Joseph Altonji

Last updated
Joseph G. Altonji
Born1953 (age 70–71)
New York City, U.S.
Education Yale University (BA, MA)
Princeton University (PhD)
Academic career
Institution Yale University
Field Labor Economics
Macroeconomics
Applied Econometrics
Doctoral
advisor		 Orley Ashenfelter
Stephen Goldfeld
Doctoral
students		 Christina Paxson
Information at IDEAS / RePEc
Website Personal Website

Joseph Gerard Altonji (born 1953) is an American economist and the Thomas DeWitt Cuyler Professor of Economics at Yale University. His fields of interest include macroeconomics and applied econometrics and in particular labour economics, being ranked as one of the foremost labour economists worldwide. [1] In 2018, his contributions to the analysis of labour supply, family economics and discrimination were rewarded with the IZA Prize in Labor Economics. [2]

Contents

Biography

Joseph Altonji received his B.A. and M.A. in economics from Yale University in 1975, followed by a Ph.D. from Princeton University in 1981. After his Ph.D., Altonji became an assistant professor of economics at Columbia University before moving to an associate professorship at Northwestern University in 1986, where he was promoted to professor in 1990. In 2002, Altonji moved back to Yale University as the Thomas DeWitt Cuyler Professor of Economics, a position he still holds. Besides his academic appointments, Altonji has served as consultant to the Federal Reserve Banks of Chicago and Cleveland, has been a senior fellow at NCI Research, and a consultant to the Center for Naval Analysis. [3] Since 2002, he has been a Research Fellow at the IZA Institute of Labor Economics. [4] He is currently a member of the Federal Economic Statistics Advisory Committee and the NSF Social, Behavior and Economic Sciences Advisory Committee. His research has been acknowledged through fellowships of the Econometric Society and the Society of Labor Economists as well as a membership in the American Academy of Arts and Sciences. [3] In 2018, Altonji won the IZA Prize for Labor Economics. [2]

Research

Joseph Altonji's research interests include "labour market fluctuations, labour supply, consumption behaviour, the economics of education, economic links among family members, race and gender in the labour market, wage determination, and econometric methods". [5] Altonji ranks among the top 1% of economists registered on IDEAS/RePEc in terms of research output. [6] In 2021, a special issue of the Journal of Labor Economics was devoted to Altonji's work. [7] [8]

Research on labour supply

Joseph Altonji's first field of research have been the economics of labour supply. In a seminal 1982 paper, he analysed whether aggregate fluctuations in (un-)employment can be explained as intertemporal substitution in labour supply, as hypothesized by e.g. Robert E. Lucas, and found the model to be rejected in the data. [9] In another analysis of the sensitivity of the labour supply to intertemporal wage variation, Altonji uses either consumption data or a first-difference approach to control for wealth and wage expectations and finds the intertemporal elasticity of wage substitution for married men to be positive and small. [10] Further work on the labour supply was later produced in the 1990s with Christina Paxson, with whom Altonji found that the effects of changes in the demographic structure of the family on wives' work hours are generally much larger for wives who change employers, supporting the perspective that job changes following shifts in labour supply preferences (e.g. due to motherhood) may provide the opportunity to reduce discrepancies between desired and actual working hours. [11] In another study with Paxson on this topic, they find that workers require compensation to work in a job that, given the worker's particular preferences, offers unattractive working hours. [12]

Economics of education and training

Some of Altonji's earliest work in the economics of education and training studied the effect of high school curricula. For instance, jointly with James Spletzer, he studied the link between the receipt of on-the-job training and the characteristics of workers and jobs in the U.S. in the 1970s, for which they found no relationship between high school curriculum and training, but instead - among else - a negative link between training intensity and duration, women to be more likely to receive training than men but overall receiving less training time, and post-secondary education to make subsequent training more probable. [13] Subsequent work on high school curricula by Altonji found the return to additional courses in academic subjects to be small. [14] Further research by Altonji on the demand for and return to high school and postsecondary by field of study is reviewed in his survey of the literature (co-authored with Erica Blom and Costas Meghir). [15] In two studies with Thomas Dunn using the PSID and NLS, Altonji finds that teachers' salary, expenditures per pupil and a composite index of school quality indicators have a substantial positive effect on the wages of U.S. high school graduates, [16] but mixed results regarding whether parental education has a positive impact on children's returns to education. [17] Together with Todd Elder and Christopher Taber, Joseph Altonji has notably analysed the effect of attending a Catholic high school, finding that they substantially increase the likelihood of graduating from high school and possibly also of college attendance, though with scant effect on test scores. [18] As part of this analysis, Altonji, Elder and Taber exploited a presumed link between selections on observed and on unobserved variables and later used their results to develop an assessment method for instrumental variable strategies. [19] Finally, although most of Altonji's return in education economics is empirical, he has also contributed to its theory, most importantly through his analysis of the demand for and return to education face to uncertain education outcomes. [20]

