Persistence In Industrial Policy Impacts: Evidence From Depression-Era Mississippi, Matthew Freedman
Jul 2016
Persistence In Industrial Policy Impacts: Evidence From Depression-Era Mississippi, Matthew Freedman
Matthew Freedman
This paper studies the effects of a large-scale industrial policy implemented in 1930s Mississippi on contemporaneous and modern-day labor market outcomes. Attracted by unprecedented government incentives under Mississippi’s Balance Agriculture with Industry (BAWI) Program, 13 large manufacturing plants established operations in the state between 1936 and 1940. Using difference-in-differences and synthetic control matching techniques, I estimate that counties that received these plants experienced an over 15% increase in female labor force participation on average in the short run. Moreover, these effects persisted decades into the future, well after many of the original companies shut down. I also find suggestive evidence …
Immigration, Employment Opportunities, And Criminal Behavior, Matthew Freedman, Emily Owens, Sarah Bohn
Jun 2016
Immigration, Employment Opportunities, And Criminal Behavior, Matthew Freedman, Emily Owens, Sarah Bohn
Matthew Freedman
We take advantage of provisions of the Immigration Reform and Control Act of 1986 (IRCA), which granted legal resident status to long-time unauthorized residents but created new obstacles to employment for more recent immigrants, to explore how employment opportunities affect criminal behavior. Exploiting administrative data on the criminal justice involvement of individuals in San Antonio, Texas and using a triple-differences strategy, we find evidence of an increase in felony charges filed against residents most likely to be affected by IRCA’s employment regulations. Our results suggest a strong relationship between access to legal jobs and criminal behavior.
Your Friends And Neighbors: Localized Economic Development And Criminal Activity, Matthew Freedman, Emily G. Owens
Apr 2016
Your Friends And Neighbors: Localized Economic Development And Criminal Activity, Matthew Freedman, Emily G. Owens
Matthew Freedman
We exploit a sudden shock to demand for a subset of low-wage workers generated by the 2005 Base Realignment and Closure (BRAC) program in San Antonio, Texas to identify the effects of localized economic development on crime. We use a difference-in-differences methodology that takes advantage of variation in BRAC’s impact over time and across neighborhoods. We find that appropriative criminal behavior increases in neighborhoods where a fraction of residents experienced increases in earnings. This effect is driven by residents who were unlikely to be BRAC beneficiaries, implying that criminal opportunities are important in explaining patterns of crime.
Forthcoming in the …
The Urban Density Premium Across Establishments, R. Jason Faberman, Matthew Freedman
Apr 2016
The Urban Density Premium Across Establishments, R. Jason Faberman, Matthew Freedman
Matthew Freedman
We use longitudinal establishment data to estimate the urban density premium for U.S. establishments, controlling for observed establishment characteristics and dynamic establishment behavior. Consistent with previous studies, we find an elasticity of average establishment earnings with respect to metropolitan area population of 0.03, controlling for the endogeneity of location and establishment and metropolitan area characteristics. More importantly, we find that the estimated density premium is realized almost entirely at entry and is constant over an establishment’s life. We find little evidence that the endogenous entry or exit of establishments can account for any of the estimated density premium. We interpret …
Undergraduate Intermediate Microeconomics (Econ 301), Matthew Freedman
Dec 2015
Undergraduate Intermediate Microeconomics (Econ 301), Matthew Freedman
Matthew Freedman
This is a four-credit course that builds on the theory developed in principles of microeconomics. This course is required for students with a major in economics or with a major in business and a concentration in economics. The goals of this course are (1) to analyze the workings of markets from a quantitative rather than purely conceptual perspective; (2) to use calculus to solve microeconomics problems; (3) to be able to apply microeconomic theory to real world issues; (4) to be able to explain the intuition behind microeconomic models. Topics include the basics of demand and supply, elasticity, consumer choice, …
Undergraduate Labor Economics (Econ 336), Matthew Freedman
Dec 2015
Undergraduate Labor Economics (Econ 336), Matthew Freedman
Matthew Freedman
In this course, students will be expected to think critically about labor economics and to apply theoretical concepts related to wage and employment determination to real-world policy and workplace issues. Students will demonstrate their mastery of the subject through class participation as well as in exams, problem sets, and a writing assignment. Learning how to analyze and draw inferences from labor market data represents a key component of the class. Topics covered include, but are not limited to, labor supply and demand, human capital investment, firm compensation policy and performance incentives, unemployment, unions, discrimination, and wage inequality.
