Working Papers
World Polarization
Job polarization is a global phenomenon. I extend the analysis from a group of developed countries to a sample of 119 economies. All levels of development decreased their employment shares in routine occupations since the 1980s, suggesting increasing obsolescence. I propose a development accounting framework with technical change at the task level to quantify and extrapolate the technological trends behind this reallocation. Technological change has been biased against routine occupations and in favor of manual occupations, suggesting that in the following decades, world polarization will continue: routine occupation employment will decrease, with reallocation happening mostly from routine to manual occupations.
Structural Transformation by Cohort (with B. Hobijn & T. Schoellman)
More than half of labor reallocation during structural transformation can be attributed to new cohorts of workers disproportionately entering growing industries. This finding suggests substantial costs to reallocating workers across industries. We integrate an overlapping generations model of life-cycle career choice under switching costs with a canonical model of structural transformation. Switching costs accelerate structural transformation because they cause forward-looking workers to enter growing industries in anticipation of future productivity and wage growth. Most of the impact of switching costs, however, is on the trends in sectoral relative wages. An unanticipated acceleration of structural transformation makes more young workers line up in the service sector and reduces service sector wages. This comes disproportionately at the cost of expected future career earnings of older service sector workers.
Job Polarization, Structural Transformation, and Non-Employment
This paper investigates the quantitative importance of the non-employment margin in the labor market outcomes for the United States. During the last 50 years, the labor force has been shifting from producing goods to producing services. In terms of occupations, the routine share decreased, giving way to increases in manual and abstract ones. I argue that these two patterns are related, and that the decrease in non-employment had an important role. I propose and estimate a labor allocation model where goods, market services, and home services use different occupations as inputs. The driving force is productivity growth, which is occupation-specific. Quantitative exercises show that this non-employment channel could significantly slow down polarization and structural transformation, and induce significant displacement within the labor force.
World Polarization
Job polarization is a global phenomenon. I extend the analysis from a group of developed countries to a sample of 119 economies. All levels of development decreased their employment shares in routine occupations since the 1980s, suggesting increasing obsolescence. I propose a development accounting framework with technical change at the task level to quantify and extrapolate the technological trends behind this reallocation. Technological change has been biased against routine occupations and in favor of manual occupations, suggesting that in the following decades, world polarization will continue: routine occupation employment will decrease, with reallocation happening mostly from routine to manual occupations.
Structural Transformation by Cohort (with B. Hobijn & T. Schoellman)
More than half of labor reallocation during structural transformation can be attributed to new cohorts of workers disproportionately entering growing industries. This finding suggests substantial costs to reallocating workers across industries. We integrate an overlapping generations model of life-cycle career choice under switching costs with a canonical model of structural transformation. Switching costs accelerate structural transformation because they cause forward-looking workers to enter growing industries in anticipation of future productivity and wage growth. Most of the impact of switching costs, however, is on the trends in sectoral relative wages. An unanticipated acceleration of structural transformation makes more young workers line up in the service sector and reduces service sector wages. This comes disproportionately at the cost of expected future career earnings of older service sector workers.
Job Polarization, Structural Transformation, and Non-Employment
This paper investigates the quantitative importance of the non-employment margin in the labor market outcomes for the United States. During the last 50 years, the labor force has been shifting from producing goods to producing services. In terms of occupations, the routine share decreased, giving way to increases in manual and abstract ones. I argue that these two patterns are related, and that the decrease in non-employment had an important role. I propose and estimate a labor allocation model where goods, market services, and home services use different occupations as inputs. The driving force is productivity growth, which is occupation-specific. Quantitative exercises show that this non-employment channel could significantly slow down polarization and structural transformation, and induce significant displacement within the labor force.
Publications
"Structural Transformation and Sectoral Productivity in Costa Rica", with A. Alfaro-Ureña (2019). Economía & Sociedad, Escuela de Economía, Universidad Nacional de Costa Rica, vol. 24, Num. 55. (In Spanish)
"Price Adjustment in Costa Rica: A First Assessment Using Micro-Data" (2014). Revista de Ciencias Económicas, Instituto de Investigaciones en Ciencias Económicas, Universidad de Costa Rica, vol. 32, November.
"The Employment Dynamics in Costa Rica and the International Economic Crisis", with A. Hernández & M. P. Zúñiga-Brenes (2013). In A. Ulate & M. Soto (eds.) Costa Rica: Impacts and Lessons from the International Crisis 2008-2009. United Nations Development Program & University of Costa Rica. (In Spanish)
"The Out-of-Pocket and Catastrophic Health Expenditure Puzzle: The Costa Rican Case", with M. P. Zúñiga-Brenes & J. R. Vargas-Brenes (2012). In M. Knaul, R. Wong & H. Arreola-Ornelas (eds.) Financing Health in Latin America, Volume 1: Household Spending and Impoverishment. Global Health and Equity Series, Harvard University Press.
Other Work
"Combination of Potential Product Estimations with Bayesian Averaging", with C. Monge (2015). Central Bank of Costa Rica, Working Paper Series No. 01-2015. (In Spanish)
"Approximation of Seasonal Patterns in the Foreign Exchange Market in Costa Rica: 2006-2012", with A. Rodríguez (2012). Central Bank of Costa Rica, Working Paper Series No. 04-2012. (In Spanish)
"Validation of the VAR Model of Monetary Policy Transmission Channels in Costa Rica", with J. P. Vásquez, (2011). Central Bank of Costa Rica, Working Paper Series No. 05-2011. (In Spanish)
"Validation of the ARMA Model for Inflation Forecasting in Costa Rica" (2011). Central Bank of Costa Rica, Working Paper Series No. 03-2011. (In Spanish)
"Structural Transformation and Sectoral Productivity in Costa Rica", with A. Alfaro-Ureña (2019). Economía & Sociedad, Escuela de Economía, Universidad Nacional de Costa Rica, vol. 24, Num. 55. (In Spanish)
"Price Adjustment in Costa Rica: A First Assessment Using Micro-Data" (2014). Revista de Ciencias Económicas, Instituto de Investigaciones en Ciencias Económicas, Universidad de Costa Rica, vol. 32, November.
"The Employment Dynamics in Costa Rica and the International Economic Crisis", with A. Hernández & M. P. Zúñiga-Brenes (2013). In A. Ulate & M. Soto (eds.) Costa Rica: Impacts and Lessons from the International Crisis 2008-2009. United Nations Development Program & University of Costa Rica. (In Spanish)
"The Out-of-Pocket and Catastrophic Health Expenditure Puzzle: The Costa Rican Case", with M. P. Zúñiga-Brenes & J. R. Vargas-Brenes (2012). In M. Knaul, R. Wong & H. Arreola-Ornelas (eds.) Financing Health in Latin America, Volume 1: Household Spending and Impoverishment. Global Health and Equity Series, Harvard University Press.
Other Work
"Combination of Potential Product Estimations with Bayesian Averaging", with C. Monge (2015). Central Bank of Costa Rica, Working Paper Series No. 01-2015. (In Spanish)
"Approximation of Seasonal Patterns in the Foreign Exchange Market in Costa Rica: 2006-2012", with A. Rodríguez (2012). Central Bank of Costa Rica, Working Paper Series No. 04-2012. (In Spanish)
"Validation of the VAR Model of Monetary Policy Transmission Channels in Costa Rica", with J. P. Vásquez, (2011). Central Bank of Costa Rica, Working Paper Series No. 05-2011. (In Spanish)
"Validation of the ARMA Model for Inflation Forecasting in Costa Rica" (2011). Central Bank of Costa Rica, Working Paper Series No. 03-2011. (In Spanish)