| 1. |
- Nilsson, Anna, 1977-
(författare)
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Indirect effects of unemployment and low earnings : Crime and children's school performance
- 2005
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- This thesis consists of three self-contained essays that consider indirect effects of unemployment and low earnings on crime and children’s school performance. The first essay, Crime, unemployment and labor market programs in turbulent times (joint with Jonas Agell), investigates the effect of unemployment and participation in labor market programs, in general and among youth, on Swedish crime rates using a new panel data set for Swedish municipalities for the period 1996-2000. The exceptional variation in Swedish unemployment in the 1990s provides a remarkable (quasi-) experiment. Between 1996 and 2000 the overall unemployment rate (including those enrolled in labor market programs) decreased from 11.9 to 6.8 percent, and for those most likely to commit crimes, people under the age of 25, unemployment decreased from 21.2 to 8.7 percent. But the decrease in unemployment was far from uniform across the country, and our identification strategy is to use the exceptional variation in the improvement in labor market conditions across municipalities to isolate the relationship between unemployment and crime. We also consider whether placement in labor market programs reduce crime. Such an effect could arise for many reasons. Program participation may imply: (i) that there is less time for other activities, including crime; (ii) social interactions that prevent the participant from adopting the wrong kind of social norms; (iii) a greater ability to earn legal income in the labor market. Unlike most previous studies we identify a statistically and economically significant effect of general unemployment on the incidence of burglary, auto-theft and drug possession. Contrary to much popular wisdom, however, we could not establish a clear association between youth unemployment and the incidence of youthful crimes and there is no evidence that labor market programs – general ones and those targeted to the young – help to reduce crime.The second essay, Earnings and crime: The case of Sweden, analyzes whether low earnings has an effect on Swedish crime rates, considering the overall crime rate and specific property crime categories, using a panel of county-level data for the period 1975–2000. Various measures of the income distribution are considered, based on annual labor earnings as well as annual disposable income. The results indicate that the effect of low earnings on crime in Sweden is at best weak. We estimate a significant effect of low earnings on the number of auto thefts, but the effect is small. Low earnings seem to have no effect on the overall crime rate, the number of burglaries or the robbery rate. The results give, however, further support for an unambiguous link between unemployment and the overall crime rate as well as specific property crime categories. These findings are in contrast with results from, for example, the United States where wages are found to have a stronger impact on crime than unemployment. The differing results could, at least partly, be explained by the fact that during the period investigated, Swedish unemployment has been of a more permanent nature than U.S. unemployment, and that transitory earnings fluctuations appear to dominate the Swedish earnings distribution for young men, a part of the population committing a disproportionate share of many crimes.Finally, the third essay, Parental unemployment and children’s school performance, considers another possible indirect effect of unemployment, namely the school performance of the children of the unemployed. I use Swedish data on individual GPA from the completion of primary school at age 16 and final grades from upper secondary school for a majority of all children completing primary school in 1990 directly moving on to three years of upper secondary school, which they complete in 1993. The empirical method builds on the idea that primary school GPA can be used to control for family and individual heterogeneity. The huge variation in Swedish unemployment during the beginning of the 1990s, which can be traced to macroeconomic events, provides an ideal setting for testing the hypothesis that parental unemployment affects children’s school performance. The main results can be summarized as follows. If a mother is subjected to an unemployment spell during the period when one of her children attends upper secondary school, the school performance of the child marginally improves. This implies that, for women, the positive effect of having extra time on your hands exceeds the negative effects of the disadvantages caused by unemployment. This positive effect of having an unemployed mother seems to increase with the length of the unemployment spell. On the opposite, having a short-term unemployed father has a negative effect on a child’s school performance while the effect is insignificant for long-term paternal unemployment. The fact that a long-term unemployment spell of the father has a less clear effect could be interpreted as the shock of unemployment wearing out. One explanation for the differing results across genders could be that women in general cope better with being unemployed and hence are able to use their new extra time doing something productive, such as spending quality time with their children.
