Social and Behavioral Sciences Commons^™

Chain Restaurant Calorie Posting Laws, Obesity, And Consumer Welfare, Charles J. Courtemanche, David Frisvold, David Jimenez-Gomez, Mariétou H. Ouayogodé, Michael Price

Institute for the Study of Free Enterprise Working Papers

The 2010 Patient Protection and Affordable Care Act (ACA) introduced a mandate requiring chain restaurants to post calorie counts on menus and menu boards. This paper investigates whether and why calorie posting laws work. To do so, we develop a model of calories consumed that highlights two potential channels through which mandates influence choice and outlines an empirical strategy to disentangle these alternatives. We test the predictions of our model using data from the Behavioral Risk Factor Surveillance System to compare changes in body mass index (BMI), obesity, and consumer well-being in locations that implemented calorie-posting laws between 2008 and …

Kentucky Annual Economic Report 2020, Michael W. Clark, William H. Hoyt, Simon Sheather, Michael T. Childress

Kentucky Annual Economic Report

This report is one of the important ways that the Center for Business and Economic Research fulfills its mission to examine various aspects of the Kentucky economy. The analysis and data presented here cover a variety of topics that range from an economic forecast for Kentucky in 2020 to a broad presentation of factors affecting the economy.

50 Economic Facts And Figures About Kentucky, 2020, Michael Childress

CBER Infographic Posters

50 ECONOMIC FACTS AND FIGURES ABOUT KENTUCKY, 2020

The Effects Of E-Cigarette Taxes On E-Cigarette Prices And Tobacco Product Sales: Evidence From Retail Panel Data, Chad Cotti, Charles J. Courtemanche, Joanna Catherine Maclean, Erik Nesson, Michael F. Pesko, Nathan Tefft

Institute for the Study of Free Enterprise Working Papers

We explore the effect of e-cigarette taxes enacted through 2017 in eight states and two large counties on e-cigarette prices, e-cigarette sales, and sales of other tobacco products. We use the Nielsen Retail Scanner data for the years 2011 to 2017, comprising approximately 35,000 retailers nationally. We calculate a Herfindahl–Hirschman Index of 0.251 for retail-based purchases of e-cigarettes, indicating high market concentration. We estimate a tax-to-price pass-through of 1.55 (p < 0.01) and an e-cigarette own-price elasticity of -2.6 (p < 0.01) for the average e-cigarette tax. We also estimate a positive cross-price elasticity of demand for e-cigarettes and traditional cigarettes of roughly 1.1 for the average tax, suggesting that e-cigarettes and traditional cigarettes are economic substitutes. Our results suggest that higher e-cigarette taxes would increase e-cigarette prices and reduce e-cigarette sales, with an unintended effect of increasing traditional cigarette sales. We simulate that for every one standard e-cigarette pod (a device that contains liquid nicotine in e-cigarettes) of 0.7 ml no longer purchased as a result of an e-cigarette tax, the same tax increases traditional cigarettes purchased by 6.2 extra packs.

Time Spent Exercising And Obesity: An Application Of Lewbel’S Instrumental Variables Method, Charles J. Courtemanche, Joshua C. Pinkston, Jay Stewart

Institute for the Study of Free Enterprise Working Papers

This paper examines the role physical activity plays in determining body mass using data from the American Time Use Survey. Our work is the first to address the measurement error that arises when time use during a single day—rather than average daily time use over an extended period—is used as an explanatory variable. We show that failing to account for day-to-day variation in activities results in the effects of time use on a typical day being understated. Furthermore, we account for the possibility that physical activity and body mass are jointly determined by implementing Lewbel’s instrumental variables estimator that exploits …

The Coffee In Your Cup: Reviewing Fair Trade’S Impact On Development, Elena Liu

Oswald Research and Creativity Competition

Fair trade is one of many certification strategies available to coffee producers around the globe. The fair trade (FT) movement broke into the American coffee industry with strategies aimed at reducing global poverty among farmers in developing nations, primarily using the FMP and FP mechanisms. This review will discuss why research on the development effects of fair trade is increasingly nebulous, how researchers have analyzed it up until now, their findings, and future recommendations to improve the clarity of results. Current literature on fair trade’s impact provides consistent reports of higher prices attained, but inconclusive findings surrounding increased income and …

