Cauê Dobbin

We investigate the role of firms in intergenerational mobility by decomposing the intergenerational elasticity of earnings (IGE) into firm-IGE and individual-IGE using a two-way fixed effects framework. Using data from Israel, we find that the firm component is responsible for 22% of the overall IGE. We then explore potential mechanisms and find that education differences explain a large share of the individual-IGE, while place of residence and demographics are more important for the firm-IGE. Guided by these empirical patterns, we develop a novel method to estimate the role of skill-based sorting and find that it accounts for approximately half of the firm-IGE. Our results provide evidence that the intergenerational transmission of earnings encompasses more than just human capital, and highlight the importance of promoting equal access to high-paying firms and reducing labor market segregation in efforts to enhance equality of opportunity.

We study how abortion subsidies affect abortion take-up using administrative data from Israel covering the universe of legal abortions. Leveraging a reform that expanded eligibility for government funding for abortion, we find that the subsidy significantly increased abortion, with the largest effects among young women from backgrounds with strict views on abortion. A simple model explains this pattern: subsidies reduce the need for parental financial support, shifting decision-making power toward the young woman. Our findings show that funding abortion expands young women’s autonomy over abortion decisions, placing subsidies in the same policy space as parental consent laws. This mechanism is supported by both survey evidence on intergenerational mismatch in abortion attitudes and corroborative evidence from the United States.

We study the rapid expansion of Brazil’s private online higher-education sector and its effects on market structure and college enrollment. Exploiting regional and field-specific variation in online education penetration, we find that online programs expand access for older students but divert younger students from higher-quality in-person programs. Greater competition lowers tuition prices but also reduces the supply of in-person degrees. Using an equilibrium model of college education, we show that in the absence of online programs, total enrollment would be 14 percent lower, while in-person enrollment would rise by 33 percent. On net, aggregate labor-market value added declines by 1.4 percent. Online education raises value added for older students, who benefit from increased access, but lowers it for younger students, who shift toward lower-return online options. Counterfactual policies that restrict online enrollment to older cohorts could increase value added for younger students without reducing gains for older cohorts.

In many low- and middle-income countries, consumers access education and health services in environments characterized by substantial provider choice. In these settings, a dense landscape of fee-charging private providers has emerged, often located near public facilities and competing for the same clientele. We refer to these environments as human capital markets. This chapter begins by documenting that such markets are now pervasive. We present empirical evidence that human capital markets share many features with conventional product markets: households choose among a wide range of public and private providers with heterogeneous attributes, and providers respond strategically to policy interventions and competitive pressures. We then assess the extent to which canonical models from industrial organization can account for observed behavior, highlighting both their insights and their limitations. Next, we examine the key ways in which human capital markets depart from standard product-market benchmarks—most notably that education and health are both consumption goods and investments, and that quality is often difficult to observe—and review empirical and conceptual approaches developed to address these features. We conclude by outlining the major unresolved questions and promising directions for future research.

We study supply-side responses to student financial aid, focusing on how tuition responds to the targeting of aid. Our framework identifies two mechanisms: a direct effect, which raises tuition, and a composition effect, which can lower tuition if aid targets price-sensitive students. Leveraging a reform in Brazil’s student loan program, we provide descriptive evidence that both mechanisms are quantitatively important. We then estimate an equilibrium model of higher education to quantify the impact of alternative targeting schemes. We find that a loan program with merit-based targeting increases tuition by 3.0%, while need-based targeting raises tuition by only 0.4%. This difference arises because low-income students—targeted in the need-based scheme—are more price sensitive. These price adjustments have a strong impact on enrollment decisions, emphasizing the importance of targeting in student financial aid policy design.

We study the consequences of affirmative action in centralized college admissions systems. We develop an empirical framework to examine the effects of a large-scale program in Brazil that required all federal institutions to reserve half their seats for socioeconomically and racially marginalized groups. By exploiting admissions cutoffs, we find that marginally benefited students are more likely to attend college and are enrolled at higher-quality degrees four years later. Meanwhile, there are no observed impacts for marginally displaced non-targeted students. To study the effects of larger changes in affirmative action, we estimate a joint model of school choices and potential outcomes. We find that the policy has impacts on college attendance and persistence that imply a virtually one-to-one income transfer from the non-targeted to the targeted group. These findings indicate that introducing affirmative action can increase equity without affecting efficiency.

We challenge the view that the negative correlation between firm quality and separation rates reflects efficient separations. Using Brazilian administrative data, we show that this correlation is driven by lower layoff rates at high-quality firms, not differences in quits. We develop a job search model where wage rigidity and productivity uncertainty generate inefficient layoffs. The model predicts that higher-quality firms have larger markdowns and, consequently, fewer layoffs. Empirically, we validate this by showing that firms facing stronger wage rigidity have higher layoffs and a steeper quality-layoff correlation, and that markdowns are higher in better firms and negatively correlated with layoffs.

Between 2006 and 2010 the U.S. government built an additional 548 miles of border wall along the U.S.-Mexico border. Combining survey data from all major border crossing points with administrative data on 5.7 million primarily unauthorized Mexican migrants, we study how the border wall expansion affected migration patterns and local labor markets. The wall changed migrants’ choice of route, their choice of destination within the United States, and their decision to migrate in the first place. On net, we estimate the wall decreased migration flows by three hundred thousand migrants, roughly one-third of the observed decline in Mexican migration between 2005 and 2015. Incorporating the decrease in migration into a spatial equilibrium model, we estimate that the wall increased (decreased) wages of low-skill (high-skill) U.S. workers by a modest $9 ($21) per year.