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Papers Containing Tag(s): 'Ordinary Least Squares'

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Center for Economic Studies - 95

North American Industry Classification System - 94

Longitudinal Business Database - 92

National Science Foundation - 78

Total Factor Productivity - 76

Annual Survey of Manufactures - 74

Bureau of Labor Statistics - 69

National Bureau of Economic Research - 65

Standard Industrial Classification - 65

Current Population Survey - 60

Internal Revenue Service - 58

Census Bureau Disclosure Review Board - 58

Bureau of Economic Analysis - 57

Longitudinal Employer Household Dynamics - 54

American Community Survey - 52

Census of Manufactures - 51

Longitudinal Research Database - 45

Chicago Census Research Data Center - 44

Employer Identification Numbers - 42

Metropolitan Statistical Area - 40

Decennial Census - 38

Federal Reserve Bank - 38

Cobb-Douglas - 37

Census of Manufacturing Firms - 32

Social Security Administration - 30

Protected Identification Key - 30

Federal Statistical Research Data Center - 30

Economic Census - 30

Census Bureau Longitudinal Business Database - 29

Special Sworn Status - 29

Standard Statistical Establishment List - 28

Alfred P Sloan Foundation - 27

Disclosure Review Board - 27

University of Chicago - 26

Generalized Method of Moments - 23

Business Register - 23

Survey of Income and Program Participation - 22

Federal Reserve System - 21

Social Security - 21

Social Security Number - 20

2SLS - 19

American Economic Review - 19

Journal of Economic Literature - 19

Harmonized System - 18

Organization for Economic Cooperation and Development - 17

Census Bureau Business Register - 17

New York University - 17

2010 Census - 16

Department of Economics - 15

County Business Patterns - 15

Environmental Protection Agency - 15

International Trade Research Report - 15

Harvard University - 14

Longitudinal Firm Trade Transactions Database - 14

Research Data Center - 14

Herfindahl Hirschman Index - 14

Quarterly Journal of Economics - 14

PSID - 14

Journal of Political Economy - 14

UC Berkeley - 13

University of Michigan - 12

University of Maryland - 12

Quarterly Census of Employment and Wages - 12

Kauffman Foundation - 12

World Bank - 12

American Economic Association - 12

Cornell University - 12

National Longitudinal Survey of Youth - 11

National Center for Health Statistics - 11

Business Dynamics Statistics - 11

Department of Labor - 11

Postal Service - 11

Department of Agriculture - 11

Michigan Institute for Teaching and Research in Economics - 11

W-2 - 10

Columbia University - 10

Person Validation System - 10

Retirement History Survey - 10

North American Industry Classi - 10

Journal of Labor Economics - 10

AKM - 9

NBER Summer Institute - 9

Business Services - 9

Department of Commerce - 9

Department of Housing and Urban Development - 9

Board of Governors - 9

1940 Census - 9

Retail Trade - 9

Unemployment Insurance - 9

Securities and Exchange Commission - 9

Journal of Econometrics - 9

Journal of Economic Perspectives - 9

TFPQ - 9

Quarterly Workforce Indicators - 9

Review of Economics and Statistics - 9

MIT Press - 9

World Trade Organization - 8

Office of Management and Budget - 8

