This paper examines the impact of manufacturing employment decline on the socioeconomic outcomes within and between black and white Americans since 1960. The analysis shows that manufacturing decline had a negative impact on blacks in terms of their wages, employment, marriage rates, house values, poverty rates, death rates, single parenthood, teen motherhood, child poverty, and child mortality. In addition, the decline in manufacturing increased inequality within the black community for wages and other outcomes. Similar patterns are found for whites, but to a lesser degree—leading to larger gaps between whites and blacks in wages, marriage patterns, poverty, single-parenthood, and death rates.

This paper shows that workers can affect the productivity of their coworkers based on income maximization considerations, rather than relying on behavioral considerations such as peer pressure, social norms, and shame. We show that a worker's effort has a positive effect on the effort of coworkers if they are complements in production, and a negative effect if they are substitutes. The theory is tested using a panel data set of baseball players from 1970 to 2003. The results are consistent with the idea that the effort choices of workers interact in ways that are dependent on the technology of production.

This paper demonstrates that mall store contracts are written to internalize externalities through both an efficient allocation and pricing of space, and an efficient allocation of incentives across stores. Certain stores generate externalities by drawing customers to other stores, whereas many stores primarily benefit from external mall traffic. Therefore, to varying degrees, the success of each store depends upon the presence and effort of other stores, and the effort of the developer to attract customers to the mall. Using a unique data set of mall tenant contracts, we show that rental contracts are written to (i) efficiently price the net externality of each store and (ii) align the incentives to induce optimal effort by the developer and each mall store according to the externality of each store's effort.

The labor market prospects of young, unskilled men fell dramatically in the 1980s and improved in the 1990s. Crime rates show a reverse pattern: increasing during the 1980s and falling in the 1990s. Because young, unskilled men commit most crime, this paper seeks to establish a causal relationship between the two trends. Previous work on the relationship between labor markets and crime focused mainly on the relationship between the unemployment rate and crime, and found inconclusive results. In contrast, this paper examines the impact of both wages and unemployment on crime, and uses instrumental variables to establish causality. We conclude that both wages and unemployment are significantly related to crime, but that wages played a larger role in the crime trends over the last few decades. These results are robust to the inclusion of deterrence variables, controls for simultaneity, and controlling for individual and family characteristics.