Disaster and Recovery: The Public and Private Sectors in the Aftermath of the 1906 Earthquake in San Francisco

A severe earthquake in San Francisco in 1906 severed electrical and gas lines and collapsed chimneys. Fires resulted, burning for four days over 2800 acres. The commercial and residential center of the city was destroyed. Two hundred fifty thousand people of the city’s 400,000 population were left homeless, including a majority of public and private sector workers. Municipal records of land titles and bank account records were lost. Payouts from property insurance claims, necessary for rebuilding, were in doubt because policies covered damage from fires, but not from earthquakes. The municipal government was corrupt. Yet, within three years the city was rebuilt, commercial activity restored, and the population level recovered. Two public sectors developments were key. The first was the actions of U.S. Army troops stationed outside the fire zone at the Presidio and Fort Mason. They moved to maintain order, protect property, and fight fires within hours of the earthquake. They patrolled the city for 74 days. These actions were extra-legal in that martial law was never declared. Army troops also built and maintained the communications network, took over the distribution of food and other supplies, and constructed and ran many of the relief camps. The second development was also extra-legal. The municipal government was displaced the day of the earthquake by a citizens committee of business and civic leaders. This Committee would control local government funds, including $10 million in donations, and dictate or cajole liberal land use, zoning, business licensing, and building trade rules to speed redevelopment and build confidence in the recovery. Thus, the U.S. Army and the Committee set the stage for rapid redevelopment by maintaining property rights and a legal and administrative framework conducive to a robust private market rebuilding of the city. In a narrow sense the uniqueness of the U. S. Army response and the displacement of the municipal government means the San Francisco recovery is not generalizable to other disasters. In a broader sense, however, the extraordinary San Francisco recovery echoes Hirshleifer: “Historical experience suggests that recovery [from a disaster] will hinge upon the ability of government to maintain or restore property rights together with a market system that will support the economic division of labor.”San Francisco, earthquakes, urban disasters

Immigrant Networks and the U.S. Bilateral Trade: the Role of Immigrant Income

This paper examines the role of immigrant networks on trade, particulalry through the demand effect. First, we examine the effect of immigration on trade when the immigrants consume more of the goods that are abundant in their home country than the natives in a standard Heckscher-Ohlin model and find that the effect of immigration on trade is a priori indeterminate. Our econometric gravity model consists of 63 major trading and immigrant sending countries for the U.S. over 1991 - 2000. We find that the immigrants income, mostly through demand effect, has a significant negative effect on the U.S. imports. However, if we include the effect of the immigrant income interacted with the size of the immigrant network, measured by the immigrant stock, we find that higher the immigrant income lower is the immigrant network effect for both U.S. exports and imports. This we find in addition to the immigrant stock elasticity of 0.27% for U.S. exports and 0.48% for U.S. imports. Capturing the immigrant assimilation with the level of immigrant income this paper finds that the immigrant network effect on trade flows is weakened by the increasing level of immigrant assimilation.immigrant networks, immigrant assimilation, demand effect, trade.

Knowledge Spillovers and the Timing of Foreign Entry

We analyze how foreign presence affects local ?firm productivity. We relax the standard implicit assumption that spillovers are immediate and permanent. We ?find that spillovers are dynamic. Foreign entry of a majority foreign owned fi?rm has a short run negative effect on the productivity of local competitors, which is more than offset by a longer run positive effect. The entry of minority foreign owned fi?rms has an immediate, though short-lived, positive effect on local suppliers. The entry of majority foreign owned fi?rms also improves the productivity of local suppliers, but the effect materializes later and lasts longer.FDI, spillovers, dynamics, timing

Foreign Direct Investment and Labor Rights: A Panel Analysis of Bilateral FDI Flows

The paper analyses the impact of fundamental labor rights on bilateral FDI flows to 82 developing countries. The results indicate that investments by multinationals are significantly higher in countries that adhere to labor rights, thereby refuting the hypothesis that repression of these rights fosters FDI.FDI, Labor Rights, Developing Countries

Skyscrapers and Skylines: New York and Chicago, 1885-2007

This paper compares and contrasts the determinants of the market for skyscrapers in Chicago and New York from 1885 to 2007, using annual time series data. I estimate the factors that determine both the number of skyscraper completions and the height of the tallest building completed each year in the two cities. I find that each city responds differently to the same economic fundamentals. Also, regressions test for and find the presence of strategic interaction across the two cities. I also estimate the effects of zoning regulations on height. Compared to New York, Chicago's zoning policies significantly reduced the height of its skyline.New York, Chicago, skyscrapers, building height

Vertical Versus Horizontal Tax Externalities: An Empirical Test

We study taxation externalities in federations of benevolent governments. Where different hierarchical government levels tax the same base, one can observe two types of externalities: a horizontal externality, working among governments of the same level and leading to tax rates that are too low compared to the social optimum; and a vertical externality, working between different levels of government and leading to suboptimally high tax rates. Building on the model of Keen and Kotsogiannis (2002), we derive a discriminating hypothesis to distinguish vertical and horizontal tax externalities based on measurable variables. This test is applied to a panel data set on local taxes in a sample of Swiss municipalities that feature direct-democratic fiscal decision making, so as to maximize the correspondence with the "benevolent" governments of the theory. We find that vertical externalities dominate - they are thus an observed empirical phenomenon as well as a notable extension to the theory of tax competition.

The Association Between the Frequency of Wife Assault and Marital Dissolution

In this paper, we investigate the source of the positive association between domestic abuse in a first marriage and the probability of that marriage ending using the 1993 Violence Against Women survey (VAWS) data. We find that the association between abuse and the decision to separate remains significant and largely unaffected when all VAWS variables thought to influence the decision to separate are added to the probit. Most of the variables which are not available in the VAWS do not appear to be capable of generating a spurious positive relationship between the frequency of abuse and marital dissolution. We also find no evidence of systematic reporting differences which might generate a spurious association between abuse and dissolution.

The impacts of the 1988 tax reform on married women's labour supply in Canada

I investigate the impact of the Canadian Federal tax reform of 1988 on the labour supply of lower income married women. The Canadian federal tax reform of 1988 replaced the spousal exemption with a nonrefundable tax credit. This reduced the dependence of a low income married woman’s effective marginal tax rate on the effective marginal tax rate of her husband. Using difference-in-difference estimators, I compare the labour supply of women married to higher income husbands (the "treatment" group) and the labour supply of women married to lower income husbands (the "control" group). The treatment group experienced significantly larger reductions in their effective marginal tax rate than the control group. I find a significant increase in labour force participation for women married to higher income husbands. I also show that the tax reform significantly increased the total annual working ho

Legalization and Immigrant Homeownership: Evidence from Spain

A significant homeownership gap still remains between natives and immigrants in most countries. Because of the many advantages of homeownership for immigrants and for the communities where immigrants reside, a variety of countries have tried to implement policies that facilitate immigrant homeownership. Many of these policies hinge on immigrants’ legal status. Yet, owing to data limitations, we still know very little about its impact on immigrant homeownership. We address this gap in the literature and find that legalization raises immigrant homeownership by 20 percentage-points even after accounting for a wide range of individual and family characteristics known to impact housing ownership. This finding underscores the importance of legal status in immigrant assimilation –housing being an important indicator of immigrant adaptation, and the need for further explorations of the impact of amnesties on the housing markets of immigrant-receiving economies.Immigration, Housing, Legal Status, Spain