Research on family economics

Another field of research of Altonji is the economic analysis of the family, especially in joint work with Laurence Kotlikoff and Fumio Hayashi as well as with Thomas Dunn. Together with Hayashi and Kotlikoff, Altonji finds that, within the extended family in the U.S., the distribution of consumption is independent of the distribution of resources, suggesting that members of an extended family are not altruistically linked. [21] Exploring the effects of income and wealth on time and money transfers between parents and children further, they find that money transfers tend to reduce inequality in household incomes but that income differences poorly predict time transfers, with richer siblings giving more to parents and receive less; overall, the results call for more sophisticated exchange models of transfers. [22] Another finding is that risk sharing between or within U.S. American families is incomplete. [23] In later work, Altonji, Hayashi and Kotlikoff renew their rejection of the altruism hypothesis, finding in their research on parental altruism and inter vivos transfers that redistributing one dollar from a recipient child to donor parents leads to a "trickle down" of only 13%, far less than what would be expected under altruism (100%). [24] More recently, together with Dunn, Altonji has studied the relationships among the family incomes and labour market outcomes of relatives. [25]

Research on discrimination and migration

Altonji has also made substantial contributions to the field of labour market discrimination, especially through his comprehensive survey of the literature on race and gender in the labour market (with Rebecca Blank). [26] Another seminal study is due to Altonji and Charles Pierret, who show that if firms statistically discriminate among young workers on the basis of easily observable characteristics, the coefficients on the easily observed variables should fall and the coefficients on hard-to-observe correlates of productivity should rise, as firms learn about workers' productivity. [27] More recently, in work with Ulrich Doraszelski, Altonji has studied the role of permanent income and demographics regarding the wealth differences between blacks and whites in the U.S. [28] Finally, besides his work on discrimination, Altonji has also analysed the effects of immigration on the labour outcomes of less-skilled natives in the U.S. (together with David Card), finding some evidence that less-skilled natives in high-immigrant cities have moved out of immigrant-intensive industries and that an inflow of immigrants equal to 1% may reduce the average weekly earnings of less-skilled natives by about 1.2%. [29]

Research on wages, income and consumption

In his research on wages, Altonji and Robert Shakotko finds that wages rise modestly with job seniority and that general labour market experience and "job shopping" account for most wage growth over a career, with the strong cross-sectional relationship between tenure and wages being mainly due to heterogeneity bias. [30] A 2005 reestimation by Altonji and Nicolas Williams yielded an estimate of 10 years of tenure increasing the log wage by 0.11, suggesting that the return to tenure has likely grown over time. [31] In a paper with Aloysius Siow, Altonji tests the rational expectations lifecycle model of consumption against a Keynesian model and the rational expectations lifecycle model with imperfect capital markets, finding the evidence to reject the Keynesian model but yielding inconclusive results as to whether the assumption of perfect capital markets is necessary or not. [32] In a study with Paul Devereux, Altonji studies to what extent nominal wages are downwardly rigid and what effect such rigidities have on wage levels, wage changes, and labour market transitions. [33] Most recently, Altonji, Anthony Smith Jr. and Ivan Vidangos used indirect inference to estimate a joint model of earnings, employment, job changes, wage rates, and work hours over a career, finding that human capital is responsible for most of earnings growth over a career, though with important roles for job seniority and mobility, and that unemployment shocks have substantial impacts on earnings in both the short and long run. [34]

Other research

Further major research by Altonji has addressed small-sample bias in GMM estimation of covariance structures (with Lewis Segal), [35] cross section and panel data estimators for nonseparable models with endogenous regressors (with Rosa Matzkin), [36] and the implications of changes in the characteristics of American youth for adult outcomes (with Prashant Bharadwaj and Fabian Lange). [37]

