Christopher Roth

Labor Market Concerns and Support for Immigration

Do labor market concerns affect support for immigration? Using a large, representative sample of the US population, we first elicit beliefs about the labor market impact of immigration. To generate exogenous variation in beliefs, we then provide respondents in the treatment group with research evidence showing no adverse labor market impacts of immigration. Treated respondents update their beliefs and become more supportive of immigration, as measured by self-reported policy views and petition signatures. Treatment effects also persist in an obfuscated follow-up study. Our results demonstrate that information about the labor market impact of immigration causally affects support for immigration.

Conspicuous Consumption and Peer Effects: Evidence from a Randomized Field Experiment

Relative concerns over status goods imply that peer effects in conspicuous consumption are an important determinant of consumption patterns. I use data from a cluster-randomized cash transfer program from Indonesia to test for peer effects in conspicuous consumption. Using data on the visibility of a variety of goods, I examine whether peer effects in consumption differ by consumption visibility. In line with a model of conspicuous consumption, I find that the expenditure share of visible goods rises for households whose peers’ visible consumption is exogenously increased. Finally, I shed light on the social mechanisms underlying peer effects in consumption.

Experienced Inequality and Preferences for Redistribution

We examine whether individuals’ experienced levels of income inequality affect their preferences for redistribution. We use several large nationally representative datasets to show that people who have experienced higher inequality during their lives are less in favor of redistribution, after controlling for income, demographics, unemployment experiences and current macroeconomic conditions. They are also less likely to support left-wing parties and to consider the prevailing distribution of incomes to be unfair. We provide evidence that these findings do not operate through extrapolation from own circumstances, perceived relative income or trust in the political system, but seem to operate through the respondents’ fairness views.

Beliefs about Racial Discrimination: Representative Evidence

We provide nationally representative evidence on American people’s beliefs about racial discrimination and explore whether these beliefs causally affect support for affirmative action programs. In an online experiment on a large, representative sample of Americans, we elicited incentivized beliefs about the extent of racial labor market discrimination against blacks. We document large heterogeneity in beliefs and find particularly pronounced political differences: Republicans are about 15 percentage points less likely than Democrats to overestimate racial discrimination in the labor market. To introduce exogenous variation in beliefs, we provided a random subset of our respondents with research evidence from a correspondence study that tested for discrimination against blacks in the labor market. Respondents strongly and persistently updated their beliefs about racial discrimination in response to the information. Treated respondents who underestimated racial discrimination also increased their donations to a pro-black civil rights organization by 18 percent of a standard deviation. However, the treatment did not reduce political polarization in donations as Republicans who underestimated racial discrimination did not increase their donations. This finding suggests that the political disagreement on affirmative action programs is not mainly determined by differences in beliefs about racial discrimination. (JEL C91, D83, F22, J15)

How Do Expectations About the Macroeconomy Affect Personal Expectations and Behavior

Using a representative online panel from the US, we examine how individuals’ macroeconomic expectations causally affect their personal economic prospects and their behavior. To exogenously vary respondents’ expectations, we provide them with different professional forecasts about the likelihood of a recession. Respondents update their macroeconomic outlook in response to the forecasts, extrapolate to expectations about their personal economic circumstances and adjust their consumption plans and stock purchases. Extrapolation to expectations about personal unemployment is driven by individuals with higher exposure to macroeconomic risk, consistent with macroeconomic models of imperfect information in which people are inattentive, but understand how the economy works.

Public Debt and the Demand for Government Spending and Taxation

We examine how beliefs about the debt-to-GDP ratio affect peoples attitudes towards government spending and taxation. Using representative samples of the US population, we run a series of experiments in which we provide half of our respondents with information about the debt-to-GDP ratio in the US. Based on a total of more than 4,000 respondents, we find that most people underestimate the debt-to-GDP ratio and reduce their support for government spending once they learn about the actual amount of debt, but do not substantially alter their attitudes towards taxation. The treatment effects seem to operate through changes in expectations about fiscal sustainability and persist in a four-week follow-up.We examine how beliefs about the debt-to-GDP ratio affect people’s attitudes towards government spending and taxation. Using a representative sample of the US population, we provide half of our respondents with information about the debtto-GDP ratio in the US. We find that most people underestimate the debt-to-GDP ratio and favor a cut in government spending once they learn about the actual amount of debt, but do not alter their attitudes towards taxation. The treatment effects operate through changes in beliefs about fiscal sustainability and persist in a four-week follow-up. JEL Classification: P16, E60, Z13.

Social Spillovers of a School Building Program: Evidence on Improved Inter-Ethnic and Inter-Religious Relationships

Can the government increase tolerance among its citizens by providing them with more schooling? We exploit a large school building program from Indonesia to examine the causal relationship between education and attitudes towards people from a different ethnicity and religion. Our generalized difference-in-differences estimates suggest that receiving more education causes an increase in interethnic and interreligious tolerance. Specifically, a one standard d eviation increase in education results in a .4 standard deviation increase in tolerance. We demonstrate robustness of results and show that the common trend assumption is satisfied. Subsequently, we shed light light on several mechanisms: first, treated individuals are more likely to migrate, to live in cities and to work in occupations outside of agriculture. This in turn, increases their incomes and the religious and economic diversity of their social environment. Second, we employ an additional identification strategy to show that the educational content under Suharto emphasizing the national unity of Indonesia is an important mechanism underlying the estimated treatment effects.