Trouble In The Tails? What We Know About Earnings Nonresponse 30 Years After Lillard, Smith, And Welch, Christopher R. Bollinger, Barry T. Hirsch, Charles M. Hokayem, James P. Ziliak

Economics Faculty Publications

Earnings nonresponse in household surveys is widespread, yet there is limited knowledge of how nonresponse biases earnings measures. We examine the consequences of nonresponse on earnings gaps and inequality using Current Population Survey individual records linked to administrative earnings data. The common assumption that earnings are missing at random is rejected. Nonresponse across the earnings distribution is U-shaped, highest in the left and right tails. Inequality measures differ between household and administrative data due in part to nonresponse. Nonresponse biases earnings differentials by race, gender, and education, particularly in the tails. Flexible copula-based models can account for nonrandom nonresponse.

The Effects Of Opioids On Kentucky's Workforce, Michael W. Clark, Jenny A. Minier, Charles J. Courtemanche, Bethany L. Paris, Michael T. Childress

CBER Research Report

From the executive summary:

Opioid abuse represents a significant and growing public health issue for both the nation and Kentucky. In 2016, opioids contributed to more than 62,000 deaths nationally and 1,406 deaths in Kentucky. National studies have placed the societal costs of opioid abuse at $55.7 billion in 2007 and $78.5 billion in 2013 (Birbaum et al. (2011) and Florence et al. (2016)). These costs included increased health care expenditures, higher criminal justice costs, and lost earnings due to reduced employment and premature deaths. The While House Council of Economic Advisors (2017) estimated the societal costs of opioid abuse …

The Effect Of Smoking On Kentucky’S Workforce, Michael W. Clark, Jenny A. Minier, Charles J. Courtemanche, Bethany L. Paris, Michael T. Childress

CBER Research Report

Excerpt from the Executive Summary:

Smoking has been estimated to increase health care costs in the United States by $167.5 billion annually (Xu et al. 2015). In Kentucky, smoking adds $2.5 billion in health care expenditures each year. Most of these costs were paid by public programs such as Medicaid and Medicare. While these costs are significant, they represent only a portion of the costs that smoking imposes on society. Smoking also leads to poorer labor market outcomes. Smokers are more likely to be unemployed, earn lower wages, and die prematurely than non-smokers. These negative labor market effects reduce economic …

Kentucky School Districts As Educational Bright Spots, Michael T. Childress

CBER Research Report

Every year a select group of Kentucky school districts perform better than expected on measures of educational achievement. These measures include things like the percentage of elementary students who achieve proficiency or distinguished in reading, or the proportion of less‐advantaged middle school students who show a similar level of competency on the math assessment.

There are wide differences in the learning environments, finances, and student outcomes among and within Kentucky’s 173 school districts. This is not surprising given that the largest school district in the state, Jefferson County, has 97,000 students and 165 schools, while the smallest, West Point Independent …

Can Mergers And Acquisitions Internalize Positive Externalities In Funding Innovation?, Leo Li, Mark Liu

Institute for the Study of Free Enterprise Working Papers

Fundamental innovation usually involves huge upfront costs, but the benefits are spread across various sectors of the economy. Given the large costs and limited appropriability of the benefits associated with the innovation, individual firms underinvest in these innovations relative to the socially optimal level. We find that mergers and acquisitions (M&As) can internalize the positive externalities by merging firms from both the user industries and the producer industries of an innovation. Using the US patent citation dataset, we define the user and producer relationship between each pair of industries and between each pair of industry and technological class. We then …

Medicaid Coverage Across The Income Distribution Under The Affordable Care Act, Charles J. Courtemanche, James Marton, Aaron Yelowitz