Indian Health Service - 8

Department of Homeland Security - 8

Cornell Institute for Social and Economic Research - 8

Heckscher-Ohlin - 8

Wholesale Trade - 8

LEHD Program - 8

Medical Expenditure Panel Survey - 8

Person Identification Validation System - 8

Boston Research Data Center - 8

Technical Services - 7

Boston College - 7

General Accounting Office - 7

Supreme Court - 7

Master Address File - 7

Characteristics of Business Owners - 7

Small Business Administration - 7

Patent and Trademark Office - 7

Housing and Urban Development - 7

Duke University - 7

State Energy Data System - 7

Princeton University Press - 7

Federal Reserve Board of Governors - 7

University of California Los Angeles - 7

Survey of Manufacturing Technology - 7

Electronic Data Interchange - 7

Establishment Micro Properties - 7

Journal of International Economics - 7

Computer Network Use Supplement - 7

Department of Education - 6

National Income and Product Accounts - 6

Initial Public Offering - 6

University of Toronto - 6

Harvard Business School - 6

National Ambient Air Quality Standards - 6

Core Based Statistical Area - 6

Bureau of Labor - 6

Princeton University - 6

Russell Sage Foundation - 6

NUMIDENT - 6

Employer-Household Dynamics - 6

Health and Retirement Study - 6

Supplemental Nutrition Assistance Program - 6

Administrative Records - 6

IQR - 6

Public Administration - 6

National Institute on Aging - 6

Labor Productivity - 6

Cambridge University Press - 6

Fabricated Metal Products - 6

Economic Research Service - 6

MTO - 5

Survey of Industrial Research and Development - 5

Value Added - 5

CAAA - 5

Washington University - 5

Earned Income Tax Credit - 5

Data Management System - 5

General Education Development - 5

Integrated Longitudinal Business Database - 5

Regression Discontinuity Design - 5

Individual Characteristics File - 5

Center for Research in Security Prices - 5

Employment History File - 5

Manufacturing Energy Consumption Survey - 5

Temporary Assistance for Needy Families - 5

Personally Identifiable Information - 5

Review of Economic Studies - 5

Census Bureau Center for Economic Studies - 5

Sloan Foundation - 5

Journal of Human Resources - 5

North American Free Trade Agreement - 5

Net Present Value - 5

BLS Handbook of Methods - 5

Securities Data Company - 5

University of Minnesota - 5

E32 - 5

Customs and Border Protection - 5

Census of Retail Trade - 5

New York Times - 5

Geographic Information Systems - 5

Social Security Disability Insurance - 5

National Research Council - 5

PAOC - 5

Pollution Abatement Costs and Expenditures - 5

WECD - 5

Yale University - 4

Business R&D and Innovation Survey - 4

National Center for Science and Engineering Statistics - 4

Agriculture, Forestry - 4

American Immigration Council - 4

Penn State University - 4

Adjusted Gross Income - 4

Michigan Institute for Data Science - 4

Census Numident - 4

Indian Housing Information Center - 4

Individual Taxpayer Identification Numbers - 4

Council of Economic Advisers - 4

IBM - 4

Linear Probability Models - 4

Arts, Entertainment - 4

Energy Information Administration - 4

Federal Trade Commission - 4

Department of Justice - 4

Computer Assisted Telephone Interviews and Computer Assisted Personal Interviews - 4

