Follow me on twitter: @caroartc

I am a PhD candidate at UCLA and I will join the Economics Department at the University of Toronto in the summer of 2019. I work on labor economics, education and crime.

Job Market Paper “The Cost of Bad Parents: Evidence from the Effects of Parental Incarceration on Children's Education”

This paper provides evidence that parental incarceration increases children's educational attainment. I collect criminal records for 90,000 low-income parents who have been convicted of a crime in Colombia, and combine it with administrative data on the educational attainment of their children. I exploit exogenous variation in parental incarceration resulting from the random assignment of defendants to judges with different propensities to convict and incarcerate. My identification strategy differs from the usual judge IV application because I model incarceration as two stage decision problem: First conviction, and then incarceration. I exploit judge leniency along these two different margins. Intuitively, I take advantage of the fact that I can compare children of parents who faced similar judge conviction leniency, but had different incarceration leniency. I derive a new expression that extends the Local Average Treatment Effect concept, to a setting with two sources of unobserved treatment heterogeneity. I find that conditional on conviction, parental incarceration increases education by 0.8 years for children whose parents are on the margin of incarceration. This positive effect is larger for boys, violent crimes, and cases in which the incarcerated parent is the mother.

Mentions in media: WSJ: Real Time Economics / Radio interview (in Spanish -minute 55) / Techonomy -podcast.


The Effect of Human Capital on Earnings: Evidence from a Reform in Colombia’s top University (2018) Journal of Public Economics. Vol 157, January. pp 212-225

In this paper I test whether the return to college education is the result of human capital accumulation or instead reflects the fact that attending college signals higher ability to employers. I exploit a reform at Universidad de Los Andes, which in 2006 reduced the amount of coursework required to earn degrees in economics and business by 20% and 14%, respectively, but did not change the quality of incoming or graduating students. The size of the entering class, their average high school exit exam scores, and graduation rates were not affected by the reform, indicating that selection of students into the degrees remained the same. Using administrative data on wages and college attendance, I estimate that wages fell by approximately 16% in economics and 13% in business. These results suggest that human capital plays an important role in the determination of wages and reject a pure signaling model. Surveying employers, I find that the reduction in wages may have resulted from a decline in performance during the recruitment process, which led students to be placed in lower-quality firms. Using data from the recruitment process for economists at the Central Bank of Colombia, I find that the reform reduced the probability of Los Andes graduates' being hired by 17 percentage points.

Mentions in media:

WSJ: Real Time Economics / Forbes / Bloomberg Opinion, by Noah Smith/Techonomy (podcast)/ Brookings- Future Development by Shanta Devarajan / Courtier en Bourse/ ProMarket / World Bank Newsletter / LiveMint

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