Nancy H. Chau

• Ph. D
• Professor (Full) at Cornell University

This paper unpacks the effects of social networks on county‐level COVID19 vaccinations in the US. We jointly assess the contemporaneous and dynamic network ef‐fects of vaccination exposure, to distinguish between network‐mediated contemporane‐ous effects (e.g., “vaccine‐hunter” Facebook groups crowd‐source information about ac‐cess and efficacy) an...

As the world’s climate continues to change, human populations are exposed to increasingly severe and extreme weather conditions that can promote migration. Here, we examine how extreme weather influences the likelihood of undocumented migration and return between Mexico and the United States. We used data from 48,313 individuals observed between 19...

In this article, I echo Jones (1965) and sketch a model rooted in search frictions and costly entry to demonstrate by example how central features of simple general equilibrium models can show up as ‘retranslated properties in diverse areas’. By uncovering and imparting popular understanding about these central features of simple general equilibriu...

This paper studies the education gradient associated with health reporting errors for two highly prevalent non-communicable diseases among older adults in India. We analyze a novel data set—the Longitudinal Aging Study in India (2017–18) panel survey—to unpack the sources of health reporting error in a developing-country context for the first time....

We present a model which considers both the regulatory burden of offshoring barriers and possible terms of trade gains from such barriers. Non-tariff barriers are shown to be unambiguously welfare-reducing, and tariff barriers raise welfare only when associated terms-of-trade gains exceed resulting regulatory burdens, in which case there is a posit...

A growing body of research investigates how changes in weather shape individual choices about migration, yet highly variable results continue to challenge our understanding of the weather-migration nexus. We use a data-driven approach to identify which weather variables best predicted migration decisions of 54,986 individuals originating in Mexico...

Canonical models of migration feature border enforcement as a strategy to contain undocumented immigration by effectively exacting a mobility cost. This paper revisits the role of border enforcement policy in a task-based model of the labor market where employers simultaneously hire circular migrants to take temporary tasks at low wages, in additio...

The sweatshop debate is contentious and enduring – some see salaried sweatshop jobs as the only chance out of poverty for the poorest. Others see abominable sweatshop conditions as human rights violations in which the poorest are prey. Despite these stark assessments, is it possible to organize notions of acceptable sweatshop jobs and isolate defin...

Fixed-term labor contracting has increasingly replaced regular open-ended employment in developing countries. What justifies its emergence? Why determines its intensity? What policy responses are appropriate, if any? In a two-tiered task-based model of the labor market, we demonstrate that within establishments, fixed-term contracting can indeed co...

Are political activists preferentially targeted by politicians who engage in strategic transfers to bolster political support? This paper incorporates two distinctive rationales in a model of politically motivated strategic transfers: to mobilize support from the activists themselves, and to mobilize support from electors these activists have influ...

Labor market subcontracting is a global phenomenon. This paper presents a theory of wage fairness in a subcontracted labor market, where workers confront multi-party employment relationships and deep wage inequities between regular and subcontractor-mediated hires. We show that subcontracting derives its appeal from a downward revision of workers’...

Our parsimonious two‐country (developed country and developing country) model of offshoring provides nuanced results. These include cases where wages monotonically improve, as well as where wages exhibit an inverted‐U relationship with offshoring cost reductions. We identify conditions under which these relationships hold. Since global welfare alwa...

The Trade Adjustment Assistance for Farmers (TAAF) program was established in 2002 to help farmers adversely affected by surges in imports. The program has been underused by farmers and, as a result, the American Recovery and Reinvestment Act (ARRA) of 2009 redesigned the program by loosening the eligibility criteria and changing the structure of t...

This paper proposes an overlapping generations multi-sector model of the labour market for developing countries with four heterogeneities - heterogeneity within self-employment, heterogeneity in job experience, heterogeneity in pathways to self-employment, and heterogeneity in ability. We revisit an iconic paradox in a class of multi-sector labour...

This paper argues that while rooting out sweatshop conditions raises unemployment, the potential gains include an increase in decent work employment, a pro-worker shift in distribution, and an improvement in overall efficiency. In a search model of employment inspired by firm- and household-level evidence about the harm that sweatshop conditions po...

This article provides a selective survey of the large literature on informal work in developing countries. The literature spans a wide range of issues, including definition, measurement, impact on workers and aggregate productivity, as well as policy linkages. We highlight three sets of issues where a renewal in research seems particularly warrante...

We propose a spatial model of producer market access where local middlemen reap market power due to match friction, and fair traders enter to present an alternative. The model features location as a key determinant of the impact of fair trader entry on the market share of fair traders, the distribution of consumer willingness to pay between middlem...

