Category: Data Source

Did the Covid housing boom induce the Great Resignation?

by  Tyler Cowen in

Following the Covid-19 pandemic, U.S. labor force participation declined significantly in 2020, slowly recovering in 2021 and 2022 — this has been referred to as the Great Resignation. The decline has been concentrated among older Americans. By 2022, the labor force participation of workers in their prime returned to its 2019 level, while older workers’ participation has continued to fall, responsible for almost the entire decline in the overall labor force participation rate. At the same time, the U.S. experienced large booms in both the equity and housing markets. We show that the Great Resignation among older workers can be fully explained by increases in housing wealth. MSAs with stronger house price growth tend to have lower participation rates, but only for home owners around retirement age — a 65 year old home owner’s unconditional participation rate of 44.8% falls to 43.9% if he experiences a 10% excess house price growth. A counterfactual shows that if housing returns in 2021 would have been equal to 2019 returns, there would have been no decline in the labor force participation of older Americans.

That is from a new paper by Jack Y. Favilukis and Gen Li, via Scott Lincicome.

Who is locally influential these days?

by  Tyler Cowen in

Um…um…uh-oh:

Who do people think are influential in their own community? This question is important for understanding topics such as social networks, political party networks, civic engagement, and local politics. At the same time as research on these topics has grown, measurement of public perceptions of local influence has dried up. Years ago, researchers took active interest in the question of community influence. They found that most ordinary Americans could identify a person who they thought had influence in their community. Respondents usually named business leaders. Where does the public stand today? In three different ways, we ask respondents who has local influence. The vast majority of respondents today cannot think of anyone. Those who do identify someone as influential rarely choose a businessperson. This article aims to reintroduce the public opinion of community influence and situate findings in related scholarship.

Here is the new article by Joshua Hochberg and Eitan Hersh.  David Brooks, telephone!  Don’t even ask how the “religious leaders” fare in the polling…

Gender and tone in recorded economics presentations

by  Tyler Cowen in

You’re going to see a lot more research papers like this one:

This paper develops a replicable and scalable method for analyzing tone in economics seminars to study the relationship between speaker gender, age, and tone in both static and dynamic settings. We train a deep convolutional neural network on public audio data from the computer science literature to impute labels for gender, age, and multiple tones, like happy, neutral, angry, and fearful. We apply our trained algorithm to a topically representative sample of presentations from the 2022 NBER Summer Institute. Overall, our results highlight systematic differences in presentation dynamics by gender, field, and format. We find that female economists are more likely to speak in a positive tone and are less likely to be spoken to in a positive tone, even by other women. We find that male economists are significantly more likely to sound angry or stern compared to female economists. Despite finding that female and male presenters receive a similar number of interruptions and questions, we find slightly longer interruptions for female presenters. Our trained algorithm can be applied to other economics presentation recordings for continued analysis of seminar dynamics.

Some people might just stop going to recorded conferences, of course.  That paper is by Amy Handlan and Haoyu Sheng, via the excellent Kevin Lewis.

Ethnic Remoteness Reduces the Peace Dividend from Trade Access

by  Tyler Cowen in

This paper shows that ethnically remote locations do not reap the full peace dividend from increased market access. Exploiting the staggered implementation of the US-initiated Africa Growth and Opportunity Act (AGOA) and using high-resolution data on ethnic composition and violent conflict for sub-Saharan Africa, our analysis finds that in the wake of improved trade access conflict declines less in locations that are ethnically remote from the rest of the country. We hypothesize that ethnic remoteness acts as a barrier that hampers participation in the global economy. Consistent with this hypothesis, satellite-based luminosity data show that the income gains from improved trade access are smaller in ethnically remote locations, and survey data indicate that ethnically more distant individuals do not benefit from the same positive income shocks when exposed to increased market access. These results underscore the importance of ethnic barriers when analyzing which locations and groups might be left behind by globalization.

That is from a new NBER working paper by Klaus Desmet and Joseph F. Gomes.