Course materials are …
Who Benefits From Environmental Regulation? Evidence From The Clean Air Act Amendments, Antonio Bento, Matthew Freedman, Corey Lang
Jul 2015
Who Benefits From Environmental Regulation? Evidence From The Clean Air Act Amendments, Antonio Bento, Matthew Freedman, Corey Lang
Matthew Freedman
Using geographically disaggregated data and exploiting an instrumental variable strategy, we show that, contrary to conventional wisdom, the benefits of the 1990 Clean Air Act Amendments (CAAA) were progressive. The CAAA created incentives for local regulators to target the initially dirtiest areas for cleanup, creating heterogeneity in the incidence of air quality improvements that favored lower-income households. Based on house price appreciation, households in the lowest quintile of the income distribution received annual benefits from the program equal to 0.3% of their income on average during the 1990s, over twice as much as those in the highest quintile.
Earlier versions …
Place-Based Programs And The Geographic Dispersion Of Employment, Matthew Freedman
Jun 2015
Place-Based Programs And The Geographic Dispersion Of Employment, Matthew Freedman
Matthew Freedman
Government efforts to improve local economic conditions by encouraging private investment in targeted communities could affect the broader geographic distribution of employment in a region, especially to the extent that subsidized businesses face few constraints on whom they hire. This paper examines the labor market impacts of investment subsidized by the U.S. federal government’s New Markets Tax Credit (NMTC) program, which provides tax incentives to promote business investment in low-income neighborhoods. To identify the program’s effects, I exploit a discontinuity in the rule determining the eligibility of census tracts for NMTC-subsidized investment. Using rich administrative data on workers’ residence and …
The Criminal Justice Response To Policy Interventions: Evidence From Immigration Reform, Sarah Bohn, Matthew Freedman, Emily Owens
May 2015
The Criminal Justice Response To Policy Interventions: Evidence From Immigration Reform, Sarah Bohn, Matthew Freedman, Emily Owens
Matthew Freedman
Changes in the treatment of individuals by the criminal justice system following a policy intervention may bias estimates of the effects of the intervention on underlying criminal activity. We explore the importance of such changes in the context of the Immigration Reform and Control Act of 1986 (IRCA). Using administrative data from San Antonio, Texas, we examine variation across neighborhoods and ethnicities in police arrests and in the rate at which those arrests are prosecuted. We find that changes in police behavior around IRCA confound estimates of the effects of the policy and its restrictions on employment on criminal activity.
Low-Income Housing Development, Poverty Concentration, And Neighborhood Inequality, Matthew Freedman, Tamara Mcgavock
Dec 2014
Low-Income Housing Development, Poverty Concentration, And Neighborhood Inequality, Matthew Freedman, Tamara Mcgavock
Matthew Freedman
Considerable debate exists about the merits of place-based programs that steer new development, and particularly affordable housing development, into low-income neighborhoods. Exploiting quasi-experimental variation in incentives to construct and rehabilitate rental housing across neighborhoods generated by Low-Income Housing Tax Credit (LIHTC) program rules, we explore the impacts of subsidized development on local housing construction, poverty concentration, and neighborhood inequality. While a large fraction of rental housing development spurred by the program is offset by a reduction in the number of new unsubsidized units, housing investment under the LIHTC has measurable effects on the distribution of income within and across communities. …
Agency And Compensation: Evidence From The Hotel Industry, Matthew Freedman, Renata Kosova
Feb 2014
Agency And Compensation: Evidence From The Hotel Industry, Matthew Freedman, Renata Kosova
Matthew Freedman
We examine how agency problems in the workplace interact with compensation policies by taking advantage of the structure of the hotel industry, in which many chains have both company managed and franchised properties. As residual claimants on their properties’ profits, franchisees have stronger incentives to monitor employees than managers in company managed hotels. Exploiting this variation and using rich, longitudinal data on the hotel industry, we estimate differences in wages and human resource practices across company managed and franchised hotels within chains as well as within individual hotels as they change organizational form. Our results suggest that the timing of …
Mba Managerial Economics (Mgec 611/612), Matthew Freedman
Dec 2013
Mba Managerial Economics (Mgec 611/612), Matthew Freedman
Matthew Freedman
Managerial economics for MBAs.
