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Differences in Disability Insurance Allowance Rates
August 2025
Working Paper Number:
CES-25-54
Allowance rates for disability insurance applications vary by race and ethnicity, but it is unclear to what extent these differences are artifacts of other differing socio-economic and health characteristics, or selection issues in SSA's race and ethnicity data. This paper uses the 2015 American Community Survey linked to 2015-2019 SSA administrative data to investigate DI application allowance rates among non-Hispanic White, non-Hispanic Black, non-Hispanic Asian, non-Hispanic American Indian/Alaska Native, and Hispanic applicants aged 25-65. The analysis uses regression, propensity score matching, and inverse probability weighting to estimate differences in allowance rates among applicants who are similar on observable characteristics. Relative to raw comparisons, differences by race and ethnicity in multivariate analyses are substantially smaller in magnitude and are generally not statistically significant.
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Credit Access in the United States
July 2025
Working Paper Number:
CES-25-45
We construct new population-level linked administrative data to study households' access to credit in the United States. These data reveal large differences in credit access by race, class, and hometown. By age 25, Black individuals, those who grew up in low-income families, and those who grew up in certain areas (including the Southeast and Appalachia) have significantly lower credit scores than other groups. Consistent with lower scores generating credit constraints, these individuals have smaller balances, more credit inquiries, higher credit card utilization rates, and greater use of alternative higher-cost forms of credit. Tests for alternative definitions of algorithmic bias in credit scores yield results in opposite directions. From a calibration perspective, group-level differences in credit scores understate differences in delinquency: conditional on a given credit score, Black individuals and those from low-income families fall delinquent at relatively higher rates. From a balance perspective, these groups receive lower credit scores even when comparing those with the same future repayment behavior. Addressing both of these biases and expanding credit access to groups with lower credit scores requires addressing group-level differences in delinquency rates. These delinquencies emerge soon after individuals access credit in their early twenties, often due to missed payments on credit cards, student loans, and other bills. Comprehensive measures of individuals' income profiles, income volatility, and observed wealth explain only a small portion of these repayment gaps. In contrast, we find that the large variation in repayment across hometowns mostly reflects the causal effect of childhood exposure to these places. Places that promote upward income mobility also promote repayment and expand credit access even conditional on income, suggesting that common place-level factors may drive behaviors in both credit and labor markets. We discuss suggestive evidence for several mechanisms that drive our results, including the role of social and cultural capital. We conclude that gaps in credit access by race, class, and hometown have roots in childhood environments.
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Place Based Economic Development and Tribal Casinos
April 2025
Working Paper Number:
CES-25-24
Tribal lands in the U.S. have historically experienced some of the worst economic conditions in the nation. We review some existing research on the effect of American Indian tribal casinos on various measures of local economic development. This is an industry that began in the early 1990s and currently generates more than $40 billion annually. We also review the state of the literature on the effects of casino operations on communities in or adjacent to tribal areas. Using a new dataset linking individual and enterprise-level data longitudinally, this study examines the industry- and location-specific impacts of tribal casino operations. We focus in particular on the employment of American Indians. We document positive flows from unemployment and non-casino geographies to work in sectors related to casino operations. Tribal casinos differ from other standard place-based economic development projects in that they are focused on a single industry; we discuss these differences and note that some of the positive spillover effects may be similar to other, more standard place-based policies. Finally, we discuss additional and open-ended questions for future research on this topic.
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Tip of the Iceberg: Tip Reporting at U.S. Restaurants, 2005-2018
November 2024
Working Paper Number:
CES-24-68
Tipping is a significant form of compensation for many restaurant jobs, but it is poorly measured and therefore not well understood. We combine several large administrative and survey datasets and document patterns in tip reporting that are consistent with systematic under-reporting of tip income. Our analysis indicates that although the vast majority of tipped workers do report earning some tips, the dollar value of tips is under-reported and is sensitive to reporting incentives. In total, we estimate that about eight billion in tips paid at full-service, single-location, restaurants were not captured in tax data annually over the period 2005-2018. Due to changes in payment methods and reporting incentives, tip reporting has increased over time. Our findings have implications for downstream measures dependent on accurate measures of compensation including poverty measurement among tipped restaurant workers.
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Garage Entrepreneurs or just Self-Employed? An Investigation into Nonemployer Entrepreneurship
October 2024
Working Paper Number:
CES-24-61
Nonemployers, businesses without employees, account for most businesses in the U.S. yet are poorly understood. We use restricted administrative and survey data to describe nonemployer dynamics, overall performance, and performance by demographic group. We find that eventual outcome ' migration to employer status, continuing as a nonemployer, or exit ' is closely related to receipt growth. We provide estimates of employment creation by firms that began as nonemployers and become employers (migrants), estimating that relative to all firms born in 1996, nonemployer migrants accounted for 3-17% of all net jobs in the seventh year after startup. Moreover, we find that migrants' employment creation declined by 54% for the cohorts born between 1996 to 2014. Our results are consistent with increased adjustment frictions in recent periods, and suggest accessibility to transformative entrepreneurship for everyday Americans has declined.
