Denvil R. Duncan, Ph.D.

This study examines the tax compliance effect of changing the ownership structure of state-owned enterprises (SOEs) using a large dataset of Chinese industrial firms. We exploit the variation in SOEs ownership—oversight authority shifted from one level of government to either a lower one (i.e., decentralization) or to the private sector (i.e., privatization), in a difference-in-differences framework to find that both decentralization and privatization causes an increase in tax compliance as measured by effective tax rate. Additionally, we find evidence that while the decentralization results are driven by the reduced distance between a decentralized SOE and its oversight government, the privatization results appear to be driven by greater tax-scrutiny. Decentralization and privatization are often seen as strategies to improve efficiency in the affected markets. Our results suggest that changes in firm ownership strengthened the state’s capacity to raise revenues in the post-SOE reform period, which partially explains the country’s success in economic transition.

We examine the role of charitable food assistance during periods of economic distress by looking at donations to a large Midwestern food bank. We explore the determinants of in-kind food provisions and financial donations during the COVID-19 pandemic and find that both types of assistance dramatically increased at the onset of the pandemic. However, these increases were not persistent. We argue that this is evidence that the charitable food system serves a critical role in facilitating the transmission of federal provisions and charitable donations to households in need during times of crisis.

The Budgetary Enforcement Act of 1990 (BEA90), in effect from 1992 to 2002, is frequently held up as an example of a congressional control that constrained U.S. federal spending. This paper provides a formal test of this conventional wisdom using synthetic control on federal non-defense discretionary expenditures, which is the category of spending BEA90 was considered the most binding. A BEA90-retaining Synthetic United States generated from a lasso regression on a large panel of donors high-income national economic and government finance indicators ultimately reach 2006 at about the same level as the actual United States despite temporarily showing some more restraint immediately upon expiration. We conclude that BEA90 effect on federal non-defense discretionary spending was small, short-lived, statistically likely to have emerged from chance, and more generally did not bend the curve of federal expenditure growth.

Although a large literature has studied discrimination in the labor market, there is little evidence on sex- and race-based discrimination of workers against (potential) employers. We implement a randomized experiment in an online labor market to contribute to this gap in the literature. In our experiment, workers make labor-supply decisions after we randomly expose them to signals about the race and sex of the employer. Our empirical analysis provides fairly strong evidence that workers discriminate against black employers when making labor effort decisions. Race-based discrimination is driven primarily by white workers against black male employers. We find weaker and less conclusive evidence of a favorable sex gap toward female employers. An additional survey with randomized components suggests that perceived differences in the likelihood that an employer honors the labor contract does not differ by employer race or sex.

We test whether labor supply responds symmetrically to wage increases and decreases using a randomized real effort online experiment. The results show that wage increases have smaller effects on labor supply than wage decreases of equal magnitude, especially on the extensive margin where the response to a wage decrease is twice that to a wage increase. This finding suggests that labor-supply responses to wage changes are asymmetric. We discuss the potential mechanisms behind our results including standard models of labor supply, reference dependence in consumption and reciprocity.