CATI - 4

Standard Occupational Classification - 4

Business Register Bridge - 4

Integrated Public Use Microdata Series - 4

Disability Insurance - 4

Stanford University - 4

Management and Organizational Practices Survey - 4

Information and Communication Technology Survey - 4

Center for Administrative Records Research - 4

Foreign Direct Investment - 4

Survey of Business Owners - 4

Financial, Insurance and Real Estate Industries - 4

Labor Turnover Survey - 4

Center for Administrative Records Research and Applications - 4

Local Employment Dynamics - 4

Wal-Mart - 4

International Standard Industrial Classification - 4

Stern School of Business - 4

Service Annual Survey - 4

Federal Reserve Bank of Chicago - 4

Permanent Plant Number - 4

Consolidated Metropolitan Statistical Areas - 4

Auxiliary Establishment Survey - 4

Insurance Information Institute - 4

COMPUSTAT - 4

COVID-19 - 3

Business Research and Development and Innovation Survey - 3

Annual Business Survey - 3

Educational Services - 3

Federal Register - 3

Professional Services - 3

Medicaid Services - 3

National Institutes of Health - 3

Master Earnings File - 3

American Housing Survey - 3

MAF-ARF - 3

European Commission - 3

Computer Assisted Personal Interview - 3

Census Industry Code - 3

Census Edited File - 3

Herfindahl-Hirschman - 3

European Union - 3

Occupational Employment Statistics - 3

Accommodation and Food Services - 3

SSA Numident - 3

Carnegie Mellon University - 3

D22 - 3

Employer Characteristics File - 3

Georgetown University - 3

Company Organization Survey - 3

JOLTS - 3

Detailed Earnings Records - 3

Centers for Disease Control and Prevention - 3

Statistics Canada - 3

United States Census Bureau - 3

Public Use Micro Sample - 3

Federal Insurance Contribution Act - 3

United Nations - 3

IZA - 3

Computer Aided Design - 3

Census of Services - 3

Summary Earnings Records - 3

New England County Metropolitan - 3

econometric - 72

labor - 72

production - 71

manufacturing - 65

employ - 63

employed - 53

economist - 52

industrial - 50

estimating - 50

market - 50

workforce - 50

recession - 50

endogeneity - 48

growth - 47

macroeconomic - 46

expenditure - 45

investment - 43

earnings - 40

employee - 39

sale - 38

revenue - 36

demand - 34

export - 33

economically - 33

produce - 32

company - 32

estimation - 31

spillover - 28

sector - 27

gdp - 27

innovation - 26

entrepreneurship - 26

worker - 25

manufacturer - 24

heterogeneity - 24

housing - 23

neighborhood - 23

exporter - 23

finance - 23

profit - 23

monopolistic - 22

productivity growth - 22

technological - 22

entrepreneur - 22

payroll - 22

efficiency - 22

productive - 21

occupation - 21

hiring - 20

enterprise - 20

poverty - 19

rent - 19

unemployed - 19

financial - 19

immigrant - 19

salary - 19

competitor - 19

establishment - 19

organizational - 19

acquisition - 19

import - 18

ethnicity - 18

regression - 18

disadvantaged - 17

technology - 17

segregation - 17

incentive - 17

profitability - 16

metropolitan - 16

survey - 16

discrimination - 16

resident - 16

merger - 16

industry productivity - 16

econometrician - 16

residence - 15

depreciation - 15

job - 15

unobserved - 15

welfare - 15

population - 15

hispanic - 15

residential - 15

factory - 14

leverage - 14

entrepreneurial - 14

regulation - 14

earn - 13

financing - 13

multinational - 13

product - 13

consumption - 13

workplace - 13

aggregate - 13

venture - 13

hire - 12

investor - 12

loan - 12

debt - 12

employment growth - 12

minority - 12

emission - 12

trading - 12

socioeconomic - 12

enrollment - 12

schooling - 12

diversification - 12

regress - 12

patent - 11

productivity dynamics - 11

layoff - 11

tariff - 11

country - 11

labor productivity - 11

ethnic - 11

pollution - 11

city - 11

immigration - 11

bias - 11

impact - 11

retirement - 11

cost - 11

regulatory - 11

exogeneity - 11

statistical - 11

corporate - 11

estimator - 11

relocation - 10

exporting - 10

productivity estimates - 10

growth productivity - 10

labor markets - 10

lending - 10

bankruptcy - 10

lender - 10

regional - 10

specialization - 10

endogenous - 10

environmental - 10

racial - 10

disparity - 10

segregated - 10

family - 10

respondent - 10

earner - 10

productivity measures - 10

geographically - 10

incorporated - 10

estimates productivity - 10

state - 10

plant productivity - 10

intergenerational - 9

