Market Size and Trade in Medical Services

March 2023 (with Josh Gottlieb, Maya Lozinski, Pauline Mourot)

We measure the importance of increasing returns to scale and trade in medical services. Using Medicare claims data, we document that "imported" medical care — services produced by a medical provider in a different region — constitute about one-fifth of US healthcare consumption. Larger regions specialize in producing less common procedures, which are traded more. These patterns reflect economies of scale: larger regions produce higher-quality services because they serve more patients. Because of increasing returns and trade costs, policies to improve access to care face a proximity-concentration tradeoff. Production subsidies and travel subsidies can impose contrasting spillovers on neighboring regions.

Media mention: Washington Post

Spatial Economics for Granular Settings

January 2021 (with Felix Tintelnot) [revisions requested at Econometrica]

We examine the application of quantitative spatial models to the growing body of fine spatial data used to study economic outcomes for regions, cities, and neighborhoods. In "granular" settings where people choose from a large set of potential residence-workplace pairs, idiosyncratic choices affect equilibrium outcomes. Using both Monte Carlo simulations and event studies of neighborhood employment booms, we demonstrate that calibration procedures that equate observed shares and modeled probabilities perform very poorly in such settings. We introduce a general-equilibrium model of a granular spatial economy. Applying this model to Amazon's proposed HQ2 in New York City reveals that the project's predicted consequences for most neighborhoods are small relative to the idiosyncratic component of individual decisions in this setting. We propose a convenient approximation for researchers to quantify the "granular uncertainty" accompanying their counterfactual predictions.

Spatial Correlation, Trade, and Inequality: Evidence from the Global Climate

November 2021 (with Kyle Meng and Solomon Hsiang)

Global phenomena, such as climate change, often have local impacts that are spatially correlated. We show that greater spatial correlation of productivities can increase international inequality by increasing the correlation between a country's productivity and its gains from trade. We confirm this prediction using a half-century of exogenous variation in the spatial correlation of agricultural productivities induced by a global climatic phenomenon. We introduce this general-equilbrium effect into projections of climate-change impacts that typically omit spatial linkages and therefore do not account for the global scope of climate change. We project greater international inequality, with higher welfare losses across Africa.

Measuring movement and social contact with smartphone data: a real-time application to COVID-19

Journal of Urban Economics, JUE Insight, 2022, Volume 127 (with Victor Couture, Allison Green, Jessie Handbury, Kevin Williams)

Tracking human activity in real time and at fine spatial scale is particularly valuable during episodes such as the COVID-19 pandemic. In this paper, we discuss the suitability of smartphone data for quantifying movement and social contact. These data cover broad sections of the US population and exhibit pre-pandemic patterns similar to conventional survey data. We develop and make publicly available a location exposure index that summarizes county-to-county movements and a device exposure index that quantifies social contact within venues. We also investigate the reliability of smartphone movement data during the pandemic.

How Many Jobs Can be Done at Home?

Journal of Public Economics, 2020, Volume 189 (with Brent Neiman)

We classify the feasibility of working at home for all occupations. We find that 37 percent of jobs in the United States can be performed entirely at home, with significant variation across cities and industries. Applying our occupational classification to 85 other countries reveals that lower-income economies have a lower share of jobs that can be done at home.

Media mentions: WSJ, Brookings, Politico, Vox, Journalist's Resource, International Business Times, Daily Mail, Business Insider, Quartz, WSJ, Economist, Vice, Reason, FT, MarketWatch, The Hill, BI, WSJ, NYT, AEI, NYT, Reuters, BI, NYT, Reuters, NYT, Economist, BBC, LA Times, FT, 2023 Economic Report of the President

The Comparative Advantage of Cities

Journal of International Economics, 2020, Volume 123 (with Don Davis)
Winner of 2022 Bhagwati Award

What determines the distributions of skills, occupations, and industries across cities? We develop a theory that incorporates a system of cities, their internal urban structures, and a high-dimensional theory of factor-driven comparative advantage. It predicts that larger cities will be skill-abundant and specialize in skill-intensive activities according to the monotone likelihood ratio property. Data on US cities, education groups, occupations, and industries are consistent with our theory's predictions.

Cities, Lights, and Skills in Developing Economies

Journal of Urban Economics, 2021, Volume 125 (with Antonio Miscio and Don Davis)

We construct metropolitan areas for Brazil, China, and India by aggregating finer geographic units on the basis of contiguous areas of light in nighttime satellite images. In China and India, lights-based metropolitan populations follow a power law, while administrative units do not. Examining variation in relative quantities and prices of skill across these metropolitan areas, we conclude that agglomeration is skill-biased in Brazil, China, and India.

