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The ��ɫApp Institute for Economic Policy Research has awarded fellowships to 16 students for the upcoming academic year.

The fellowships – totaling about $400,000 – allow PhD candidates to conduct research and work on their dissertations without having to manage teaching responsibilities. Following is a list of graduate student fellows for the 2016-17 academic year and a brief description of their dissertations. Read here for more information about SIEPR’s eight fellowship programs.

Bobak Pakzad-Hurson:  “Is Pay Transparency a Good Idea? Theory and Evidence on Market Efficiency and the Gender Pay Gap”  This paper examines the theory behind recent calls for pay transparency as a mechanism to provide more information to women in negotiations.  It then looks at pay differences using data from Task Rabbit.  Both the theory and empirical evidence find that transparency can increase efficiency in some circumstances, but can also exacerbate the gender pay gap in others.

Juan Rios: “Optimal Anti-Poverty Programs: An Application to the Brazilian Bolsa Família” This paper provides guidelines for the design of cash transfer programs. Such programs are among the most common poverty alleviation policies.

Evan Mast: “The effect of decentralization on tax incentives, and the local allocation of economic activity”  Competition between jurisdictions to attract businesses is important both for local finances, firm location, jobs, and infrastructure.  This paper looks at the effects of such competition in New York to see the effects of the competition and impact of centralization restrictions.

Monica Bhole: “The Market for Graduate Student Loans”  This paper examines the market for graduate students loans and the impact of increased ability to borrow from the government through the PLUS program.  Graduate students borrow shift borrowing from private loans to government loans despite the ability to have lower interest charges on the private loans.  Despite the higher interest rates, other features of the government loans make them more attractive to graduate students.

Davide Malacrino: “Entrepreneurs’ Wealth and Firm Dynamics”  This paper looks at how firm owners’ personal finances modulate the transmission of economic shocks to the firm and its employees. Using data on every Norwegian firm from 2004 to 2013 shows that, conditional on size and age, firms owned by wealthy shareholders are less sensitive to revenue shocks in many dimensions including, survival rate, hiring rate and employees' wage growth.

Stephen Nei:  “Essays in Network Interaction”  A network perspective provides insights into the functioning of societies. This project examines how individuals in a society share bits of information each individual has, and whether the bits of information aggregate so as to maximize the likelihood that all individuals are making the right decision. Then the project expands to look at the interplay between societies: how alliances between nations can help prevent international wars.

Barbara Biasi:  “Unions, Salaries, and The Market for Teachers: Evidence from Wisconsin” Teacher salaries are often determined by a teacher's academic qualification and years of seniority and are negotiated between teacher unions and school districts. The lack of a link between performance and compensation is regarded as one of the issues behind the challenges faced by many public school districts when attracting and retaining high quality teachers. This paper exploits a recent reform of teacher pay in Wisconsin, which prohibited collective bargaining over salary schedules, to study the effects of performance pay on the composition of the teaching body. Evidence shows that teachers respond to salary changes by moving across districts or by leaving public schools. In particular, high-quality teachers move to districts with a high merit pay component of salaries, and low-quality teachers leave these districts.

Atul Gupta:  “Quality incentives, hospital responses and patient health” This paper provides an economic framework to analyze hospital responses and impact on patient health due to quality of care financial incentives.  Hospitals were penalized if their 30 day re-admissions rates for elderly Medicare patients were deemed too high. Hospitals respond to the penalty.  The probability of re-admission for Medicare patients decreases. Targeted patients also have improved one-year mortality rates. At the same time, Hospitals also slightly change their patient mix away from Medicate patients.

Santiago Perez:  “Moving to opportunity:  Railroads, migrations and economic mobility” Regional inequalities explain a substantial fraction of inequality within countries.  The expansion of railroads in Argentina led to a substantial increase in geographic mobility, particularly among unskilled individuals. Individuals in relatively disadvantaged regions were able to take advantage of the new migration opportunities facilitated by railroads. As a result, they experienced higher rates of upward mobility.

Moritz Lenel: “The Role of Government Securities in Financial Markets”  Between December 2008 and October 2014, the US Federal Reserve undertook three rounds of quantitative easing during which it bought government-backed securities of longer maturity in exchange for central bank reserves. These market interventions were undertaken to lower yields on mortgages and corporate assets to stimulate economic activity. This project studies how the supply of both short- and long-term government-backed securities affects asset prices and lending volumes in financial markets.

Santiago Saavedra: “Observing evasion: local incentives and illegal mining”  This paper studies tax evasion and local authorities’ incentives in the context of illegal mining in Colombia. This paper uses satellite images and machine learning to determine the extent of legal and illegal mining and measures the change in activity in response to a change in the royalty share allocated to municipalities.

Megha Patnaik: “Small business credit in the Great Recession” Bank closures during and after the Great Recession hurt small business (10-250 employees) credit, but not credit for the micro firms (less than 10 employees).  House price movements are positively associated with credit for micro firms but not for small firms. These results indicate that bank credit is the main source of formal credit for small firms whereas the collateral lending channel based on housing wealth is the main source of credit for micro firms.

Kelly Zhang:  “Corrupting Politicians - Evidence from Kenya” This project examines why politician corruption is so prevalent in developing democracies, through the lens of Kenyan politics. First, it uses experimental evidence to illustrate how voter pessimism towards the political class undermines the electoral incentive for politicians to be clean. Then, it uses survey data and embedded experiments to document voter demand for cash from politicians and how much citizens value public goods over private transfers. Finally, it uses data from politician interviews to characterize how traits of public spirit and managerial ability map out to politician strategies in licitly or illicitly funding cash transfers, legislative performance, and local public goods provision. Together, these three paper chapters suggest how high levels of poverty can perpetuate politician corruption in developing democracies.

Kareem Elnahal: “Walrasian Contracting in Primary Financial Markets” This paper studies security design with different information known to the firm and investors. The model is able to shed light on some of the most salient features of primary markets, including the use of debt and convertible preferred debt, credit rationing, and the ’pecking order’ of security designs by project type. “Due diligence” plays a critical role, both in sustaining trade and shaping market outcomes. The results show that ‘macroprudential’ policies that seek to mitigate systemic financial risk, either by limiting debt and leverage or by limiting private information acquisition (through disincentives like strict disclosure rules) may face much steeper tradeoffs than realized.

Alonso Villacorta: “Balance Sheets of the Financial and Non-Financial Sectors and Business Cycles” By lending to multiple borrowers, intermediaries pool idiosyncratic risks and increase the provision of collateral in the economy, allowing more funds to flow from lenders to firms. However, intermediaries require collateral for their loan. However, during financial crises, when the economy already has low intermediary capital less intermediation implies tighter constraints and lower collateral values, which affects capital allocation and reduces output.

Yevgeniy Teroshyn: Teroshyn is examining the linkages between rule-based and rule-like monetary policy and economic stability. It provides both a theoretical model and empirical evidence with data from nine countries.  The model and evidence show improved economic stability primarily through lower inflation volatility.