factor productivity - 9

prospect - 9

stock - 9

borrower - 9

borrowing - 9

outsourcing - 9

pollutant - 9

wealth - 9

tax - 9

international trade - 9

tenure - 9

regressing - 9

unemployment rates - 9

productivity analysis - 9

productivity plants - 9

renter - 8

investment productivity - 8

invest - 8

creditor - 8

subsidiary - 8

outsourced - 8

inventory - 8

supplier - 8

mobility - 8

bank - 8

shock - 8

corporation - 8

commodity - 8

price - 8

pricing - 8

federal - 8

productivity differences - 8

migrant - 8

quarterly - 8

consumer - 8

longitudinal - 8

educated - 8

producing - 8

effect wages - 7

exported - 7

productivity shocks - 7

wages productivity - 7

funding - 7

importer - 7

urban - 7

black - 7

spending - 7

neighbor - 7

efficient - 7

census data - 7

wage data - 7

accounting - 7

aggregate productivity - 7

union - 7

compensation - 7

census bureau - 7

opportunity - 7

labor statistics - 7

estimates employment - 7

wage changes - 7

employment dynamics - 7

rural - 7

suburb - 7

manufacturing industries - 7

relocating - 7

shipment - 6

regressors - 6

invention - 6

manufacturing productivity - 6

productivity impacts - 6

relocate - 6

investing - 6

patenting - 6

monopolistically - 6

race - 6

good - 6

wage growth - 6

industry concentration - 6

sampling - 6

wage differences - 6

epa - 6

eligible - 6

manager - 6

management - 6

productivity wage - 6

measures productivity - 6

migrate - 6

migration - 6

trend - 6

strategic - 6

home - 6

generation - 6

acquirer - 6

recessionary - 6

analysis productivity - 6

productivity increases - 6

locality - 6

firms productivity - 6

area - 6

discriminatory - 6

dependent - 6

employing - 6

proprietorship - 6

profitable - 6

subsidy - 5

rates productivity - 5

bankrupt - 5

region - 5

productivity size - 5

externality - 5

larger firms - 5

industry wages - 5

mexican - 5

census responses - 5

education - 5

credit - 5

graduate - 5

commerce - 5

startup - 5

proprietor - 5

researcher - 5

average - 5

competitiveness - 5

advantage - 5

diversified - 5

wholesale - 5

industry variation - 5

diversify - 5

budget - 5

customer - 5

saving - 5

wage effects - 5

wage industries - 5

eligibility - 5

managerial - 5

risk - 5

regulation productivity - 5

productivity dispersion - 5

industries estimate - 5

sourcing - 5

immigrant entrepreneurs - 5

mortality - 5

takeover - 5

firms size - 5

employer household - 5

parental - 5

fertility - 5

decade - 5

declining - 5

trends labor - 5

firms trade - 5

insurance - 5

technical - 5

parent - 5

adulthood - 5

retailer - 5

district - 5

report - 5

econometrically - 5

aggregation - 5

agricultural - 5

ownership - 5

plant investment - 5

abatement expenditures - 5

pollution abatement - 5

plants industry - 5

longitudinal employer - 5

polluting - 5

expense - 5

effects employment - 4

innovate - 4

liquidation - 4

equity - 4

borrow - 4

collateral - 4

gain - 4

exogenous - 4

practices productivity - 4

estimates pollution - 4

importing - 4

imported - 4

latino - 4

citizen - 4

census household - 4

white - 4

school - 4

fund - 4

substitute - 4

prices products - 4

residential segregation - 4

regulated - 4

banking - 4

reside - 4

pension - 4

oligopolistic - 4

foreign - 4

export market - 4

moving - 4

firms grow - 4

disability - 4

employment statistics - 4

census research - 4

census employment - 4

sectoral - 4

employment wages - 4

earnings workers - 4

startup firms - 4

startups employees - 4

maternal - 4

birth - 4

mother - 4

recession employment - 4

contract - 4

custom - 4

tech - 4

retail - 4

trade models - 4

social - 4

quantity - 4

dispersion productivity - 4

rate - 4

income neighborhoods - 4

restructuring - 4

elasticity - 4

employment measures - 4

assimilation - 4

asian - 4

inference - 4

amenity - 4

agriculture - 4

shift - 4

shareholder - 4

conglomerate - 4

agency - 4

firms export - 4

firms exporting - 4

exporting firms - 4

partnership - 4

utilization - 4

environmental regulation - 4

costs pollution - 4

native - 4

immigrant population - 4

firms plants - 4

plants firms - 4

performance - 4

worker wages - 4

plants industries - 4

textile - 4

estimates production - 4

wage gap - 3

earnings employees - 3

innovating - 3

taxpayer - 3

poorer - 3

capital productivity - 3

growth employment - 3

economic growth - 3

citizenship - 3

1040 - 3

immigrant workers - 3

refugee - 3