Gender, competition, and performance: Evidence from chess players

by  Tyler Cowen in

This paper studies gender differences in performance in a male‐dominated competitive environment chess tournaments. We find that the gender composition of chess games affects the behaviors of both men and women in ways that worsen the outcomes for women. Using a unique measure of within‐game quality of play, we show that women make more mistakes when playing against men. Men, however, play equally well against male and female opponents. We also find that men persist longer before losing to women. Our results shed some light on the behavioral changes that lead to differential outcomes when the gender composition of competitions varies.

Here is the full paper by Peter Backus, Maria Cubel, Matej Guid, Santiago SĂĄnchez‐PagĂ©s, and Enrique LĂłpez Mañas.  Via someone who is thanked in any case!

Why has construction productivity been falling?

by  Tyler Cowen in

There is a new NBER working paper on this topic by Austan Goolsbee and Chad Syverson:

Aggregate data show a large and decades-long decline in construction sector productivity. This decline in such a large sector has had a material effect on secular productivity growth for the economy as a whole. Prior work has focused on the role of potential measurement problems in construction, particularly output deflators in the measurement of productivity. This paper brings some new evidence to bear on the industry’s measured productivity problems and suggests that measurement error is probably not the sole source of the stagnation. First, using measures of physical productivity in housing construction, productivity is falling or, at best, stagnant over multiple decades. Second, there has been a noticeable decline over time in the efficiency with which construction firms translate materials inputs into output, and a corresponding shift toward more value-added-intensive production. Third, using state-level data, we do not find evidence of patterns of within-industry reallocation that might be expected of efficiently operating input and output markets. States with more productive construction sectors do not see growth in their shares of total U.S. construction activity; if anything, their shares fall. This may point to frictions in these markets that slow or stop what is in many other markets an important channel for productivity growth.

Here is a useful image:

Image

xDon’t forget the blog/Substack on this issue by Brian Potter.

The decline of religion, and the rise of deaths of despair

by  Tyler Cowen in

In recent decades, death rates from poisonings, suicides, and alcoholic liver disease have dramatically increased in the United States. We show that these “deaths of despair” began to increase relative to trend in the early 1990s, that this increase was preceded by a decline in religious participation, and that both trends were driven by middle-aged white Americans. Using repeals of blue laws as a shock to religiosity, we confirm that religious practice has significant effects on these mortality rates. Our findings show that social factors such as organized religion can play an important role in understanding deaths of despair.

That is from a new NBER working paper by Tyler Giles, Daniel M. Hungerman, and Tamar Oostrom.  Ross Douthat, telephone!

Unexpected Inflation and the Redistribution of Wealth

by  Alex Tabarrok in

We have a great new MRU video giving students some practice with unexpected inflation and the redistribution of wealth. As always, we like to teach a bit of history with our economics so you might also gets some perspective on William Jennings Bryan and the cross of gold. This video is part of a new Money & Inflation Unit Plan which has lots of excellent resources including lessons plans, interactive games and more on money and inflation for teachers of economics. All free, as always.

Of course, if you do teach principles of economics all of this wonderful material pairs beautifully with the best principles of economics textbook, Modern Principles.

What we know about road deaths during the pandemic

by  Tyler Cowen in

The study verified that the absence of traffic jams played some role in allowing drivers to reach dangerous speeds on too-wide roads, but the researchers also found that the most significant differences between their forecast and real-world death totals happened in the dead of night, when most roads have always been congestion-free.

Between 10 p.mm and 1:59 a.m., deaths were nearly 22 percent higher than expected; during the typical morning rush hours, by contrast, deaths were actually 6.3 percent lower than the model anticipated they’d be. The late afternoon and evening rush hour, meanwhile, “did not differ significantly from the forecast.”

…2020 also saw an increase in hit-and-runs, which clocked in at 31.2 percent higher than originally forecast.

…According to AAA, “about 70 percent of the entire increase in driver fatal crash involvement [between May and December of 2020] was specifically among males under the age of 40.” Tefft suspects that increase may have been particularly driven by the minuscule subset of young, male motorists who were emboldened to do risky things on the road when the world shut down, though the data doesn’t tell him exactly why.

