Essays on Labor and Development Economics

This dissertation studies the impact of institutional interventions on labor markets in the United States, Norway and India. The labor markets studied are diverse, and include the criminal sector in the United States, the healthcare sector in Norway and the market for workfare employment in rural India. Chapter 1 studies whether juvenile offenders are deterred by the threat of criminal sanctions. Existing research, which studies adolescent crime as a series of on-the-spot decisions, finds that deterrence estimates are negligible at best. This paper first presents a model that allows the return from crime to increase with previous criminal involvement. The predictions of the model are tested using policy variation in the United States over the period 2006-15. The results show that when criminal capital accumulates, juveniles may respond in anticipation of increases in criminal sanctions. Accounting for these anticipatory responses can overturn the conclusion that harsh sanctions do not deter juvenile crime. Chapter 2 studies the impact of a graduate's first job on her career trajectory, and how job-seeking graduates’ respond to the persistence of these "first job effects". For identification, we exploit a natural experiment in Norway, where doctors' first jobs were allocated through a random serial dictatorship mechanism until 2013. We use administrative data on individual outcomes to confirm empirically that the residency allocation mechanism effectively randomized choice sets of hospitals across medical graduates. We then use the resulting variation in individual doctors’ choice sets to show that first jobs affect doctors' earnings, place of residence, and specialization in the long run. Chapter 3 evaluates the effects of encouraging the selection of local politicians in India via community-based consensus, as opposed to a secret ballot election. I find that financial incentives aimed at encouraging consensus-based elections and discouraging political competition crowd in younger, more educated political representatives. However, these incentives also lead to worse governance as measured by a fall in local expenditure and regressive targeting of workfare employment. These results can be explained by the fact that community-based processes are prone to capture by the local elite, and need not improve the quality of elected politicians or governance.