Economics 590: Inequality, Opportunity, Mobility, and Housing
University of Illinois, Urbana-Champaign
Fall 2023
Professor David Albouy
Office: 225A David Kinley Hall (DKH)
Office Hours: Tuesday: 11:00am-12:20 pm
Email: albouy@illinois.edu
Meeting: Monday and Wednesday: 3:30 to 4:50pm, 222 David Kinley Hall
Description: This course will examine important topics related to local opportunity, upward mobility, housing, and local government policy. These classes are discussion based and there are no formal lectures, although I will sometimes pause discussion and go to the board to explain important concepts.
Grading (100 points)
20% Class Participation We discuss each paper in class. You are expected to contribute and I will ask everyone to speak. Good questions are as valuable as good answers. You are here to learn: it is more important to be actively engaged than to not say something wrong. We often learn best through mistakes.
28% (2 points each) Article Reflections for Journal of Economic Perspective Articles You must read and submit your reflections on each article before each class. For these articles, write three long paragraphs (or more) answering the three following open-ended questions. You may want to have a quick look at what are in the references to help you better answer them.
1) What was MOST ENLIGHTENING? What particular finding or perspective was most novel or surprising to you? Did anything change your way of thinking about the topic, e.g. make you reconsider some prior beliefs? Did it answer a question you had sometimes wondered about or raise a question you had never thought of.
2) What was LEAST SATISFYING? Were there any findings or conclusions you were more skeptical of? Was there a topic where you thought the evidence was the most lacking relative to the importance of the topic? This can involve a question that may just be difficult to answer or even to frame.
3) What was MOST PROMISING for future research? Of all the works cited, which one would you like to read the most? Even better, do you see a topic you would be most interested in researching yourself? You may want to do a few minutes of Google searches and additional reading.
28% (2 points each) Article Summaries for all other Articles There is no page limit, but you should try to condense the most important information in concise, well-written English. Each summary should be divided into four sections. The odd sections should be short; the even ones long.
1) QUESTION: What is (are) the question(s) the paper is trying to answer?
2) METHODOLOGY: What methodology is the author using to address the question? Describe the theory and/or empirical methods.
3) CONCLUSION: What conclusions does the author reach?
4) LIMITATIONS: How are the conclusions sensitive to the methodology used?
34% Mini Empirical Research Project with a Classmate Take some easily available data and explore at topic that is related to the class. It needs to be interesting, although it does not need to be especially long, original, or involve a causal design – although that would be great. Replications are encouraged, but they should be more “scientific” than “pure.” This will involve both a 30-minute presentation the last week of class (14%), and a short paper due on the day of the Final Exam (20%) that you may write together. More explanation to come.
Course Schedule and Required Readings
Week 1: Neighborhood and Intergenerational Mobility
Chyn, Eric, and Lawrence F. Katz. 2021. “Neighborhoods Matter: Assessing the Evidence for Place Effects.” Journal of Economic Perspectives, 35 (4): 197-222.
Chetty, Raj, Nathaniel Hendren, Maggie R Jones, and Sonya R Porter, 2020. “Race and Economic Opportunity in the United States: an Intergenerational Perspective.” The Quarterly Journal of Economics, 135(2): 711–783,
Week 2: Urban Density and Learning
Duranton, Gilles, and Diego Puga. 2020. "The Economics of Urban Density." Journal of Economic Perspectives, 34 (3): 3-26.
De La Roca, Jorge and Diego Puga. 2017 “Learning by Working in Big Cities.” The Review of Economic Studies, 84(1): 106–42.
Week 3: Internal Migration and Dynamics
Molloy, Raven, Christopher L. Smith, and Abigail Wozniak. 2011. "Internal Migration in the United States." Journal of Economic Perspectives, 25 (3): 173-96.
Howard, Greg. 2020. "The Migration Accelerator: Labor Mobility, Housing, and Demand." American Economic Journal: Macroeconomics, 12 (4): 147-79.
Week 4: Place-Based Policies in the U.S.
