Book Description

This dissertation includes three chapters. The first two chapters mainly focus on the effects of job displacement on earnings. The first chapter analyzes how the effects of job displacement on earnings vary among natives and immigrants in the United States, while the second chapter studies the distributional effects of job displacement using quantile regression and distribution regression. The third chapter considers the distributional effects of having children on women's income. In particular, I apply the Changes in Changes approach and distribution regression to study how the motherhood penalty varies across different women. Chapter 1, tilted THE HETEROGENEOUS EFFECTS OF JOB DISPLACEMENT ON IMMIGRANT AND NATIVE WORKERS, extends the previous literature by analyzing the consequences of job displacement on weekly earnings among natives and immigrants in the United States and also examines whether job displacement has different effects among native displaced workers residing in states with different share of immigrants' population. Although there are contradictory findings in the literature about how immigrants would respond to labor market shocks differently from natives, the existing literature agreed on the fact that workers who involuntarily lose their jobs experience long spells of unemployment after displacement. Fully understanding the consequences of job displacement among natives and immigrants, and the role of the share of immigrants' population on native displaced workers may help policy-makers to better formulate immigration policies as well as off-setting labor market policies for displaced workers. My results show that some groups of immigrants experience slightly smaller earning losses following displacement compared to natives, and I did not find significant effects of the share of immigrants on the earning loss of native displaced workers. Chapter 2, titled HETEROGENEOUS EFFECTS OF JOB DISPLACEMENT ON EARNINGS (with Brantly Callaway), considers how the effect of job displacement varies across different individuals. In particular, our interest centers on features of the distribution of the \textit{individual-level} effect of job displacement. Identifying features of this distribution is particularly challenging -- e.g., even if we could randomly assign workers to be displaced or not, many of the parameters that we consider would not be point identified. We exploit our access to panel data, and our approach relies on comparing outcomes of displaced workers to outcomes the same workers would have experienced if they had not been displaced and if they maintained the same rank in the distribution of earnings as they had before they were displaced. Using data from the Displaced Workers Survey, we find that displaced workers earn about \$157 per week less than they would have earned if they had not been displaced. We also find that there is substantial heterogeneity. We estimate that 42\% of workers have higher earnings than they would have had if they had not been displaced and that a large fraction of workers have substantially lower earnings than the average effect of displacement. Finally, we also document major differences in the distribution of the effect of job displacement across education levels, sex, age, and counterfactual earnings levels. Throughout the paper, we rely heavily on quantile regression. First, we use quantile regression as a flexible (yet feasible) first step estimator of conditional distributions and quantile functions that our main results build on. We also use quantile regression to study how covariates affect the distribution of the individual-level effect of job displacement. Chapter 3, titled THE HETEROGENEOUS EFFECTS OF HAVING CHILDREN ON WOMEN'S INCOME, estimates the distributional effects of having children on women's annual income in the United States using the National Longitudinal Survey of Youth from 1979 to 2016. Existing work on motherhood penalty shows that while the wage gap among men and women becomes smaller in the United States, the gap between mothers and childless women is increasing (\cite{waldfogel1998understanding}). After childbirth, women usually experience an immediate decrease in their earnings relative to what they would have earned if they had not become a mother. The gap closes somewhat over time though mothers never fully catch up to their counterfactuals. Previous work tried to explain the motherhood wage penalty by estimating the average treatment effect of children on women's earnings, but these effects can be quite heterogeneous across mothers with different observable characteristics. By utilizing the Changes-in-Changes model and distribution regression, I find that around 90\% of mothers have lower income after having children. White, married, older, and highly educated mothers with two or more children experience a substantial drop in their income.