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EARNINGS ADJUSTMENT FRICTIONS: EVIDENCE FROM SOCIAL SECURITY EARNINGS TEST
September 2013
Working Paper Number:
CES-13-50
We study frictions in adjusting earnings to changes in the Social Security Annual Earnings Test (AET) using a panel of Social Security Administration microdata on one percent of the U.S. population from 1961 to 2006. Individuals continue to "bunch" at the convex kink the AET creates even when they are no longer subject to the AET, consistent with the existence of earnings adjustment frictions in the U.S. We develop a novel framework for estimating an earnings elasticity and an adjustment cost using information on the amount of bunching at kinks before and after policy changes in earnings incentives around the kinks. We apply this method in settings in which individuals face changes in the AET bene.t reduction rate, and we estimate in a baseline case that the earnings elasticity with respect to the implicit net-of-tax share is 0.23, and the .xed cost of adjustment is $152.08.
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DO HOUSING PRICES REFLECT ENVIRONMENTAL HEALTH RISKS? EVIDENCE FROM MORE THAN 1600 TOXIC PLANT OPENINGS AND CLOSINGS
April 2013
Working Paper Number:
CES-13-14
A ubiquitous and largely unquestioned assumption in studies of housing markets is that there is perfect information about local amenities. This paper measures the housing market and health impacts of 1,600 openings and closings of industrial plants that emit toxic pollutants. We find that housing values within one mile decrease by 1.5 percent when plants open, and increase by 1.5 percent when plants close. This implies an aggregate loss in housing values per plant of about $1.5 million. While the housing value impacts are concentrated within ' mile, we find statistically significant infant health impacts up to one mile away.
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More than a Million New American Indians in 2000: Who are They?
March 2013
Working Paper Number:
CES-13-02
Over a million people reported their race as American Indian in the 2000 U.S. Census but did not report that race in the 1990 Census. We investigate three questions related to this extraordinary population change: (1) Which subgroups of American Indians had the greatest numerical growth? (2) Which subgroups had the greatest proportional increase? And (3) is it plausible that all 'new' American Indians reported multiple races in 2000? We use full-count and high-density decennial U.S. census data; adjust for birth, death, and immigration; decompose on age, gender, Latino origin, education, and birth state; and compare the observed American Indian subgroup sizes in 2000 to the sizes expected based on 1990 counts. The largest numerical increases were among non-Latino youth (ages 10-19), non-Latino adult women, and adults with no college degree. Latinos, highly-educated adults, and women have the largest proportionate gains, perhaps indicating that 'American Indian' has special appeal in these groups. We also find evidence that a substantial number of new American Indians reported only American Indian race in 2000, rather than a multiple-race response. This research is relevant to social theorists, race scholars, community members, program evaluators, and the Census Bureau.
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Spatial Organization of Firms: Internal and External Agglomeration Economies and Location Choices Through the Value Chain
September 2012
Working Paper Number:
CES-12-33
We explore the impact of geographically bounded intra-firm spillovers (internal agglomeration economies) and geographically bounded inter-firm spillovers (external agglomeration economies) on firms' location strategies. Using data from the Census Bureau's Longitudinal Business Database and the U.S. Cluster Mapping Project, we analyze organic expansions of biopharmaceutical firms (by both new establishments and employment increase in existing establishments) in the U.S. in 1993-2005. We consider all activities in the value chain and allow location choices to vary by R&D, manufacturing, and sales. Our findings suggest that (1) internal and external agglomeration economies have separate, positive impacts on location, with relevant differences by activity; (2) internal economies of agglomeration arise within an activity (e.g., among plants) and across activities (e.g., between manufacturing and sales); (3) the effects of internal economies across and within activities vary by activity and type of organic expansion; and (4) across-activity internal economies are asymmetric.