study - 3

globalization - 3

affluent - 3

electricity - 3

energy - 3

energy efficiency - 3

policy - 3

utility - 3

sample - 3

survey households - 3

debtor - 3

imputation - 3

executive - 3

equilibrium - 3

level productivity - 3

firms import - 3

migrating - 3

enrolled - 3

employment trends - 3

data - 3

data census - 3

microdata - 3

founder - 3

pollution exposure - 3

pregnancy - 3

wages production - 3

employment recession - 3

younger firms - 3

foreign trade - 3

fiscal - 3

coverage - 3

grocery - 3

supermarket - 3

aging - 3

mandate - 3

concentration - 3

technology adoption - 3

filing - 3

wage variation - 3

percentile - 3

productivity firms - 3

model - 3

geography - 3

decline - 3

parents income - 3

employment count - 3

asset - 3

development - 3

restaurant - 3

suburbanization - 3

census years - 3

regional economic - 3

local economic - 3

impact employment - 3

export growth - 3

exports firms - 3

network - 3

economic census - 3

retailing - 3

taxation - 3

share - 3

environmental expenditures - 3

house - 3

capital - 3

plant - 3

manufacturing plants - 3

agglomeration - 3

innovator - 3

woman - 3

computer - 3

research census - 3

observed productivity - 3

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Viewing papers 1 through 10 of 298


  • Working Paper

    Understanding Criminal Record Penalties in the Labor Market

    June 2025

    Working Paper Number:

    CES-25-39

    This paper studies the earnings and employment penalties associated with a criminal record. Using a large-scale dataset linking criminal justice and employer-employee wage records, we estimate two-way fixed effects models that decompose earnings into worker's portable earnings potential and firm pay premia, both of which are allowed to shift after a worker acquires a record. We find that firm pay premia explain a small share of earnings gaps between workers with and without a record. There is little evidence of variable within-firm premia gaps either. Instead, components of workers' earnings potential that persist across firms explain the bulk of gaps. Conditional on earnings potential, workers with a record are also substantially less likely to be employed. Difference-in-differences estimates comparing workers' first conviction to workers charged but not convicted or charged later support these findings. The results suggest that criminal record penalties operate primarily by changing whether workers are employed and their earnings potential at every firm rather than increasing sorting into lower-paying jobs, although the bulk of gaps can be attributed to differences that existed prior to acquiring a record.
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  • Working Paper

    The Effects of Eviction on Children

    May 2025

    Working Paper Number:

    CES-25-34

    Eviction may be an important channel for the intergenerational transmission of poverty, and concerns about its effects on children are often raised as a rationale for tenant protection policies. We study how eviction impacts children's home environment, school engagement, educational achievement, and high school completion by assembling new data sets linking eviction court records in Chicago and New York to administrative public school records and restricted Census records. To disentangle the consequences of eviction from the effects of correlated sources of economic distress, we use a research design based on the random assignment of court cases to judges who vary in their leniency. We find that eviction increases children's residential mobility, homelessness, and likelihood of doubling up with grandparents or other adults. Eviction also disrupts school engagement, causing increased absences and school changes. While we find little impact on elementary and middle school test scores, eviction substantially reduces high school course credits. Lastly, we find that eviction reduces high school graduation and use a novel bounding method to show that this finding is not driven by differential attrition. The disruptive effects of eviction appear worse for older children and boys. Our evidence suggests that the impact of eviction on children runs through the disruption to the home environment or school engagement rather than deterioration in school or neighborhood quality, and may be moderated by access to family support networks.
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  • Working Paper

