Essays in Applied Economics
Chapter 1 examines whether moral hazard in unemployment insurance (UI) varies with the job-finding rate (JFR) and the job-losing rate (JLR). A search model allowing exogenous separation predicts that the JLR and the JFR depending on the tightness of the labor market could affect moral hazard differently. Consistent with the predictions, this chapter finds empirical evidence that moral hazard becomes smaller if JLR is higher while not varying with tightness. Policy makers should focus on JLR, which is a main driver of local unemployment rates, to adjust UI benefits according to labor market conditions. Chapter 2 estimates the impact of patient cost sharing on utilization over time by difference-in-discontinuities with population data. This chapter exploits the difference in coinsurance by cohort, 10\% vs 20\%, during ages 70-74. This chapter finds that the impact after five years on total spending is similar to the immediate impact, while heterogeneity by type of care exists. The reduction of discretionary care gets larger over time and remains persistent after age 75, possibly due to habit formation. In contrast, the impact on less discretionary care remains unchanged over time, diluting the strengthening impact of discretionary care and stabilizing the response dynamics of total spending as observed. Chapter 3 develops a theoretical framework to analyze the impact of social norms on the marriage-market outcome. Social norms have a husband work outside the home and a wife take care of children, irrespective of their comparative advantages. Social norms generate larger inefficiency if a high-skill wife has comparative advantages in working than a low-skill husband, making marriages less beneficial for high-skill women, hindering their match, and inducing them to leave the marriage market when outsourcing childcare is difficult. This effect decreases the aggregated surplus in an economy. At the same time, the decrease in the competitiveness of high-skill women could improve others in the marriage market, high-skill men or low-skill women.