Please see Canvas for course materials.
Taught Fall 2014.
Undergraduate Public Finance (Bepp 201), Matthew Freedman
Dec 2013
Undergraduate Public Finance (Bepp 201), Matthew Freedman
Matthew Freedman
This course will examine the role of the government in the economy and its impact on individuals and firms. The aim of the course is to provide an understanding of the reasons for government intervention in the economy, the extent of that intervention, and the response of individuals and firms to the government’s actions. A wide variety of topics will be covered, including (but not limited to) environmental regulation, education, health care, social insurance programs, budget deficits, and the taxation of both individuals and firms.
The syllabus is posted here.
Course materials are posted on Canvas.
Taught Spring …
Undergraduate Personnel Economics (Ilrle/Econ 4430), Matthew Freedman
Dec 2012
Undergraduate Personnel Economics (Ilrle/Econ 4430), Matthew Freedman
Matthew Freedman
In this course, students will be expected to apply economic theories to human resource management issues. The course will provide students with a rigorous framework in which to understand and analyze real-world personnel policies, their implementation, and their effects. Topics and issues we will discuss include human capital theory, hiring standards and screening, productivity and performance measurement, compensation schemes, layoffs and buyouts, training, teamwork, performance incentives, benefits, worker empowerment, and employee evaluation programs. Students will demonstrate their mastery of the subject through class participation as well as in exams, problem sets, and a group project.
Course materials are posted on …
Undergraduate Intermediate Microeconomics - Math-Intensive (Bepp 250), Matthew Freedman
Dec 2012
Undergraduate Intermediate Microeconomics - Math-Intensive (Bepp 250), Matthew Freedman
Matthew Freedman
This course will introduce you to “managerial economics”, the application of microeconomic theory to management problems. Microeconomic theory is a remarkably useful body of ideas for understanding and analyzing the behavior of individuals and firms in a variety of contexts. The goal of the course is to get you to internalize this body of theory well enough so that you can rigorously and efficiently analyze management—as well as other—problems in an economic framework. While this is a “tools” course, we will cover many real-world applications, particularly business applications, throughout the course. We will depart from usual microeconomic policy courses with …
Graduate Labor Economics Ii (Econ 7430/Ilrle 7460), Matthew Freedman
Dec 2012
Graduate Labor Economics Ii (Econ 7430/Ilrle 7460), Matthew Freedman
Matthew Freedman
This course is one-fourth of a two-semester sequence in graduate labor economics. This segment will focus on theories of principal-agent models and compensation design; firm, industry, and occupation effects; job search theory; and labor market policy evaluation. In addition to covering the basic theory behind these subjects, we will discuss the major empirical challenges surrounding each topic. We will go on to develop and apply different econometric approaches to dealing with such challenges, including difference-in-differences, instrumental variable estimation, and regression discontinuity.
See also the Labor Economics Seminar Series.
Course materials are posted on Blackboard.
Taught Spring 2013.
