, I study a natural experiment at an elite university in Colombia where the number of low-income students tripled as a result of the introduction of the financial aid program Ser Pilo Paga. The average increase in the percentage of low income peers -9.5 percentage points- had modest to null impacts on wealthy students' academic performance. I shed light on the mechanisms behind this lack of peer effects by studying changes in social interactions using data on students' co-movements across campus captured by turnstiles located at all entrances. Desegregation led to increased connections between wealthy and low-income students. At least half of the increase in interactions between wealthy and low-income students, however, is explained by interactions of wealthy students with low-income but high-achieving students. These results suggest students diversify their interactions primarily among students with similar academic achievement levels. Ver documento

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Seminario CEDE - Juan Felipe Riaño

This paper provides the first systematic empirical examination of bureaucratic nepotism and anti-nepotism legislation in an entire modern bureaucracy. By linking confidential information on family ties and administrative employer-employee records for the universe of civil servants in Colombia, I uncover three sets of empirical findings. First, using a novel methodology of family network reconstruction, I provide evidence on the pervasiveness of close family connections in the public administration and demonstrate its negative relationship with the performance of public sector agencies. Second, by further exploiting within-bureaucrat variation in family connections generated by the turnover of top non-elected bureaucrats, I show that family connections to public sector managers and advisors distort the allocation and compensation of workers at lower levels of the hierarchy. Connected bureaucrats receive higher salaries and are more likely to be hierarchically promoted but are negatively selected in terms of public sector experience, education, and records of misconduct. Third, I evaluate an anti-nepotism legislation reform by exploiting a sharp discontinuity in the set of family connections restricted by this law. I prove the limited effectiveness of this reform and show how bureaucrats strategically responded to this policy change by substituting margins of favoritism and reshuffling posts within the public administration.

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Seminario CEDE - Arlen Guarin

Can reparations for victims of human rights violations help rebuild lives? We estimate the effects of reparations across the life cycle, leveraging variation induced by Colombias program for victims of the internal armed conflict. The reparations consist of large one-off, lump-sum payments of up to 10,000 USD (PPP 26,000 USD) and represent, on average, three times recipients annual household income. We link comprehensive national administrative panel microdata and measure numerous individual- and household-level outcomes, including work and living standards, health care utilization, and intergenerational impacts on victims children. We exploit the staggered rollout of reparation payouts and the unexpected timing of their receipt using event study approaches and document three main sets of results. First, reparations cause an immediate decrease in the probability of formal employment driven by shifts out of low-pay, high-risk, salaried jobs. Three years after receipt, victims have higher wages and are more likely to own an active business. Second, reparations cause an economically meaningful decrease in health care utilization, consistent with improved health thanks to better working and living conditions. Third, reparations increase high school test scores and college attendance rates of victims children. We conclude that the large transfers of money provided by reparations allow households to make fundamental investments, narrow the gaps formed due to conflict, and appear to be an effective policy tool to promote recovery and development.

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Seminario CEDE - José Morales-Arilla

Do autocrats favor their supporters during economic shocks? I introduce a model of redistribution and regime stability that shows how in-group favors can be a strategic response to economic downturns. The model predicts that, as economic shocks worsen, autocrats may favor their supporters and confront opposition protests to save on appeasement costs. I test the model's main results in two empirical settings. First, I focus on the Venezuelan blackouts of 2019. Consistent with the model, the Maduro regime was more likely to exempt regime-supporting regions affected by the blackout from later power rationing. Moreover, blackout-induced protests were limited to opposition-leaning regions. I then focus on negative rainfall shocks in Sub-Saharan Africa. Droughts magnify differences in development, protests and state-coercion outcomes in favor of leaders' home regions.

11:00 am

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Seminario CEDE - Rodrigo Rodimiro

Major technological changes have come with an adjustment period of stagnant productivity before the economy operates at its full potential. The mechanism of this adoption process is still not well understood. Using event studies, I document that productivity increases with a five-year lag after the adoption of industrial robots in Brazilian local labor markets. Combining employer-employee matched data with a novel measure of robot adoption, I provide first evidence of establishment-level labor reorganization and organizational capital depreciation induced by the automation process. During the five years after adoption, labor switching across occupations increases within firms, moving from production to support activities. I show that firms organizational capital measured by workers firm-occupation-specific experience depreciates and then slowly re-accumulates. When these processes stop, the productivity gains reach their maximum. I use these results to estimate a general equilibrium model with heterogeneous firms, endogenous robot adoption, and organizational capital accumulation. The model accounts for the productivity paradox, the diffusion of industrial robots, and the change in the aggregate skill demand. The model highlights the role of organizational costs accompanying the adoption of new technologies. I illustrate its usefulness by using it to characterize the implications of the innovators dilemma.

11:00 am

Universidad de los Andes

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Seminario CEDE - Diana Van Patten

This paper exploits a natural experiment to study the extent to which attitudes towards trade reflect economic fundamentals. In 2007, Costa Rica was the first developing country to put a free trade agreement (FTA) to a national referendum; with only one question on the ballot, 60% of Costa Rican adult citizens casted a vote on whether they wanted a trade agreement (CAFTA-DR) to be ratified, or not. We use disaggregated results of the referendum and match these results with detailed employer-employee data, firm customs and balance-sheet data, firm-to-firm transactions data, and data on household composition and expenditures. We document that a firms exposure to the FTA significantly influences the attitudes of its employees towards trade policy. We find that high-skilled workers are, on average, more likely to be in favor of the free trade agreement, and that within-industry heterogeneity is key in explaining votes, as compared with sector exposure. We find a role for local labor market competition in explaining vote shares, in particular for households employed in non-tradable sectors. Finally, we compare the importance of the earnings channel with respect to the expenditures channel, and document that both are salient in explaining voting behavior.

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