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References

  1. ↑ He has also known for his research in such topics as the Black-White wealth gap, economic links among relatives, and the economics of immigration. Joseph Altonji is ranked among the top 1% of economists registered in the field of labour economics on IDEAS/RePEc. Retrieved April 4, 2019.
  2. 1 2 "The 2018 IZA Prize in Labor Economics goes to Joseph Altonji". newsroom.iza.org. May 17, 2018. Retrieved April 4, 2019.
  3. 1 2 "Curriculum vitae of Joseph Altonji on the website of Yale University. Retrieved April 4th, 2019" (PDF). Archived from the original (PDF) on 2016-03-04. Retrieved 2014-12-23.
  4. ↑ Profile of Joseph Altonji on the IZA website. Retrieved April 4, 2019.
  5. ↑ Profile of Joseph Altonji on his personal website. Retrieved April 4, 2019.
  6. ↑ Altonji ranks 302nd among 55674 registered authors on IDEAS/RePEc. Retrieved April 4, 2019.
  7. ↑ "Journal of Labor Economics | Vol 39, No S1". www.journals.uchicago.edu. Retrieved 2021-03-16.
  8. ↑ Aaronson, Daniel; Kahn, Lisa B.; Meghir, Costas; Taber, Christopher (2020-12-16). "Introduction: A Special Issue in Honor of Joseph Altonji". Journal of Labor Economics. 39 (S1): S1–S3. doi:10.1086/712385. ISSN   0734-306X. S2CID   229290762.
  9. ↑ Altonji, Joseph G. (1982). "The Intertemporal Substitution Model of Labour Market Fluctuations: An Empirical Analysis". The Review of Economic Studies. 49 (5): 783–824. doi:10.2307/2297189. ISSN   0034-6527. JSTOR   2297189.
  10. ↑ Altonji, Joseph G. (1986). "Intertemporal Substitution in Labor Supply: Evidence from Micro Data". Journal of Political Economy. 94 (3): S176–S215. doi:10.1086/261403. ISSN   0022-3808. JSTOR   1837180.
  11. ↑ Altonji, Joseph G.; Paxson, Christina H. (1992). "Labor Supply, Hours Constraints, and Job Mobility". The Journal of Human Resources. 27 (2): 256–278. doi:10.2307/145735. ISSN   0022-166X. JSTOR   145735.
  12. ↑ Altonji, Joseph G.; Paxson, Christina H. (1988). "Labor Supply Preferences, Hours Constraints, and Hours-Wage Trade-offs". Journal of Labor Economics. 6 (2): 254–276. doi:10.1086/298183. ISSN   0734-306X. JSTOR   2535044.
  13. ↑ Altonji, Joseph G.; Spletzer, James R. (1991). "Worker Characteristics, Job Characteristics, and the Receipt of On-the-Job Training". Industrial and Labor Relations Review. 45 (1): 58–79. doi:10.2307/2524702. ISSN   0019-7939. JSTOR   2524702.
  14. ↑ Altonji, Joseph G. (1995). "The Effects of High School Curriculum on Education and Labor Market Outcomes". The Journal of Human Resources. 30 (3): 409–438. doi:10.2307/146029. ISSN   0022-166X. JSTOR   146029.
  15. ↑ Altonji, Joseph G.; Blom, Erica; Meghir, Costas (2012). "Heterogeneity in Human Capital Investments: High School Curriculum, College Major, and Careers". Annual Review of Economics. 4 (1): 185–223. doi:10.1146/annurev-economics-080511-110908. ISSN   1941-1383.
  16. ↑ Altonji, Joseph G.; Dunn, Thomas A. (1996). "Using Siblings to Estimate the Effect of School Quality on Wages". The Review of Economics and Statistics. 78 (4): 665–671. doi:10.2307/2109953. ISSN   0034-6535. JSTOR   2109953.
  17. ↑ Altonji, Joseph G.; Dunn, Thomas A. (1996). "The Effects of Family Characteristics on the Return to Education". The Review of Economics and Statistics. 78 (4): 692–704. doi:10.2307/2109956. ISSN   0034-6535. JSTOR   2109956.
  18. ↑ Altonji, Joseph G.; Elder, Todd E.; Taber, Christopher R. (2005). "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools". Journal of Political Economy. 113 (1): 151–184. doi:10.1086/426036. ISSN   0022-3808. JSTOR   10.1086/426036.
  19. ↑ Altonji, Joseph G.; Elder, Todd E.; Taber, Christopher R. (2005). "An Evaluation of Instrumental Variable Strategies for Estimating the Effects of Catholic Schooling". The Journal of Human Resources. 40 (4): 791–821. doi:10.3368/jhr.XL.4.791. ISSN   0022-166X. JSTOR   4129541.
  20. ↑ Altonji, Joseph G. (1993). "The Demand for and Return to Education When Education Outcomes are Uncertain". Journal of Labor Economics. 11 (1): 48–83. doi:10.1086/298317. ISSN   0734-306X. JSTOR   2535184.
