C. Austin Davis
Postdoc. Assc., Yale University
Asst. prof., American University
I investigate the role of regulation and factor prices in the rapid, widespread adoption of mechanical harvesting technology by Brazilian sugarcane growers. I use worker- and establishment-level data to test the regulation using complementary regression discontinuity and difference-in-differences approaches. I find that regulation is, at best, a partial explanation, accounting for no more than one quarter of the dramatic change in harvesting practices. I develop a tipping-point model to show how rising wages may have played an important role even though the change in wages was gradual and the change in harvesting was abrupt; instrumental variables estimates imply that increasing wages alone are sufficient to explain the adoption of green technology.
Presented at the Southern Economic Association Annual Meeting (2015), University of Michigan (2016), Northeastern Universities Economic Development Consortium (scheduled 2016 - poster), Texas A&M (scheduled 2016), Michigan State University (scheduled 2016).
Putting Out the Fires: Sugarcane Harvesting, Air Pollution, and Health in Brazil (with Sebastian Miller)
Motivated by a dramatic reduction in agricultural burning, this paper investigates the relationship between air quality and a variety of health outcomes in South-Central Brazil. We improve on existing literature through the use high-resolution, daily satellite data; these data allow us to study the effects of short-term, local variation in ambient air quality but also allow us to guard against idiosyncratic results by considering a large region for a long period of time. We assemble a comprehensive picture by considering a range of outcomes, including hospital admissions, deaths, birthweight, and gestation. We find that local air quality has a detectable negative impact on birthweight and increases the likelihood of pre-term birth. However, in contrast to previous work, the magnitudes of our estimates are very small and we are unable to show an increase in hospital admissions associated with air quality. Draft available upon request.
Presented at the Inter-American Development Bank (2014) and the University of Michigan (2015).
Not Moving to Opportunity: Migration and Labor Mobility in Brazil
Development brings changes in the work people do and the places they live. Thus, the ability of workers to take advantage of opportunities by changing occupation, industry, or location is important for development. Using panel data on all formal employment in Brazil, I explore how labor mobility and migration relate to two interesting features of the Brazilian labor markets: dramatically rising wages, especially at the bottom of the wage distribution, and persistent cross-sectional wage disparities. From the late 1990s to 2014, Brazil experienced striking increases in both wages and employment. These increases were concentrated at the bottom of the wage distribution. At the same time, remarkable cross-sectional wage disparities exist in Brazil; even within the same narrowly-defined industries and occupations, individuals may earn twice as much as others depending on where they work. I identify the industries and occupations behind increases in labor demand.
The Roads to Market
To move beyond subsistence agriculture, farmers must be able to transport and sell their crops. At the same time, transportation routes are often chosen endogenously to support actual or potential economic activity. I examine both the effects of transportation networks on agriculture and the effects of agriculture on transportation networks. I exploit the politically-motivated founding of Brasília as a source of exogenous variation in road networks. This variation allows me to estimate how the creation of new roadways affects agricultural activity and land use. The legalization of genetically-engineered soybeans provides exogenous variation in the returns to agriculture. With data on road construction and municipal-level public expenditures, I use this variation to determine how local governments provide public goods in response to newly-profitable agricultural activity.
Labor-market Effects of Generous Old-Age Pensions (with Margaret Lay and Ben Thompson)
Old age pensions are important poverty-reduction tools, especially in developing countries, where they have been shown to improve various household outcomes including health, education, and employment. Together with Margaret Lay and Ben Thompson, I will study how developing-country pension systems affect worker and firm behavior. Brazil offers unusually generous pensions to rural and public-sector workers. We develop a theoretical model to understand how these pensions affect the hiring decisions of firms, in addition to the labor supply and educational choices of households receiving a pension. Combining this model with panel data on all formal employment in Brazil, we estimate the effect of pensions on several outcomes, including household labor supply, the composition of firms' labor force, and returns to experience.