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| 2. |
- Wilkens, Carl, 1968-
(författare)
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Auri sacra fames : Interest Rates -- Prediction, Jumps and the Market Price of Risk
- 2005
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- This thesis consists of three essays investigating different aspects of interest rates."Prediction of Future Risk-Neutral Short-Term Interest Rate Densities: Can the Black, Derman and Toy Model Assist?" (Co-authored with David Vestin.) This essay evaluates two different approaches to inferring expectations of future interest rates from asset prices. One is based on bond data and builds on the Black, Derman and Toy model, the other is based on option prices. We compare the outcome with a specified assumed benchmark data generating process. The main conclusion is that the option based model works well, whereas the bond based model has difficulties in capturing aspects of the true distribution."Natura non facit saltum – Or Are Jumps an Inherent Feature in European Interest Rate Markets?" A jump-enhanced diffusion model for the instantaneous interest rate is estimated on the EURIBOR, LIBOR and STIBOR one-week interest rates via the characteristic function and a Fourier transform to recover the density function. This is compared with an estimated non-jump diffusion model. Both continuous-time and discrete-time versions of the model are estimated. For all three interest rate series, likelihood ratio tests favor the jump-enhanced model at a statistically significant level. This result holds for both the continuous-time and the discrete-time versions of the model."Estimating the Market Price of Risk in European Interest Rate Markets Using Spectral GMM." The market price of risk in European interest rate markets, constituted by the market price of diffusion risk and the market price of jump risk, is estimated for a jump diffusion model, using the characteristic function and the Generalized Method of Moments. Utilized data is the EURIBOR twelve-month interest rate during 1999-2003. The results are in line with earlier studies on US interest rate markets. The estimation technique appears promising in its technical simplicity, but entails practical estimation difficulties such as start-value sensitivity and lack of efficiency.
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| 3. |
- Ahrsjö, Ulrika, 1989-
(författare)
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Essays on Economic Disadvantage : Criminal Justice, Gender and Social Mobility
- 2022
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- Youth Crime, Community Service and Labor Market OutcomesCan lifetime trajectories of youth offenders be improved through criminal justice policy? I evaluate the effects of a youth justice reform in Sweden that sharply increased the share of juveniles assigned to court-ordered community service --- i.e. unpaid, low-skilled work. On average, the reform did not affect post-conviction recidivism or labor market outcomes, but these average effects mask considerable heterogeneity depending on the most likely alternative sanction. In particular, post-reform recidivism and incarceration rates are lower for individuals for whom community service replaces fines. Applying a machine learning method for causal inference, I then evaluate the net financial effect of the policy conditional on observable characteristics and analyze how the program could be targeted for improved efficiency. The results suggest that community service can benefit youth offenders, but that it is not suitable as a universal program.Intergenerational Mobility Trends and the Changing Role of Female LaborWe present new evidence on the existence and drivers of trends in intergenerational income mobility using administrative income data from Scandinavia along with survey data from the United States. Harmonizing the data from Sweden, Denmark and Norway, we first find that intergenerational rank associations in income have increased uniformly across Scandinavia for cohorts of children born between 1951 and 1979. Splitting the trends by gender, we find that father-son mobility has been stable in all three countries, while correlations involving females display substantial trends. Similar patterns are confirmed in the US data, albeit with slightly different timing. Utilizing information about individual occupation, education and income in the Scandinavian data, we find that intergenerational mobility in latent economic status has remained relatively constant for all gender combinations. This is found to be driven by increased female labor market participation at the intensive as well as the extensive margin. The observed decline in intergenerational mobility in Scandinavia is thus consistent with a socially desirable development where female skills are increasingly valued in the labor market.Wage Inequality, Selection and the Evolution of the Gender Earnings Gap in Sweden We estimate the change in the gender wage gap between 1968 and 2019 in Sweden accounting for (1) changes in the intensive margin of labor supply; (2) changes in the overall wage inequality; (3) changes in selection into the labor market using parametric and non-parametric selection corrections. Our results show that between 1968 and 1991, about half of the changes in the gender wage gap can be attributed to changes in the overall wage distribution. Conversely, changes in the wage distribution from 1991 to 2019 mask a larger closure of the gender wage gap. Our corrections for selection into the labor force suggest that uncorrected estimates miss about half of the around 20 percentage points decrease in the gender wage gap over the 1968-2019 period.Identity in Court Decision-MakingWe explore the role of identity along multiple dimensions in high-stakes decision-making. Our data set contains information about gender, ethnic background, age and socioeconomic indicators for randomly assigned jurors and defendants in a Swedish district court. Our results show that defendants are significantly less likely to get a prison sentence if they and the jurors belong to the same identity-forming group. For example, a defendant is 15 percent less likely to get a prison sentence if he or she has the same level of education as all three jurors compared to if none of them have the same educational attainments.
