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This paper examines the distribution of the gasoline tax burden in the presence of increased electric vehicle adoption. Automobile manufacturers and even some states have ambitious goals to phase out gas-powered cars. However, in spite of these plans, the primary source of automobile infrastructure funding in the United States continues to be gasoline taxes. Less demand for gasoline threatens this source of revenue for maintaining roads and further shifts the burden of the tax toward consumers who can't afford the still relatively expensive electric vehicles. The analysis here illustrates the fundamental regressivity of the gasoline tax, then simulates the distributional impact of replacing the current gas tax with a lump-sum/income tax with different assessment rules designed to replace revenue generated by the gasoline tax. For example, many states are considering switching from a gas tax to a tax based on miles driven to shore up infrastructure funding. Alternatively, the required revenue could be paid equally across income quartiles or assessed based on income. Not surprisingly, the degree of regressivity of replacing the gasoline tax depends on how the tax is assessed across the income distribution. JEL classification: H22, Q21, D11 Key words: gas tax, incidence, consumer demand system, income distribution, equity, I. Introduction In January 2021, General Motors announced that it plans to completely phase out cars using internal combustion (gasoline) engines (Eisenstein 2021) by 2035, and they aren't alone. Volkswagen, [...]

Using the Current Population Survey between 1996 and 2018, this paper investigates the role constraints to migration might play in explaining racial/ethnic disparities in the labor market. The Delta Index of dissimilarity is used to illustrate a greater distributional mismatch between race/education specific workers and jobs among minorities relative to white non-Hispanics. Regression analysis then shows that this mismatch is consistent with minorities being less responsive to changes in the distribution of job opportunities. However, minorities are more responsive when the growing job opportunities are located in areas with greater same-racial/ethnic representation, suggesting that social constraints might play a role in the observed distributional mismatch. The analysis focuses on 25-54 year old men. JEL classification: J61, J15, J18 Key words: racial labor market disparities, migration costs, Delta Index, social costs, place-based, people-based, mismatch, Migration Constraints and Disparate Responses to Changing Job Opportunities 1 Introduction and Background Long-standing disparities in labor market outcomes by race are well documented. (1) At the opening of a [...]

Consistent with predictions from the literature, we find that higher levels of in-migration dilute multiple dimensions of a community's level of social capital. The analysis employs a 2SLS methodology to account for potential endogeneity of migration. JEL classification: R23, D71, C36, C38 Key words: social capital, migration, decennial census, social capital community benchmark survey, nonpublic data, simultaneous equations, endogeneity, factor analysis, 1. Introduction and Background The extensive literature on social capital demonstrates that it has many forms and perspectives. (1) This diverse nature of social capital may have prompted Woolcock (2001, [...]

This paper calculates the change in optimal labor supply and total family welfare resulting from the Tax Cuts and Jobs Act of 2017 (TCJA). We estimate labor supply elasticities for married families in the Current Population Survey from 2015 to 2017, using a joint family utility model. These elasticities are then used to simulate changes in optimal labor supply and resulting change in welfare among families with different characteristics under the new TCJA tax code. We find that optimal hours are lower post-TCJA, relative to before. However, there are differences across family members and family types. Both men's and women's optimal hours decline with income starting in the second quintile, but the decline is more dramatic for men. Overall, all families' welfare increased post-TCJA, with the gains in welfare disproportionately benefiting the wealthy; families with any self-employment income; families with children; and families renting, versus owning, their home. JEL classification: I30, J22, D19 Key words: family welfare, joint labor supply, microsimulation, TCJA https://doi.org/10.29338/wp2021-18, 1 Introduction and Backgrounds On December 31, 2017, the Tax Cuts and Jobs Act (TCJA) became the most sweeping reform of the U.S. tax code since the Economic Growth and [...]

Cigarette smokers earn significantly less than nonsmokers, but the magnitude of the smoking wage gap and the pathways by which it originates are unclear. Proposed mechanisms often focus on spot differences in employee productivity or employer preferences, neglecting the dynamic nature of human capital development and addiction. In this paper, we formulate a dynamic model of young workers as they transition from schooling to the labor market, a period in which the lifetime trajectory of wages is being developed. We estimate the model with data from the National Longitudinal Survey of Youth, 1997 Cohort, and we simulate the model under counterfactual scenarios that isolate the contemporaneous effects of smoking from dynamic differences in human capital accumulation and occupational selection. Results from our preferred model, which accounts for unobserved heterogeneity in the joint determination of smoking, human capital, labor supply, and wages, suggest that continued heavy smoking in young adulthood results in a wage penalty at age 30 of 14.8 percent and 9.3 percent for women and men, respectively. These differences are less than half of the raw mean difference in wages at age 30. We show that the contemporaneous effect of heavy smoking net of any life-cycle effects explains roughly 67 percent of the female smoking wage gap but only 11 percent of the male smoking wage gap. JEL classification: I10, I12 Key words: wages, smoking; dynamic system of equations, 1 Introduction Smoking cigarettes is associated with well-documented expected longevity (Doll et al., 2004; Darden et al., 2018) and health care expenditure (Sloan et al., 2006; Xu et al., 2015) [...]

