Bio

I am an assistant professor at the Naval Postgraduate School. I work on topics in labor economics, crime, and behavioral economics.

Curriculum Vitae

Email: maxim.massenkoff@nps.edu

Working Papers

Racial inequality in the U.S. unemployment insurance system

(with Daphné Skandalis and Ioana Marinescu)

NBER Working Paper No. 30252

▷ Abstract
The U.S. unemployment insurance (UI) system operates as a federal-state partnership, where states have considerable autonomy to decide on specific UI rules. This has allowed for systematically stricter rules in states with a larger Black population. We study how these differences in state rules create a gap in the unemployment insurance that Black and White unemployed workers receive. Using administrative data from random audits on UI claims in all states, we first document a large racial gap in the UI that unemployed workers receive after filing a new claim. Black claimants receive an 18% lower replacement rate (i.e., benefits relative to prior wage, including denials) than White claimants. In principle, the replacement rate of each claimant mechanically depends on the rules prevailing in her state and on her work history (e.g., the earnings before job loss and the reason for separation from prior employer). Since we observe claimants' UI-relevant work history and state, we are in a unique position to identify the role of each factor. After accounting for Black-White differences in work history, differences in rules across states create an 8% Black-White gap in replacement rate (i.e., slightly less than half of the overall gap). Using a standard welfare calculation, we show that states with the largest shares of Black workers would gain the most from having more generous UI rules. Altogether, our results highlight that disparate state rules in the UI institution create racial inequality without maximizing overall welfare.

What happens in vagueness

(with Peter DeScioli, Kyle Thomas, and Steven Pinker)

▷ Abstract
Why do people speak vaguely when they propose illicit deals? We test the theory that speakers use vagueness strategically. Participants play an economic game in which a schemer and accomplice can coordinate to take money from a mark. When a cop was watching, the schemer was more likely to send a vague message ("Some things are better left unsaid") to the accomplice, which usually recruited the accomplice to collude. In Experiment 2, the schemer could write their own message. When the cop was watching, they wrote messages that were more vague, which again recruited the accomplice effectively.

Family Formation and Crime

(with Evan Rose)

Revision requested, American Economic Journal: Applied Economics

NBER Working Paper No. 30385

▷ Abstract
We use administrative data from Washington State to perform a large-scale analysis of the impact of family formation on crime. Our estimates indicate that pregnancy triggers sharp declines in arrests rivaling any known intervention, supporting the view that childbirth is a "turning point" that reduces deviant behavior through social bonds. For mothers, criminal arrests drop precipitously in the first few months of pregnancy, stabilizing at half of pre-pregnancy levels three years after birth. Men show a sustained 20 percent decline in crime that begins at pregnancy, although arrests for domestic violence spike at birth. These effects are concentrated among first-time parents, suggesting that a permanent change in preferences---rather than transitory time and budget shocks---may be responsible. A separate design using parents of stillborn children to estimate counterfactual arrest rates reinforces the main findings. Marriage, in contrast, is not associated with any sudden changes and marks the completion of a gradual 50 percent decline in arrests for both men and women.

A New Racial Disparity in Traffic Fatalities

(with Aaron Chalfin)

NBER Working Paper No. 30636

▷ Abstract
In 2015, for the first time in nearly forty years, the rate of motor vehicle fatalities for Black Americans exceeded that of white Americans. By 2020, the gap in death rates stood at 34%, accounting for approximately 4,000 excess deaths between 2014 and 2020. This disproportionate increase occurred in nearly all states, in rural as well as urban areas, and was shared by drivers of all ages and genders. We consider a variety of potential explanations for the emerging race gap including race-specific changes in time spent driving, the circumstances of driving, the quality of medical care for crash victims, decreases in other types of mortality, changes in policing, and risky driving behaviors such as speeding, driving without a seat belt and driving while intoxicated. We can rule out many of these factors as important contributors to the race gap, but find evidence for two of them. The first is opportunity: Relative to white Americans, Black Americans are spending more time in vehicles than they have in the past. Changes in time spent driving, while modest, likely explain an important share of the emergent race gap. The second is a relative increase in drug use, manifested by a quadrupling of the rate of overdose deaths among Black Americans after 2014. Increased drug use appears to have resulted in a concomitant increase in fatal crashes involving drivers under the influence of drugs. Finally, we consider whether the emerging race gap is explained by the so-called "Ferguson effect," the idea that police officers have pulled back from enforcement activity in recent years. On the one hand, traffic stops made by police officers do appear to have declined after 2014. However, the decline in traffic stops does not appear to be race-specific and there is little evidence of a broad increase in risky driving behaviors like speeding and driving without a seat belt.

Job search and unemployment insurance: New evidence from claimant audits

▷ Abstract
Do higher unemployment insurance benefits reduce job search among the unemployed? I examine this question using data from verified audits of US claimants giving their weekly benefit amount, reservation wage, targeted occupation, and number of job contacts made. In a regression kink design, I find that weekly monetary benefits increase unemployment duration but have no impact on search behaviors. As evidence against misreporting, I show that reservation wages predict reemployment wages and decrease with unemployment duration and the local unemployment rate. These results suggest that explicitly measured search behaviors may not explain the duration response to benefits.

Publications and Accepted Papers

Economic Outcomes of Strikers in an Era of Weak Unions

(with Nathan Wilmers)

Accepted, Journal of Labor Economics

▷ Abstract
From 1970 to 2000, US worker participation in labor strikes decreased by 90 percent. We show using understudied measures from labor market surveys that strikers also experienced worse outcomes after 1981. Event study evidence using the PSID suggests that strikers enjoyed 5-10 percent wage gains prior to the 1980s, but flat wage changes thereafter. Additional analysis of collective bargaining agreements and person-level data from the SIPP and CPS reinforce the finding that strikes since the 1980s have not been associated with increases in wages, hours, or benefits. These findings are consistent with decreased strike effectiveness, perhaps due to employers' higher propensity to hire strike replacements, or with more negative selection into "defensive" strikes that do not allow large pay increases.

Wage Stagnation and the Decline of Standardized Pay Rates, 1974-1991

(with Nathan Wilmers)

American Economic Journal: Applied Economics, 2023

Best Paper Award, Academy of Management OMT Division, 2020.

▷ Abstract
Using new establishment-by-occupation microdata, we show that the use of discretionary wage-setting significantly expanded in the 1970s and 1980s. Increasingly, wages for blue-collar workers were not standardized by job title or seniority, but instead subject to managerial discretion. When establishments abandoned standardized pay rates, wages fell, particularly for the lowest-paid workers in a job and for those in establishments that previously paid above market rates. This shift away from standardized pay rates, in context of a broader decline in worker bargaining power, accelerated the decline in real wages experienced by blue collar workers in the 1980s.

Online Appendix | AEA Research Highlight

Activity-adjusted crime rates show that public safety worsened in 2020

(with Aaron Chalfin)

Proceedings of the National Academy of Sciences, 2022

▷ Abstract
This paper argues that changes in human activity during the COVID-19 pandemic led to an unusual divergence between crime rates and victimization risk in US cities. Most violent crimes declined during the pandemic. But analysis using foot traffic data shows that the risk of street crime victimization was elevated throughout 2020. People in public spaces were 15-30 percent more likely to be robbed or assaulted. This increase is unlikely to be explained by changes in crime reporting or selection into outdoor activities by potential victims. Traditional crime rates may present a misleading view of recent changes in public safety.

Coverage: Washington Post, Slate

Working paper