Bartik, Timothy J. 2020. "Using Place-Based Jobs Policies to Help Distressed Communities." Journal of Economic Perspectives, 34 (3): 99-127.
Gaubert, Cecile, Patrick M. Kline and Danny Yagan 2021. “Place-Based Redistribution.” NBER Working Paper No. 28337.
*Andrew Garin and Jonathan Rothbaum 2022. The Long-Run Impacts of Public Industrial Investment on Regional Development and Economic Mobility: Evidence from World War II.” Working Paper
Week 5: Place-Based Policies in Europe
Ehrlich, Maximilian v., and Henry G. Overman. 2020. "Place-Based Policies and Spatial Disparities across European Cities." Journal of Economic Perspectives, 34 (3): 128-49.
Briant, Anthony, Miren Lafourcade, and Benoit Schmutz. 2013. “Can Tax Breaks Beat Geography? Lessons from the French Enterprise Zone Experience.” American Economic Journal: Economic Policy 7 (2): 88–124.
Week 6: Migration and Infrastructure in the Developing World
Lagakos, David. 2020. "Urban-Rural Gaps in the Developing World: Does Internal Migration Offer Opportunities?" Journal of Economic Perspectives, 34 (3): 174-92.
Akresh, Richard, Daniel Halim and Marieke Kleemans 2023. “Long-Term and Intergenerational Effects of Education: Evidence from School Construction in Indonesia,” The Economic Journal, 133(650): 582–612
Week 7: Taxes and Location Choices
Kleven, Henrik, Camille Landais, Mathilde Muñoz, and Stefanie Stantcheva. 2020. "Taxation and Migration: Evidence and Policy Implications." Journal of Economic Perspectives, 34 (2): 119-42.
Martinez, Isabel 2022 “Mobility responses to the establishment of a residential tax haven: Evidence from Switzerland” Journal of Urban Economics 128.
Week 8: Tax Incentives and Businesses
Slattery, Cailin, and Owen Zidar. 2020. "Evaluating State and Local Business Incentives." Journal of Economic Perspectives, 34 (2): 90-118.
Giroud, Xavier and Joshua Rauh. 2019 “State Taxation and the Reallocation of Business Activity: Evidence from Establishment-Level Data” Journal of Political Economy, 127(3):1262-1316
Week 9: Housing Supply Constraints and Investments
Baum-Snow, Nathaniel. 2023. "Constraints on City and Neighborhood Growth: The Central Role of Housing Supply." Journal of Economic Perspectives, 37 (2): 53-74.
Albouy and Ehrlich (2018) “Housing Productivity and the Social Cost of Land-Use Regulations” Journal of Urban Economics, 107 101-120.
*Aaronson, Daniel, Daniel Hartley, and Bhashkar Mazumder. 2021. "The Effects of the 1930s HOLC "Redlining" Maps." American Economic Journal: Economic Policy, 13 (4): 355-92.
Week 10: Slums and Affordable Housing
Marx, Benjamin, Thomas Stoker, and Tavneet Suri. 2013. "The Economics of Slums in the Developing World." Journal of Economic Perspectives, 27 (4): 187-210.
Diamond, Rebecca and Tim McQuade. 2019. Who Wants Affordable Housing in Their Backyard? An Equilibrium Analysis of Low-Income Property Development. Journal of Political Economy, 127(3):1063-1117
Week 11: Gentrification
Couture and Handbury “Neighborhood Change, Gentrification, and the Urbanization of College Graduates” Journal of Economic Perspectives
Brummet, Quentin and David Reed. 2022 “The Effects of Gentrification on Incumbent Residents” Working Paper
Week 12: Homeownership and Wealth
Goodman, Laurie S., and Christopher Mayer. 2018. "Homeownership and the American Dream." Journal of Economic Perspectives, 32 (1): 31-58.
Akbar, Prottoy A., Sijie Li Hickly, Allison Shertzer, Randall P. Walsh; 2022 “Racial Segregation in Housing Markets and the Erosion of Black Wealth.” The Review of Economics and Statistics