Working Papers

The Local and Aggregate Effects of Land-Use Regulation on Farmland Protection

Awarded UEA Prize for Best Student Paper (Honorable Mention) and EMUEA Kraks Fond Prize (Runner-Up), 2019

Abstract: This paper studies the distortionary effects of land-use regulations that preserve farmland from urban sprawl. I exploit a major policy restricting farm-to-urban land conversion in China -- the Farmland Red Line Policy -- to provide causal evidence on the negative impact of land-use regulation on local development, measured by GDP and population growth. To understand the aggregate impact of the policy, I develop a quantitative spatial equilibrium model that features endogenous land-use decisions. The calibrated model reveals a 7% loss in workers' welfare due to the policy. Furthermore, a cap-and-trade platform that allows local regions to exchange farmland preservation requirements can eliminate 60% of workers' welfare costs. The results suggest that fast-growing economies need to design land-use policies carefully, as the welfare costs of poorly designed policies can be substantial.

Geographic Integration and Firm Exports: Evidence from China, with Lin Tian (INSEAD & CEPR)

Media Coverage: VoxEU, VoxDev, Bloomberg

Abstract: This paper examines the impact of transportation infrastructure development, designed exclusively to enhance the integration of domestic markets, on a country's export performance. By leveraging the expansion of China's high-speed rail (HSR) as a quasi-natural experiment, we provide robust evidence that enhanced within-sector integration resulting from this infrastructure development significantly boosts firms' export performance. This impact is observed through increased export sales and volume, expanded market reach, and improved product quality. Our findings are consistent with the notion that HSR connections facilitate knowledge spillovers among exporters, aiding them to overcome information barriers and thereby improving foreign market access. Importantly, we address potential confounding factors, showing that the findings remain robust when accounting for alternative channels like supplier and customer access, and labor market pooling effects. This study underscores the pivotal role of domestic transportation infrastructure in mitigating information frictions and driving a country's international market integration. 

The Value of Cleaner Waterways, with Qianyang Zhang (Columbia University)

Abstract: This paper investigates the economic impacts of cleaning up heavily polluted waterways in urban neighborhoods. We exploit the Black-and-Odorous Water Program in China as a natural experiment to identify the causal impact of cleaner waterways on local housing prices, housing supply, and business growth. First implemented in 2016, the program remediated heavily polluted waterways in China's most developed cities. Using a Difference-in-Difference estimator, we find that the program mainly benefits properties within 1 mile of the cleaned-up waterways: these properties were 3.7% cheaper before the program and experienced a 2.3% market value appreciation after the program. We also show that developers building new apartment complexes near BOW sites are more likely to provide high-end units with luxury decoration and spacious layouts. In addition, we observe various service businesses thriving in the neighborhoods close to the cleaned-up waterways, indicating a revitalization of these areas. Our findings shed light on the effects of environmental programs in real estate markets and neighborhood dynamics.

National Road Upgrading and Structural Transformation: Evidence from Ugandan Households, with Ian Herzog (Huron University College) and Siyuan Liu (University of Toronto)

Abstract: This paper studies effects of market access, via better roads, on labor market outcomes of remote households in developing nations. Combining individual panel data with Uganda's doubling of paved roads, we find that market access causes workers to quit family farms and take more specialized paid work. Effects concentrate in peripheral areas, households with comparative advantage in off-farm work, and reflect off-farm opportunities rather than reduced demand for farm output. Findings are consistent with reliable transport allowing trade with urban areas that creates opportunities to specialize according to individual comparative advantage. 

Selected Work-In-Progress

Apartment Remodeling and Housing Affordability, with Jiayin Hu (Peking University) and Shangchen Li (Peking University)

Rising rents in cities prompt many tenants, especially younger cohorts, to share apartments and convert common spaces into extra bedrooms. To facilitate this practice, prop-tech flat-sharing platforms emerge. They rent apartments from landlords, remodel them and create additional bedrooms, and then sublet individual bedrooms. This boosts room availability but raises concerns about overcrowding and congestion spillovers. To study this business model's impacts on the rental and housing markets, we exploit the business expansion of the largest Chinese flat-sharing platform in Beijing as a natural experiment. Its expansion provides rich variation in the share of remodeled units both across residential complexes and over time. To address endogeneity, we instrument it with the residential building's suitability to adopt the remodeling service, which is then interacted with the national growth of the business, as proxied by the search index of this service. Empirical results verify that while remodeling services effectively reduce rental prices, they also generate a negative externality by making homeowners relocate to alternative neighborhoods. We develop a quantitative model of residential housing choices that features heterogeneous tenants and endogenous remodeling decisions to study the aggregate and distributional effects of remodeling activity. 

Input Sourcing in Lopsided Low-income Economies, with Alan Griffith (University of Washington) and Jonas Hjort (UCL)

Input sourcing is central to the process of economic development. We first document that, contrary to conventional wisdom, the share of inputs originating abroad is almost as high in Uganda---a landlocked, low-income country---as in rich, open economies. The monthly transaction-level data we use, which cover the universe of formal, firm-to-firm and firm-to-foreign country trade in the Ugandan economy, also reveal that indirect imports are sourced from few firms, and via short supply chains. Together these three ``new'' facts motivate a model of input sourcing in a networked economy. Inputs, output quantities, and output prices are determined by firms maximizing profits subject to input prices and both a domestic and international sourcing network. Decreases in the cost of imports lead to lower prices for importers' output in the domestic market. We exploit exchange rate shocks and firms' prior direct and indirect import origins to test the model's predictions. When the relative cost of foreign goods decreases, direct importers import more. However, first- and higher-order indirect importers import less, instead buying more foreign content domestically. Pass-on price effects appear to "magnify" network structures that economize on high fixed costs of importing, widening access to foreign content but hindering substitution to direct international trade.

Transportation Infrastructure, Market Access and Deforestation, with Ian Herzog (Huron University College) and Clark Lundberg (San Diego State University)

We study the impacts of transportation infrastructure improvements on forest loss in Uganda between 2001 and 2021 using a large-scale national road upgrade program. We combine high-resolution panel data on deforestation with changes in travel times to major markets caused by road improvements. Results indicate that by improving market access, upgraded roads cause local forest loss. We find evidence that these effects are associated with lower agricultural activity, with significant reductions in satellite-derived proxies of agricultural production.  Effects are most pronounced in regions with high agricultural activity and relatively low manufacturing activity, and preliminary evidence suggests that forest loss largely reflects extraction rather than land clearing. 

Teaching

I serve as an instructor at the University of Toronto-Scarborough for the following courses:

• Introduction to Regression Analysis

• Theory and Practice of Regression Analysis