Weilong Zhang
Interests: Labor Economics, Education Economics, Family Economics, Psychology Economics

Key Words: Labor Market Policy, Welfare Inequality, Personality Traits

Job Market Paper

Distributional Effects of Local Minimum Wage Hikes: A Spatial Job Search Approach

This paper develops and estimates a spatial general equilibrium job search model to study the effects of local and universal (federal) minimum wage policies. In the model, firms post vacancies in multiple locations. Workers, who are heterogeneous in terms of location and education types, engage in random search and can migrate or commute in response to job offers. I estimate the model by combining multiple databases including the American Community Survey (ACS) and Quarterly Workforce Indicators (QWI). The estimated model is used to analyze how minimum wage policies affect employment, wages, job postings, vacancies, migration/commuting, and welfare. Empirical results show that minimum wage increases in local county lead to an exit of low type (education<12 years) workers and an influx of high type workers (education>12 years), which generates negative externalities for workers in neighboring areas. I use the model to simulate the effects of a range of minimum wages. Minimum wage increases up to $14/hour increase the welfare of high type workers but lower welfare of low type workers, expanding inequality. Increases in excess of $14/hour decrease welfare for all workers. I further evaluate two counterfactual policies: restricting labor mobility and preempting local minimum wage laws. For a certain range of minimum wages, both policies have negative impacts on the welfare of high type workers, but beneficial effects for low type workers.

Research

Personality Traits, Intra-household Allocation and the Gender Wage Gap (with Christopher Flinn and Petra Todd)

Accepted, European Economic Review

A model of how personality traits affect household time and resource allocation decisions and wages is developed and estimated. In the model, households choose between two behavioral modes: cooperative or noncooperative. Spouses receive wage offers and allocate time to supply labor market hours and to produce a public good. Personality traits, measured by the so-called “Big Five” traits, can affect household bargaining weights and wage offers. Model parameters are estimated by Simulated Method of Moments using the Household Income and Labor Dynamics in Australia (HILDA) data. Personality traits are found to be important determinants of household bargaining weights and of wage offers and to have substantial implications for understanding the sources of gender wage disparities.

A Dynamic Model of Personality, Schooling, and Occupational Choice (with Petra Todd)

Revision Requested by Quantitative Economics

This paper develops a dynamic discrete choice model of schooling and occupational choices that incorporates time-varying personality traits, as measured by the so-called “Big Five" traits. The model is estimated using the Household Income and Labor Dynamics in Australia (HILDA) longitudinal dataset from Australia. Personality traits are found to play a critical role in explaining education and occupational choices over the lifecycle. The traits evolve during young adult years but stabilize in the mid-30s. Results show that individuals with a comparative advantage in schooling and white-collar work have, on average, higher cognitive skills and higher personality traits, in all five dimensions. The estimated model is used to evaluate two education policies: compulsory senior secondary school and a 50% college subsidy. Both policies are found to be effective in increasing educational attainment, but the compulsory schooling policy provides greater benefits to lower socioeconomic groups. Allowing personality traits to evolve with age and with years of schooling proves to be important in capturing policy response heterogeneity.

Welfare Reform and Children’s Early Cognitive Development (with Hau Chyi and Orgul Demet Ozturk)

Contemporary Economic Policy 32, no. 4 (2014): 729-751.

In this paper, we use a dynamic structural model to measure the effects of (i) single mothers’ work and welfare use decisions and (ii) welfare reform initiatives on the early cognitive development of the children of the NLSY79 mothers. We use PIATMath scores as a measure of attainment and show that both the mothers’ work and welfare use benefit children on average. Our simulation of a policy that combines a time limit with work requirement reduces the use of welfare and increases employment significantly. These changes in turn significantly increase children’s cognitive attainment. This implies that the welfare reform was not only successful in achieving its stated goals, but was also beneficial to welfare children’s outcomes. In another policy simulation, we show that increasing work incentives for welfare population by exempting labor income from welfare tax can be a very successful policy with some additional benefits for children’s outcomes. Finally, a counterfactual with an extended maternal leave policy significantly reduces employment and has negative, though economically insignificant, impact on cognitive outcomes.

Teaching Experience

Course Instructor:
Econometrics (Undergraduate), 2014

Recitation Instructor and Teaching Assistant:
Econometrics III (Graduate), for Prof. Petra Todd and Prof. Benjamin Connault, 2016
Health Economics (Undergraduate), for Prof. Juan Pablo Atal, 2016
Social Choice (Undergraduate), for Prof. Sangmok Lee, 2015
Public Finance (Undergraduate), for Prof. Uriel Spiegel, 2015
Instruction to Econometrics (Undergraduate), for Prof. Xu Cheng, 2014
Statistics for Economists (Undergraduate), for Prof. Francis Ditraglia, 2014
Introductory Business Economics (Undergraduate), for Prof. Gizen Saka, 2013

Other

Selected Conference and Seminar Presentations:

(2017) SEHO 1st Annual Meeting, WEAI 92nd Annual Conference, Asian Meeting of the Econometric Society, China Meeting of the Econometric Society
(2016) 18th ZEW Summer Workshop
(2015) 10th Annual Economic Graduate Student Conference, Inaugural RES Symposium of Junior Researchers
(2011) The 16th World Congress of International Economic Association, Tsinghua Workshop in Macroeconomics

References

Petra Todd (Co-advisor)
Department of Economics
University of Pennsylvania
520 McNeil Building,
3718 Locust Walk
Philadelphia, PA, 19104, USA
215-898-4084
ptodd@econ.upenn.edu

Christopher Flinn (Co-advisor)
Department of Economics
New York University
19 West 4th Street
New York, NY 10012, USA
212-998-8925
christopher.flinn@nyu.edu

Sarah Moshary
Department of Economics
University of Pennsylvania
512 McNeil Building,
3718 Locust Walk
Philadelphia, PA, 19104, USA
moshary@econ.upenn.edu

Status

I am on the job market and will be available for interviews during the AEA meeting in Philadelphia from 1/5 to 1/7.