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Intergenerational Transmission of Race: Permeable Boundaries between 1970 and 2010
September 2012
Working Paper Number:
CES-12-24
We study the social construction of race boundaries by investigating patterns in the race, ancestry, and Mexican origin responses provided for children of 14 types of interracial marriages using dense restricted-use data from 1970 to 2010. Our broader purpose is to expose social processes that convert a newborn child of mixed heritage into an adult person of a particular race. We include a more diverse set of families, a longer time span, and more accurate estimates than prior research. These expansions bear fruit.Taking ancestry responses into account and studying the longer-term patterns reveals that mixed-heritage responses have been common since 1980. Expanding the types of mixed heritage and including double-minorities shows that there is substantial variation in response patterns across the 14 groups.
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University Innovation, Local Economic Growth, and Entrepreneurship
June 2012
Working Paper Number:
CES-12-10
Universities, often situated at the center of innovative clusters, are believed to be important drivers of local economic growth. This paper identifies the extent to which U.S. universities stimulate nearby economic activity using the interaction of a national shock to the spread of innovation from universities - the Bayh-Dole Act of 1980 - with pre-determined variation both within a university in academic strengths and across universities in federal research funding. Using longitudinal establishment-level data from the Census, I find that longrun employment and payroll per worker around universities rise particularly rapidly after Bayh-Dole in industries more closely related to local university innovative strengths. The impact of
university innovation increases with geographic proximity to the university. Counties surrounding universities that received more pre-Bayh-Dole federal funding - particularly from the Department of Defense and the National Institutes of Health - experienced faster employment growth after the law. Entering establishments - in particular multi-unit firm expansions - over the period from 1977 to 1997 were especially important in generating long-run employment growth, while incumbents experienced modest declines, consistent with creative destruction. Suggestive of their complementarities with universities, large establishments contributed more substantially to the total 20-year growth effect than did small establishments.
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Migration and Dispersal of Hispanic and Asian Groups: An Analysis of the 2006-2008 Multiyear American Community Survey
October 2011
Working Paper Number:
CES-11-33
This report seeks to evaluate selective migration processes of Hispanic and Asian nationality groups in the US from established settlement areas, using recent migration data from the American Community Survey. The underlying goal is to detect migration tendencies leading toward an increased dispersion of these groups associated with their migration processes. Using descriptive statistics, maps, and migration models, we assess how migration processes in the 2006-8 period are leading to the dispersal of Hispanic and Asian race ethnic groups across metropolitan areas, with special attention to the roles of co-ethnic communities and spatial assimilation. These analyses employ migration data available from the 3-year 2006-8 American Community Survey using restricted data from the US Census Bureau's Research Data Centers. This use of the restricted ACS files permitted the first post 2000 analysis of inter-metropolitan migration for Hispanic groups (Mexicans, Puerto Ricans, Cubans, Salvadorans, Dominicans) and Asian groups (Chinese, Indians, Filipinos, Vietnamese, Koreans) using the detailed demographic and geographic attributes available with these files. The data and analysis presented here provide a benchmark for further research of this kind with the American Community Survey in light of the fact that migration data will no longer be available from the US decennial census. The study examines migration from these groups' major settlement areas to other metropolitan area destinations as they are affected by the attraction of co-ethnic communities and by a migrant selectivity pattern consistent with the perspective of spatial assimilation. The migration processes themselves were evaluated in terms of two components: the out--migration rates of residents, and the destination selection of movers. From the perspective of co-ethnic community attraction, it was hypothesized that the outmigration rates from high co-ethnic settlement areas would be lower than those from areas where the group had a smaller overall presence and that the destination selections of out-migrants would be positively affected by the presence of high co-ethnic population shares in destination areas. From the spatial assimilation perspective, it was hypothesized that out-migration from high coethnic areas would least likely occur for group members with lowest education, poor facility with English, and recently arrived in the US; whereas the selection of destinations with large coethnic population shares would be most likely to occur for these same population categories. The results strongly confirm that co-ethnic community attraction continues to