The article has further points of interest.

Where are all the workers?

by  Tyler Cowen in

The subtitle of the paper is “From Great Resignation to Quiet Quitting”, here is the abstract:

To better understand the tight post-pandemic labor market in the US, we decompose the decline in aggregate hours worked into the extensive (fewer people working) and the intensive margin changes (workers working fewer hours). Although the pre-existing trend of lower labor force participation especially by young men without a bachelor’s degree accounts for some of the decline in aggregate hours, the intensive margin accounts for more than half of the decline between 2019 and 2022. The decline in hours among workers was larger for men than women. Among men, the decline was larger for those with a bachelor’s degree than those with less education, for prime-age workers than older workers, and also for those who already worked long hours and had high earnings. Workers’ hours reduction can explain why the labor market is even tighter than what is expected at the current levels of unemployment and labor force participation.

Dain Lee, Jinhyeok Park, and Yongseok Shin wrote that new NBER working paper, important work for understanding our current time.

“Unveiling the Price of Obscenity”

by  Tyler Cowen in

Does legitimating sinful activities have a cost? This paper examines the relationship between housing demand and overt prostitution in Amsterdam. In our empirical design, we exploit the spatial discontinuity in the location of brothel windows created by canals, combined with a policy that forcibly closed some of the windows near these canals. To pin down their effect on housing prices, we apply a difference-in-discontinuity (DiD) estimator, which controls for the precise location of brothel windows and the effect of other policies and local developments. Our results show that the housing prices are discontinuous at the bordering canals, and this discontinuity nearly disappears after closures. The discontinuity is also found to decrease with the distance to brothels, disappearing after 300 yards. Our estimates indicate that homes right next to sex workers were 30 percent cheaper before the closures. This result seems unrelated to the presence of other businesses, such as bars and cannabis shops. Instead, the price discount is partly explained by petty crimes. However, 73 percent of the effect remains unexplained after controlling for many forms of crime and risk perception. Our findings suggest that households tend to be against the visible presence of sex workers and related nuisances, reaffirming their marginalization.

That is from a new paper by Erasmo Giambona and Rafael P. Ribas, via a highly reputable man.

Are scientific breakthroughs less fundamental?

by  Tyler Cowen in

From Max Kozlov, do note the data do not cover the very latest events:

The number of science and technology research papers published has skyrocketed over the past few decades — but the ‘disruptiveness’ of those papers has dropped, according to an analysis of how radically papers depart from the previous literature.

Data from millions of manuscripts show that, compared with the mid-twentieth century, research done in the 2000s was much more likely to incrementally push science forward than to veer off in a new direction and render previous work obsolete. Analysis of patents from 1976 to 2010 showed the same trend.

“The data suggest something is changing,” says Russell Funk, a sociologist at the University of Minnesota in Minneapolis and a co-author of the analysis, which was published on 4 January in Nature. “You don’t have quite the same intensity of breakthrough discoveries you once had.”

The authors reasoned that if a study was highly disruptive, subsequent research would be less likely to cite the study’s references, and instead cite the study itself. Using the citation data from 45 million manuscripts and 3.9 million patents, the researchers calculated a measure of disruptiveness, called the ‘CD index’, in which values ranged from –1 for the least disruptive work to 1 for the most disruptive.

The average CD index declined by more than 90% between 1945 and 2010 for research manuscripts (see ‘Disruptive science dwindles’), and by more than 78% from 1980 to 2010 for patents. Disruptiveness declined in all of the analysed research fields and patent types, even when factoring in potential differences in factors such as citation practices…

The authors also analysed the most common verbs used in manuscripts and found that whereas research in the 1950s was more likely to use words evoking creation or discovery such as, ‘produce’ or ‘determine’, that done in the 2010s was more likely to refer to incremental progress, using terms such as ‘improve’ or ‘enhance’.

Here is the piece, and here is the original research by Michael Park Erin Leahey, and Russell J. funk.

