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Working Paper
Commuting, Labor, and Housing Market Effects of Mass Transportation: Welfare and Identification
REVISED MARCH 2019 This paper studies the effects of Los Angeles Metro Rail on the spatial distribution of people and prices. Using a panel of bilateral commuting flows, I estimate a quantitative spatial general equilibrium model to quantify the welfare benefits of urban rail transit and distinguish the benefits of reduced commuting frictions from other channels. The subway causes a 7%-13% increase in commuting between pairs of connected tracts; I select plausible control pairs using proposed subway and historical streetcar lines to identify this effect. The structural parameters of the model ...
Report
Trade Models, Trade Elasticities, and the Gains from Trade
We argue that the welfare gains from trade in models with micro-level margins exceed those in frameworks without these margins. Theoretically, we show that for fixed trade elasticity, different models predict identical trade flows, but different patterns of microlevel price variation. Thus, given data on trade flows and micro-level prices, different models have different implied trade elasticities and welfare gains. Empirically, models with extensive or variable mark-up margins yield significantly larger welfare gains. Our trade elasticity estimates are robust over time in contrast to leading ...
Working Paper
Estimating Border Effects: The Impact of Spatial Aggregation
Trade data are typically reported at the level of regions or countries and are therefore aggregates across space. In this paper, we investigate the sensitivity of standard gravity estimation to spatial aggregation. We build a model in which symmetric micro regions are aggregated into macro regions. We then apply the model to the large literature on border effects in domestic and international trade. Our theory shows that aggregation leads to border effect heterogeneity. Larger regions or countries are systematically associated with smaller border effects. The reason is that due to spatial ...