UC Berkeley

This dissertation reflects research on the US labor markets over the course of large macroeconomic events. Each chapter studies a particular facet of how to understand movements in labor markets and individual lives as the macroeconomy shifts. In my first chapter, I introduce and motivate each of the subsequent chapters as essential for furthering our collective understanding of human well-being in an ever evolving and fluctuating macroeconomy.

In the second chapter of my dissertation, I study the impact of technological change on workers by examining the adoption of the tractor in American agriculture. The paper uses complete count census data at both the county and individual level to study the impact of farm mechanization in the first half of the twentieth century. I examine the individual-level outcomes and adjustment mechanisms for impacted individuals. I find that the generation of farm workers that was older than 18 when the tractor was adopted saw large disemployment effects and an exodus from the labor market, though no strong migratory patterns. In contrast, youth who grew up on farms were likely to stay in farm work and do not show strong propensity to migrate out of their county of origin. I conclude that changing technology requires new tasks and skills, making it difficult for incumbent workers to adjust. New entrants, however, have the capacity to adapt to the changing work requirements.

In the third chapter, co-authors and I show that the standard implementation of X13-ARIMA yields predictable revisions to initial releases of employment growth. At the onset of severe recessions, initial growth rates tend to be revised downward. This causes the severity of recessions to be underestimated in real-time-- a major concern for policy-makers. The problem arises from the combination of concurrent seasonal adjustment, and the standard forecasting procedure used as part of the seasonal adjustment algorithm, when applied to abrupt movements such as those that occur at the onset of a recession. This problem was avoided in the COVID crisis only due to the triggering of outlier detection clauses, which counteracted this effect.

In the fourth chapter, I study the empirical accuracy of home production in macroeconomic models. I begin by building a simple RBC-style model with home production and two income earners. I solve and simulate the model to demonstrate how shocks to productivity may impact time allocation between two spouses in the home. I then use the American Time Use Survey to study time allocation in response to the Great Recession. I use state-level variation in the unemployment rate over the Great Recession to measure how men and women's time spent on market work, home production, childcare and leisure varied with labor market conditions. I find that men's market work does decline with state-level unemployment and that men's home production and childcare do increase. Women's time use does not appear to change. Finally, I test the model by estimating how men's and women's time in home production and market work relate. I find that contrary to the prediction of the model, men's and women's time in home production do not co-move. This finding calls for further work to understand how to better model time allocation and substitution within a household.