Neil Lloyd

PhD Job Market Candidate

My research interests are in Labour Economics; in particular, the relationship between public institutions and individual labour market outcomes in both developed and developing countries. My job market paper demonstrates how the income tax structure interacts with the inequality of childbirth to incentivize strategic, infra-marginal labour supply adjustments by both mothers and fathers.

In a different paper I examine the impact of incorporation on self-employed workers’ labour supply, exploiting regulatory changes at the province-profession level in Canada.  In work with Thomas Lemieux and Nicole Fortin, we re-examine the importance of spillover effects when measuring the impact of labour market institutions on the wage-distribution.

I will be available for interview during the 2020/2021 Canadian Economics Employment Exchange, European Economic Association conferences, and American Economic Association conferences. I expect to graduate in 2021.

 

JOB MARKET PAPER

The event of initial childbirth is associated with a highly unequal and persistent adjustment to female labour supply and earnings. It is also associated with an increase in the demand flexible, `family friendly’ employment among mothers. My job market paper explores the hypothesis that under an individual tax structure the interaction of these two factors results in the reorganization of household labour supply around co-employment with childbirth. This is because, as self-employed workers these households benefit from both reducing their taxes through income-splitting and from the flexibility of self-employment.

I show that in Canada, an individual tax jurisdiction, the event of initial childbirth is associated with a discontinuous increase (3%) in joint self-employment among married households. As in the literature, fathers show no sign of reducing their employment with family formation but do switch from the wage-paying sector into self-employment (5%); even pre-empting the event of childbirth. Maternal self-employment increases discontinuously after childbirth (5%), with the majority of this explained by women married to self-employed men. In a parallel analysis of longitudinal survey data I show that this is a real labour supply phenomenon, where co-employed mothers benefit from the same flexibility of other self-employed mothers: increased part-time work and the ability to work form home. This transition to self-employment represents the creation of a `family friendly’ firm.

I then connect this labour supply decision to the income tax structure through a simulated instrument research design. I exploit exogenous variation in the income tax structure as a shock to the potential value of income-splitting across different birth cohorts. As such, I can estimate a separate elasticity for each event-time: it is both stable and symmetric across men and women, consistent with the income-splitting mechanism. The estimated elasticity of 0.5 and potential savings of 3% suggest that income-splitting can account for a 1.5 %-point increase in male self-employment or half the estimated increase in co-employment with childbirth. This is approximately the difference-in-difference in Canadian and US self-employment among men of the same age with and without children. Thus, income-splitting is not simply a tax avoidance exercise. It is an incentive to be self-employed and co-employed with family formation, that has a long-lasting impact on both male and female labour supply beginning with childbirth.[GO TO PAPER]

PHD RESEARCH

This paper provides causal evidence on the impact of incorporation on the labour supply of self-employed workers, as well as their spouses. It does so by exploiting regulation changes at the province-profession level that were introduced to permit the registration of professional corporations in Canada. Among other benefits, corporations acts as a tax shelter to professionals, reducing their current marginal tax rate and increasing their lifetime wealth. My results suggest that incorporation leads to an increase in labour supply, consistent with the reduction in marginal tax rate. However, the increase in female labour supply is four-fold that of men. Incorporation is also associated with a 50 %-point increase in the likelihood that a female professional has employees, relative to 14 %-points for men. Incorporation therefore encourages small business owners to take on the risk of employees, which could be the mechanism through which labour supply is then increased. Preliminary results using annual taxable income data suggest these reforms increased female earnings relative to male earnings, thereby reducing gender inequality among self-employed professionals. [GO TO PAPER]

This paper extends the DiNardo, Fortin, and Lemieux (1996) study of the links between labor market institutions and wage inequality in the United States and updates the analysis to the 1979 to 2017 period. A notable extension quantifies the magnitude and distributional impact of spillover effects from minimum wages and unions, also known at the union threat effect. A distribution regression framework is used to estimate both types of spillover effects separately and jointly. Accounting for spillover effects doubles the contribution of de-unionization to the increase in male wage inequality and raises the explanatory power of declining minimum wages to two thirds of the increase in inequality at the bottom end of the female wage distribution.[GO TO PAPER]

This project investigates the hypothesis that the low levels of self-employment and informal sector activity in contemporary South Africa can be linked to the legacy of labour recruitment in South Africa’s gold mining industry. At the outset of the Witwatersrand gold rush (1886) labour was largely sourced from outside of South Africa: Southern Mozambique, Botswana, even China. However, during the early 1900’s a series of events culminated in the expansion of recruitment to African men within South Africa. These events included the collapse of the Witwatersrand Native Labour Association (WNLA) as a centralized recruitment agency, the decision by the Transvaal government to repatriate around 30,000 Chinese workers, and a recession in the Cape province which led the governor to encourage recruiters to expand their operations to the Cape’s ‘native reserves’. We combine historical recruitment data with contemporary, geo-coded survey data to estimate the long run impact of the centralized mining recruitment on contemporary self employment. Our research design exploits the historical borders of districts selected for recruitment, as well as the historical location of private sector recruiters prior to the re-establishment of a monopsony in 1918.[GO TO PAPER]

WORKING PAPER

Increasing access to HIV testing: Impacts on equity of coverage and uptake from a national campaign in South Africa (2015) SALDRU Working Paper Series: No. 145. (Co-author with Brendan Maughan-Brown, Jacob Bor and Atheendar Venkataramani)[GO TO PAPER]

New evidence on subjective well-being and the definition of unemployment in South Africa" (2013) SALDRU Working Paper Series: No. 94. (Co-author with Murray Leibbrandt)[GO TO PAPER]

Entry into and exit from informal enterprise ownership in South Africa: An analysis of the 2013 Survey of Employers and Self Employed and the 2013 Quartlerly Labour Force Survey" (2016) REDI3x3 Working Paper Series: No. 17 (Co-author with Murray Leibbrandt)[GO TO PAPER]

PUBLICATIONS

Lloyd, N. and Leibbrandt, M. (2018) Entry into and exit from informal enterprise ownership in South Africa, in Fourie, F. (ed.), The South African Informal Sector: Creating Jobs, Reducing Poverty, HSRC Press, South Africa

Maughan-Brown, Brendan, Neil Lloyd, Jacob Bor, and Atheendar S Venkataramani (2016). Changes in self-reported HIV testing during South Africa’s 2010/2011 national testing campaign: gains and shortfalls, Journal of the International AIDS Society, 19:1

Lloyd, Neil and Murray Leibbrandt (2014). New evidence on subjective well-being and the definition of unemployment in South Africa, Development Southern Africa, 31:1, 85-105

 

VANCOUVER SCHOOL OF ECONOMICS, UBC, 2015-2020

  • ECON 490 Seminar in Applied Economics (Winter, 2020)
  • ECON 490 Seminar in Applied Economics (Fall, 2019)
  • ECON 527 Econometric Methods (Fall, 2018)
  • ECON 527 Econometric Methods (Fall, 2017)
  • ECON 327 Econometric Methods (Fall, 2016)

VANCOUVER SCHOOL OF ECONOMICS, UBC, 2013-2014

  • ECON 102 Principles of Macroeconomics (Winter, 2014)
  • ECON 101 Principles of Microeconomics (Fall, 2013)

SESSIONAL LECTURER, UBC, January/July 2013 – August 2014/August 2015

  • ECO 1010F Principles of Microeconomics (First Semester, 2013)
  • ECO 1011S Principles of Macroeconomics (Second Semester, 2014)
  • ECO 1010F Principles of Microeconomics (First Semester, 2015)
  • ECO 2003F Microeconomics II (First Semester, 2015)