ASSA 2026 Round-up: Day 1
Yesterday was the first day of the 2026 annual meeting of the Allied Social Science Associations, which is organized by the American Economic Association. The 3-day conference, held in Philadelphia this year, features hundreds of sessions covering a wide variety of economics and other social science research. This year, Equitable Growth’s grantee network, Steering Committee, and Research Advisory Board and their research are well-represented throughout the program, featured in many different sessions of the conference.
Below are lightly edited abstracts from some of the papers and presentations that caught the attention of Equitable Growth staff during the first day of this year’s conference, with links to the sessions in which the papers were presented. Equitable Growth also organized a paper session on the first day of the conference focused on innovation and labor market dynamics, which was chaired by our former AEA Summer Economics Fellow April Burrage of Stanford University.
Come back tomorrow morning for highlights from day two and Tuesday morning for highlights from day three.
Franchising and Labor Standards Compliance in the Fast-Food Industry
Gonçalo Costa, Harvard University; Daniel Schneider, Harvard University; David Weil, Brandeis University and Harvard University
Abstract: Over the past decades, the U.S. labor market has been transformed by increasing fissuring and a breakdown of traditional employment relations, raising the specter of workers losing the protections of core labor standards. One common model of fissured work is franchising, found broadly in the economy but especially in food service. Theory and prior evidence suggest that this form of fissuring may lead to noncompliance with labor standards, but limited data on franchise structure and direct measurement of violations have proved an impediment to research on this topic. We use novel employer-employee linked survey data on labor standards violations combined with administrative data on franchise density to investigate how franchising affects compliance with labor standards in the fast-food industry. We find that companies with a greater density of franchise establishments exhibit significantly higher rates of labor law violations. The effects are particularly pronounced for newer workplace regulations, such as fair workweek and paid sick leave laws. These findings are robust across specifications with varying measures of franchise status and confounding factors. Furthermore, we employ event study analyses examining differential compliance patterns around the implementation of fair workweek, paid sick leave, and minimum wage requirements. Our results carry implications for the strategic targeting of labor standards enforcement.
Path Dependence in the Labor Market: The Long-run Effects of Early Career Occupational Experience
Adam Isen, Johns Hopkins University; Jesse Bruhn, Brown University; Jacob Fabian, Brown University; Matthew Gudgeon, Tufts University; Aaron Phipps, U.S. Military Academy – West Point
Abstract: We study the causal effect of early career occupational experiences on labor market outcomes. To do so, we pair more than two decades of administrative tax data with internal personnel records from the largest employer of young adults in the United States: the U.S. Army. Soldiers work in a diverse and varied set of military occupations, including noncombat roles such as mechanics, legal services, financial specialists, cooks, dental hygienists, police officers, and network/computer specialists. Eligibility is determined by test score cut-offs, which we leverage in a series of 37 regression discontinuity designs. We find that early career occupational experiences generate a substantial amount of path dependence, with point estimates that suggest a 19 percentage point increase in the likelihood of being observed in an identical or closely related occupation as much as 20 years later. We also find highly heterogeneous yet predictable effects on long-run wages. Implied changes in occupational earnings premia explain more than 60 percent of the causal variation in earnings, with slope estimates that suggest improvements in average occupational wage rates are tightly linked to actual causal effects on earnings. Changes in nonroutine and routine task intensity also explain causal wage gains; however, educational attainment and union density do not. Taken together, our results highlight the importance of early career occupational experience as a key channel for promoting long-run economic success among young adults who are not college bound.
David McMillon, Emory University
Abstract: This paper contributes to stratification economics by examining the conditions under which reparative race-focused reforms improve macroeconomic output, material conditions (consumption), and social welfare. While recent high-profile studies claim that equitable reforms would boost Gross Domestic Product, many rely on static accounting, ignoring behavioral feedback and relative intergroup status envy. I develop a dynamic representative agent model in which groups derive utility from relative status, face wage and human capital distortions, and choose endogenous effort. A planner uses proportional taxation to finance reforms for the disadvantaged group, rebating revenues as transfers. I derive conditions for reforms to generate increased aggregate output, Pareto consumption gains, and Pareto welfare gains, given status-envy parameter γ. Using a literature-based calibration, most of the policy space enhances GDP and consumption for both groups. Fewer policies even generate Pareto welfare gains, despite significant status envy—suggesting equity, productive efficiency, and political feasibility can coexist for appropriately designed reparative reforms. The optimal policy raises GDP by 42 percent with Pareto-consumption gains. However, it only Pareto-improves Welfare if γ ≤ 0.41—interpretable as a willingness to pay at most 41 cents to block one dollar of exogenous disadvantaged gains. Beyond a larger threshold, a welfare-maximizing planner rejects the output-maximizing reform, and every percent increase in status envy reduces GDP gains by 0.24 percent. This illustrates tension between output-based and preference-based efficiency, highlighting how normative definitions shape what it means for an equitable policy to be “efficient” under racial hierarchy.
This research was funded in part by Equitable Growth.
