5. Income and substitution effects of a disability insurance reform (accepted for publication) Journal of Public Economics (with Eva Deuchert)
Disability insurance (DI) systems are widely criticized for their inherent work disincentives. This paper evaluates the effects of a Swiss DI reform that aims to lower pensions for a group of existing DI beneficiaries and introduces an additional notch to the pension schedule. The reform does not significantly affect average earnings and employment, but increases the disability degree of those threatened by a pension decline. We estimate bounds on the income and substitution effects employing the principal stratification framework. The income effect is quantitatively important, while the substitution effect is smaller and bounds include zero.
4. Culture and Taxes (forthcoming) Journal of Political Economy (with Raphaël Parchet)
We propose a difference-in-differences strategy to identify the existence of inter-jurisdictional tax competition and to estimate its spatial reach. Our strategy rests on differences between desired tax levels determined by culture-specific preferences and equilibrium tax levels determined by interjurisdictional fiscal externalities and by preferences. While fiscal preferences differ systematically and demonstrably between French-speaking and German-speaking Swiss municipalities, we find that local income tax burdens do not change discretely at the language border but exhibit smooth spatial gradients. We also develop a theoretical tax competition model of strategic tax setting by local governments that anticipate the effects of tax rates on the per-capita income and the median "hedonic" income, two inextricable consequences of the sorting of heterogeneous individuals.
3. Culture, Work attitudes, and job search: Evidence from the Swiss language border (2017) Journal of the European Economic Association, 15 (5), 1056-1100 (with Rafael Lalive, Andreas Steinhauer, and Josef Zweimüller)
Unemployment varies across space and in time. Can attitudes toward work explain some of these differences? We study job search durations along the Swiss language border, sharply separating Romance language speakers from German speakers. According to surveys and voting results ,the language border separates two social groups with different cultural background and attitudes toward work. Despite similar local labor markets and identical institutions, Romance language speakers search for work almost seven weeks (or 22%) longer than their German speaking neighbors. This is a quantitatively large effect, comparable to a large change in unemployment insurance generosity.
2. Effects of a higher replacement rate on unemployment durations, employment, and earnings (2015) Swiss Journal of Economics and Statistics, 151 (1), 1-25
1. The Demand for Social Insurance. Does Culture Matter? (2011) Economic Journal, 121, F413-F448 (with Rafael Lalive, Andreas Steinhauer, and Josef Zweimüller)
Revise and Resubmit:
Disability, Educational Attainment, and Earnings Equality (with David Baldridge, Richard Dirmeyer, and Mukta Kulkarni)
While interest in research on the inclusion of persons with disabilities continues to grow, these individuals encounter barriers to equal employment opportunities and remain a marginalized and understudied group. Education has been identified as an important equalizer, yet the extent to which educational attainment impacts career outcomes for persons with disabilities is complex and not currently fully understood. This study provides descriptive evidence on earning differences between persons with and without disabilities, and the moderating effects of education, gender and race. We use data from the American Community Survey 2015, analyzing 885,950 records, including 40,438 persons with disabilities. Results indicate that individuals with disabilities earn 29.7 percent less than individuals without a disability. Moreover, we find a 21.8 percent earning gap between men with disabilities and women with disabilities and a 7.0 percent earning gap when comparing minorities with disabilities and non-minorities with disabilities. Overall, we find that while persons with disabilities as a whole benefit from greater educational attainment, they are less successful in converting educational gains into earnings gains and that race and gender also play a role. Considering the importance of harnessing diverse talent in organizations, we outline implications for research and human resource practitioners.
Class composition, special needs students, and peers' achievement (with Simone Balestra and Helge Liebert)
This paper evaluates the effects of classroom composition and inclusive schooling on student achievement. Combining population data on student achievement with psychological examination records, we find that higher levels of special needs students in a class lower students' performance in a standardized test. There is distinct effect heterogeneity: Special needs students themselves and students at the lower end of the achievement distribution suffer the most from higher inclusion. Furthermore, the effect is largely driven by students at the upper end of the special needs distribution, i.e. those with more severe needs and conspicuous behavior. In addition, we find evidence that effects only emerge after the number of special needs studnets exceeds 15% of students in a classroom.
Summer-born struggle: the effect of school starting age on health, education, and work (with Simone Balestra and Helge Liebert), NEW VERSION
This paper offers a comprehensive analysis of the impact of school starting age (SSA) from childhood through the labor market. We first study the effect of SSA on a child's probability of developing special educational needs in early grades. Children with a higher SSA are less likely to develop behavioral problems and speech impediments, whereas learning disabilities, ADHD, and dyslexia/dyscalculia remain unaffected. The SSA-effect persists throughout compulsory schooling, resulting inhigher test scores in grade eight and better-quality vocational training contracts. However, we find no effect on earnings and employment.
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