    Firm Heterogeneity, Misallocation, and Trade

    May 2025

    Authors: John Chung

    Working Paper Number:

    CES-25-33

    To what extent do domestic distortions influence the gains from trade? Using data from Chinese manufacturing surveys and U.S. census records, I document two novel stylized facts: (1) Larger producers in China exhibit lower revenue productivity, whereas larger producers in the U.S. exhibit higher revenue productivity. (2) Larger exporters in China exhibit lower export intensity, whereas larger exporters in the U.S. exhibit higher export intensity. A model of heterogeneous producers shows that only the U.S. patterns are consistent with an efficient allocation. To reconcile the observed patterns in China, I introduce producer- and destination-specific subsidies and estimate the model without imposing functional form assumptions on the joint distribution of productivity and subsidy rates. Accounting for distortions in China leads to substantially smaller estimated gains from trade.
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  • Working Paper

    The Rising Returns to R&D: Ideas Are Not Getting Harder to Find

    May 2025

    Working Paper Number:

    CES-25-29

    R&D investment has grown robustly, yet aggregate productivity growth has stagnated. Is this because 'ideas are getting harder to find'? This paper uses micro-data from the US Census Bureau to explore the relationship between R&D and productivity in the manufacturing sector from 1976 to 2018. We find that both the elasticity of output (TFP) with respect to R&D and the marginal returns to R&D have risen sharply. Exploring factors affecting returns, we conclude that R&D obsolescence rates must have risen. Using a novel estimation approach, we find consistent evidence of sharply rising technological rivalry. These findings suggest that R&D has become more effective at finding productivity-enhancing ideas but these ideas may also render rivals' technologies obsolete, making innovations more transient.
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  • Working Paper

    The Rise of Industrial AI in America: Microfoundations of the Productivity J-curve(s)

    April 2025

    Working Paper Number:

    CES-25-27

    We examine the prevalence and productivity dynamics of artificial intelligence (AI) in American manufacturing. Working with the Census Bureau to collect detailed large-scale data for 2017 and 2021, we focus on AI-related technologies with industrial applications. We find causal evidence of J-curve-shaped returns, where short-term performance losses precede longer-term gains. Consistent with costly adjustment taking place within core production processes, industrial AI use increases work-in-progress inventory, investment in industrial robots, and labor shedding, while harming productivity and profitability in the short run. These losses are unevenly distributed, concentrating among older businesses while being mitigated by growth-oriented business strategies and within-firm spillovers. Dynamics, however, matter: earlier (pre-2017) adopters exhibit stronger growth over time, conditional on survival. Notably, among older establishments, abandonment of structured production-management practices accounts for roughly one-third of these losses, revealing a specific channel through which intangible factors shape AI's impact. Taken together, these results provide novel evidence on the microfoundations of technology J-curves, identifying mechanisms and illuminating how and why they differ across firm types. These findings extend our understanding of modern General Purpose Technologies, explaining why their economic impact'exemplified here by AI'may initially disappoint, particularly in contexts dominated by older, established firms.
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  • Working Paper

    Size Matters: Matching Externalities and the Advantages of Large Labor Markets

    April 2025

    Working Paper Number:

