VILLANOVA DEPARTMENT OF ECONOMICS SEMINAR SERIES

This seminar series extends our department's curriculum by welcoming renowned scholars and experts to engage with our faculty and students on cutting-edge research across a wide array of topics related to economics. Through conversations and stimulating presentations, our seminar series exposes students to the advanced knowledge and insights needed to navigate the complexities of today's economic landscape, and reflects and supports Villanova’s teacher-scholar model.

SPRING 2024 SEMINAR SERIES

Seminars are held on Fridays at 11am in Bartley (room TBD) unless otherwise noted.

PRESENTER PAPERS

Jaroslaw Pietras presents "European Carbon Border Adjustment Mechanism and its implications for EU-US trade"

The European Union has introduced a new border measure known as the Carbon Border Adjustment Mechanism, impacting the import of certain products into Europe. This measure will affect all exporters, including those from the United States, dealing in steel, aluminum, cement, fertilizers, inorganic chemicals, electricity, and hydrogen products. The mechanism raises the cost of imports based on the scale of CO2 emissions during the production process in exporting countries. This adjustment aligns with the system of payments for CO2 emissions in Europe, regulated by the Emission Trading System (ETS). How will this system function? What economic mechanisms underlie it? What implications will it have for exporters? What requirements must companies meet, and how significant are the imposed costs? Does the system adhere to World Trade Organization rules, and is there a way to avoid it? These questions will be addressed in a lecture by Dr Jarosław Pietras, Visiting Professor at the College of Europe in Bruges, Belgium, and former Director General of the European Council of the EU.

James Raymond Vreeland presents The Foreign Policy Implications of China’s Bilateral Swap Agreements

Authors: Qi Liu, Xun Pang, and James Raymond Vreeland

This paper examines whether China’s expanding network of bilateral swap agreements (BSAs) is enhancing its influence in foreign affairs. We argue that these BSAs can drive partner states’ foreign policy alignment towards China by increasing a country’s financial dependence on the rising power and by enhancing its enthusiasm for China as an alternative to the United States as the leader of world order. Taking advantage of recent developments in Bayesian causal inference, we analyze data from 1992 to 2021 across 195 countries. Our findings reveal that BSAs augment China’s political influence—particularly with economically vulnerable countries and those dissatisfied with the US-led economic order. As a pioneering quantitative study of China’s BSA network, this paper advances our understanding of great power dynamics in international relations, emphasizing the role of financial interdependence in shaping global political influence.

Daniel Hamermesh presents The Economic Impact of Heritable Physical Traits: Hot Parents, Rich Kid?

Since the mapping of the human genome in 2004, biologists have demonstrated genetic links to the expression of several income-enhancing physical traits. To illustrate how heredity produces intergenerational economic effects, this study uses one trait, beauty, to infer the extent to which parents’ physical characteristics transmit inequality across generations. Analyses of a large-scale longitudinal study in the U.S., and a much smaller data set of Chinese parents and children, show that a one standard-deviation increase in parents’ looks is associated with a 0.4 standard-deviation increase in their child’s looks. A large data set of U.S. siblings shows a correlation of their beauty consistent with the same expression of their genetic similarity, as does a small sample of billionaire siblings. Coupling this estimate with parameter estimates from the literatures describing the impact of beauty on earnings and the intergenerational elasticity of income suggests that one standard-deviation difference in parents’ looks generates a 0.06 standard-deviation difference in their adult child’s earnings, which amounts on average to additional annual earnings in the U.S. of about $2300.

Margaret Leighton presents The Kids Aren’t Like They Used to Be: 40 Years of Evidence on Selection into College Major

Authors: Margaret Leighton & Jamin Speer

The aspirations and abilities of young people are fundamental characteristics that shape both education and labor market outcomes. Using over 40 years of nationally representative data on US college entrants, we show how student aspirations and abilities have changed over three generations, with a steady upward drift in students' self-rated abilities and some dramatic reversals in aspirations. Average levels of both abilities and aspirations differ greatly across college majors; selection into majors based on these characteristics has also changed somewhat over time. We show that time-varying major-average levels of aspirations and abilities have considerable explanatory power for predicting individual income, with aspirations twice as important as abilities, and marginally more important than college major itself. Our findings suggest that estimates of the return to college major that are vulnerable to imbalance in the average abilities and aspirations of students across different majors will be substantially biased. Some low-earnings majors look considerably better when accounting for students' financial and family aspirations.

Paul Ko presents "Trade, Gender Wage Gap, and Female Labor Force Participation"

Authors: Terry Cheung, Paul Ko, and Han Yang

We examine the impact of international trade on the gender wage gap and female labor force participation. To do this, we construct a multi-sector quantitative trade model that incorporates endogenous household labor supply decisions with home production. In our model, the goods sector relies more heavily on intermediate inputs than the services sector. As trade increases, the goods sector, which is more male-intensive, uses cheaper imported intermediate inputs and substitutes away from labor. If goods and services are complements, this leads to a rise in labor demand for services. Since the service sector is relatively more female-intensive, the expansion of trade decreases the gender wage gap (trade-driven structural transformation). Furthermore, as home production (non-market services) and market services are substitutes, workers substitute away from home production for market services, leading to an increase in female labor force participation (trade-driven marketization). Embedding these mechanisms, our quantitative analysis shows that trade-driven marketization increases female labor force participation, and trade-driven structural change increases female wages and decreases male wages, therefore lowering the gender wage gap.

Sandra Rozo presents Unraveling the Domino Effect: The Impacts of Mass Migration at Origin

Authors: Sandra Rozo, Nicolas Cabra and Maria Micaela Sviastchi

What are the development impacts of mass migration in origin countries? We use remote sensing data to examine the effects of the massive exodus of Venezuelan migrants in Venezuela's economic growth, inequality, and electoral outcomes. To answer this question we compare municipalities with different shares of foreigners at origin, before and after the migration surge of 2016-2019. We document that municipalities with more foreigners at baseline, which we show are also those with more out-migration, saw sharp declines in night light luminosity, increments in inequality, and lower political support for the incumbent opposition.

Kathleen Segerson presents "Collective Approaches and 'Lending a Helping Hand'"