Targeted Business Incentives And Local Labor Markets, Matthew Freedman
Dec 2012
Targeted Business Incentives And Local Labor Markets, Matthew Freedman
Matthew Freedman
This paper uses a regression discontinuity design to examine the effects of geographically targeted business incentives on local labor markets. Unlike elsewhere in the U.S., enterprise zone (EZ) designations in Texas are determined in part by a cutoff rule based on census block group poverty rates. Exploiting this discontinuity as a source of quasi-experimental variation in investment and hiring incentives across areas, I find that EZ designation has a positive effect on resident employment, increasing opportunities mainly in lower-paying industries. While business sitings and expansions spurred by the program are more geographically diffuse, EZ designation is associated with increases in …
Teaching New Markets Old Tricks: The Effects Of Subsidized Investment On Low-Income Neighborhoods, Matthew Freedman
Nov 2012
Teaching New Markets Old Tricks: The Effects Of Subsidized Investment On Low-Income Neighborhoods, Matthew Freedman
Matthew Freedman
This paper examines the effects of investment subsidized by the federal government’s New Markets Tax Credit (NMTC) program, which provides tax incentives to encourage private investment in low-income neighborhoods. I identify the impacts of the program by taking advantage of a discontinuity in the rule determining the eligibility of census tracts for NMTC-subsidized investment. Using this discontinuity as a source of quasi-experimental variation in commercial development across tracts, I find that subsidized investment has modest positive effects on neighborhood conditions in low-income communities. Though spillovers appear to be small and crowd out incomplete, the results suggest that some of the …
Decomposing The Sources Of Earnings Inequality: Assessing The Role Of Reallocation, Fredrik Andersson, Elizabeth Davis, Matthew Freedman, Julia Lane, Brian Mccall, L. Kristin Sandusky
Sep 2012
Decomposing The Sources Of Earnings Inequality: Assessing The Role Of Reallocation, Fredrik Andersson, Elizabeth Davis, Matthew Freedman, Julia Lane, Brian Mccall, L. Kristin Sandusky
Matthew Freedman
This paper exploits longitudinal employer-employee matched data from the U.S. Census Bureau to investigate the contribution of worker and firm reallocation to changes in earnings inequality within and across industries between 1992 and 2003. We find that factors that cannot be measured using standard cross-sectional data, including the entry and exit of firms and the sorting of workers across firms, are important sources of changes in earnings distributions over time. Our results also suggest that the dynamics driving changes in earnings inequality are heterogeneous across industries.
Agglomeration, Product Heterogeneity, And Firm Entry, Matthew Freedman, Renata Kosova
Apr 2012
Agglomeration, Product Heterogeneity, And Firm Entry, Matthew Freedman, Renata Kosova
Matthew Freedman
This paper investigates the interaction between product heterogeneity and geographic agglomeration. Using data for nearly the entire population of U.S. hotels, we examine patterns of entry into different regions among establishments delineated by product segment. We find that to the extent that hotels agglomerate, they are sensitive to the composition and size distribution of other hotels in an area. Our results are consistent with countervailing competition and agglomeration effects that vary in strength across differentiated firms.
Click here for a working paper version of this paper on SSRN.
Past Work Experience And Earnings Trajectories Of Single Mothers, Fredrik Andersson, Matthew Freedman, Susan Hauan, Julia Lane
Dec 2011
Past Work Experience And Earnings Trajectories Of Single Mothers, Fredrik Andersson, Matthew Freedman, Susan Hauan, Julia Lane
Matthew Freedman
The increasing labor supply of single mothers in the US labor market in the 1990s is well documented, but due to data deficiencies it generally has been difficult to track the progress in the labor market of this group. In this study we integrate household characteristics data from the Current Population Survey with administrative longitudinal employment and earnings records from the US Census Bureau’s Longitudinal Employer-Household Dynamics (LEHD) program, enabling us to construct employment and earnings histories covering the six years prior to and five years following the survey year (either 1997 or 1998) of each respondent. In contrast to …
Undergraduate Labor Economics (Ilrle 2400), Matthew Freedman
Dec 2010
Undergraduate Labor Economics (Ilrle 2400), Matthew Freedman
Matthew Freedman
In this course, students will be expected to think critically about labor economics and to apply theoretical concepts related to wage and employment determination to real-world policy and workplace issues. Students will demonstrate their mastery of the subject through class participation as well as in exams, problem sets, and a writing assignment. Learning how to analyze and draw inferences from labor market data represents a key component of the class. Topics covered include, but are not limited to, labor supply and demand, human capital investment, firm compensation policy and performance incentives, unemployment, unions, discrimination, and wage inequality.