This paper investigates differences in outcomes between historically black colleges and universities (HBCU) and traditional college and universities (non-HBCUs) using a standard Oaxaca/Blinder decomposition. This method decomposes differences in observed educational and labor market outcomes between HBCU and non-HBCU students into differences in characteristics (both student and institutional) and differences in how those characteristics translate into differential outcomes. Efforts to control for differences in unobservables between the two types of students are undertaken through inverse-probability weighting and propensity score matching methodologies. We find that differences in student characteristics make the largest contributions to each outcome difference. However, some hope in identifying policy levers comes in the form of how characteristics translate into outcomes. For example, whereas HBCUs appear to be doing a better job helping female graduates parlay their education into higher earnings, non-HBCUs are doing a better job in helping graduates in science, technology, engineering, and mathematics translate their training into higher earnings. Patterns and importance of regressors are similar at different points of the distributions of outcomes. JEL classification: I24, I26, C21 Key words: HBCU, decomposition, student debt, returns to education, propensity-score matching, inverse-probability weighting, quantile regression https://doi.org/10.29338/wp2020-10, Decomposing Outcome Differences between HBCU and non-HBCU Institutions I. Introduction and Background The analysis in this paper decomposes average differences in educational and labor market outcomes observed between graduates from [...]

This paper determines how individual, relative to community, social capital affects individual migration decisions. We make use of nonpublic data from the Social Capital Community Benchmark Survey to predict multidimensional social capital for observations in the Current Population Survey. We find evidence that individuals are much less likely to have moved to a community with average social capital levels lower than their own and that higher levels of community social capital act as positive pull-factor amenities. The importance of that amenity differs across urban/rural locations. We also confirm that higher individual social capital is a negative predictor of migration. JEL classification: R23, D71, C36, C38 Key words: social capital, migration, Current Population Survey, amenities, nonpublic data, factor analysis, 1. Introduction and background A growing body of research argues that workers make their migration decisions based on noneconomic factors, in addition to economic factors such as wages (Deller et [...]

This paper calculates the welfare cost to families of an unemployment shock. Using U.S. data, we find that, overall, an average annualized expected dollar equivalent welfare loss of $1,156 when the unemployment rate rises by one percentage point. The welfare loss is greater for married families than for single families and increases with education. We then estimate that a loss in purchasing power of 1.8 percent generates the same amount of welfare loss as a one-percentage-point rise in the unemployment rate. Additionally, the shock to purchasing power that a family is willing to endure to avoid a one percentage point increase in the aggregate unemployment rate rises with income. The results in this paper inform policymakers about the distributional implications of decisions likely to affect labor markets. JEL classification: I30, E52, J22, D19 Key words: family welfare, joint labor supply, microsimulation dual mandate, monetary policy, Family Welfare and the Cost of Unemployment 1. Introduction and Background The purpose of this paper is to evaluate the welfare cost of a shock to unemployment for families with [...]

The share of married families in which the wife earns more than her husband has grown significantly during the past few decades. In spite of the higher total earnings these types of families typically experience, the inversion of traditional earnings superiority apparently produces considerable angst for the families. This paper examines how the total welfare of families of different relative earnings structures has fared during two very different decades and finds that families in which the wife is the higher wage earner experienced at least as much welfare gain as families with a different relative earnings structure. The implication is that even if total welfare isn't as high in families with higher earning wives, as recent literature suggests, the welfare of those families is closing in on families of different earnings structures, as their gains in welfare have either surpassed or kept up with welfare gains of other family types during the past three decades. JEL classification: I30, J22, D19 Key words: joint labor supply, family utility, micro-simulation, A TALE OF TWO DECADES: RELATIVE INTRA-FAMILY EARNING CAPACITY AND CHANGES IN FAMILY WELFARE OVER TIME I. Introduction and Background Various sources have documented the fairly dramatic rise in the [...]

