Working Papers

Public Goods Under Financial Distress: Evidence from Cities in the Great Depression [Link]

Local governments in the U.S. issue debt to fund infrastructure projects and provide important public services to residents. When a financial crisis occurs, financially leveraged cities can suffer distress and curtail public spending, which may lead to out-migration by households. In this paper, I collect novel archival panel data on cities and municipal bonds during 1920s and 1930s and examine local public good provision during the Great Depression. I find that distressed cities significantly lowered public good provision - roughly 20 percent of the drop in expenditure can be explained through a re-allocation of budgets towards debt repayment. Despite large institutional differences between cities and firms, the effects of financial distress on wages are surprisingly similar. In response, I find suggestive evidence that households subsequently relocated away from distressed cities.


Recessions, Constraints, and Public Education: Impact of the Great Depression on the High School Movement [Link]

I study the impact of the Great Depression on educational attainment and intergenerational education mobility of U.S. males in the 1930s. I collect novel archival data on youth unemployment and school quality during the Great Depression and study how each affected overall high school graduation rates across U.S. cities during the last stage of the High School Movement. Using linked Census data on young males and their fathers, my empirical strategy attempts to explain the within-city variation in high school graduation rates and mobility across cohorts. I find that worsening local labor markets for youth significantly increased their secondary school attendance and graduation rates while education spending cuts decreased them, but to a smaller extent. The effect is largest for youth from lower socioeconomic backgrounds. Overall, I find that the Depression increased intergenerational education mobility. 


Correlation in State and Local Tax Changes [Link]

We develop a comprehensive dataset of state and local taxes from 2000-2015 that includes personal income taxes, property taxes, corporate income taxes, sales taxes, estate taxes and excise taxes. We illustrate how state and local taxes have changed over time, in response to business cycles, and to what extent different taxes co-move within a state or locality. Across states and local jurisdictions, large differences in the mix of taxes are observed, and these differences have tended to become more pronounced over time. Moreover, we note that different types of taxes tend to co-move within a state or local jurisdiction, highlighting the importance for researches to take into account the entirety of the tax system, rather than just a single tax type, when examining household or firm responses to state and local tax changes. At both a state and local level, increases in tax rates of all types tend to increase tax revenue but worsen business conditions and employment.


Works in Progress

Lender of Last Resort: Local Financial Constraints and Federal Reserve Policy in the 1930s

Economic recovery from financial crises is typically slower than from other crises, possibly due to credit rationing by financial intermediaries. I study whether lender-of-last-resort policies of the Atlanta Federal Reserve Bank during the Great Depression eased firms’ financial constraints using a novel database of local economic conditions from 1927 to 1937. My identification strategy relies on the willingness of the Federal Reserve to extend credit in some regions and not in others and plausibly exogenous placement of Federal Reserve boundaries. I find evidence that Fed intervention stymied banking panics, but I do not, surprisingly, find any meaningful effect of Fed policies on local economic outcomes.