Dutch Disease or Agglomeration? The Local Economic Effects of Natural Resource Booms in Modern America
with Hunt Allcott
Forthcoming, Review of Economic Studies
October 2016 version
Do natural resources benefit producer economies, or is there a ”Natural Resource Curse,” perhaps as Dutch Disease crowds out manufacturing? We combine new data on oil and gas abundance with Census of Manufactures microdata to estimate how oil and gas booms have affected local economies in the United States since the 1970s. Migration does not fully offset labor demand growth, so local wages rise. Notwithstanding, manufacturing is actually pro-cyclical with resource booms, driven by growth in upstream and locally-traded sectors. The results highlight how many manufacturers produce locally-traded goods and how natural resource linkages can drive manufacturing growth.
Creative Destruction: Barriers to Urban Growth and the Great Boston Fire of 1872
with Richard Hornbeck
American Economic Review, 107(6), pp. 1-35
Historical city growth, in the United States and worldwide, has required remarkable transformation of outdated durable buildings. Individual reconstruction decisions may be inefficient and restrict growth, however, due to externalities and transaction costs. This paper analyzes new plot-level data in the aftermath of the Great Boston Fire of 1872, estimating substantial economic gains from the created opportunity for widespread reconstruction. An important mechanism appears to be positive externalities from neighbors’ reconstruction. Strikingly, impacts from this opportunity for widespread reconstruction were sufficiently large that increases in land values were comparable to the previous value of all buildings burned.
Research Opportunities in Emerging Markets: an Inter-disciplinary Perspective from Marketing, Economics, and Psychology
with Emerging markets are fast-growing developing countries that are creating not only a rapidly expanding segment of middle class and rich consumers but also have a sizable segment of “poor” consumers. This paper presents an inter-disciplinary perspective integrating insights from quantitative and behavioral marketing, social psychology, industrial organization, and development economics with the purpose of generating and answering research questions on emerging markets. We organize our discussion around three themes. First, there is substantial heterogeneity in the social, cultural, economic, and institutional environments as well as rapid change in these characteristics. Coupled together, the heterogeneity and dynamics increase the scope of variables and inter-relationships that have traditionally been investigated. Second, emerging markets continue to have sizeable “poor” and rapidly growing “new rich” populations, requiring marketers and researchers to understand how to market to the poor and the “new rich.” Exploiting these features in research can help deepen our theoretical understanding of markets and marketing. Third, from a methodological perspective, differences in types of available secondary data and the lower cost of collecting primary data create opportunities to develop new approaches for addressing research questions. We also encourage scholars to move beyond cross-country regressions offering broad-brush exploratory insight, to country-industry-specific research that exploits unique characteristics of a particular emerging market.
Can Informational Campaigns Raise Awareness and Local Participation in Primary Education?
with Abhijit Banerjee, Rukmini Banerji, Esther Duflo, Rachel Glennerster, Stuti Khemani and Marc Shotland
Economic and Political Weekly
Vol. 42, No. 15 (Apr. 14-20, 2007), pp. 1365-1372
A central plank of public policy for improving primary education services in India is the participation of village education committees, consisting of village government leaders, parents, and teachers. This paper reports the findings from a survey in a rural district in Uttar Pradesh. Rural households, parents, teachers and VEC members were surveyed on the status of education services and the extent of community participation in the public delivery of education services. Most parents do not know that a VEC exists, public participation in improving education is negligible, and large numbers of children in the villages have not acquired basic competencies of reading, writing, and arithmetic. Based on the findings of the baseline survey, this paper also describes a set of information and advocacy campaigns that have been designed to explore whether local participation can increase, and future research plans to evaluate the impact of these interventions.