Applied Microeconomic Essays on: Immigration, Labor and Welfare
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Date
2018-07-24
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Abstract
This dissertation encompasses three different topics in applied microeconomics with the common thread of understanding the impact of public policy on economic behavior, choice, and welfare. By employing causal inference methods, I identify the intended and unintended effects of immigration policies on crime rates and labor market preferences. By applying a nonparametric identification technique, I evaluate the measurement error in reported subjective well-being, an alternative criterion gaining the attention of more researchers to evaluate policy interventions.
In the first essay, I study the effect of Alabama’s HB56 immigration law on crime. Alabama HB
56 passed in 2011, is considered to be the strictest anti-illegal immigration bill in the United States. By using the synthetic control method to create a counter-factual Alabama, this chapter provides suggestive evidence of heterogeneous causal effects of Alabama HB 56 on crime. Compared to the synthetic group, the rate of violent crime increased as a response to Alabama HB 56, while there was no significant change in property crime rate after the law was implemented. A placebo test is performed to demonstrate the robustness of the results.
In the second essay, I investigate the impact of the H-1B cap exemption on Ph.D. labor markets.
The American Competitiveness in the Twenty-first Century Act of 2000 (AC 21) eliminated the H-1B cap for foreign employees of academic, non-profit and government research organizations. This act potentially affects the job preferences of newly graduated foreign Ph.D. students. Choosing a career in an uncapped H-1B qualified entity makes the foreign-born Ph.D. graduates to circumvent the risk of facing the fiercely competitive H-1B application process and possibly avoiding potential losses due to a visa rejection. I use data from the Census of Ph.D. graduates to examine the policy impact on academic and industry labor markets in the United States. The results show that Ph.D. graduates with temporary visas are 5% more likely to pursue a job in academia, and 3-4% less likely to choose a job in industry. Placebo and falsification tests on post-doctoral participation further exclude other external changes that could possibly affect the job market.
As a measure of welfare, the growth of subjective well-being (SWB) is among the most critical aims in human society. However, self-reported well-being is potentially subject to significant
misclassification errors. In the final essay, I employ a recently developed method from the measurement error literature to correct measures of reported happiness in 80 countries. I find that misclassification errors are correlated with prevalent religious beliefs and countries’ economic development stages, along with other individual characteristics. By utilizing the corrected SWB, I further reexamine the Easterlin paradox and modified-Easterlin hypothesis. The findings indicate that although reported SWB is not associated with GDP per capita, the corrected measure of SWB is. I find no evidence for a happiness satiation point as defined in previous studies.
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Anti-illegal Immigrant Law, Alabama, Crime, Synthetic control, Academia, H-1B Visa, Immigration Law, Easterlin paradox, Economic development, Misclassification errors, Welfare