Tommaso Porzio

Achieving Scale Collectively

Econometrica · 2022 · 27 citations

Many firms in developing countries could be too small to adopt modern technology embodied in expensive production machines. This paper shows that rental market interactions allow these small firms to increase their effective scale and mechanize production. We conduct a survey of manufacturing firms in Uganda, which uncovers an active rental market for large machines between small firms in informal clusters. We then build an equilibrium model of firm behavior and estimate it with our data. We fin…

Labor Misallocation Across Firms and Regions

National Bureau of Economic Research · 2022-07-01 · 15 citations

We develop a frictional labor market model with multiple regions and heterogeneous firms to study how frictions impeding labor mobility across space affect the joint allocation of labor across firms and regions. Bringing the model to matched employer-employee data from Germany, we find that spatial frictions generate large misallocation of labor across firms within regions. By shielding firms from competition for workers from other regions, spatial frictions allow low productivity firms to expan…

Labor Misallocation Across Firms and Regions

SSRN Electronic Journal · 2022-01-01 · 10 citations

Jobs in the Smog: Firm Location and Workers’ Exposure to Pollution in African Cities

National Bureau of Economic Research · 2022-10-01 · 7 citations

In developing countries, most manufacturing firms are small and located in high-density urban areas, often near congested streets. To study the determinants and implications of this location choice, we collect a novel firm survey and detailed air pollution measurements within Ugandan cities. We find that firms locate on the busiest roads searching for customer visibility, but in doing so they expose their workers to substantial pollution. This sorting pattern increases profits, but with severe h…

Measuring the Valuation of Liquidity with Penalized Withdrawals

National Bureau of Economic Research · 2022-04-01 · 6 citations

We introduce penalized withdrawals from retirement savings accounts as a new revealed-preference tool to measure households' valuation of liquidity. This approach addresses key empirical challenges by providing a proxy for marginal utility without requiring assumptions on preferences or data on access to credit. Using U.S. administrative tax data from 1999-2018, we document three main findings. First, geographic differences, driven by local credit supply, account for over 30% of the nationwide v…