Course materials are …
Lost Jobs And Health Insurance: An Analysis Of The Impact Of Employment Volatility On Firm-Provided Health Insurance Coverage, Fredrik Andersson, Iben Bolvig, Matthew Freedman, Julia Lane
Dec 2010
Lost Jobs And Health Insurance: An Analysis Of The Impact Of Employment Volatility On Firm-Provided Health Insurance Coverage, Fredrik Andersson, Iben Bolvig, Matthew Freedman, Julia Lane
Matthew Freedman
It is an established fact that there are high levels of employment volatility in the United States. Despite the importance of employer-provided benefits in the U.S. insurance system, the impact of prior job instability on one’s future ability to obtain insurance coverage is not well understood. This paper finds a negative relationship between the volatility of a worker’s employment and her likelihood of receiving firm-provided health insurance. Previous employment volatility reduces each of the four factors necessary to receive such insurance: a worker’s subsequent chances of getting a job, her chances of getting a job in a firm that offers …
Low-Income Housing Development And Crime, Matthew Freedman, Emily Owens
Dec 2010
Low-Income Housing Development And Crime, Matthew Freedman, Emily Owens
Matthew Freedman
This paper examines the effect of rental housing development subsidized by the federal government’s Low-Income Housing Tax Credit (LIHTC) program on local crime. Under the LIHTC program, certain high-poverty census tracts receive Qualified Census Tract (QCT) status, which affects the size of the tax credits developers receive for building low-income housing. Changes in federal rules determining QCT status generate quasi-experimental variation in the location of LIHTC projects. Exploiting this variation, we find that low-income housing development in the poorest neighborhoods brings with it significant reductions in violent crime that are measurable at the county level. There are no detectable effects …
Reaching For The Stars: Who Pays For Talent In Innovative Industries?, Fredrik Andersson, Matthew Freedman, John Haltiwanger, Julia Lane, Kathryn Shaw
May 2009
Reaching For The Stars: Who Pays For Talent In Innovative Industries?, Fredrik Andersson, Matthew Freedman, John Haltiwanger, Julia Lane, Kathryn Shaw
Matthew Freedman
Innovative firms need to hire and motivate highly talented workers. This article connects the potential returns to innovation to the structure of compensation for skilled employees. We show that the software firms that operate in software sectors with high potential upside gains to innovation pay more to 'star' workers than do other firms that operate in stable markets. Firms operating in product domains with highly skewed positive returns pay employees more in up-front starting salaries and offer higher compensation growth. The large estimated effects on earnings are robust to the inclusion of a wide range of controls for worker and …
Graduate Labor Economics I (Econ 7420/Ilrle 7450), Matthew Freedman
Dec 2008
Graduate Labor Economics I (Econ 7420/Ilrle 7450), Matthew Freedman
Matthew Freedman
This course is one-fourth of a two-semester sequence in graduate labor economics. This segment will focus on theories of human capital and labor supply. In addition to covering the basic theory behind these subjects, we will discuss the major empirical challenges surrounding each topic. We will go on to develop and apply different econometric approaches to dealing with such challenges, including difference-in-differences, instrumental variable estimation, and regression discontinuity.
See also the Labor Economics Seminar Series.
Course materials are posted on Blackboard.
Taught Fall 2008 and Fall 2009.
Job Hopping, Earnings Dynamics, And Industrial Agglomeration In The Software Publishing Industry, Matthew Freedman
Oct 2008
Job Hopping, Earnings Dynamics, And Industrial Agglomeration In The Software Publishing Industry, Matthew Freedman
Matthew Freedman
This paper investigates the implications of industrial clustering for labor mobility and earnings dynamics in one large and increasingly important high-technology sector. Taking advantage of longitudinal employee-employer matched data, I exploit establishment-level variation in agglomeration to explore how clustering in the software publishing industry affects labor market outcomes. The results show that clustering makes it easier for workers to job hop within the sector. Higher earnings levels in more agglomerated areas are partly attributable to sorting across locations among workers and firms in the industry on the basis of observable and unobservable characteristics. Controlling for this heterogeneity, workers in clusters …
Ilr Impact Brief - Industry Clusters Affect Job Mobility And Earnings Growth, Matthew Freedman
Jun 2008
Ilr Impact Brief - Industry Clusters Affect Job Mobility And Earnings Growth, Matthew Freedman
Matthew Freedman
Industry clusters are associated with greater job hopping and faster growth in workers’ earning power relative to the experience of workers at less spatially concentrated companies. Workers in these clusters tend to accept lower starting salaries than peers at more isolated firms in anticipation of rapid gains that accompany movement from job to job within the cluster and the accumulation of industry-specific knowledge. Higher earnings observed among workers in clustered firms may also reflect choices made by workers with certain characteristics to seek employment in an area with a high concentration of similar firms and by companies with certain characteristics …
