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« Back to Results

Urban and Labor

Paper Session

Friday, Jan. 4, 2019 2:30 PM - 4:30 PM

Hilton Atlanta, 218
Hosted By: American Real Estate and Urban Economics Association
  • Chair: Henry J. Munneke, University of Georgia

Location and Intergenerational Educational Mobility

Jung Choi
,
Urban Institute
Richard Green
,
University of Southern California

Abstract

High school drop outs are more likely to have children in cities where college shares are high, while those who received greater education are less likely to have children in these cities. This pattern is puzzling, as cities that attract college graduates have higher costs of living, and can be more expensive to raise children, especially for the least educated households. We provide one compelling explanation for why the less educated households locate in high skilled cities – better education for their children. Using the Census and ACS data from 1980 to 2010, our study finds that children in ages between 16 and 24 living with a high school dropout head are more likely be enrolled in school in cities with high shares of college graduates. On the other hand, we do not find any relationship between college share and school enrollment for children of parents with higher educational attainment. To control for endogeneity raised from unobserved locational variables we use two instruments, the existence of a land grant university and land availability. We also address the issue of self-selection by comparing the results between recent movers and non-movers. In all specifications, our findings remain consistent: the children of the least educated benefit most from living in a high skilled city. Our results suggest that location can have greater impact for the children in households with less resources to support them.

Geography and Employer Recruiting

Russell Weinstein
,
University of Illinois-Urbana-Champaign

Abstract

I analyze whether reducing geographic distance to high-wage jobs increases access to those employment opportunities. I collect office locations and campus recruiting strategies for over 70 prestigious banking and consulting firms, from 2000 to 2013. Using an event-study framework, I find firms are twice as likely to recruit at local universities after opening a nearby office, and 6.5 times more likely outside industry clusters. New target campuses outside industry clusters are less academically selective. I complement the analysis with two case studies and firm-level hiring data from two business schools. Hires from local universities also increase after firms increase their local presence, relative to other similar firms. The results suggest the importance of a university's local labor market for post-graduation outcomes.

Workplace Flexibility and Entrepreneurship

Changcheng Song
,
National University of Singapore
Sumit Agarwal
,
National University of Singapore
Jian Zhang
,
Hong Kong Baptist University

Abstract

Working at home benefits workers with low fixed costs and the ability to engage in joint market and household production. We evaluate a large-scale reform in Singapore that allows the possibility of business creation at one’s residential property and study whether the option of home-based entrepreneurship spurs entrepreneurial activities. Difference-in-difference estimate shows that the reform leads to a significantly higher level of business creation, implying that entry regulation with high fixed costs is an important factor that deters entrepreneurship. The effect is more pronounced for low-income individuals and industries with high starting capitals. Additional new firms in response to the reform have a higher survival rate, and the effect is also more pronounced for low-income individuals and industries with high starting capitals. These results suggest that financially constrained entrepreneurs benefit more from the reform. The reform also encourages entrepreneurs to become serial entrepreneurs, and they open a larger business with similar survival rate for their second firm. These results show that the home office scheme effectively spurs entrepreneurial activities and attract more entry into self-employment without significantly lowering the average quality of the pool.

The Impact of Housing Quality on Health and Labor Market Outcomes: The German Reunification

Steffen Kuenn
,
Maastricht University
Juan Palacios Temprano
,
Maastricht University

Abstract

Environmental hazards such as ambient air pollution and extreme temperatures have a significant impact on individuals' health and generate massive economic costs in industrialized countries. However, individuals spend on average 90% of their time indoors reducing their exposure to outdoor hazards. While economist and policy makers are certain that the provision of decent housing should lead to increased health and well-being, empirical evidence is largely missing or based on small scale experiments on poor households in developing countries. This paper studies the massive renovation wave in East Germany in the aftermath of the German reunification to contribute population-representative evidence on the impact of improved housing conditions on occupants' health and labour market outcomes in industrialized countries. During the 90s, the German government implemented several programs to modernize the East German housing portfolio. The largest program spent a total of euro 40 billion and renovated 3.6 million dwellings in East Germany. Using the German Socio-Economic Panel (SOEP) and applying a fixed effect approach exploiting the exogenous variation in the exact timing of the renovation, we find that a major renovation of a dwelling significantly improves tenants' subjective and objective health outcomes. Sensitivity analysis with respect to time-varying unobserved factors confirm the robustness of the results.
Discussant(s)
Jan Brueckner
,
University of California-Irvine
Ruchi Singh
,
University of Georgia
Mike Eriksen
,
University of Cincinnati
Wei Huang
,
National University of Sinapore
JEL Classifications
  • R2 - Household Analysis
  • J2 - Demand and Supply of Labor