Immigration and Trade: Evidence from the 1920s Quota Acts (Joint with Alex Palmer)
We exploit a large shock to mass migration, the 1920s US Quota Acts, to causally identify the effect of migration restrictions on trade. Estimating a Difference-in-Difference (DiD) model with heterogeneous treatment effects, we derive several conclusions: First, the 1920's quotas lowered US-European migration, especially migration of farmers from Southern and Eastern (SE) Europe, with negative effects for US-European imports and exports. Specifically, a 1% rise in quota exposure reduces imports by 0.05% and exports by 0.06%. Second, we observe a decline in Southern and Eastern European exports to other SE countries, and SE primary sector exports in general. Lastly, we show that the 1920's quotas reduced SE primary sector output above and beyond the decline associated with reduced primary sector exports. These findings are robust across different sample-periods, quota exposure measures, and estimation methods. We argue that the changing composition of migration post-quota can explain these results.
The Effect of Medical Marijuana Legalization on Pharmaceutical Payments to Physicians (Joint with Rhet Smith)
Although cannabis is federally prohibited, a majority of U.S. states have implemented medical cannabis laws (MCLs). As more individuals consider the drug for medical treatment, they potentially substitute away from prescription drugs. Therefore, an MCL signals competitor entry. This paper exploits geographic and temporal variation in MCLs to examine the strategic response in direct-to-physician marketing by pharmaceutical firms as cannabis enters the market. We use office detailing records from 2014-2018 aggregated to the county level and find detailing increases by 7% in the quarter an MCL is proposed. The increase is temporary, however, and attenuates after MCL approval. We then incorporate physician-level cannabis recommendation data from Florida and find opioid detailing to cannabis-friendly doctors declines following MCL enactment. Although we find weak evidence of a similar decline in our primary analysis, the effects are muted at the aggregate level by the small percent of doctors that recommend cannabis.
How Productive is Public Investment? Evidence from Formal and Informal Production in India (Joint with Santanu Chatterjee & Abhinav Narayanan)
We use firm-level data on formal and informal production in India to examine the sectoral consequences of government investment in public infrastructure. Our results indicate that the output elasticity of public capital, proximity to highway infrastructure, time since project completion, and firm size are important determinants of the sectoral effects of infrastructure on firm productivity. First, we show that while public capital is associated with a positive and significant output elasticity for formal sector firms, it has no systematic effect on informal firms. Next, using a major highway construction project in India, we show that proximity to a newly completed highway and the time since project completion are productivity-enhancing for formal firms, with these benefits distributed evenly across firm size in that sector. By contrast, similar benefits do not accrue to informal firms. Specifically, the presence of large firms in areas close to a newly completed highway crowds out the output of small informal firms, thereby mitigating the overall benefits of public investment for the informal sector.
Work in Progress
Understanding the Aggregate and Distributional Impact of Remittances (Joint with Santanu Chatterjee and John Gibson)
Optimal Public Debt in a Small Open Economy (Joint with Santanu Chatterjee and John Gibson)
Monetary Policy Shocks and Regional House Price Responses (Joint with Bill Lastrapes)
Williams College of Business
Department of Economics
3800 Victory Parkway
Cincinnati, OH 45207