Trump won in counties that lost jobs to China and Mexico

Here is an interesting article that my very talented research assistant Francesco Ruggieri co-authored with Cerrato and Ferrara on the impact of (Autor Dorn Hanson) trade shocks on county vote shares.

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The Effect of Pension Income on Elderly Earnings: Evidence from Social Security and Full Population Data

From Gelber, Isen, and Song:

We estimate the effect of pension income on earnings by examining the Social Security Notch, which cut lifetime discounted Old Age and Survivors Insurance (OASI) benefts by over $6,100 on average for individuals born in 1917 relative to those born in 1916. Using Social Security Administration microdata on the U.S. population by day of birth and a regression discontinuity design, we document that the Notch caused a large increase in elderly earnings. The point estimates show that a $1 increase in OASI benefits causes earnings in the elderly years to decrease by 46 to 61 cents due to an income effect, and the evidence is consistent with the hypothesis that only current (not future) benefits affect earnings. Under further assumptions we rule out more than a small substitution elasticity. Our results suggest that the increase in OASI benefits from 1950 to 1985 can account for at least half of the dramatic decrease in the elderly employment rate over this period.

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Why Retire When You Can Work? Hours are way up for elderly workers

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Zip-code Economics

Here is a new article from Chicago Booth Review that is worth a read

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Financial firms make large share of pass-through income

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See here for details

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Pass-through income and the top 1%

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See here for details

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Quantitative Spatial Economics

From Redding and Rossi-Hansberg:

The observed uneven distribution of economic activity across space is influenced by variation in exogenous geographical characteristics and endogenous interactions between agents in goods and factor markets. Until recently, the theoretical literature on economic geography had focused on styl- ized settings that could not easily be taken to the data. This paper reviews more recent research that has developed quantitative models of economic geography. These models are rich enough to speak to first-order features of the data, such as many heterogenous locations and gravity equation rela- tionships for trade and commuting. Yet at the same time these models are sufficiently tractable to undertake realistic counterfactuals exercises to study the effect of changes in amenities, productivity, and public policy interventions such as transport infrastructure investments. We provide an extensive taxonomy of the different building blocks of these quantitative spatial models and discuss their main properties and quantification.

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