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| 4. |
- Almén, Daniel, 1984-
(författare)
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Societal Impacts of Modern Conscription : Human Capital, Social Capital and Criminal Behaviour
- 2020
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- Opportunity Costs and Conscription: An Unintended Progressive Tax?Throughout history to present days, policymakers, social commentators and others have oftentimes viewed conscription as a natural extension of secondary education, and an important institution for vocational training. This paper uses Swedish administrative data and exploits a reform in 2004, implying a sudden downsizing of the military, to identify the causal effects of peacetime conscription on later labour market outcomes and education. I find that unemployment increased in the short run, and lasted up to four years after service. There are no significant overall effects on income or educational attainment. However, these average effects hide a large heterogeneity. High ability conscripts fall behind their counterparts who did not start military service, both in terms of income and employment. Furthermore, the results suggest that the effect is attributed to high ability conscripts assigned as privates. In contrast, no such evidence is found for conscripts assigned to officer training, despite the fact that all of them have a high ability, and a longer time in service. Plausibly, high ability conscripts have high opportunity costs of doing military service, and the civilian benefits from training as privates are too small to counteract these costs. The results highlight the importance of precise matching of aptitude to type of training or education, an insight that might be generalized to other contexts beyond conscription.Citizenship, Social Capital and the Role of Conscription: Evidence from SwedenMany scholars have argued that conscription has played an important role as a nation-builder throughout history. Today, advocates of conscription often put forward its potential to induce citizenship and civic engagement. This paper addresses this claim by studying the causal effects of military service on civic engagement by using Swedish administrative data on election participation, blood donation, and the payment of a mandatory, but highly evaded, fee to the public broadcasting service. I study two qualitatively very different conscription systems from two different eras in Sweden, yielding a high external validity. To study the effects of universal conscription (almost all healthy and fit men serve) during the early 1990s, I use an empirical strategy similar in spirit to work using randomly assigned judges as an instrument. To identify the effects of selective conscription (a small fraction of motivated and positively selected men serve), I exploit a reform in 2004, implying a sudden downsizing of the military. In contrast to the previous correlational literature, the results show small and insignificant point estimates for all outcomes in both populations studied. Hence, I find no evidence of any causal effects of military service on civic engagement in either a selective-, or in a universal conscription systemThe Effect of Military Conscription on the Formation of Criminal Behaviour: Evidence from a Natural ExperimentConscription has been suggested to be a policy-tool to break young men's anti-social life-trajectories. This paper uses Swedish administrative data and exploits a reform in 2004, implying a sudden downsizing of the military, to identify the causal effects of peacetime conscription on contemporaneous, short- and medium-term crime. I find no evidence of any effects on criminal activity while in service. However, the post-service results show crime increasing effects of military service at the intensive margin (number of convictions), but not at the extensive margin (probability of conviction). The overall crime increasing effect seems to be primarily driven by thefts. This study finds no support for increased overall violent behaviour or that the military context per se induces anti-social behaviour. Rather, some suggestive evidence for worsened labour market opportunities for some groups is documented as a plausible mechanism behind the crime increasing results.