Institute for the Study of Free Enterprise Working Papers

This chapter examines trends in Medicaid enrollment across the income distribution after the ACA’s Medicaid expansion.Using data from the American Community Survey between 2012and 2017, we compare Medicaid coverage over time in 9 states that expanded Medicaid in 2014 with no previous expansion for able-bodied, working-age adults with 12 states that had not expanded Medicaid by 2019 and also had no previous expansion for such adults. A difference-in-differences model is used to formalize this comparison. Similar to many previous studies, we find that Medicaid coverage increased dramatically for income-eligible adults under 138% of the federal poverty level (FPL). In addition, …

The Allocation And Exchange Of Property Rights As A Way To Understand Comparative Economics Systems And Managerial Economics, John Garen

Institute for the Study of Free Enterprise Working Papers

This paper discusses how economic systems can be described by the manner that property rights are allocated to individuals, to the government, or to interests groups. Property rights entail control of use of assets, claim on the net income from an asset, and transferability of the previous two. Economics systems (e.g., capitalism, socialism, cronyism) are characterized by who holds these rights, in whole or in part, and this determines the success or failure of an economy. A related analysis is applied to understanding business organization, e.g., the corporate and non-corporate form, franchising, and employee compensation methods. Each entails a (voluntary) …

The Economic Impact Of Diabetes In Kentucky, Michael W. Clark, Jenny A. Minier, Charles J. Courtemanche, Bethany L. Paris, Michael T. Childress

CBER Research Report

Excerpt from the Executive Summary:

The Kentucky Department of Public Health is responsible for improving the health and safety of Kentucky’s residents by preventing disease and injuries and encouraging healthy lifestyles. The department administers nearly 150 programs that address critical health issues affecting Kentuckians. These programs screen newborns for health problems, prevent the spread of infectious diseases, promote oral health, and provide numerous other services.

Diabetes represents a growing health concern for the nation and Kentucky. It is a chronic condition that causes blood sugar levels to rise and contributes to other serious health conditions such as heart and kidney …

The Effects Of Traditional Cigarette And E-Cigarette Taxes On Adult Tobacco Product Use, Michael F. Pesko, Charles J. Courtemanche, Joanna Catherine Maclean

Institute for the Study of Free Enterprise Working Papers

We study the effects of traditional cigarette tax rate changes and e-cigarette tax adoption on use of these products among US adults. Data are drawn from the Behavioral Risk Factor Surveillance System and National Health Interview Survey data over the period 2011to 2017. Using a difference-in-differences model, we find that higher traditional cigarette taxes reduce adult traditional cigarette use and increase adult e-cigarette use, suggesting that the products are economic substitutes. E-cigarette tax adoption reduces e-cigarette use, with some heterogeneity across groups, and dilutes the own-tax responsiveness of traditional cigarettes.

Kentucky Annual Economic Report 2019, Michael T. Childress, Jenny Minier, William H. Hoyt, Simon Sheather

Kentucky Annual Economic Report

This report is one of the important ways that the Center for Business and Economic Research fulfills its mission as specified in the Kentucky Revised Statutes (KRS 164.738) to examine various aspects of the Kentucky economy. The analysis and data presented here cover a variety of topics that range from an economic forecast for Kentucky in 2019 to a broad presentation of factors affecting the economy.

Social Security And Medicare Spending Growth: Is It Just More Seniors Or More Per Senior?, John Garen

Institute for the Study of Free Enterprise Working Papers

Long-term federal budget forecasts show sizable increases in federal spending in the coming decades. This is concerning to those who worry that the growth of government will diminish incentives, reduce productivity, and limit economic growth. A large share of the forecasted increase in spending is due to Social Security and Medicare. This paper considers how much of this increase is simply due to the growth in the eligible population and how much is due to growth in spending per beneficially. The findings show both the former and the latter account for sizable shares of the growth. Thus, there is room …

The Federal-Private Wage Differential: How Has It Evolved?, Sun-Ki Choi, John Garen