reduce outmigration of groups from major settlement origins and positively influences their destination selections. A series of multivariate migrant destination selection models confirm a consistent draw of ethnically similar destinations across individual Hispanic and Asian groups when other economic, demographic and structural metropolitan attributes are taken into account. In contrast, results regarding spatial assimilation are typically mixed or nonexistent in characterizing both out-migration and mover destination selectivity patterns. In fact, we find contrary evidence for some Asian groups for whom it is the most educated, and native born migrants who show a penchant for selecting destinations with greater co-ethnic population shares. Among the greatest destinations for Indians, for example, are Philadelphia, Seattle, Dallas, Boston and Atlanta- areas with higher than average Indian population shares, and areas that also house knowledge-based industries. The selection of co-ethnic destinations among Hispanic group migrants appears somewhat impervious to education attainment and Hispanic and Mexican group movers, who are foreign born and who arrived since 2000, are least, rather than most, prone to select co-ethnic destinations. The mover destination models make plain that employment growth at destination provides a strong draw for all Hispanic groups. This suggests that recent growth in low skilled jobs in parts of the country with small Hispanic populations are nonetheless attracting newly arrived, and less skilled Mexicans and other Hispanics who might have previously been especially lured to destinations with large co-ethnic population shares.
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The Case of the Missing Ethnicity: Indians without Tribes in the 21st Century
June 2011
Working Paper Number:
CES-11-17
Among American Indians and Alaska Natives, most aspects of ethnicity are tightly associated with the person's tribal origins. Language, history, foods, land, and traditions differ among the hundreds of tribes indigenous to the United States. Why did almost one million of them fail to respond to the tribal affiliation part of the Census 2000 race question? We investigate four hypotheses about why one-third of multiracial American Indians and one-sixth of single-race American Indians did not report a tribe: (1) survey item non-response which undermines all fillin- the-blank questions, (2) a non-salient tribal identity, (3) a genealogy-based affiliation, and (4) mestizo identity which does not require a tribe. We use multivariate logistic regression models and high-density restricted-use Census 2000 data. We find support for the first two hypotheses and note that the predictors and results differ substantially for single race versus multiple race American Indians.
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Workplace Concentration of Immigrants
November 2010
Working Paper Number:
CES-10-39R
To what extent do immigrants and the native-born work in separate workplaces? Do worker and employer characteristics explain the degree of workplace concentration? We explore these questions using a matched employer-employee database that extensively covers employers in selected MSAs. We find that immigrants are much more likely to have immigrant coworkers than are natives, and are particularly likely to work with their compatriots. We find much higher levels of concentration for small businesses than for large ones, that concentration varies substantially across industries, and that concentration is particularly high among immigrants with limited English skills. We also find evidence that neighborhood job networks are strongly positively associated with concentration. The effects of networks and language remain strong when type is defined by country of origin rather than simply immigrant status. The importance of these factors varies by immigrant country of origin'for example, not speaking English well has a particularly strong association with concentration for immigrants from Asian countries. Controlling for differences across MSAs, we find that observable employer and employee characteristics account for about half of the difference between immigrants and natives in the likelihood of having immigrant coworkers, with differences in industry, residential segregation and English speaking skills being the most important factors.
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Access Methods for United States Microdata
August 2007
Working Paper Number:
CES-07-25
Beyond the traditional methods of tabulations and public-use microdata samples, statistical agencies have developed four key alternatives for providing non-government researchers with access to confidential microdata to improve statistical modeling. The first, licensing, allows qualified researchers access to confidential microdata at their own facilities, provided certain security requirements are met. The second, statistical data enclaves, offer qualified researchers restricted access to confidential economic and demographic data at specific agency-controlled locations. Third, statistical agencies can offer remote access, through a computer interface, to the confidential data under automated or manual controls. Fourth, synthetic data developed from the original data but retaining the correlations in the original data have the potential for allowing a wide range of analyses.
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