Wealth across the generations

by  Tyler Cowen in

“The main takeaways:

  • Millennials are roughly equal in wealth per capita to Baby Boomers and Gen X at the same age.
  • Gen X is currently much wealthier than Boomers were at the same age: about $100,000 per capita or 18% greater
  • Wealth has declined significantly in 2022, but the hasn’t affected Millennials very much since they have very little wealth in the stock market (real estate is by far their largest wealth category)”

That is from Jeremy Horpendahl (no double indent performed by me), via Rich Dewey.

Lead and violence: all the evidence

by  Tyler Cowen in

Kevin Drum offers a response to a recent meta-study on the link between lead and violence, blogged by me here.

I’ll take this moment to explain why the lead-violence connection never has sat that well with me.

Let’s say we are trying to explain why 2022 America is richer than the Stone Age.  We could cite “incentives, policy, and culture,” noting that any accumulated stock of wealth also came from these (and possibly other) factors.  You might disagree about which policies, or which cultural features of modernity, and so on, but the answer to the question pretty clearly lies in that direction.

Now let us say we are trying to explain why America today is richer than Albania today.  You would do just fine to start with “incentives, policy, and culture.”  You could add in some additional factors, such as superior natural resources, but you would be on the same track as with the Stone Age comparison.  You would not have to summon up an entirely new theory.

Why is Nashville richer than Chattanooga?  Again, start with “incentives, policy, and culture,” noting you might need again supplementary factors.

Broadly the same theory is applying to all of these different comparisons.  Across time, across space, across countries, and across cities.  There is something about this broad unity that is methodologically satisfying, and it helps confirm our view that we are on the right track in our inquiries.

Now consider the lead-crime connection.  Insofar as you elevate the connection as very strong, you are tossing out the chance of achieving that kind of unity.

Why was violent crime so often more frequent in earlier periods of human history?  It wasn’t lead, at least not for most periods, perhaps not for any of the much earlier periods.

Why was there more peace in Ethiopia five years ago than in the last few years?  Again, whatever the reasons it wasn’t a change in lead exposure.

Why is the murder rate in Haiti today much higher than during the Duvaliers?  Again, no one thinks the answer has much to do with changes in lead exposure.  Mainly it is because political order has collapsed, and the country is ruled by gangs rather than by an autocratic tyranny.

How about the violence rate in the very peaceful parts of Africa compared to the very violent parts?  Again, lead is rarely if ever going to be the answer to that one.

So we know in the true, overall model big changes in violence can happen without lead exposure being the driving force.  Very big changes.  In fact those big changes in violence rates, without lead being a major factor, happen all the time.

And many of those big changes are mysterious in their causes.  It really isn’t so simple to explain why different parts of Africa have different murder rates, often by very significant amounts.  You can hack away at the problem (e.g, Kenya and Tanzania have very different histories), but there is no simple “go to” theory.  Furthermore, since both violence and peace often feed upon themselves, in a “broken windows” increasing returns sort of way, the initial causes behind big differences in violence outcomes might sometimes be fairly slight and hard to find.

That to my mind makes “the true model” somewhat biased against lead being a major factor in changes in violence rates.  In the broader scheme of things, lead exposure seems to be a supplementary factor rather than a major factor.  It doesn’t rule out lead as a major factor, either logically or statistically, if you wish to explain why U.S. violence fell from the 1960s to today.  But the true model has a lot of non-lead, major shifts in violence, often unexplained or hard to explain.

Addendum: I am also surprised by Kevin’s comment that there isn’t likely to be much publication bias in lead-violence studies.  I take publication bias to be a default assumption, namely the desire to show a positive result to get published.  That hardly seems unlikely to me at all.  And in this particular case there is even a particular political reason to wish to pin a lot of the blame on lead exposure.  Correctly or not, people on the Left are much more likely to elevate lead exposure as a cause of social problems.

And to repeat myself, just to be perfectly clear, it strikes me as unlikely that the effect of lead exposure on violence in zero is the last seventy years of the United States.