Gabriele Guaitoli

Summary: Limitations to workers' spatial mobility reduce access to productive jobs, misallocating labour across space and firms. Several policies aim to mitigate this misallocation, but differ in how they change the local economic conditions firms face, such as floorspace costs or agglomeration economies. I show that the effectiveness of a policy crucially depends on which firms are more sensitive to changes in local conditions. I call this sensitivity localness. Using UK microdata, I find that productivity and localness are negatively correlated, and - importantly - differently so across space. Accounting for localness heterogeneity in a spatial general equilibrium model dampens, by up to 75%, the welfare and output gains from policies, such as housebuilding programs, that decrease congestion externalities in productive locations. Intuitively, reducing local congestion costs creates low-productivity jobs rather than productive ones, as low-productivity firms are more local, in particular in high-productivity locations.

Summary: Income inequalities between old and young individuals have increased in rich countries but have fallen in developing ones. We connect these facts to long-term trends in education, growth, and demographics, and show that popular measures of (labour) earning gaps underestimate the phenomenon.

1. • • Press coverage: Washington Post

     • Non-technical summary: LIS "Inequality Matters" Newsletter, June 2022

     • Previously circulated as "Global Trends in Intergenerational Income Inequality".

Summary: Local non-pharmaceutical interventions in the USA led to negative externalities on neighbouring labour markets, both through a labour demand factor (affecting workers of locked-down businesses) and a goods demand factor (preventing locals from consuming non-tradeables and amenities in neighbouring counties).

1. • • Slides

     • Press Coverage: VoxEU Podcast