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Working Paper
It's Good Weather for More Government: The Effect of Weather on Fiscal Policy
I show that weather conditions on election day affect future fiscal policy. When it rains during state elections, there is an increase in the relative income of voters, which is followed by an increase in expenditure and debt. The increase in expenditure is directed towards a larger police and safety budget. This result is compatible with a model of complementarity between consumption and public goods. In the model, high-income voters support an increase in safety budget because they benefit more from it than low-income voters.
Working Paper
Taxation, Compliance, and Clandestine Activities
We investigate the delicate balance policymakers have to strike between raising tax revenues for public good provision and controlling the distortionary effects of taxes on (i) tax evasion, (ii) total work hours, and (iii) the allocation of work hours to illegal activities. These distortions lower the constrained optimal tax rate and result in the under-provision of the public good. This under-provision problem is mitigated when surplus from the audit agency is seamlessly transferred to the taxing authorities. Extensions of the basic model incorporate agent heterogeneity and a more general ...
Journal Article
Lockdown Responses to COVID-19
This article describes the relationship between countries' lockdown responses to the COVID-19 pandemic and those countries' political rights and civil liberties, macroeconomic variables, and vulnerability to the virus. Political rights and civil liberties cannot explain the differences in lockdown timing across countries. Countries with high contagion exposure due to weak water sanitation and weak health systems locked down their economies as fast as possible to reduce contagion. However, countries more vulnerable to COVID-19 due to large fractions of elderly and smokers in the population did ...
Journal Article
The Long Road to Recovery: New York Schools in the Aftermath of the Great Recession
Using rich panel data and an interrupted time-series analysis, the authors examine how the funding and expenditure dynamics of New York school districts changed in the four years after the Great Recession. Extending prior work on the immediate effects of the recession on school finances in 2009-10 in Chakrabarti, Livingston, and Setren (2015), they take a longer-term view through 2012, to document what happened when support from federal stimulus funding began to dwindle and then ended. The analysis finds that the more than $6 billion in support from the American Recovery and Reinvestment Act ...
Journal Article
Tough Choices: New Jersey Schools during the Great Recession and Beyond
This study examines the medium-term effects of the Great Recession on school finances in New Jersey using detailed school district panel data and an interrupted time series analysis. The authors find that the recession led to sharp cuts in school funding and expenditure, in spite of the federal stimulus. These cuts deepened as the stimulus abated. An analysis of variations by metropolitan area reveals that the Camden metro area, the highest poverty area reviewed, experienced considerably larger cuts in expenditures when the stimulus receded compared with other areas. The findings are ...
Report
Precarious slopes? The Great Recession, federal stimulus, and New Jersey schools
While sparse literature exists investigating the impact of the Great Recession on various sectors of the economy, there is virtually no research that studies the effect of the Great Recession, or past recessions, on schools. This paper starts to fill the void. Studying school funding during the recession is of paramount importance because schools have a fundamental role in fostering human capital formation and economic growth. We exploit unique panel-data and trend-shift analysis to analyze how New Jersey school finances were affected during the Great Recession and the ARRA federal stimulus ...
Working Paper
Walking a tightrope: are U. S. state and local governments on a fiscally sustainable path?
This paper develops a new measure of state and local fiscal sustainability called the "trend gap," which is based on socioeconomic and other fundamental factors and removes the short-term influence of the business cycle. The paper estimates the trend gap and finds that the nationwide per capita trend gap has been on a growing path over the past three decades, a different conclusion than found in previous studies. Social insurance and income maintenance programs have played a major role in the growth of the trend gap, while pension and other post-employment benefits (OPEB) plans have become ...
Working Paper
Disinvesting in the future?: a comprehensive examination of the effects of state appropriations for public higher education
In aggregate, state appropriations are the largest revenue source for public higher education in the United States. However, these appropriations have significantly declined over past decades, drawing serious concerns about the potential negative impact on schools and students. This paper provides a more comprehensive study of the effects of state appropriations than previous research, while explicitly exploring and testing the heterogeneity of the effects by institutional type. It finds strong evidence of the negative effects of state appropriation cuts in the areas of tuition and fees, ...
Working Paper
Is Los Angeles Becoming Transit Oriented?
Over the past 20 years, local and regional governments in the Los Angeles metropolitan area have invested significant resources in building rail transit infrastructure that connects major employment centers. One goal of transit infrastructure is to catalyze the development of high density, mixed-use housing and commercial activity within walking distance of rail stations, referred to as Transit Oriented Development (TOD). This project examines the quantity, type, and mix of economic activity that has occurred around newly built rail stations in Los Angeles over the past 20 years. ...
Report
Merit Aid, Student Mobility, and the Role of College Selectivity
In this paper, we investigate the role of college selectivity in college choice decisions (both in-state and out-of-state) of freshmen students following Georgia's HOPE scholarship program. How did HOPE affect the selectivity of colleges attended by Georgia's freshmen students? Did it induce Georgia's freshmen students who would have otherwise attended more selective out-of-state colleges to instead attend less selective in-state ones? Or was there movement to more selective ones, both in-state and out-of-state? Using student residency and enrollment data from IPEDS and selectivity data from ...