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| 5. |
- Almerud, Jakob, 1984-
(författare)
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Public Policy, Household Finance and the Macroeconomy
- 2018
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- The thesis contains four separate essays, spanning questions of the interaction between public policy, household finance and the macroeconomy. How does public policy affect macroeconomic outcomes, and the choices and welfare of households, and what are households’ optimal financial responses to changes in macroeconomic environments? Furthermore, the thesis includes a development of a method, which is helpful to answer questions like the ones stated above. The first essay, Optimal Public Policy in a Multi-Sector Economy with Asymmetric Shocks, shows how fiscal policy can complement monetary policy. It is shown that fiscal policy can be used to improve macroeconomic outcomes and make the economy more efficient. Since fiscal policy, in general, includes more instruments than monetary policy, it is possible to neutralize several frictions in the economy simultaneously. This is shown in a general equilibrium model with dynastic households, where firms face monopolistic competition, sticky prices, productivity shocks and cost-push shocks. The second essay, On the Design of Mortgage Default Legislation, asks how different types of mortgage contracts interact with different types of mortgage default policies regarding the probability of a default on home-owner’s mortgage. The different types of mortgage contracts analyzed are fixed rate annuity mortgages, adjustable rate amortized mortgages and adjustable rate non-amortized mortgages. The mortgage default policies span from non-recourse (where the mortgage lender takes all the default risk) to full recourse (where the borrower takes all the default risk). It is shown that a “borrower friendly” non-recourse policy is, as the one implemented in many parts of the United States, not necessarily borrower friendly due to its effect on the risk premium. This is investigated in a model with finitely lived households and an endogenous risk premium. The third essay, On The Empirical Relevance of Cointegration Between Stock Market Returns and Labor Income on Optimal Portfolio Choice, investigates how finitely lived households optimally choose a portfolio consisting of risk-free bonds and risky equity, and how this choice is affected by the long-run correlation between risky (cumulative) equity returns and stochastic labor income. More specifically, I investigate if the empirical cointegration (long-run correlation) between the two variables is strong enough to affect the optimal portfolio choice. It is shown that it is not. Cointegration exists between the two variables, but the speed-of-adjustment back to the cointegration equilibrium is to slow to have a significant effect on the households’ optimal portfolios. The fourth essay, Solving Dynamic Programming Problems Using Stochastic Grids and Nearest-Neighbor Interpolation, describes a new computational method, which is used in the second and third essays. The method is developed to solve models with finitely lived households who face a complex economic environment. Post-state decision rules for the households are used together with simulated stochastic grids over the exogenous variables. By simulating the grids it is possible to reduce the number of grid points that the model is solved for, thereby making it significantly faster to solve models with many exogenous state variables. It is shown that it is possible to solve non-linear life-cycle models including at least eight state variables relatively quickly on a standard desktop computer.
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| 6. |
- Blomqvist, Niklas, 1987-
(författare)
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Essays on Labor Economics : The Role of Government in Labor Supply Choices
- 2020
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- "Right to Work Full-time" Policies and Involuntary Part-time EmploymentThis paper investigates the effect of right to full-time policies implemented to decrease involuntary part-time work for public care workers employed by Swedish municipalities. Taking advantage of a staggered decision process, these policies are evaluated using a difference-in-differences approach. Results show that involuntary part-time employment is real and significant, with 10% of part-time employed workers choosing full-time when given the opportunity. The effect mainly comes from a decrease in contracts of <75% of full-time and an increase in contracts of 80% of full-time and above. Further results from the full-time policies show that being more flexible in the choice of hours worked is popular among workers, indicated by an increase in tenure and reduced turnover in municipalities that offer more flexibility in the choice of hours worked.Hours Constraints and Tax Elasticity Estimates - Evidence from Swedish Public Care WorkersThere is a concern that tax elasticity estimates may be downward biased in the presence of optimization frictions for workers. So far, there is limited evidence on the nature of these optimization frictions. This paper provides new insight into one part of the optimization frictions black box, namely hours constraints. Using unique and newly collected data, I exploit a staggered implementation of a policy that gave some public care workers the opportunity to choose their preferred hours of work. Taking advantage of this policy, I estimate differences in tax elasticities between constrained and unconstrained public care workers by comparing bunching at a large tax kink in the Swedish tax system. The empirical evidence points to the conclusion that hours constraints do not affect tax elasticity estimates.Restricting Residence Permits - Short-Run Evidence from a Swedish ReformIn June 2016, the Swedish parliament decided to restrict the granting of permanent residence permits for asylum seekers in Sweden. The new status quo for a refugee is a temporary rather than a permanent residence permit. In a first evaluation of this reform we use a Regression discontinuity analysis in which we follow refugees, aged 25-65, over their first years after arrival. Our main results show that a temporary residence permit increases the probability of working and enrolling in regular education.Mom and Dad Got Jobs: Natural Resources, Economic Activity, and Infant HealthThe impact of local economic shocks, such as the discovery and exploitation of natural resources, on labor markets and health is not well understood. Both positive and negative effects have been documented in the literature. In this paper, we show that the phase before active resource extraction begins directly affects the local economy. This implies that previous estimates – typically based on designs exploiting differences before and after the active phase of extraction begins - may have understated the actual effect of natural resource extraction on outcomes of interest. Using rich data from Sweden combined with differences in the timing and location of mineral exploitation permits, we find a positive impact on female and male employment and earnings and a negative effect on housing prices. Children’s health outcomes are also negatively affected, an effect likely driven by the increase in local economic activity rather than extraction-related externalities.