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Income, Wealth, and Environmental Inequality in the United States
October 2024
Working Paper Number:
CES-24-57
This paper explores the relationships between air pollution, income, wealth, and race by combining administrative data from U.S. tax returns between 1979'2016, various measures of air pollution, and sociodemographic information from linked survey and administrative data. In the first year of our data, the relationship between income and ambient pollution levels nationally is approximately zero for both non-Hispanic White and Black individuals. However, at every single percentile of the national income distribution, Black individuals are exposed to, on average, higher levels of pollution than White individuals. By 2016, the relationship between income and air pollution had steepened, primarily for Black individuals, driven by changes in where rich and poor Black individuals live. We utilize quasi-random shocks to income to examine the causal effect of changes in income and wealth on pollution exposure over a five year horizon, finding that these income'pollution elasticities map closely to the values implied by our descriptive patterns. We calculate that Black-White differences in income can explain ~10 percent of the observed gap in air pollution levels in 2016.
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After the Storm: How Emergency Liquidity Helps Small Businesses Following Natural Disasters
April 2024
Working Paper Number:
CES-24-20
Does emergency credit prevent long-term financial distress? We study the causal effects of government-provided recovery loans to small businesses following natural disasters. The rapid financial injection might enable viable firms to survive and grow or might hobble precarious firms with more risk and interest obligations. We show that the loans reduce exit and bankruptcy, increase employment and revenue, unlock private credit, and reduce delinquency. These effects, especially the crowding-in of private credit, appear to reflect resolving uncertainty about repair. We do not find capital reallocation away from neighboring firms and see some evidence of positive spillovers on local entry.
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Antitrust Enforcement Increases Economic Activity
October 2023
Working Paper Number:
CES-23-50
We hand-collect and standardize information describing all 3,055 antitrust law suits brought by the Department of Justice (DOJ) between 1971 and 2018. Using restricted establishment-level microdata from the U.S. Census, we compare the economic outcomes of a non-tradable industry in states targeted by DOJ antitrust lawsuits to outcomes of the same industry in other states that were not targeted. We document that DOJ antitrust enforcement actions permanently increase employment by 5.4% and business formation by 4.1%. Using an event-study design, we find (1) a sharp increase in payroll that exceeds the increase in employment, meaning that DOJ antitrust enforcement increases average wages, (2) an economically smaller increase in sales that is statistically insignificant, and (3) a precise increase in the labor share. While we cannot separately measure the quantity and price of output, the increase in production inputs (employment), together with a proportionally smaller increase in sales, strongly suggests that these DOJ antitrust enforcement actions increase the quantity of output and simultaneously decrease the price of output. Our results show that government antitrust enforcement leads to persistently higher levels of economic activity in targeted industries.
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Unionization, Employer Opposition, and Establishment Closure
July 2023
Working Paper Number:
CES-23-35
We study the effect of private-sector unionization on establishment employment and survival. Specifically, we analyze National Labor Relations Board union elections from 1981'2005 using administrative Census data. Our empirical strategy extends standard difference-in-differences techniques with regression discontinuity extrapolation methods. This allows us to avoid biases from only comparing close elections and to estimate treatment effects that include larger marginof- victory elections. Using this strategy, we show that unionization decreases an establishment's employment and likelihood of survival, particularly in manufacturing and other blue-collar and industrial sectors. We hypothesize that two reasons for these effects are firms' ability to avoid working with new unions and employers' opposition to unions. We find that the negative effects are significantly larger for elections at multi-establishment firms. Additionally, after a successful union election at one establishment, employment increases at the firms' other establishments. Both pieces of evidence are consistent with firms avoiding new unions by shifting production from unionized establishments to other establishments. Finally, we find larger declines in employment and survival following elections where managers or owners were likely more opposed to the union. This evidence supports new reasons for the negative effects of unionization we document.
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Virtual Charter Students Have Worse Labor Market Outcomes as Young Adults
June 2023
Working Paper Number:
CES-23-32
Virtual charter schools are increasingly popular, yet there is no research on the long-term outcomes of virtual charter students. We link statewide education records from Oregon with earnings information from IRS records housed at the U.S. Census Bureau to provide evidence on how virtual charter students fare as young adults. Virtual charter students have substantially worse high school graduation rates, college enrollment rates, bachelor's degree attainment, employment rates, and earnings than students in traditional public schools. Although there is growing demand for virtual charter schools, our results suggest that students who enroll in virtual charters may face negative long-term consequences.
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