Worker Rights in Collective Bargaining
Benjamin Arold, University of Cambridge; Elliott Ash, ETH Zurich; W. Bentley MacLeod, Yale University; Suresh Naidu, Columbia
Abstract: This paper proposes novel natural language methods to measure worker rights from collective bargaining agreements for use in empirical economic analysis. Applying unsupervised text-as-data algorithms to a new collection of 30,000 CBAs from Canada in the period 1986–2015, we parse legal obligations (e.g., “the employer shall provide…”) and legal rights (e.g., “workers shall receive…”) from the contract text. We validate that contract clauses provide worker rights, which include both amenities and control over the work environment. Companies that provide more worker rights score highly on a survey indicating pro-worker management practices. Using time-varying province-level variation in labor income tax rates, we find that higher taxes increase the share of worker-rights clauses while reducing pre-tax wages in unionized firms, consistent with a substitution effect away from taxed compensation (wages) toward untaxed amenities (worker rights). Further, an exogenous increase in the value of outside options (from a leave-one-out instrument for labor demand) increases the share of worker rights clauses in CBAs. Combining the regression estimates, we infer that a one-standard-deviation increase in worker rights is valued at about 5.7 percent of wages.
Labor Supply Responses to Income: Evidence from Child Tax Benefits
Jacob Goldin, University of Chicago; Tatiana Homonoff, New York University; Neel Lal, University of Chicago; Ithai Lurie, U.S. Department of Treasury; Katherine Michelmore, University of Michigan; Matthew Unrath, University of Southern California
Abstract: Many U.S. social programs condition benefit eligibility on work. Eliminating work requirements would better target benefits to the neediest families but would also attenuate pro-work incentives. We study how expanding child tax credits to nonworkers affects maternal labor supply, using administrative tax records and variation in state credit eligibility from quasi-random birth-timing. We employ a novel method for using placebo analyses to maximize the precision of our regression discontinuity estimator. Eliminating work requirements causes very few mothers to exit the labor force; our 95 percent confidence intervals exclude reductions more than one-third of 1 percent.
The Macroeconomic Effects of Climate Policy Uncertainty
Diego Känzig, Northwestern University; Konstantinos Gavriilidis, University of Stirling; Ramya Raghavan, Northwestern University; James H. Stock, Harvard University
Abstract: We develop a novel measure of climate policy uncertainty based on newspaper coverage. Our index spikes during key U.S. climate policy events—including presidential announcements on international agreements, congressional debates, and regulatory disputes—and shows a recent upward trend. Using an instrument for plausibly exogenous uncertainty shifts, we find that higher climate policy uncertainty decreases output and emissions while raising commodity and consumer prices, acting as supply rather than demand shocks. Monetary policy counteracts these inflationary pressures, affecting the transmission of climate policy uncertainty. Firm-level analyses show stronger declines in investment and research and development when firms have higher climate change exposure.
How Much Will Global Warming Cool Global Growth?
Ishan Nath, Federal Reserve Bank of San Francisco; Valerie A. Ramey, Hoover Institution; Peter J. Klenow, Stanford University
Abstract: Does a permanent rise in temperature decrease the level or growth rate of GDP in affected countries? Differing answers to this question lead prominent estimates of climate damages to diverge by an order of magnitude. This paper combines indirect evidence on economic growth with new empirical estimates of the dynamic effects of temperature on Gross Domestic Product to argue that warming has persistent, but not permanent, effects on growth. We start by presenting a range of evidence that technology flows tether country growth rates together, preventing temperature changes from causing country-specific growth rates to diverge permanently. We then use data from a panel of countries to show that temperature shocks have large and persistent effects on GDP, driven in part by persistence in temperature itself. These estimates imply projected future global losses of 8 percent to 13 percent of GDP from unabated warming, which is at least three to six times larger than level effect estimates and 25 percent to 70 percent smaller than permanent growth effect estimates, with larger discrepancies for initially hot and cold countries.
Hell with the Lid Off: Racial Segregation and Environmental Equity in America’s Most Polluted City
Spencer Banzhaf, North Carolina State University; William Mathews, University of Pittsburgh; Randall Walsh, University of Pittsburgh
Abstract: This study examines the changing relationship between racial segregation and environmental equity in Pittsburgh from 1910 to 1940. Utilizing newly digitized historical data on the spatial distribution of air pollution in what was likely America’s most polluted city, we analyze how racial disparities in exposure to air pollution evolved during this period of heightening segregation. Our findings reveal that Black residents experienced significantly higher levels of pollution compared to their White counterparts and that this disparity increased over time. We identify within-city moves as a critical factor exacerbating this inequity, with Black movers facing increased pollution exposure. In contrast, European immigrants, who were also initially exposed to relatively high levels of pollution, experienced declining exposure as they assimilated over this time period. We also provide evidence of the capitalization of air pollution into housing markets. Taken as a whole, our results underscore the importance of considering environmental factors in discussions of racial and economic inequalities.
This research was funded in part by Equitable Growth.
Do Unions Decrease Earnings Inequality?
