Three Essays in Labor and Regional Economics

Abstract

This dissertation consists of three chapters. Chapter 1 uses the 1994 North American Free Trade Agreement (NAFTA) and granular data on Mexican municipalities to study the local effects of trade liberalization on college wage premiums, housing costs, and urban amenities between 1990 and 2010. I measure local exposure to international trade by constructing a market access database of each municipality's lowest-cost route to the closest US truck port. I find that municipalities facing larger trade exposure experienced: (1) declines in local wage differences between college and non-college graduates, both in nominal and real terms; (2) smaller increases in local urban amenities. I interpret these results under the notion of spatial equilibrium in which non-monetary urban amenities compensate for gaps in real wages across cities.

Chapter 2 analyzes the effects of the COVID-19 pandemic on labor market outcomes for men and women in Mexico. Using a large longitudinal dataset and an event-study design, I find that the labor market effects of the pandemic differed by gender and changed considerably over time. While men temporarily suffered from a higher probability of unemployment, women experienced greater and more persistent declines in labor force participation. By exploring the heterogeneity of the effects across sub-samples, I show that these disparities in the recovery of labor participation are mainly driven by increased childcare needs and are linked to women being over-represented in informal and part-time jobs.

Chapter 3 investigates how gender gaps vary across space and time using census microdata for Mexico during 1990-2010. I document that female-to-male gaps in working hours increased on average for all municipality sizes, but this increase was disproportionately greater in smaller compared to larger municipalities. This novel empirical pattern also coincides with a more rapid increase in the share of services in smaller locations that initially specialized in producing goods (primary activities and manufacturing). Motivated by these stylized facts, I quantify the impact of industry-specific labor demand shocks on local gender gaps in working hours and explore the heterogeneity of the effects across municipality sizes. I find that labor demand shocks in the goods industry only affect female relative work hours in small municipalities. My results suggest that the interaction between industry specialization across locations, industry differences in female labor intensities, and the rise of the service economy boosted female employment in smaller cities.