This paper uses unique administrative data to expand the understanding of the role women's intermittency decisions play in the determination of their wages. We demonstrate that treating intermittency as exogenous significantly overstates its impact. The intermittency penalty also increases in the education level of the woman. The penalty for a woman with a high school degree with an average amount of intermittency during six years after giving birth to her first child is roughly half the penalty for a college graduate. We also demonstrate the value of using an index to capture multiple dimensions of the intermittency experience, and we illustrate the importance of firm dynamics in the determination of a woman's wage. JEL classification: J13, J31, J22 Key words: intermittency, administrative data, career interruptions, fertility, labor supply, wage differentials, I. Introduction A vast literature quantifies the labor market penalty associated with a worker who exhibits intermittent labor force attachment. The penalty is typically measured in terms of lower wages [...]

The analysis in this paper provides estimates of family welfare losses generated by wage and nonlabor income declines experienced across the Great Recession and by labor market constraints existing postrecession. Welfare losses are greater as families (both married and single) move up the income distribution. Total static welfare losses are estimated to amount to roughly $190 billion, comparing family welfare between 2007 and 2011. JEL classification: I30, J22, D19, E32 Key words: family welfare, joint labor supply, microsimulation, constrained hours, Family Welfare and the Great Recession I. Introduction and Background Analyses of the impact of the Great Recession on families have taken many forms. Morgan et al. (2012) find little [...]

Using administrative, individual-level, longitudinal data from the state of Georgia, this paper finds that a documented worker employed by a firm that hires undocumented workers can expect to earn 0.15 percent less than if employed by a firm that does not hire undocumented workers. However, in sectors where there are opportunities for task specialization and benefits from communication skills, documented workers can expect to earn a wage premium of less than 1 percent from being employed at a firm that also hires undocumented workers. JEL classification: J30, J15 Key words: illegal immigrants, immigration, unauthorized immigration, I. Introduction and Background The United States has a long history of immigration debate. Through the last century and into this one, immigration policy has been subjected to changing economic [...]

Working Paper 2011-2 March 2011 Abstract: Utilizing linked vital statistics, administrative employer, and state welfare records, the analysis in this paper investigates the determinants of a woman's intermittent labor force [...]

Working Paper 2010-12 August 2010 Abstract: This paper contributes to a large literature concerned with identifying the source of the widening wage gap between high school and college graduates by [...]

Working Paper 2010-2 February 2010 Abstract: During the late 1990s, the convergence of women's labor force participation rates to men's rates came to a halt. This paper explores the degree [...]

Working Paper 2008-28 December 2008 Abstract: Do firms employing undocumented workers have a competitive advantage? Using administrative data from the state of Georgia, this paper investigates the incidence of undocumented [...]

Working Paper 2008-24 October 2008 Abstract: This paper proposes a novel approach that has the potential to hasten the eradication of gender disparities in employment. This approach relies upon the [...]

Working Paper 2008-8 February 2008 Abstract: Recent trends in the labor force participation of women have brought much public attention to the issue of women opting out. This paper explores [...]

Working Paper 2008-7 February 2008 Abstract: Using administrative data from the state of Georgia, the authors find that a greater share of undocumented workers in an industry has a statistically [...]

Abstract: This paper examines the inflow and outflow of workers to different industries in Georgia during the information technology (IT) boom of the 1990s and the subsequent bust. Workers in [...]

Working Paper 2005-22 September 2005 Abstract: This paper applies a standard treatment effects model to determine that participation in Freshman Learning Communities (FLCs) improves academic performance and retention. Not controlling [...]

Working Paper 2005-11 June 2005 Abstract: This paper uses matched employer-employee data for the state of Georgia to examine workers' earnings experience through the information technology (IT) sector's employment boom [...]

Working Paper 2004-25 October 2004 Abstract: This paper demonstrates that, because of declining labor force participation rates, the usual estimates of job creation needed to keep unemployment in check are [...]

Abstract: This paper uses unique employer-employee matched administrative data files to determine that firm and industry employment dynamics play significant roles in the earnings gains of workers who change jobs [...]

Abstract: The purpose of this paper is to determine whether workers' commitment to the labor force declined after 9/11, as many popular press accounts at the time suggested it would. [...]

Working Paper 2004-12 May 2004 Abstract: This paper uses a unique personnel data set to explore job separation behavior among welfare hires. Our results indicate that welfare hires are no [...]

Abstract: This paper demonstrates how state administrative data (from Georgia) can be used to decompose net employment growth in order to track establishment births, deaths, contractions, and expansions over time. [...]

Abstract: Using the Health and Retirement Survey, this paper finds a 16 percent selectivity-corrected wage penalty among women who engage in intermittent labor market activity. This penalty is experienced at [...]