Essays in Applied Microeconomics

Sammanfattning: This thesis consists of four self-contained papers in applied microeconomics. The first paper asks how a neighbors purchase of a specific good affects a households likelihood of purchase. I use an image classification algorithm to process a large set of aerial photos in order to infer household ownership of a visible durable good, specifically a trampoline. To estimate the neighborhood effect, I use a fixed effects approach together with exogenous variation stemming from new neighbors moving in. I find that neighborhood effects are present, but only over short distances.The second paper documents how the financial portfolios of parents change in response to the birth of a child. To identify dynamic effects around child birth, we use an event study approach with a matched treatment and control sample and a novel implementation of the same sex instrument. We find that parents reduce their financial risk by a reduced propensity to participate in risky financial markets. Our findings are consistent with a consumption smoothing response as effects seem to be driven by a need for liquidity caused by lower earnings and increased consumption and housing costs. We find little evidence suggesting that parents actively adjust the composition of their risky financial portfolio in response to child birth.The third paper examines the effects of super-fast internet connections on the academic achievement of students in upper secondary school. We link detailed register data on around 250,000 students to local levels of access to optic fiber broadband to estimate the effect of broadband on student GPA using within-student variation in a difference-in-differences setup. We show that reaching full coverage in the student’s parish of residence causes a GPA reduction of about 4 percent of a standard deviation in our preferred specification.The fourth paper estimates the effect of Agri-Environmental Schemes (AES) on nutrient runoff using farm level abatement data and water samples. A combination of data sources identifies all farms located upstream from a given water quality sampling site. We estimate whether within-watershed variation in AES payments affects nitrogen and phosphorus concentrations in water samples. The study finds that higher uptake of some, but not all, AES were in fact associated with reduced nutrient runoff.