Local Labour Markets and Skill Acquisition
Regional inequalities in developed economies have been the subject of both a large academic literature and policy interest. Yet, little is known about the causal impact of local skill demand on the supply of skills by local students. I study this relationship in England, which has large spatial disparities; an educational system where local economic conditions have little direct impact on school funding; standardized test scores; and detailed data on outcomes by field. I use establishment-level administrative data to document the cross-sectional and panel variation in the level and field of skills demanded. I then combine this with individual-level education data to study whether local skill demand shapes local students’ educational attainment: their results; level of education; and fields of study. I document a positive cross-sectional correlation between the skills demanded in local jobs and education choices. But, using a dynamic difference-in-difference strategy, I find at most a very muted response to large increases in local demand for degrees or specific skills for subsequent cohorts of students making educational investment decisions. I discuss the implications of my findings for policies aiming to target regional inequality.
Individual Consequences of Occupational Decline, with Per-Anders Edin, Georg Graetz, Sofia Hernnäs, and Guy Michaels, Economic Journal, August 2023, 133(654): 2178–2209
We assess the career earnings losses that individual Swedish workers suffered when their occupations’ employment declined. High-quality data allow us to overcome sorting into declining occupations on various attributes, including cognitive and non-cognitive skills. Our estimates show that occupational decline reduced mean cumulative earnings from 1986–2013 by no more than 2%–5%. This loss reflects a combination of reduced earnings conditional on employment, reduced years of employment and increased time spent in unemployment and retraining. While on average workers successfully mitigated their losses, those initially at the bottom of their occupations’ earnings distributions lost up to 8%–11%.
On the Definition and Measurement of Ageing, with Julian Ashwin, Siavesh Mohades, and Andrew Scott
Ageing is central to economic and social policy, yet there is no widely accepted, operational definition of ageing. This paper proposes a broad, intuitive, and testable definition based on two axiomatic conditions: monotonicity and inevitability. These require that ageing variables deteriorate in expectation over long horizons, while allowing for short-run reversals, and that deterioration becomes increasingly certain as the time horizon expands. We formulate these conditions at the individual, cohort, and population levels and derive hypothesis tests to assess whether observed variables satisfy them. We apply this framework to panel data from the English Longitudinal Study of Ageing (ELSA), using dynamic panel models that allow for persistence and potential non-stationarity. Examining a range of health and economic outcomes, we find that variables which appear to reflect ageing at the population level may not do so at the individual level. Moreover, most heterogeneity in later-life outcomes is unrelated to ageing and instead reflects differences established earlier in life. Finally, we show that even when variables satisfy the proposed ageing conditions, they are generally not invertible, implying that measures of `biological age' can be highly misleading.
Familial Persistence of Geographic Mobility
The early post-war era in the United States was a time of high geographic mobility, both in the short- and long-run migration. Since then, migration rates in the US have stagnated or fallen. I use PSID data to track families over time and shed light on the generational dynamics of migration. I document the characteristics of geographic mobility and find persistence across generations. I find preliminary evidence suggesting heterogeneity across families is not explained by observables. Children born in a different state than at least one of their parents are ~30% more likely to migrate than those born in the same state as both parents.