Working Papers
Costs of Variety and Public Procurement: The Case of Municipal Buses
I study a public procurement environment in which buyers repeatedly purchase differentiated equipment and where subsequent operation or maintenance costs are lower when acquiring incumbent equipment types, giving rise to conflicting incentives: facilitating competition among potential sellers leads to lower prices while restricting competition among them allows buyers to avoid costs of introducing a new variety. I construct novel data on fleet renewal by municipal bus operators in Poland who use a prevalent scoring auction format to favor incumbent bus producers. I develop and estimate a structural model of auctions with bidder favoritism to quantify the main driving forces of the trade-off. The results indicate that favoritism helps buyers manage the trade-off by reallocating the winning probability toward preferred sellers while keeping the competitive pressure on prices if enough bidders appear at the auction. Increasing order size may increase welfare by stimulating participation and weakening the relative significance of variety.
Recipient of Young Economists’ Essay Award at EARIE 2024, and runner-up in 9th UniCredit Econ JM Best Paper Award.
Previously circulated under the title Procurement with Bid Preference and Buyer’s Switching Costs: The Case of Municipal Buses.
The Effect of Constitutional Provisions on Education Policy and Outcomes
joint with Anusha Nath and Scott Dallman
Education services in the United States are determined predominantly by non-market institutions, the rules of which are defined by state constitutions. This paper empirically examines the effect of changes in constitutional provisions on education outcomes in the United States. To show causal effects, we exploit discontinuities in the procedure for adopting constitutional amendments to compare outcomes when an amendment passed with those when an amendment failed. Our results show that adoption of an amendment results in higher per-pupil expenditure, higher teacher salaries, smaller class size, and improvements in reading and math test scores. We examine the underlying mechanism driving these results by studying the actions of the legislature and the courts after an amendment is passed. We find that, on average, the legislature responds with a one-year lag in enacting education policies satisfying the minimum standards imposed by the amendment, and there is no increase in the number of education cases reaching appellate courts. Using school finance reforms, we also show that in situations where the legislature fails to enact education policies, courts intervene to enforce constitutional standards to improve outcomes. This enforcement mechanism is more impactful in states that have higher constitutional minimum standards. Taken together, the causal effects on education outcomes and the patterns in legislative bill enactments and court cases provide a novel test of the hypothesis that a strong constitutional provision improves the bargaining position of citizens vis-à-vis that of elected leaders. If citizens do not receive education services as mandated in the constitution, they can seek remedy in court.
Links: (pdf) (short slides)
Evaluating the Impact of Large Scale Social Programs with an Application to Labor Supply and Child Benefits
I propose a method of evaluating universal government programs in which the lack of appropriate control groups limits the usability of conventional frameworks. The method accentuates the researcher's role in making an identification argument and supports it with a flexible choice model estimated nonparametrically using recent advances in machine learning. I apply my framework to estimate the effects of a large-scale child benefit program on the female labor supply. Aggregating impacts on labor market flows, I show that the program led to a 2–3 percentage points decrease in labor supply among eligible women, driven by discouragement among job seekers.
supported by Polish National Science Centre grant #2016/N/HS4/03637
Links: (pdf)
Work in Progress
The Costs of Variety: Productivity of Differentiated Inputs
joint with Dan Yu
This paper studies heterogeneity in capital production input. In many industries, goods of the same purpose but different make are used as intermediate inputs in producing final goods or services. Such input differentiation may generate friction in the production process by making it less efficient when the inputs are more heterogeneous. This friction persists even if all the differentiated inputs are of the same quality, value, or vintage. Using unique data on urban bus fleets, we investigate the costs associated with variety in differentiated capital inputs. We identify aspects of the variety relevant to production efficiency and are first to provide causal evidence on gains from unifying units within the capital input. Specifically, the same bus is more utilized in a fleet with a higher share of similar buses than in a fleet composed of substantially different buses (by up to 10%), and requires fewer units of labor to deliver the same output. Our results are informative about possibly prevalent sources of measurement error in standard measures of capital input and signal a new cause of resource misallocation.
Links: Draft available on request.
Other work
- The impact of inflation expectations on Polish consumers’ spending and saving (with Ewa Stanisławska, Eastern European Economics, 55.1 (2017): 3-28)