CIPRIAN DOMNISORU

ciprian.domnisoru[at]aalto[dot]fi

I am an Assistant Professor of Economics and Data Science at the Aalto School of Business- Helsinki GSE. My research areas are Labor Economics, Applied Microeconomics and the Economics of Education. I am particularly interested in how labor market institutions and educational policies affect upward mobility.



RESEARCH

The Intergenerational Transmission of Human Capital: Evidence from the Golden Age of Upward Mobility (with David Card and Lowell Taylor), NBER Working Paper 25000 (under review)

Summaries: Vox, https://voxeu.org/article/public-education-and-intergenerational-mobility

NBER Digest https://www.nber.org/digest/nov18/w25000.shtml

We use 1940 Census data to study the intergenerational transmission of human capital for children born in the 1920s and educated during an era of expanding but unequally distributed public school resources. Looking at the gains in educational attainment between parents and children, we document lower average mobility rates for blacks than whites, but wide variation across states and counties for both races. We show that schooling choices of white children were highly responsive to the quality of local schools, with bigger effects for the children of less-educated parents. We then narrow our focus to black families in the South, where state-wide minimum teacher salary laws created sharp differences in teacher wages between adjacent counties. These differences had large impacts on schooling attainment, suggesting an important causal role for school quality in mediating upward mobility.

This paper aims to reconcile diverging results in the literature on the effects of compulsory schooling reforms on earnings. I point out, through a simple model of human capital accumulation, the importance of identifying parental education information to better target the set of potential compliers. Using detailed parental background data, the empirical analysis uncovers the large and positive effects of a French school leaving age reform previously shown to have produced zero and statistically insignificant effects on the earnings of impacted cohorts. The analysis suggests that identifying parental education is likely a crucial effort in analyzing contemporary compulsory schooling policies.

Tuition subsidies and Overeducation (draft available upon request)

Rising tuition subsidies and student loans have boosted college completion in the U.S., but have they also increased the overeducation rate? I find that some of the largest college subsidy efforts of the U.S. government, the WWII, Vietnam War, and Post-9/11 G.I. Bills, led to persistent increases in the overeducation rate among bachelor's degree holders. Motivated by these empirical patterns, I employ a dynamic structural model of occupational choice to address selection issues and conduct counterfactual analyses. The model is estimated using NLSY97 data, and accounts for parental background, academic performance, university selectivity and college major choice. The model achieves a good fit of empirical patterns in the college graduation and overeducation rates. Counterfactual analyses indicate that increases in tuition subsidies lead to higher rates of overeducation, and lower predicted earnings among college graduates. Notwithstanding the pre-college human capital of subsidy beneficiaries, reducing overeducation stands out as a policy-actionable way to improve the public monetary efficiency of tuition subsidies.


The Rise of For-Profit Higher Education: A General Equilibrium Analysis (with Ioana Schiopu) (draft available upon request)

In recent decades, for-profit colleges have risen to prominence in U.S. higher education policy. We develop a general equilibrium model of the four-year college market, focusing on the competition between the fast-rising for-profit college sector and the public and not-for-profit sectors. The model captures competing profit maximization and academic quality objectives, the markets for traditional and nontraditional students, and variation in institutional financial aid policies and student loan balances. In calibration, the model predicts substantially different levels of tuition, instructional spending and average student body abilities, which match data counterparts well. We conduct counterfactual analyses relevant to recent U.S. policy debates, including subsidy cuts at public colleges, increases in federal financial aid, and ``gainful employment" legislation that links access to federal funding for universities to their graduates' debt-to-earnings ratios.

The secular decline in teen employment: the role of compulsory schooling laws and work permits (draft available upon request)

I analyze the role that compulsory schooling and employment certificate legislation play in the secular decline in teenage employment in the United States since 2000. A simple model predicts compulsory schooling policies reduce teenage employment even under very lax or absent enforcement, through signals perceived by employers. Using a difference in differences strategy and Current Population Survey data, I show that increases in school leaving ages in 21 states since 1985 have reduced the employment rate of 16 and 17- year-olds by one to three percentage points. The effect was stronger in states requiring work permits for 16 and 17-year-olds. Using a similar empirical strategy, I analyze the effect of dropping work permit requirements for 16 and 17-year-olds, in five states that did so between 1977 and 1996. The employment rate of 16 year-olds increased by about two percentage points after employment certificates were no longer required.


WORK IN PROGRESS


"The Heterogeneous Effects of Education on Health and Wealth using 100 years of Data" [Provisional Title] (with David Card, Seth Sanders, Lowell Taylor and Victoria Udalova)

"The Impact of College Education on Old-Age Mortality: A Study of Marginal Treatment Effects" (with Evan Taylor)

"Minimum Wage Laws and Technology Adoption" (with Hakki Ozdenoren)


PEER-REVIEWED POLICY RESEARCH

The largest drop in income inequality in the European Union during the Great Recession: Romania‘s puzzling case”, Conditions of Work and Employment Series, No.51 , International Labour Organization, Geneva, Switzerland, 2014.

Decent Work policy options for the Romanian economy,” Policy Integration Department Working Papers, No.105, International Labour Organization, Geneva, Switzerland, 2012.