Institute for the Study of Free Enterprise Working Papers

Federal, state, and local budget issues in the aftermath of the Great Recession stimulated a revival of interest in government worker pay. In the paper, we study the evolution of the federal-private pay differential from 1995 to 2017 using Current Population Survey data, enabling us to examine the current pay gap and how it has changed over time. Wage regressions are estimated by year for federal and private sector workers and used to calculate the yearly federal-private wage differential. To deal with unobserved heterogeneity, we adopt control function methods. We also estimate of the probability of receiving employer-provided health insurance …

The Three-Year Impact Of The Affordable Care Act On Disparities In Insurance Coverage, Charles J. Courtemanche, James Marton, Benjamin Ukert, Aaron Yelowitz, Daniela Zapata, Ishtiaque Fazlul

Economics Faculty Publications

Objective
To estimate the impact of the major components of the ACA (Medicaid expansion, subsidized Marketplace plans, and insurance market reforms) on disparities in insurance coverage after three years.

Data Source
The 2011-2016 waves of the American Community Survey (ACS), with the sample restricted to nonelderly adults.

Design
We estimate a difference-in-difference-in-differences model to separately identify the effects of the nationwide and Medicaid expansion portions of the ACA using the methodology developed in the recent ACA literature. The differences come from time, state Medicaid expansion status, and local area pre-ACA uninsured rates. In order to focus on access disparities, we …

The Digital Knowledge Economy Index: Mapping Content Production, Sanna Ojanperä, Mark Graham, Matthew Zook

Geography Faculty Publications

We propose the construction of a Digital Knowledge Economy Index, quantified by way of measuring content creation and participation through digital platforms, namely the code sharing platform GitHub, the crowdsourced encyclopaedia Wikipedia, and Internet domain registrations and estimating a fifth sub-index for the World Bank Knowledge Economy Index for year 2012. This approach complements conventional data sources such as national statistics and expert surveys and helps reflect the underlying digital content creation, capacities, and skills of the population. An index that combines traditional and novel data sources can provide a more revealing view of the status of the world’s digital …

Maternal Work Hours And Childhood Obesity: Evidence Using Instrumental Variables Related To Sibling School Eligibility, Charles J. Courtemanche, Rusty Tchernis, Xilin Zhou

Economics Faculty Publications

This study exploits plausibly exogenous variation derived from the youngest sibling’s school eligibility to estimate the effects of maternal work on the weight outcomes of older children. We first show that mothers’ work hours increase gradually along both the extensive and intensive margins as the age of the youngest child rises, whereas mothers’ spouses’ work hours do not appear to be responsive. We develop an instrumental-variables model that shows that mothers’ work hours lead to larger increases in children’s body mass index z-scores and probabilities of being overweight/obese than those identified in previous studies. Subsample analyses find that the …

Investment In Human Capital And Labor Mobility: Evidence From A Shock To Property Rights, Christopher P. Clifford, William C. Gerken

Institute for the Study of Free Enterprise Working Papers

We show that the assignment of property rights to client relationships affects employee behavior in the industry for financial advice. Our identification comes from staggered firm-level entry into the Protocol for Broker Recruiting. The protocol effectively transfers the ownership of the client relationship from the firm to the employee. We document that entering into the protocol increases employee labor mobility among member firms. Further, we find that upon protocol inclusion, employees are less likely to generate customer complaints and more likely to invest in their own general human capital, but less likely to invest in firm-specific human capital. We use …

Effects Of Shifts In The Local Tax Base On Economic Outlook, Shelby Buckman

Posters-at-the-Capitol Presentations

In Kentucky, local governments can impose taxes on property and income. Tax options and maximum rates are limited by the classification of the city, which is loosely based on population size. In the summer of 2017, the City of Henderson, Kentucky’s City Council passed an ordinance that lowered real estate tax rates and raised the occupational payroll tax rates. This shift is forecasted to be net neutral for city revenue, which raised the question of how changes in the local tax burden affect a Kentucky city’s long run economic outlook.