Established by a three person committee in 1914, the structure of the Federal Reserve System has remained essentially unchanged ever since, despite criticism at the time and over ensuing decades. This paper examines the original selection of cities for Reserve Banks and branches, and placement of district boundaries. We show that each aspect of the...

If capital becomes internationally mobile but labor does not, are outcomes of labor disputes tilted in favor of workers or employers? In this paper, we show that the answer depends critically on how the information structure of the dispute changes endogenously with capital mobility, and in addition, whether international investment incentives selec...

We study the impact of tax and minimum wage reforms on the incidence of informality. To gauge the incidence of informality, we use measures of the extent of tax evasion, the extent of minimum wage noncompliance, and the size of the informal workforce. Our approach allows us to examine (i) the distinction between determinants of firm-level reported...

How does the introduction of rural public work schemes impact individual incentives to migrate? This paper examines this question in the context of rural public work program ( Yigong-daizhen ) in China, and unveils empirical evidence that suggest that the introduction of Yigong-daizhen projects in fact stimulates outmigration at the village level,...

We study the impact of tax and minimum wage reforms on the incidence of informality. To gauge the incidence of informality, we use measures of the extent of tax evasion, the extent of minimum wage non-compliance, and the size of the informal workforce. Our approach allows us to examine (i) the distinction between determinants of firm-level reported...

We explore three hitherto poorly understood characteristics of the human trafficking market – the cross-border ease of mobility of traffickers, the relative bargaining strength of traffickers and final buyers, and the elasticity of buyers' demand. In a model of two-way bargaining, the exact configuration of these characteristics is shown to determi...

For decades, rapid urban expansion has led to concerns over the loss of cultivated land in rural China. This contrasts sharply with another salient feature of the Chinese land policy reform landscape that has gone on largely unnoticed: the addition of newly cultivated land in China through land development has consistently exceeded land conversion....

Two stylized representations are often found in the academic and policy literature on informality and formality in developing countries. The first is that the informal (or unregulated) sector is more competitive than the formal (or regulated) sector. The second is that contract enforcement is easier in the formal sector than in the informal sector,...

This paper explores empirically and theoretically one of the least studied economic phenomenon: the trafficking of women and children into slavery. By focusing on market imper-fections and differential bargaining power amongst the concerned parties, we pin down how the incentives of traffickers (middlemen) are affected in response to interventions...

Ethnic conflicts and their links to international human trafficking have recently received a surge in international attention. It appears that ethnic conflicts exacerbate the internal displacement of individuals from networks of family and community, and their access to economic and social safety nets. These same individuals are then vulnerable to...

In many countries, non-compliance with minimum wage legislation is widespread and authorities may be seen as having turned a blind eye to legislation they have themselves passed. We show that turning a blind eye can indeed be an equilibrium phenomenon with "ex post" credibility, in a model of minimum wage policy with imperfect competition, imperfec...

In many markets in developing countries, especially in remote areas, middlemen are thought to earn excessive profits. Non-profits come in to counter what is seen as middlemen's market power, and rich country consumers pay a fair-trade premium for products marketed by such non-profits. This paper provides answers to the following five questions. How...

This paper presents a capability-augmented model of on the job search, in which sweatshop conditions stifle the capability of the working poor to search for a job while on the job. The augmented setting unveils a sweatshop equilibrium in an otherwise archetypal Burdett-Mortensen economy, and reconciles a number of oft noted yet perplexing features...

Appropriate assessment of the social value of market access is at the core of a broad range of inquiries in trade research. A selection include: the appraisal of industry-level production and consumption distortions due to selective trade liberalization and partial tax reform; the construction of national-level quantity indicators of market access...

We investigate the effects of spillovers on quality of exports emanating from investment in product quality by multinational corporations, operating in less developed countries. By using a duopoly set up, we show that under price competition these spillovers enhance the quality of exports by less developed countries. We also show that this result i...

This paper develops a positive theory of two-way capital flows—the outward flight of productive capital, and inward foreign direct investment that acquires ownership of local production units. The model exploits insights from decision-making under uncertainty, and traces out how entrepreneurial incentive to engage in risky production impacts equili...

This paper proposes a trade restrictiveness indicator that explicitly incorporates environmental externalities. The index employs directional distance functions and use indicators (i.e. differences rather than ratios) modified to account for and evaluate efficiency changes in the face of simultaneous and multi-dimensional trade and environmental po...

Both raw intuition and past experience suggest that the success of an employment guarantee scheme (EGS) in safeguarding the welfare of the poor depends both on the wage it promises, and the ease with which any worker can gain access. An EGS is thus at once a wage guarantee and a rationing device. We chart the positive and normative limits of such a...

Passed by the Lok Sabha on August 23, 2004 and signed by the President of India on September 5, 2005, the National Rural Employment Guarantee Act (NREGA) has been hailed as a major initiative in the Government of India's commitment to providing an economic safety net to India's rural poor. Data from 2002 show that 71.9% of India's population still...

