Date: 2019
Type: Thesis
Essays on social insurance and allocation of resources
Florence : European University Institute, 2019, EUI, ECO, PhD Thesis
MAZUR, Karol, Essays on social insurance and allocation of resources, Florence : European University Institute, 2019, EUI, ECO, PhD Thesis - https://hdl.handle.net/1814/64924
Retrieved from Cadmus, EUI Research Repository
The thesis is composed of four stand-alone essays analyzing economic problems pertinent to social insurance and allocation of resources in three applications to development, education and labor. The first essay investigates co-operative patterns of farmers in rural India engaging into informal insurance and public irrigation provision. I demonstrate theoretically, empirically and quantitatively that these two margins of co-operation reinforce each other, if the irrigational infrastructure is managed by local societies. On the other hand, management by external government agencies is associated with excessive crowding-out of informal insurance. The second essay investigates constrained efficiency of a model with educational investments subject to uninsurable dropout risk, moral hazard and an endogenous college wage premium. I show that the laissez-faire equilibrium is constrained inefficient and is characterized by under-education. To this end, I show that an optimally designed student loan program with graduation-contingent repayment rates can attain the allocative efficiency of second best. In the third essay, I show in a simple model of lumpy educational investments that subjective pessimism over returns to education can be self-confirmed in equilibrium. This leads to two empirical implications: (i) both the degree of human capital concentration and the degree of educational investments misallocation may be increasing in the rigidity of the education system’s design; and (ii) commonly pursued methods may not identify the true underlying skill distributions. The fourth essay uses a quantitative model of labor search with unemployment insurance and voluntary quits to study welfare consequences of a policyreform giving entitlement to workers quitting their jobs in the US. Structural results show that pursuing a generous entitlement policy for quitters may allow for significant welfare gains through improved insurance and allocation of workers. Moreover, I employ the assumption of monetary search costs and show that it can explain the empirically documented unemployed search behavior.
Table of Contents:
-- 1 Sharing Risk to Avoid Tragedy in Village Economies
-- 2 Student Loans with Risky Graduation and College Wage Premium
-- 3 A Note on Pessimism in Education and its Economic Consequences
-- 4 Can Welfare Abuse be Welfare Improving?
Additional information:
Defence date: 8 November 2019; Examining Board:
Prof. Árpád Ábrahám, University of Bristol, (Supervisor);
Prof. Ramon Marimon, European univeristy Institute;
Prof. Joseph Kaboski, University of Notre Dame;
Prof. Raul Santaeulalia-Llopis, MOVE-UAB and Barcelona GSE
Cadmus permanent link: https://hdl.handle.net/1814/64924
Full-text via DOI: 10.2870/917432
Series/Number: EUI; ECO; PhD Thesis
Publisher: European University Institute
LC Subject Heading: Resource allocation; Social security; Welfare economics