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« Back to Results

Public Economics

Paper Session

Friday, Jan. 5, 2018 10:15 AM - 12:15 PM

Pennsylvania Convention Center, 102-A
Hosted By: Econometric Society
  • Chair: TBD TBD, TBD

Spillovers in Social Program Participation: Evidence From Chile

Pedro Carneiro
,
University College London
Aureo de Paula
,
University College London
Barbara Flores
,
University College London
Emanuela Galasso
,
World Bank
Rita Ginja
,
University of Bergen

Abstract

We analyse how peers affect the participation in a family allowance for poor families in Chile called Subsidio Unico Familiar (SUF) using a regression discontinuity design. To identify this spillover effect, we exploit variation in the information about social programs due to a home-visitation program for families in extreme poverty introduced in 2002 called Chile Solidario (CS). Conditional on an index of wealth, eligibility to receive the home-visits are random around municipality level cutoffs. We find that individual participation in CS increases the take-up of SUF by 30% and neighbors' participation in CS also increases the take-up of SUF by 7%. We also study heterogeneity by proximity to the municipality's office given that the distance between households and the municipality office might be a measure of participation costs. Effectively, we find positive direct effect of CS (33%) and spillover effects (9%) on the take up of SUF only for those families who are distant to the office, suggesting that neighbor
s are an important channel of information transmission.

Unemployment Insurance, Strategic Unemployment and Firm-worker Collusion

Bernardus V. Doornik
,
Central Bank of Brazil
David Schoenherr
,
Princeton University
Janis Skrastins
,
Washington University-St. Louis

Abstract

Exploiting a sharp discontinuity in the application of an unexpected unemployment insurance (UI) reform in Brazil, we find that workers are more likely to be laid off when they are eligible for UI benefits, accounting for twelve percent of unemployment inflow around the eligibility threshold. We document layoff and rehiring patterns consistent with collusion between firms and workers to time unemployment spells with eligibility for UI benefits, explaining at least twenty percent of the additional unemployment inflow. Firms seem to benefit from strategic behavior by paying lower equilibrium wages. Collusive patterns increase with the potential rents that can be extracted from the UI system. When laying off workers eligible for UI benefits, firms are less likely to hire a replacement worker. This suggest that firms continue to employ workers informally while on benefits, and is consistent with all documented effects being stronger in the presence of large informal labor markets.

More COPS, Less Crime

Steven Mello
,
Princeton University

Abstract

I exploit a natural experiment to estimate the causal effect of police on crime. The American Recovery and Reinvestment Act increased funding for the COPS hiring grant program from less than $20 million over 2005-2008 to $1 billion in 2009. Hiring grants distributed in 2009 were allocated according to an application score cutoff rule, and I leverage quasi-random variation in grant receipt by comparing the change over time in police and crimes for cities above and below the threshold in a difference in differences design. Relative to low-scoring cities, cities above the cutoff experience increases in police of about 3.2% and declines in victimization cost-weighted crime of about 3.5% following the distribution of hiring grants. The effects are driven by large and statistically significant effects of police on robbery, larceny, and auto thefts, with suggestive evidence that police reduce murders as well. The program passes a cost-benefit test under some assumptions but not others. The results highlight that police hiring grants may offer higher benefit-cost ratios than other stimulus spending.
Discussant(s)
Owen Michael Zidar
,
University of Chicago
Michael Best
,
Columbia University
Katherine Meckel
,
Texas A&M University
Erich Johann Muehlegger
,
University of California-Davis
JEL Classifications
  • H2 - Taxation, Subsidies, and Revenue
  • H3 - Fiscal Policies and Behavior of Economic Agents