    CES-25-22

    Economists have long hypothesized that large and thick labor markets facilitate the matching between workers and firms. We use administrative data from the LEHD to compare the job search outcomes of workers originally in large and small markets who lost their jobs due to a firm closure. We define a labor market as the Commuting Zone'industry pair in the quarter before the closure. To account for the possible sorting of high-quality workers into larger markets, the effect of market size is identified by comparing workers in large and small markets within the same CZ, conditional on workers fixed effects. In the six quarters before their firm's closure, workers in small and large markets have a similar probability of employment and quarterly earnings. Following the closure, workers in larger markets experience significantly shorter non-employment spells and smaller earning losses than workers in smaller markets, indicating that larger markets partially insure workers against idiosyncratic employment shocks. A 1 percent increase in market size results in a 0.015 and 0.023 percentage points increase in the 1-year re-employment probability of high school and college graduates, respectively. Displaced workers in larger markets also experience a significantly lower need for relocation to a different CZ. Conditional on finding a new job, the quality of the new worker-firm match is higher in larger markets, as proxied by a higher probability that the new match lasts more than one year; the new industry is the same as the old one; and the new industry is a 'good fit' for the worker's college major. Consistent with the notion that market size should be particularly consequential for more specialized workers, we find that the effects are larger in industries where human capital is more specialized and less portable. Our findings may help explain the geographical agglomeration of industries'especially those that make intensive use of highly specialized workers'and validate one of the mechanisms that urban economists have proposed for the existence of agglomeration economies.
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  • Working Paper

    The Intangible Divide: Why Do So Few Firms Invest in Innovation?

    February 2025

    Working Paper Number:

    CES-25-15

    Investments in software, R&D, and advertising have surged, nearing half of U.S. private nonresidential investment. Yet just a few hundred firms dominate this growth. Most firms, including large ones, regularly invest little in capitalized software and R&D, widening this 'intangible divide' despite falling intangible prices. Using comprehensive US Census microdata, we document these patterns and explore factors associated with intangible investment. We find that firms invest significantly less in innovation-related intangibles when their rivals invest more. One firm's investment can obsolesce rivals' investments, reducing returns. This negative pecuniary externality worsens the intangible divide, potentially leading to significant misallocation.
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  • Working Paper

    Leveraged Payouts: How Using New Debt to Pay Returns in Private Equity Affects Firms, Employees, Creditors, and Investors

    January 2025

    Working Paper Number:

    CES-25-12

    We study the causal effect of a large increase in firm leverage. Our setting is dividend recapitalizations in private equity (PE), where portfolio companies take on new debt to pay investor returns. After accounting for positive selection into more debt, we show that large leverage increases make firms much riskier, dramatically raising exit and bankruptcy rates but also IPOs. The debt-bankruptcy relationship is in line with Altman-Z model predictions for private firms. Dividend recapitalizations increase deal returns but reduce: (a) wages among surviving firms; (b) pre-existing loan prices; and (c) fund returns, which seems to reflect moral hazard via new fundraising. These results suggest negative implications for employees, pre-existing creditors, and investors.
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  • Working Paper

    Multinational Production and Innovation in Tandem

    October 2024

    Authors: Jin Liu

    Working Paper Number:

    CES-24-64

    Multinational firms colocate production and innovation by offshoring them to the same host country or region. In this paper, I examine the determinants of multinational firms' production and innovation locations. Exploiting plausibly exogenous variations in tariffs, I find complementarities between production and innovation within host countries and regions. To evaluate manufacturing reshoring policies, I develop a quantitative multicountry offshoring location choice model. I allow for rich colocation benefits and cross-country interdependencies and prove supermodularity of the model to solve this otherwise NP-hard problem. I find the effects of manufacturing reshoring policies are nonlinear, contingent upon firm heterogeneity, and they accumulate dynamically.
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  • Working Paper

    Entry Costs Rise with Growth

    October 2024

    Working Paper Number:

    CES-24-63

    Over time and across states in the U.S., the number of firms is more closely tied to overall employment than to output per worker. In many models of firm dynamics, trade, and growth with a free entry condition, these facts imply that the costs of creating a new firm increase sharply with productivity growth. This increase in entry costs can stem from the rising cost of labor used in entry and weak or negative knowledge spillovers from prior entry. Our findings suggest that productivity-enhancing policies will not induce firm entry, thereby limiting the total impact of such policies on welfare.
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