Reduced form approaches to estimate markups typically exploit variation in observed input and output. However, these approaches ignore the presence of fixed input factors, which may result in an overestimation of the price-cost margins. We first propose a new methodology to simultaneously...

This paper analyzes the role of costly spatial interaction between regional labor mar- kets in the matching process. We adapt Shimer and Smith's (2000) assignment model with search frictions to an economy with two connected regions. We then show that the existence of labor mobility costs will...

Agglomeration can affect markups through two potential channels: agglom- erated regions toughen competition (price competition effect) and firms are more productive on average in agglomerated regions (agglomeration exter- nalities and firm selection effect). However, the literature is...

Using recently-available data from the New Immigrant Survey, we find that previous self-employment experience in an immigrant’s country of origin is an important determinant of their self-employment status in the U.S., increasing the probability of being self-employed by about 7 percent. Our...

We investigate the effect of household cash transfers during childhood on young adult body mass indexes (BMI). The effects of extra income differ depending on the household’s initial socioeconomic status (SES). Children from the initially poorest households have a larger increase in BMI...

We test the hypothesis that property institutions are responsible for the persistent low levels of business and economic development on American Indian reservations. American Indian lands are held in trust by the US Federal government and may not be used as collateral. We exploit the uniform and...

We explore two hitherto poorly understood characteristics of the human-trafficking market—the cross-border ease of mobility of traffickers and the elasticity of buyers’ demand. In a model of two-way bargaining, the exact configuration of these characteristics is shown to determine whether...

The authors investigate the effect of skin tone on labor market outcomes to determine the extent to which differences in full-time employment probabilities are due to the persistence of racial and gender discrimination or other unobserved differences. Using the Coronary Artery Risk in Young...

This research examines the impact of road construction on rural labor force outcomes in a developing country. A new road built in the Republic of Palau links formerly inaccessible rural areas to more urban wage sector employment. We use two censuses conducted five years apart which perfectly...

The Coase theorem emphasizes the role transactions costs play in efficient market outcomes. We document inefficient outcomes, in the presence of a transactions cost, in southern California land markets and the corresponding transition to efficient outcomes after the transactions cost is...