Job Market Paper

Priced Out of Entrepreneurship? Rising Local Home Prices Lower Economic Opportunities for Young Renters. (with Seungyub Han)
USC Lusk Center Research Awards 2023 & USC Economics Summer Research Award 2023-2024

Abstract
Rising housing costs reshape who can aﬀord to become an entrepreneur. This paper examines how housing aﬀordability influences entry into entrepreneurship, focusing on young individuals who lack housing collateral and are more exposed to liquidity constraints as aﬀordability declines. While prior studies emphasize how higher house prices can encourage entrepreneurship among homeowners through collateral gains, much less is known about how worsening aﬀordability aﬀects those without housing wealth. We show that examining the non-owner side is essential to understanding the broader link between housing markets and entrepreneurship. We build a stylized life-cycle model in which renters and homeowners are exogenously separated, and show that these groups respond to changes in housing aﬀordability through opposite mechanisms: a collateral channel for owners and a liquidity channel for renters. Using U.S. Census microdata aggregated to MSA-year panels and an instrumental variable strategy interacting national housing demand shocks with local housing supply elasticities, we find that declining aﬀordability significantly reduces self-employment among young adults. The model and evidence together highlight housing aﬀordability as a fundamental determinant of who can take entrepreneurial risks. Beyond housing policy, improving aﬀordability is crucial for expanding economic opportunity, fostering social mobility, and sustaining local dynamism.

Journal Publications

An aggregate economic value perspective on Korea’s marriage decline – Transitory and secular. (with Jung Hyuk Lee and Seungwoo Chin )
Journal of Demographic Economics , Forthcoming (DOI: https://doi.org/10.1017/dem.2025.10008)

Abstract
Marriage rates in Korea have been declining at an unprecedented pace in the recent two decades. Drawing on the classical economic theory of marriage as a rational choice, we compute local aggregate economic values of prime-age working men and women to examine the relationship between the relative values of men and marriage rates. The relative values of men fell dramatically by 40% during this period, undermining the economic justification of marriage under unequal allocation of housework. The two-way fixed-effects estimation using region-year transitory variations shows that a 1% decrease in the relative values of men was associated with a 0.088% decrease in marriage rates. To explain the precipitous convergence of economic values between both genders, we decompose the changes in the relative values into four components – (gender-neutral) structural changes, (gender-specific) industrial segregation, (gender-neutral) wage growth, and (gender-specific) wage gaps within industries – to measure their contributions to secular marriage decline. In the 2000s, both the alleviated industrial segregation and the structural changes toward industries with higher female proportions played a major role. On the other hand, the impact of reduced gender wage gaps within industries became also prominent in the 2010s.

Uncertainty and Household Portfolio Choice: Evidence from South Korea (with Donghyun Suh)
Economics Letters , Vol. 180, July 2019, pp. 21–24. (DOI: 10.1016/j.econlet.2019.03.009)

Abstract
We examine the effect of policy uncertainty on the household portfolio choice using the Korea Labor Income Panel Study (KLIPS). Policy uncertainty significantly reduces the share of risky assets in the household's portfolio, as well as the probability of holding risky assets. On the top of that, we alleviate possible endogeneity problem by leveraging lottery-related questionnaire in KLIPS. Furthermore, we investigate the interaction between policy uncertainty and labor income volatility. Labor income volatility offsets the effect of policy uncertainty, which is statistically and economically significant.

Testing for the Conditional Geometric Mixture Distribution (with Sang Woo Park and Jin Seo Cho )
Journal of Economic Theory and Econometrics , Vol. 29, No. 2, June 2018, pp.1-27. (DOI: 10.22812/jetem.2018.29.2.001)

Abstract
This study examines the mixture hypothesis of conditional geometric distributions using a likelihood ratio (LR) test statistic based on that used for unconditional geometric distributions. As such, we derive the null limit distribution of the LR test statistic and examine its power performance. In addition, we examine the interrelationship between the LR test statistics used to test the geometric and exponential mixture hypotheses. We also examine the performance of the LR test statistics under various conditions and confirm the main claims of the study using Monte Carlo simulations.

Deferring Graduation as Job Market Signaling (Written in Korean, Korean Title: 취업시장에서 신호로서의 졸업유예) (with Doo Hyung Yun and Jaeok Park)
The Korean Journal of Economics , Vol. 26, No. 2, December 2019, pp.245-275. (DOI: 10.46228/KJE.26.2.5)

Abstract
Due to the tough Korean job market for college graduates, it has become a universal phenomenon in Korea for college students to defer graduation. In this paper, we perform a game-theoretic analysis on delayed graduation, interpreting it as a signal sent by job applicants to the firm. We show that, when the job market is tough, there can exist a separating equilibrium in which applicants with high productivity put off graduation and those with low productivity graduate on time. In addition, there can exist pooling equilibria in which applicants of both types graduate or defer graduation. We compare the payoffs of participants in the three kinds of equilibria. We also discuss how the equilibrium will change as it becomes more difficult to get a job and as the cost of deferring graduation gets lower.

Joint Recruitment of Public Institutions: Who Gains and Who Loses" (Written in Korean, Korean Title: 공공기관 합동채용: 누가 이익을 보고 누가 손해를 보는가?) (with Jaeok Park)
Journal of Economic Theory and Econometrics , Vol. 31, No. 1, March 2020, pp.14–65. (DOI: 10.22812/jetem.2020.31.1.002)

Abstract
Recently, the Korean government is promoting the joint recruitment of public institutions, in which public institutions performing a similar task set a common date of written tests for entry-level employment. In this study, we analyze the effects of this policy on job seekers and institutions. Using a game-theoretic analysis, we derive the following results. First, when job seekers’ preferences for institutions are identical, lower-ranked institutions are less likely to participate in joint recruitment than higher-ranked ones, because joint recruitment decreases both the quantity and quality of applicants that lower-ranked institutions face. Second, when job seekers’ preferences for institutions are diverse, joint recruitment can improve the overall utility of job seekers by increasing the likelihood that job seekers enter their preferred institutions. Third, when the desirability of employment is not much different across institutions, top job seekers lose and average ones benefit from joint recruitment. Based on these results, we evaluate the policy of joint recruitment and discuss policy alternatives.

Working Papers

Do Working Wives Make Married Men Earn More? Evidence in Korea. (with Hee-Seung Yang and Myungkyu Shim )
USC Economics Outstanding Second-Year Paper Award 2022

Abstract
This paper examines whether the labour market status of a wife increases or lowers her husband’s wage, which has not yet been comprehensively considered in the previous literature. Using Korean panel data from 1998 to 2019, we first unveil the fact that a spouse’s labour income, an indicator for labour market status, has a non-monotonic effect on the marriage premium. The premium is high for married men with non-working wives and men with working wives earning high incomes. To understand the marriage wage premium, we utilise two well-known hypotheses—specialisation hypothesis and joint-search hypothesis.

Selected Work in Progress

The Impact of Porto Digital on Urban Revitalization and Gentrification in Recife, Brazil (Tentative Title). (with Alison De Farias )

The Impact of Air Pollution on Housing Prices and Migration Pattern: Evidence from South Korea.