Showing 1 - 4 of 4 Items

Date: 2017-05-26

Creator: Nicole Sadowsky, Erik Nelson

Access: Open access

Since 2011, the private ride-hailing companies Uber and Lyft have expanded into more and more US cities. We use regression discontinuity design to examine the impact of Uber and Lyft’s entry on public transportation use in the US’ largest urban areas. In most cases, entry into cities by the two ride-hailing companies was staggered: Uber entered first followed some months later by Lyft. We find that public transportation use increased in an urban area, all else equal, immediately following the first entry. However, we find that the spike in public transportation use after first entry disappeared following the entry of the second company. In fact there is some evidence that monthly public transportation ridership levels fell below their pre-first entry levels. In other words, the joint presence of the two major private ride-hailing services transformed ride-hailing services from a public transportation complement to a public transportation substitute, at least in the studied urban areas. We speculate that the first entrant complemented public transportation use for some in an urban area by solving the “last-mile” problem and by providing a potentially safer option at night when public transportation service has been reduced. However, we speculate the second entrant is likely to have spurred price competition in the urban area’s ride-hailing duopoly market and an increase in ride-hailing car supply. This competitive effect could have tipped the scales, making an entire trip with a ride-hailing service more cost-effective and convenient than splitting a trip between a ride-share company and public transportation.

Date: 2022-01-01

Creator: Levi McAtee

Access: Open access

Do minimum wage increases serve as stepping-stones to higher-paying jobs for low-pay workers? This paper analyzes the impact of state minimum wage policy on the one-year wage growth rates of individuals across the wage distribution and whether that impact changes for individuals in highly monopsonistic industries. I review the recent literature on the disemployment effect, the impact of the minimum wage on wage growth rates, the nature of monopsonistic industries, and the relationship between the minimum wage and monopsony power. I offer theoretical reasons why the minimum wage may impact the wage growth rates of individuals in monopsonistic industries differently than it impacts those of individuals in competitive industries. I then re-estimate Lopresti’s and Mumford’s (2016) panel fixed effects model to determine how the effect of a minimum wage increase depends nonlinearly on the size of the increase. Using data from 2005-2008, Lopresti and Mumford found that small minimum wage increases have a significant negative impact on wage growth rates, while large minimum wage increases have a significant positive impact. Using data from 2016-2019, I find similar results. As my primary empirical contribution, I test whether individuals in highly monopsonistic industries experience minimum wage changes differently than individuals in more competitive industries. I find monopsony power in the form of high labor immobility primarily impacts the wage growth rates of high-pay workers and does not influence how low-pay workers experience minimum wage changes. Finally, I recommend policymakers impose larger minimum wage increases to avoid impeding the wage-growth of low-pay workers.

Date: 2022-01-01

Creator: Isabel Krogh

Access: Open access

Income inequality and intergenerational mobility are two common measures of economic fairness in society. While they measure distinct ideas, they are significantly related in an inverse way across countries as well as across regions in the United States. This relationship is illustrated on the Great Gatsby Curve. Unequal access to education is one factor that has been found to drive the negative relationship between these two measures and therefore create the negatively sloping Great Gatsby Curve. Therefore, creating more equal access to education, such as through government spending, could lessen the connection between these two factors. The primary purpose of this research is to explore the effect of public educational expenditure on intergenerational mobility as well as on the slope of the Great Gatsby Curve. At the primary/secondary education level, this study finds that places with higher public spending on education tend to have higher levels of intergenerational mobility. However, no significant relationship is found between spending on tertiary education and intergenerational mobility. In addition, while higher primary/secondary educational spending is associated with a flatter Great Gatsby Curve at the school district level, these results were not consistent at the commuting zone level, so no strong conclusions can be made about the effect of public educational expenditures as a mediating factor of the Great Gatsby Curve.

Date: 2019-05-01

Creator: Gideon Moore

Access: Open access

High student debt has been hypothesized to affect career choice, causing students to desire stable, high paying jobs. To test this hypothesis, I rely on plausibly exogenous variation in debt due to a federal policy shift. In the summer of 2007, the Higher Education Reconciliation Act (or HERA) expanded the cap for federally subsidized student loans. I examine how variation in debt affects career choice and eventual salary of students using data from the National Longitudinal Survey of Youth 1979 Child and Young Adult Cohort of students who were of college age during the implementation of the policy. I find that student debt has no impact on salary two years after graduation; however, it does seem to shift students’ career choices, leading some to avoid careers in public service industries such as teaching and social work.