Mike Zabek

Economics PhD Candidate
Labor, macro, and urban/regional economics
University of Michigan
Department of Economics

Working papers

Local ties lead people to stay in declining areas. Net migration responses are smaller in areas where people’s local ties are stronger, proxied by the share of people who live where they were born. Across a wide class of models, these low migration elasticities imply that that a local stimulus, like a place based policy, will lead to a smaller dead weight loss. In a spatial equilibrium model where people receive idiosyncratic utility from living in their homes, declining areas attract fewer outsiders, have lower net migration elasticities, and residents of declining areas are worse off, compared to a model without this dynamic. Local economies adjust slowly after shocks, reaching steady state after several generations.

Full text

(With David Albouy)

Inequality in U.S. housing prices and rents both declined in the mid-20th century, even as home-ownership rates rose. Subsequently, housing-price inequality has risen to pre-War levels, while rent inequality has risen less. Combining both measures, we see inequality in housing consumption equivalents mirroring patterns in income across both space and time, according to an income elasticity of housing demand just below one. These patterns occur mainly within cities, and are not explained by observed changes in dwelling characteristics or locations. Instead, recent increases in housing inequality are driven most by changes in the relative value of locations, seen especially through land.

Full text (revision soon)

Press (selected): Washington Post

Work in progress

Parental Proximity and the Earnings Consequences of Job Loss

(With Patrick Coate and Pawel Krolikowski)

Young adults, aged 25 to 35, who live close to their parents experience stronger earnings recoveries after job displacements than those who live farther away. This result is robust to a reweighting exercise that accounts for a number of differences between workers who live near their parents and those who do not. The effect of parental proximity diminishes gradually with distance to one’s parents and appears to be driven by post-displacement wages rather than labor supply. Some evidence suggests that parents’ job networks may help adult children to find local jobs. At older ages, living near one’s parents appears to have no impact.

Cleveland Fed Economic Commentary (working paper soon)

Press (selected): Wall Street Journal, The Atlantic, Time, Business Insider