Phanindra V. Wunnava, Middlebury College; Austin Gill, Analysis Group
Abstract: One of the notable economic trends since the late 1980s is a dramatic rise in earnings inequality. Several researchers conclude that a significant source of earnings inequality is due to a large decrease in the unionized fraction of the labor force. The main focus of this paper is to investigate impact of union density, unemployment, and demographic characteristics on income inequality (i.e., Gini index). Preliminary results, based on a panel of Metropolitan Statistical Areas in the United States between 2010 and 2021, indicate that the union membership rate has a countering effect on growing income inequality. Demographic controls also seem to affect income inequality. By disaggregating union density, we find the magnitude of its effect on income inequality is larger in the private sector relative to the public sector. The overall effect of union density on Gini is driven by the private sector due to its larger share of employment. Accordingly, the recent upswing in private-sector union drives with the backdrop of a tight labor market may have an important role to play in reducing inequality in the coming years.
The Long Run Economic Effects of Medical Innovation and the Role of Opportunities
Sonia Bhalotra, University of Warwick; Damian Clarke, Universidad de Chile; Atheendar Venkataramani, University of Pennsylvania
Abstract: We leverage introduction of the first antibiotic therapies in 1937 to examine impacts of pneumonia in infancy on adult education, employment, disability, income, and income mobility, and identify large impacts on each. We then examine how racial segregation in the pre-Civil Rights era moderated the long-run benefits of antibiotics among Black Americans. We find that Black Americans born in more segregated states reaped smaller and less pervasive long-run benefits despite sharp drops in pneumonia exposure. Our findings demonstrate causal effects of early life health on economic mobility and the importance of an investment-rewarding institutional environment in realization of the full potential of a healthy start.
Who Owns the Idea? Enforceability of Property Rights and Inventor Mobility
April Burrage, Stanford University
Abstract: Who owns the idea when innovation occurs outside the scope of an employee’s formal job duties? This paper examines how changes in the enforceability of employer intellectual property rights affect inventor mobility. Using inventor-patent panel data and a difference-in-differences research design, the paper studies how shifts in legal ownership shape inventor mobility and the organization of inventive activity across firms.
Climate Change and Market Power
Hui Zhou, University of Rhode Island; Shanjun Li, Cornell University; Ivan Rudik, Cornell University; Enjie Ma, Cornell University
Abstract: Rising temperatures and increasingly frequent heatwaves are among the most prominent and well-documented manifestations of climate change. While recent studies show that extreme heat reduces firm productivity, the implications on market power remain largely unexplored, which represents an important research gap as shifts in market power can carry substantial welfare implications. Our study aims to fill this gap by examining the impact of temperature extremes on market power and the resulting welfare implications. Our empirical analysis draws on detailed firm-level balance sheet and geo-location data from ORBIS, combined with high-resolution weather information, covering 12 European countries from 2000 to 2020. We begin by analyzing how temperature extremes affect firm market shares and market concentration. The results provide strong and robust evidence that extreme heat increases local market concentration by shifting market share from smaller to larger firms. In addition, extreme heat reduces firm productivity while increasing the average mark-up. The effects are heterogeneous across firms: Productivity losses are concentrated among small firms, whereas increases in mark-ups are observed among large firms. To quantify the impact on welfare, we develop a stylized heterogeneous firm model à la Melitz (2003), which explicitly incorporates the heterogeneous effects of climate shocks on firm productivity across different firm sizes. To capture how these heterogeneous impacts lead to market share reallocation and changes in firm mark-ups, we adopt a variable elasticity of substitution framework, which allows for endogenous markup following Atkeson and Burstein (2008). The quantification exercise shows that the climate change productivity shock we observed from 2000 to 2020 leads to a welfare loss equivalent to 0.124 percent of manufacturing sector Gross Domestic Product in Europe, with substantial variation across countries. More importantly, if we ignore the role of reallocation and variable demand elasticity, we can misstate the welfare cost of climate change.
AEA Summer Program with Two Interventions: Experiential Learning and Formal Mentoring
Gerald Daniels, Howard University; Jevay Grooms, Howard University; Rhonda V. Sharpe, Women’s Institute for Science, Equity and Race; Omari Swinton, Howard University
Abstract: This paper evaluates the American Economic Association Summer Training Program, hosted at Howard University from 2021 to 2025. Program collaborators included the Women’s Institute for Science, Equity and Race, and economics faculty collaborator, the U.S. Federal Reserve Board. The program provided rigorous foundational and advanced graduate-level courses in microeconomics, econometrics, mathematical methods, and research methodology, taught by distinguished economists, as well as an Inclusive Peer Onsite Distance Mentoring Program. Participants engaged in experiential learning with leading organizations from the public and private sectors and benefited from research mentorship by Nobel Laureate David Card. The mentoring program provided comprehensive academic support, graduate school preparation, GRE training, and professional networking. The evaluation uses placement outcomes, participant feedback, and historical placements of those who participated in the summer program at previous institutions to assess the program’s effectiveness. Findings indicate that the program significantly enhanced students’ academic skills, graduate school readiness, and career trajectories, demonstrating its effectiveness in preparing participants for successful entry into doctoral programs and professional roles within economics.
