Research

Working Papers:

Abstract:

This paper analyzes the effect on the Mexican labor market of deepening the existing environmental regulations by increasing their carbon tax to truly achieve the nationally determined contributions (NDCs) emissions reductions, considering that high levels of informality characterize its labor market. We do that by developing a multi-sector general equilibrium search model that considers informal labor, both the informal sector and the informal contracts in the formal sector. Understanding how environmental regulation and informality interact seems crucial. First, because of the size of Mexican informality, second, because of the country’s carbon intensity, and third, because of the existence of additional mechanisms that differ from countries without this labor market feature. Lastly, we analyze the alternative usage of government revenue from the carbon tax and the different impacts on the economy. In particular, we find that rebating the revenue to decrease the formal tax burden can incentivize formal jobs.  


Abstract: 

This paper develops a two-sector search model with sectoral human capital accumulation to explore the effects on the labor market of implementing a per unit of energy use carbon tax in the US. In particular, I examine the costly reallocation of workers between sectors, the welfare effects of involuntary unemployment, and the heterogeneous effects of this policy on different types of workers. I separate the economy into a high-intensive sector and a low-intensive sector. I discipline the model parameters using 2014 U.S. data. I find that a carbon tax increases total unemployment by 0.3 percentage points, dirty employment rate decreases by 1.1 percentage points, and clean employment rate increases by 0.5  percentage points. Also, I find that firms in the dirty sector adjust by decreasing the demand for high-skilled workers. Increasing the number of vacancies in the low-skilled market, where the production demands less energy and workers perceive lower wages.

Academic Presentations: EDF Economics Seminar (2022), CAF - development bank of Latin America Seminar (2022), EAERE Annual Conference (2020), ITAM Alumni Conference (2020), New Advances in Sustainable Resource Use and Economic Dynamics (SURED) (2020), AERE Sponsored Sessions at the Annual MEA Meetings (2020)**, Banco de México Workshop (2019).


Abstract: 

Policymakers are deeply concerned about the impact of environmental policy on jobs, particularly regarding the potential increase in involuntary unemployment and the potential loss of high-quality jobs. This paper extends existing search-CGE models by incorporating inter- and intra-industry job ladders, allowing for on-the-job search and cross-industry job quality differences. By considering sectoral detail and disaggregation, the model aims to capture more realistic employment dynamics and the persistent earnings losses observed in empirical studies following job loss. Preliminary findings suggest that the welfare losses resulting from environmental policy induced job loss depend on whether low- or high-quality jobs are affected, with reductions in tenured workers causing more significant losses. Factors such as policy stringency and the substitutability of term and tenured workers in production further influence these effects. Our model contributes to a better understanding of the impacts of environmental policy on jobs and facilitates comparisons between workers with varying levels of attachment to regulated industries. 

Academic Presentations:  AERE 2020 Virtual Conference*, EPA’s NCEE CGE Modeling Workshop (2020), NBER Distributional Consequences of New Energy Policies Preconference (2022) * +, AERE Sponsored Sessions at the Annual MEA Meetings (2023), EDF Economics Seminar (2023), NBER Distributional Consequences of New Energy Policies Conference (2023)  


Abstract: This research identifies challenges and opportunities for achieving an inclusive just transition (JT) to a low-carbon economy, focusing on promoting an equitable workforce while advancing a sustainable economy in developed and developing countries. We conduct a two-stage comparative analysis of JT labor-oriented policies between developed and developing countries. We draw lessons from some developed countries that have implemented national and local initiatives to revitalize resource-rich communities that have experienced a downturn in the energy sector. Furthermore, we argue that these countries face common challenges in achieving a JT by ensuring “quality” jobs, compensating for displaced workers, and determining the appropriate extent of governmental interventions. In assessing developing countries, we recognize the heterogeneity among these countries, so we focus on a representative sample from the global south that allows us to characterize the labor market within the transitioning sectors, thereby identifying both challenges and potential avenues for creating new employment opportunities, facilitating skill retraining, and ensuring the integration of communities. Many of these countries are in the initial phases of a just energy transition, and notably, within the developing countries, we also explore the nascent just energy transition partnership efforts. Also, we advance opportunities and lessons drawn from advanced economies' experiences and the recent efforts of developing countries that could help achieve a global and inclusive JT. These findings can demonstrate for many countries some key steps they can take towards beginning and achieving their JT journey. Finally, we present a tool to measure progress towards JT, our JT Progress Scale, and apply the scale to the previously analyzed countries.

Academic Presentations:  AERE 2024 Summer Conference+, EDF Economic Seminar+



Research in Progress: 

Academic Presentations: IAERE Annual Conference (2021)


Academic Presentations: AERE @ the Southern Economic Association (SEA) Annual Conference (2020)


Policy Research:




Older Research Progress:




* Presented by coauthors, **Cancel because of Covid, +Schedule