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| 7. |
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| 8. |
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| 9. |
- Brinca, Pedro Soares, 1979-
(författare)
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Essays in Quantitative Macroeconomics
- 2013
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- In the first essay, Distortions in the Neoclassical Growth Model: A Cross Country Analysis, I show that shocks that express themselves as total factor productivity and labor income taxes are comparably more synchronized than shocks that resemble distortions to the ability of allocating resources across time and states of the world. These two shocks are also the most important to model. Lastly, I document the importance of international channels of transmission for the shocks, given that these are spatially correlated and that international trade variables, such as trade openness correlate particularly well with them. The second essay is called Monetary Business Cycle Accounting for Sweden. Given that the analysis is focused in one country, I can extend the prototype economy to include a nominal interest rate setting rule and government bonds. As in the previous essay, distortions to the labor-leisure condition and total factor productivity are the most relevant margins to be modeled, now joined by deviations from the nominal interest rate setting rule. Also, distortions do not share a structural break during the Great Recession, but they do during the 1990’s. Researchers aiming to model Swedish business cycles must take into account the structural changes the Swedish economy went through in the 1990’s, though not so during the last recession. The third essay, Consumer Confidence and Consumption Spending: Evidence for the United States and the Euro Area, we show that, the consumer confidence index can be in certain circumstances a good predictor of consumption. In particular, out-of-sample evidence shows that the contribution of confidence in explaining consumption expenditures increases when household survey indicators feature large changes, so that confidence indicators can have some increasing predictive power during such episodes. Moreover, there is some evidence of a confidence channel in the international transmission of shocks, as U.S. confidence indices help predicting consumer sentiment in the euro area.
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| 10. |
- Cao, Mengyi, 1984-
(författare)
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Labor, Trade and Finance : Essays in Applied Economics
- 2017
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- Essay I: Credit Constraint and College Attendance. This paper shows that housing wealth alleviate credit constraints for potential college attendees by enabling home owners to extract equity from their property and invest it in the education. Using a large US individual-level survey dataset over the 1996-2011 period, I find that one standard deviation increases of housing prices translate into approximately 72,000 more students enrolled in college each year. My results stay significant when I use proxies for aggregate housing demand shocks and for the topological elasticity of housing supply to generate variation in home equity that is assumed to be orthogonal to decision of going to college.Essay II: Income Inequality and Trade.Does trade with unskilled labor-abundant countries reduce the relative wages of U.S. unskilled labor and consequently cause increased income inequality across industries and regions? Empirical studies in the 1990s found only a modest effect. In this paper, I re-consider the question by using the income inequality measures constructed from Current Population Survey (CPS) data and analyzing the effect of rising Chinese import competition between 1993 and 2007 on US local labor markets. I find that areas which are more exposed to China imports competition have larger changes in income inequality. In my main specification, a $1,000 exogenous decadal rise in a MSA's import exposure per worker leads to a 1.5% increase in the logistic Gini. This re-distributive effect is more profound among non-college educated workers in manufacturing sectors. Essay III: Employee as Creditor: Evidence from Defined Pension Plans.In this paper, I show the role of pension plans in shaping the firms' labor market decision. By employing the loan covenants violation and consequently transferring of control rights to creditors, I examine the strategic use of pension underfunding by firms and the resultant wage cuts. I also find that the wage concession is less severe for firms from industry with bigger bargaining power. This study sheds light on how firms strategically renegotiate labor contracts to extract concessions from labor. The evidence suggests that credit contracts between debt-holders and shareholders have spillover effects on non-financial stakeholders.
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