In a theoretical model, the businesses and population would move …

Can Credit Rating Agencies Affect Election Outcomes?, Igor Cunha, Miguel A. Ferreira, Rui C. Silva

Institute for the Study of Free Enterprise Working Papers

We show that credit rating agencies can have a significant effect on election outcomes. We identify these effects by exploiting exogenous variation in municipal bond ratings due to Moody’s recalibration of its scale in 2010. We find that incumbent politicians in upgraded municipalities experience an increase in their likelihood of reelection and their vote shares. These rating upgrades improve voters’ opinions about the incumbent and produce positive wealth effects through voters’ holdings of local municipal bonds. In addition, rating upgrades cause an expansion of local governments’ debt capacity that allows the incumbent to increase spending and improve local economic conditions.

Ambulance Service Ownership And Management: How It Affects Quality Of Service Delivery For Medicare Patients, Sookti Chaudhary, Kenneth R. Troske, Suzanne Troske, Alison Davis

Institute for the Study of Free Enterprise Working Papers

This study investigates how ownership and/or management affects ambulance services across the United States. We investigate whether ambulance quality, measured by patient transportation time, varies by organization type. We estimate the effect of ownership structure on response time variables using data from the National EMS Information System (NEMSIS) for the years 2010–2015, the most comprehensive data set on emergency medical services. Focusing on ground transportation (as opposed to air and water transportation) and on Medicare-eligible (age 65 years and older) patients, we find that, on average, ambulance services owned by fire departments respond faster than those managed by other types …

Intimate Political Economies Of The Andes, Carmen Martínez Novo

Anthropology Faculty Publications

No abstract provided.

Future And Value: The Library As Strategic Partner, Antje Mays

Library Presentations

Broader economic trends spawn budget pressures for education and libraries, prompting a plethora of studies on the value and relevance of libraries. Numerous reports on economic decline in libraries and studies with mixed pronouncements on the value of libraries have led to a negative self-image within the library profession. Yet libraries' leadership in connecting learners to knowledge is at the heart of producing many of the key skills sorely needed in robust societies and economies. Librarianship has many untapped opportunities for positioning itself as a prominent strategic partner. This paper outlines current research on the economic and societal context for …

Nominal Gdp Versus Price Level Targeting: An Empirical Evaluation, James S. Fackler, W. Douglas Mcmillin

Institute for the Study of Free Enterprise Working Papers

In response to the ongoing discussion in the literature of the appropriate framework for monetary policy, we compare two of the most frequently discussed alternatives to inflation targeting—targeting either the level of nominal GDP or the price level—within the context of a simple vector autoregressive (VAR) model. Our approach can be considered a constrained-discretion approach. The model is estimated using quarterly data over the period 1979:4-2003:4, a period in which the economy was buffeted by substantial supply and demand shocks. The paths of the federal funds rate, nominal GDP, real GDP, and the price level under nominal GDP and price …

Can Maternity Benefits Have Long-Term Effects On Childbearing? Evidence From Soviet Russia, Olga Malkova

Economics Faculty Publications

This paper quantifies the effects of Russia’s 1981 expansion in maternity benefits on completed childbearing. The program provided one year of partially paid parental leave and a small cash transfer upon a child’s birth. I exploit the program’s two-stage implementation and find evidence that women had more children as a result of the program. Fertility rates rose immediately by 8.2% over twelve months. The increase in fertility rates not only persisted for the ten-year duration of the program, but it reflected large increases in higher-order births to older women who already had children before the program started.

Effects Of The Affordable Care Act On Health Care Access And Self-Assessed Health After 3 Years, Charles J. Courtemanche, James Marton, Benjamin Ukert, Aaron Yelowitz, Daniela Zapata

Economics Faculty Publications

Using data from the Behavioral Risk Factor Surveillance System, we examine the causal impact of the Affordable Care Act on health-related outcomes after 3 years. We estimate difference-in-difference-in-differences models that exploit variation in treatment intensity from 2 sources: (1) local area prereform uninsured rates from 2013 and (2) state participation in the Medicaid expansion. Including the third postreform year leads to 2 important insights. First, gains in health insurance coverage and access to care from the policy continued to increase in the third year. Second, an improvement in the probability of reporting excellent health emerged in the third year, with …