Date of Award

Summer 2026

Language

English

Embargo Period

7-17-2026

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

College/School/Department

Department of Economics

Program

Economics

First Advisor

Yue Li

Committee Members

Yue Li, Benjamin Griffy, Byoung Park

Keywords

Market Power, Allocative Efficiency, Heterogeneous Income Profiles, Maternal Labor Supply, Child Care Policy, Japan and United States

Subject Categories

Income Distribution | Industrial Organization | Labor Economics | Macroeconomics | Public Economics

Abstract

The first chapter decomposes aggregate productivity growth into a pure-technology contribution and an allocative-efficiency contribution for Japan and the United States, applying a single estimation methodology symmetrically to comparable firm-level panels. Production functions are estimated by the Gandhi, Navarro, and Rivers (2020) gross-output procedure under monopolistic competition (GNR-MC), which recovers firm-level price markups and wage markdowns, and these enter the Baqaee–Farhi (2020) decomposition through the closed form of Aoki et al. (2024). Both panels are drawn from Compustat with identical pre-processing and estimation, and we close the markup-level identification gap that GNR leave open with a normalization anchored on the average firm. Four findings emerge. First, price markups rise gradually and largely in parallel in both economies, whereas wage markdowns diverge: U.S. monopsony power loosens steadily while Japan follows a U-shaped path that ends higher, so the two series cross. Second, the variable-cost markup that enters the decomposition is therefore essentially flat in the United States, where the price and labor wedges offset, and rises in Japan, where they reinforce, overtaking the U.S. wedge by 2024. Third, wage-markdown distributions are unimodal and right-skewed in both economies, with a heavier Japanese right tail indicative of granular monopsony. Finally, the U.S. pure-technology contribution is positive throughout the sample, whereas Japan’s allocative-efficiency contribution, slightly positive on average, declines across sub-periods and turns negative after 2015. The contrast is driven by the labor margin: in Japan a tightening labor-market wedge increasingly misallocates labor, while in the United States offsetting product- and labor-market forces leave aggregate distortions broadly stable.

The second chapter revisits the heterogeneous income profiles (HIP) model of Guvenen (2009), extending the analysis with updated PSID data through 2023 and a new U.S.–Japan comparison using the Japan Household Panel Survey/Keio Household Panel Survey (JHPS/KHPS, 2004–2023). Under four specifications—a Guvenen (2009) replication, two updated U.S. specifications that differ in their treatment of the PSID’s 1999 shift from annual to biennial sampling, and a Japan specification—we estimate the structural parameters by minimum distance estimation. Three findings emerge. First, all four specifications reject the unit root in income shocks. Second, the Japanese estimates differ qualitatively from the U.S. estimates: Japan exhibits the largest dispersion in initial income levels among all specifications. Cross-sectional income inequality in Japan reflects not only growth-rate but also initial-level heterogeneity, consistent with seniority-based wages and limited inter-firm mobility. Finally, Japan shows the strongest “catching-up effect” of all four specifications: individuals with lower initial income tend to experience higher wage growth, so high initial inequality tends to converge over time.

The third chapter estimates the causal effect of New York State’s Child Care Assistance Program (CCAP) expansion on maternal labor supply. Using Current Population Survey ASEC data from 2014–2019 and 2023–2025 and a difference-in-differences design, we compare mothers in New York (excluding New York City) with mothers in states that did not expand CCAP eligibility above 300 percent of the federal poverty level. This design exploits the October 2023 eligibility expansion as plausibly exogenous variation in child care costs. The main finding is that there is no significant average treatment effect on maternal working hours, employment, or labor force participation.

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This work is licensed under the University at Albany Standard Author Agreement.

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