Date of Award

5-2018

Degree Type

Dissertation

Degree Name

Doctor of Philosophy

Major

Economics

Major Professor

Donald J. Bruce

Committee Members

Celeste K. Carruthers, LeAnn Luna, Marianne H. Wanamaker

Abstract

My dissertation consists of three essays in public economics. The first essay explores the role of parental wealth on school-to-work transitions and labor market outcomes of college graduates. I rely on quasi-experimental variation generated by short-run housing market fluctuations in South Korea during the 2000s. I find that a one percent increase in parental housing wealth reduces the employment hazard of their children by one percent. The result is mainly driven by young individuals who took additional years of schooling after college graduation. I also find some evidence that a greater level of parental wealth improves job security. The second essay, which is a joint work, examines whether the U.S. Department of Defense 1033 program crowds out police protection expenditure of localities. We exploit plausibly exogenous variation in item availability across time interacted with cross-sectional variation in transaction costs and land area. We find that items received through the 1033 program do not crowd out local police spending. The third essay documents evidence of consumption externalities from upper-income households to lower-income households using a series of tax reforms during the Bush administration as a natural experiment. I find that consumption externalities generated by the tax reforms raised quarterly consumption of lower-income households by more than 400 U.S. dollars. The increase was mainly driven by consumption of visible goods such as housing and vehicle. The effect of consumption externalities was stronger for lower-income households who were closer to upper-income households in the income distribution.

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