How Segregated is Urban Consumption?

Journal of Political Economy, 2019, 127(4): 1684-1738 (with Don Davis, Joan Monras, and Eduardo Morales)

We measure ethnic and racial segregation in urban consumption using Yelp reviews of NYC restaurants. Spatial frictions cause consumption segregation to partly reflect residential segregation. Social frictions also matter: individuals are less likely to visit restaurants in neighborhoods demographically different from their own. Nonetheless, restaurant consumption in New York City is only about half as segregated as residences. Consumption segregation owes more to social than spatial frictions.

A Spatial Knowledge Economy

American Economic Review, 2019, 109 (1): 153-70 (with Don Davis)

We develop the first system-of-cities model with costly idea exchange as the agglomeration force. The model replicates a broad set of established facts about the cross section of cities. It provides the first spatial equilibrium theory of why skill premia are higher in larger cities and how variation in these premia emerges from symmetric fundamentals.

The Determinants of Quality Specialization

Review of Economic Studies, 2017, 84(4), p.1551–1582

Why do high-income countries export high-quality goods: home demand or factor abundance? I develop a model nesting both hypotheses and employ microdata on US manufacturing plants' shipments and factor inputs to quantify the two mechanisms' roles in quality specialization across US cities. Home-market demand explains as much of the relationship between income and quality as differences in factor usage.

Telemigration and Development: On the Offshorability of Teleworkable Jobs

chapter in Robots and AI: A New Economic Era, 2022 (with Richard Baldwin)

How many newly remote jobs will go overseas? We offer a rough quantification. Telemigration seems unlikely to be transformative. Remote work is English- & soft-skill-intensive. Baseline services exports are small, and the standard gravity model restricts modest changes to have modest impacts. We propose a simple model of telemigration in which small changes can have large consequences.

Quantifying Social Interactions Using Smartphone Data

(with Victor Couture, Allison Green, Jessie Handbury)

For COVID-motivated public releases of exposure indices derived from PlaceIQ movement data, see https://github.com/COVIDExposureIndices

Internal Trade Barriers: Evidence from Indian Trucking

(with Prabhat Barnwal, Daniil Iurchenko, Pravin Krishna, Eva van Leemput)

We examine how trade between Indian states responded to the abolition of interstate border checkposts by the 2017 Goods and Services Tax reform.

Videos

• Telemigration and Development
  CEPR interview, November 2021
• How race plays a role in choosing dining destinations
  Chicago Booth Review, November 2020
• How COVID-19 is fostering collaboration among economists
  Chicago Booth Review, September 2020
• Who Can Work at Home?
  CEPR interview, April 2020
• Impact of Trump's Tariffs on Steel
  Chicago Tonight interview, August 2018
• Cities, Skills, and Technologies
  Booth Real Estate Conference, November 2015
• Why you should live in a Nerdopolis
  Chicago Booth Review, June 2015

Written coverage

• Making a good job of remote work, FT, 7 Feb 2021
• What has coronavirus taught us about working from home?, 18 June 2020
• Comments on COVID-19 effects on labor markets in Chicago Sun-Times, 15 Apr 2020
• My research was featured in the summer 2015 cover story of Capital Ideas, "Welcome to Nerdopolis".
• Our work on the Comparative Advantage of Cities was summarized by Richard Florida at CityLab.

Letters, etc

• I blog at TradeDiversion.net.
• Childcare Obligations Will Constrain Many Workers When Reopening the US Economy (with Christina Patterson and Joseph Vavra, April 2020)
• Women at work (Economist letters, 31 Dec 2011)
• Data in context (Economist letters, 18 Mar 2010)

MBA

Managing the Firm in the Global Economy

This course studies international economics from the perspective of the firm. Its objective is to equip students with analytical tools to understand the organizational, financial, and legal issues facing firms doing business across borders.

PhD

• Int'l Macro and Trade (PhD): Autumn 2022 [GitHub and Canvas]
• International trade working group
• Advice for PhD students and recommended resources
• Advice on applying to graduate school
• My project template describes my research and coding workflow (drawn from Gentzkow & Shapiro, plain-text.co, Patrick Ball)
• Spatial Sorting of Skills and Sectors (Frontiers in Urban Economics, Nov 2015)
• The basics of "Dixit-Stiglitz lite" (June 2009)