The attractiveness of product labeling stems from their voluntary nature to achieve environmental and social goals. It is argued that through product price premia which reflect the willingness of consumers to pay more for green and socially conscious products, labels have the potential to generate changes in production techniques. In addition, labe...

The dominant perspective in discussions of labour and environmental standards and globalization is that of North-South competition and its impact on Northern standards. This paper presents an alternative perspective, that of South-South competition to export to the North and its impact on Southern standards. It develops a simple model of Southern c...

Two competing nonprofits with ideologically distinct missions compete for donor funding to provide an indivisible public good in a population with heterogeneous preferences. This paper examines the extent to which (average) public values are undermined and nonprofits’ ideology compromised in a contractual game in which the right to provide the publ...

Does labeling products "Child-Labor Free" provide a market-based solution to the pervasive employment of child labor? This paper explores the promise of social labeling in the context of its four oft-noted objectives: child labor employment, consumer information, welfare, and trade linkages, when competition between the North and South is based bot...

This paper goes beyond orthodox considerations of direct payment e®ects on agricultural output, by highlighting the role of subsidies in a®ecting individual producers' ability to cover ¯xed costs, and in distorting the volume of aggregate production and net trade by implicitly discouraging exits. The theoretical model considers both taxpayer and co...

This article addresses each of these questions. The empirical findings suggest strong correlation between the likelihood of the incidence of child labor in debt bondage with the stage of development of an economy, the stage of financial development, and enforcement of core labor rights. Building on this evidence, the article presents a theoretical...

Why do some countries establish their own national eco-labeling programs and some do not? In this paper, we provide both theoretical arguments and empirical evidence suggesting that the answer to this question can shed new light on three questions that have taken center-stage in the trade and environment debate: (i) does trade exacerbate the exploi...

This paper is concerned with the institution of debt bondage and child labor employment in the context of an agrarian economy with overlapping generations. The model explores the principal-agent interaction between landlords and tenants, and identifies a set of reasons why households put children to work in response to the need to service outstandi...

The paper addresses the question of whether trade restrictiveness impacts economic performance, via a trade restrictiveness index that is decomposable into a trade distortion and a domestic distortion component. The paper builds on the Anderson and Neary price index measure of trade distortion, in evaluating trade restrictiveness via a distance fun...

This article proposes a trade restrictiveness quantity index (TRQI) to measure the welfare impact of trade restrictions based on a distance functions approach. The TRQI embodies two Farrell measures of efficiency—respectively for producers and consumers—that can be computed using standard efficiency measurement techniques. The TRQI can also be deco...

This paper establishes a political support model of immigration reforms. The analysis highlights the distinction between border enforcement and employer sanction measures in that the former can be more aptly characterized as an income transfer from employer to native labor interests, whereas the latter generates deadweight losses that are borne ent...

The paper examines the effectiveness of eco-labeling in providing a market-based solution to the under-consumption of eco-friendly products in developing and developed countries. The authors show that whether labeling is an effective device in solving the problem of asymmetric information between sellers and buyers, or whether false labeling severs...

Despite recent multilateral efforts to single out child labor in debt bondage as one of the worst forms of child labor, several important questions have yet to be addressed: How pervasive is the phenomenon? Are there systematic correlations between the incidence of children in debt bondage and the economic, legislative, and financial development in...

This paper shows that increases in the minimum wage rate can have ambiguous effects on the working hours and welfare of employed workers in competitive labor markets. The reason is that employers may not comply with the minimum wage legislation and instead pay a lower subminimum wage rate. If workers are risk neutral, we prove that working hours an...

Despite the merits of eco-labeling as a consumer information and market-based environmental policy alternative, the promise that green consumerism holds in encouraging environmentally conscious production decisions also raises concerns over whether eco-labeling deters the market access of developing countries in high income countries, and e®ectivel...

Why do countries that impose employer sanctions to deter the illegal entry of foreign workers nevertheless grant amnesty to illegal immigrants? In this article, I provide a positive theory of amnesty provision in a model where the constrained optimal immigration reform, involving the joint use of employer sanctions and border interdictions, is time...

We show that Quibria's insightful observation on the efficacy of urban policy in a model with an urban trade union and an urban informal sector holds, but with a revenue-neutral employment tax-subsidy combination levied on the urban employer. We also draw the relevance of the generalized Harris-Todaro model in providing intuition for the validity o...

The rati¯cation of ILO Labor Standards Conventions is a key explanatory variable in the empirical literature linking labor standards to economic performance. The assumption is that rati¯cation gives information on labor standards implemented in a country. This paper investigates the determinants of rati¯cation directly and, indirectly, the determin...