58 research outputs found
The Effect of Subsidized Employment on Happiness
While a large body of evidence suggests that unemployment and self-reported happiness are negatively correlated, it is not clear whether this reflects a causal effect of unemployment on happiness and whether subsidized employment can increase the happiness of the unemployed. To close this gap, this paper estimates the causal effect of a type of subsidized employment projects - Germany's Arbeitsbeschaffungsmaßnahmen - on self-reported happiness. Results from matching and fixed effects estimators suggest that subsidized employment has a large and statistically significant positive effect on the happiness of individuals who would otherwise have been unemployed. Detailed panel data on pre- and post-project happiness suggests that this effect can neither be explained by self-selection of happier individuals into employment nor by the higher incomes of the employed.Happiness, life satisfaction, unemployment, subsidized employment
Does climate change cause conflict? Damned if you do, damned if you don’t
Using detailed data on conflict-related incidents in Indonesia, we exploit seasonal variation in the relationship between rainfall and agricultural production to study the mechanism linking climate change and conflict. Furthermore, we ask whether irrigation and dam infrastructure help mitigate this link. We find that wet-season rainfall decreases production while rainfall during the dry season is beneficial for production. If agriculture is the mechanism through which climate change affects conflict, then we should expect the opposite effect on conflict, but with one-year lag. Our results show that, as expected, dry-season rainfall decreases conflict in Indonesia and in agricultural regions like Java, while wet-season rainfall increases conflict. In the latter, we find that irrigation increases conflict instead of reducing it. For Indonesia, irrigation reduces the effect of conflict during the dry season and amplifies it during the wet season. A plausible explanation is that the irrigation network is not well adapted to agriculture necessities which could generate civil unrest when a weather shock occurs. A policy that aim to reducing the impact of climate change on civil conflict should consider these drawbacks.Utilizando datos detallados sobre incidentes relacionados con conflictos en Indonesia, explotamos la variación estacional en la relación entre las precipitaciones y la producción agrícola para estudiar el mecanismo que vincula el cambio climático con los conflictos. Además, nos preguntamos si la infraestructura de riego y embalses ayudan a mitigar este vínculo. Encontramos que las lluvias en la estación húmeda disminuyen la producción, mientras que las lluvias durante la estación seca son beneficiosas para la producción. Si la agricultura es el mecanismo a través del cual el cambio climático afecta a los conflictos, entonces deberíamos esperar el efecto contrario en los conflictos, pero con un retraso de un año. Nuestros resultados muestran que, como se esperaba, las lluvias de la estación seca disminuyen el conflicto en Indonesia y en regiones agrícolas como Java, mientras que las lluvias de la estación húmeda aumentan los conflictos. En este último caso, encontramos que el riego aumenta el conflicto en lugar de reducirlo. Para Indonesia, el riego reduce el efecto del conflicto durante la estación seca y lo amplifica durante la estación húmeda. Una explicación plausible es que la red de riego no está bien adaptada a las necesidades agrícolas, lo que podría generar disturbios civiles cuando se produce mal tiempo. Una política encaminada a reducir el impacto del cambio climático en los conflictos civiles debería tener en cuenta estos inconvenientes.Centro de Investigación en Ciencias Políticas, Económicas y SocialesFil: Gatti, Nicolás. Instituto Nacional de Tecnología Agropecuaria (INTA). Instituto de Economía; ArgentinaFil: Baylis, Khaty. University of Illinois at Urbana-Champaign. Agricultural and Consumer Economics; Estados UnidosFil: Crost, Benjamin. University of Illinois at Urbana-Champaign. Agricultural and Consumer Economics; Estados Unido
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Essays in Applied Economics
This dissertation combines research on three topics in applied empirical economics. The first paper, which is based on joint work with Patrick Johnston, examines the effect of development projects on civil conflict. The second paper estimates the effect of subsidized employment on the happiness of the unemployed. The third paper, based on joint work with Santiago Guerrero, analyzes the effect of restrictions to alcohol accessibility on Marijuana use.The first paper develops a theoretical model of bargaining and conflict in the context of development projects. The model predicts that development projects cause an increase in violent conflict if governments cannot (1) ensure the project's success in the face of insurgent opposition and (2) credibly commit to honoring agreements reached before the start of the project. The model is tested by estimating the causal effect of a large development program on conflict casualties in the Philippines. Identification is based on a regression discontinuity design that exploits an arbitrary poverty threshold used to assign eligibility for the program. Consistent with the model's predictions, we find that eligible municipalities suffered a substantial increase in casualties, which lasts only for the duration of the project and is split evenly between government troops and insurgents.The second paper estimates the causal effect of a type of subsidized employment projects - Germany's \emph{Arbeitsbeschaffungsmassnahmen} - on self-reported happiness. Results from matching and fixed effects estimators suggest that subsidized employment has a large and statistically significant positive effect on the happiness of individuals who would otherwise have been unemployed. Detailed panel data on pre- and post-project happiness suggests that this effect can neither be explained by self-selection of happier individuals into employment nor by the higher incomes of the employed. This suggests that subsidized employment programs are more effective at increasing the happiness of the unemployed than an increase in unemployment benefits. The third paper estimates the effect of the Minimum Legal Drinking Age of 21 years on Marijuana use. The casual effect of this law is estimated through a regression discontinuity design that compares Marijuana use among individuals just below and just above age 21. We find a significant drop in Marijuana use at age 21, which suggests that individuals substitute between alcohol and Marijuana. Policies that restrict alcohol accessibility are therefore likely to have the unintended consequence of increasing Marijuana use
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Risk and aversion in the integrated assessment of climate change
We analyze the impact of damage uncertainty on optimal mitigation policies in the integrated assessment of climate change. Usually, these models analyzeuncertainty by averaging deterministic paths. In contrast, we build a consistentmodel deriving optimal policy rules under persistent uncertainty. For this purpose,we construct a close relative of the DICE model in a recursive dynamic programming framework. Our recursive approach allows us to disentangle effects of risk, risk aversion, and aversion to intertemporal substitution. We analyze different ways how damage uncertainty can affect the DICE equations. We compare the optimal policies to those resulting from the wide-spread ex-ante uncertainty approach averaging deterministic paths
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