Abstract: Displaced workers often exhaust their initial unemployment benefits. I analyze Germany's 2005 Hartz IV reform, which reduced the generosity of long-term unemployment insurance (UI) available once short-term benefits run out. Using administrative data on UI claimants, I exploit cross-worker and cross-cohort heterogeneity in the timing of Hartz IV's effective onset to estimate how long-term benefit reductions affect jobless durations, subsequent wages, and job characteristics. The hazard rate of reemployment rises steadily in the months before the cuts take effect, culminating in a much larger spike in job-finding at benefit exhaustion than was evident before the reform. My estimates imply that the new benefit schedule reduced the probability of experiencing a one-year jobless spell by 12.4 percent. Conditional on completed jobless duration, workers who accept jobs after exhausting short-term benefits earn 4 to 8 percent lower wages than they would have absent the reform. Averaging across completed durations, and accounting for offsetting wage gains due to shorter spells, I conclude that UI reform reduced mean reemployment wages by 1.9 percent. Hartz IV diverted claimants from low-paid "mini-jobs" that often supplement UI receipt. Net employment gains are driven by full-time jobs.
Import Competition and the Great US Employment Sag of the 2000s
(with Daron Acemoglu, David Autor, David Dorn, and Gordon Hanson), Journal of Labor Economics, 2016
Abstract: Even before the Great Recession, US employment growth was unimpressive. Between 2000 and 2007, the economy gave back the considerable employment gains achieved during the 1990s, with a historic contraction in manufacturing employment being a prime contributor to the slump. We estimate that import competition from China, which surged after 2000, was a major force behind both recent reductions in US manufacturing employment and—through input-output linkages and other general equilibrium channels—weak overall US job growth. Our central estimates suggest job losses from rising Chinese import competition over 1999–2011 in the range of 2.0–2.4 million.
Return of the Solow Paradox? IT, Productivity, and Employment in US Manufacturing
(with Daron Acemoglu, David Autor, David Dorn, and Gordon Hanson), American Economic Review Papers & Proceedings, 2014
Research in Progress
Cohort-Crowding in Entry-Level Labor Markets: Evidence from German High School Reforms
(with Simon Janssen and Markus Nagler)
Spillover Effects from Import Competition: Evidence from US Plants
(with Daron Acemoglu, David Autor, David Dorn, and Gordon Hanson)