  21. ↑ Altonji, Joseph G.; Hayashi, Fumio; Kotlikoff, Laurence J. (1992). "Is the Extended Family Altruistically Linked? Direct Tests Using Micro Data". The American Economic Review. 82 (5): 1177–1198. ISSN   0002-8282. JSTOR   2117473.
  22. ↑ Altonji, Joseph G.; Hayashi, Fumio; Kotlikoff, Laurence (1996), The Effects of Income and Wealth on Time and Money Transfers between Parents and Children (Working Paper), Working Paper Series, doi:10.3386/w5522 , retrieved 2024-06-05
  23. ↑ Hayashi, Fumio; Altonji, Joseph; Kotlikoff, Laurence (1996). "Risk-Sharing between and within Families". Econometrica. 64 (2): 261–294. doi:10.2307/2171783. ISSN   0012-9682. JSTOR   2171783.
  24. ↑ Altonji, Joseph G.; Hayashi, Fumio; Kotlikoff, Laurence J. (1997). "Parental Altruism and Inter Vivos Transfers: Theory and Evidence". Journal of Political Economy. 105 (6): 1121–1166. doi:10.1086/516388. ISSN   0022-3808. JSTOR   10.1086/516388.
  25. ↑ Altonji, Joseph G.; Dunn, Thomas A. (2012), W. Polachek, Solomon; Tatsiramos, Konstantinos (eds.), "Relationships among the Family Incomes and Labor Market Outcomes of Relatives", 35th Anniversary Retrospective, Research in Labor Economics, vol. 35, Emerald Group Publishing Limited, pp. 761–802, doi:10.1108/s0147-9121(2012)0000035047, ISBN   978-1-78190-219-6 , retrieved 2024-06-05
  26. ↑ Altonji, Joseph G.; Blank, Rebecca M. (1999), "Chapter 48 Race and gender in the labor market", Handbook of Labor Economics, vol. 3, Elsevier, pp. 3143–3259, doi:10.1016/s1573-4463(99)30039-0, ISBN   978-0-444-50189-9 , retrieved 2024-06-05
  27. ↑ Altonji, J. G.; Pierret, C. R. (2001). "Employer Learning and Statistical Discrimination". The Quarterly Journal of Economics. 116 (1): 313–350. doi:10.1162/003355301556329. ISSN   0033-5533.
  28. ↑ Altonji, Joseph G.; Doraszelski, Ulrich (2005). "The Role of Permanent Income and Demographics in Black/White Differences in Wealth". The Journal of Human Resources. 40 (1): 1–30. doi:10.3368/jhr.XL.1.1. ISSN   0022-166X. JSTOR   4129562.
  29. ↑ Altonji, J.G., Card, D. (1991). The effects of immigration on the labor market outcomes of less-skilled natives. In: Abowd, J.M., Freeman, R.B. (eds.). Immigration, Trade, and the Labor market. Chicago: University of Chicago Press, pp. 201-234.
  30. ↑ Altonji, Joseph G.; Shakotko, Robert A. (1987). "Do Wages Rise with Job Seniority?". The Review of Economic Studies. 54 (3): 437–459. doi:10.2307/2297568. ISSN   0034-6527. JSTOR   2297568.
  31. ↑ Altonji, Joseph G.; Williams, Nicolas (2005). "Do Wages Rise with Job Seniority? A Reassessment". Industrial and Labor Relations Review. 58 (3): 370–397. doi:10.1177/001979390505800304. ISSN   0019-7939. JSTOR   30038594.
  32. ↑ Altonji, Joseph G.; Siow, Aloysius (1987). "Testing the Response of Consumption to Income Changes with (Noisy) Panel Data". The Quarterly Journal of Economics. 102 (2): 293. doi:10.2307/1885065. JSTOR   1885065.
  33. ↑ Altonji, Joseph G; Devereux, Paul J (2000), The extent and consequences of downward nominal wage rigidity, Research in Labor Economics, vol. 19, Emerald Group Publishing Limited, pp. 383–431, doi:10.1016/s0147-9121(00)19015-6, hdl:10197/311, ISBN   978-1-84950-067-8 , retrieved 2024-06-05
  34. ↑ "Modeling Earnings Dynamics". Econometrica. 81 (4): 1395–1454. 2013. doi:10.3982/ECTA8415. ISSN   0012-9682.
  35. ↑ Altonji, Joseph G.; Segal, Lewis M. (1996). "Small-Sample Bias in GMM Estimation of Covariance Structures". Journal of Business & Economic Statistics. 14 (3): 353–366. doi:10.2307/1392447. ISSN   0735-0015. JSTOR   1392447.
  36. ↑ Altonji, Joseph G.; Matzkin, Rosa L. (2005). "Cross Section and Panel Data Estimators for Nonseparable Models with Endogenous Regressors". Econometrica. 73 (4): 1053–1102. doi:10.1111/j.1468-0262.2005.00609.x. ISSN   0012-9682. JSTOR   3598815.
  37. ↑ Altonji, Joseph G.; Bharadwaj, Prashant; Lange, Fabian (2012). "Changes in the Characteristics of American Youth: Implications for Adult Outcomes". Journal of Labor Economics. 30 (4): 783–828. doi:10.1086/666536. ISSN   0734-306X. JSTOR   10.1086/666536.
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