The three chapters of this dissertation examine the spatial organization of economic activities on a micro scale in a growing historical city, and on a national scale in contemporary India. The first chapter focuses on firms, investigating the question why small family firms were so prevalent in historical cities. I test whether this phenomenon is caused by a lack of technological capability to move goods and people. I exploit the natural experiment that Boston quickly electrified its previous horsedrawn streetcar system between 1889 and 1896. Analyzing new data transcribed from Boston business records from 1885 to 1905, I find that rail-connected locations experienced a 5.3-percentage point relative drop in the share of sole proprietorship establishments after the streetcar electrification, indicating that improved market access leads to an increase in average firm size. The second chapter focuses on individuals, investigating the question whether immigrants stay in ethnic enclaves due to a lack of information about outside communities within the same city. Based on individual records linked between city directories and the decennial census in Boston from 1885 to 1900, I track within-city migrations of immigrants in response to the same transport upgrade event in Boston. I find that immigrant enclave residents who worked within 25 meters of the streetcar rails in 1885 were much more likely to move to a less segregated neighborhood in 1900, compared to enclave residents who worked between 25 and 50 meters away from the rails. Evidence suggests interactions in workplace had an impact on the choices of the residential locations fifteen years after. In the third chapter, my coauthors and I perform a large scale classification of satellite imagery into “built-up” or “not built-up” areas to measure the urbanization process in India, using a reliable and comprehensive ground-truth data set we construct and a cloud-based computational platform - Google Earth Engine (GEE). Our methodology yields a classification accuracy rate between 70% and 85%, and can easily be applied to other countries and regions.

This dissertation studied two main topics: US immigration reform and the occupation

sorting of US immigrants, and factors that contribute to China's export growth. Chapter

1 develops a general equilibrium model of international migration to simulate the impact

had the U.S. shifted to a skill-based immigration system. Chapter 2 builds a multi-sector

spatial general equilibrium model featuring heterogeneous rms and workers endogenous location

choice, to quantify for China's export surge during 1990-2005. Chapter 3 studies

factors that determine the occupation sorting of US immigrants.

This dissertation studies dynamic models in the context of international economics and the U.S. economy. First, the focus is on the effect of commodity shocks in an small open economy in a dynamic trade model. Then, this dissertation studies the effects of monetary policy in a dynamic trade model. Finally, dynamics between government debt and bubbles are studied considering an overlapping generation model.

The first chapter, "Dutch Disease in a Dynamic International Trade Model of an Small Open Economy", models a dynamic small open economy which produces and trades final goods and a commodity. The commodity is modeled as an homogeneous good and it is demanded by the rest of the world. The dynamic system developed in this chapter relies on key parameters that characterize the small open economy. These parameters are the elasticity of substitution across final goods and the shape parameter of the Pareto distribution of productivities. In order to compute the steady-state of the economy and study the dynamics implied by the model, we estimate both the elasticity of substitution and the shape parameter of the Pareto distribution considering data for the Chilean economy, which satisfies the small open economy assumption as well as the commodity production.

The second chapter, "Monetary policy in a dynamic trade model with heterogeneous firms", studies the effect of monetary policy on a dynamic model of trade with heterogeneous firms. We study the dynamic implications of monetary policies that act during "normal times" and monetary policies that leave the economy at the zero lower bound. In order to do so, we craft a model which incorporates nominal rigidities. This feature generates a friction such that nominal shocks affect real allocations in the economy. To build the model, we combine nominal frictions with firm heterogeneity as in Melitz (2003) in a dynamic setting as in Ghironi and Melitz (2005).

The final chapter, "A Note on Government Debt and Bubbles", studies the interactions between government debt and bubbles in an economy. We consider a general equilibrium approach in a productive economy and we explore conditions under which government debt path in our model is consistent with the government debt path observed in the last twenty years. During that period, government debt, as share of GDP, has interacted with bubbles in a countercyclical pattern. That is, in the absence of bubbles there is an increase in the evolution of debt-to-GDP ratio, and when a bubble is traded, debt-to-GDP ratio is decreasing.

In this paper, we examine the correlation between sectoral shocks and border enforcement in the United States. Enforcement of national borders is the main policy instrument the U.S. government uses to combat illegal immigration. We see whether border enforcement falls following positive shocks to sectors that are intensive in the use of undocumented labor, as would be consistent with political economy models of illegal immigration. The main finding is that border enforcement is negatively correlated with lagged relative price changes in the apparel, fruits and vegetables, and livestock industries and with housing starts in the western United States. This suggests that authorities relax border enforcement when demand for undocumented labor is high.

In this paper, we use data from the Mexico and U.S. population censuses to examine who migrates from Mexico to the United States and how the skills and economic performance of these individuals compare to those who remain in Mexico. We test Borjas' negative-selection hypothesis that in poor countries the individuals with the strongest incentive to migrate to rich countries are those with relatively low skill levels. We find that 1) Mexican immigrants, while much less educated than U.S. natives, are on average more educated than residents of Mexico, and 2) were Mexican immigrants in the United States to be paid according to current skill prices in Mexico they would tend to occupy the middle and upper portions of Mexico's wage distribution. These results are inconsistent with the negative-selection hypothesis and suggest, instead, that in terms of observable skills there is intermediate or positive selection of immigrants from Mexico. The results also suggest that migration abroad may raise wage inequality in Mexico.

This dissertation explores three topics in Urban Economics and International

Trade. Chapter 1 measures the effect of transit access on neighborhood incomes by

exploiting a quasi-experimental setting in Dallas. I show that income in neighborhoods

that received rail access increases compared to neighborhoods that were promised to

receive access but did not receive it. The treatment effect is positively correlated with

initial neighborhood income and highlights the role of transit as an incubator for income

segregation. Chapter 2 estimates the impact of international conflict on bilateral trade

relations using several incidents of politically motivated boycotts. I find large reductions

in exports from the boycotted to the boycotting countries. Product-level results are in line

with intuition and most effective for consumer goods while having at most a temporary

effect on intermediates and capital goods. Chapter 3 explores the usage of Landsat

satellite imagery for the measurement of economic outcomes at small geographies.

In this paper, we examine the impact of enforcement of the U.S.-Mexico border on wages in U.S. and Mexican border regions. The U.S. Border Patrol polices U.S. boundaries, seeking to apprehend any undocumented entrants. It concentrates its efforts on the Mexican border. We examine labor markets in border areas of California, Texas, and Mexico. For each region, we have high-frequency data on wages and person hours the U.S. Border Patrol spends policing the border. For a range of empirical specifications and definitions of regional labor markets, we find little impact of border enforcement on wages in U.S. border cities and a moderate negative impact of border enforcement on wages in Mexican border cities. These findings are consistent with two hypothesis: (1) border enforcement has a minimal impact on illegal immigration, or (2) illegal immigration from Mexico has a minimal impact on wages in U.S. border areas.

The first two chapters of this dissertation seek to understand how climate change affects labor market outcomes and manufacturing firms in developing country contexts. Chapter One provides worker-level evidence in Brazil on different labor market adjustment margins with respect to extreme heat shocks and the underlying transmission mechanism. Exploiting rich employer-employee matched data, I find that quarterly heat shocks lead to significant increases in the propensity of manufacturing-worker layoff through the direct labor productivity channel. A significant proportion of manufacturing workers who experienced heat-related layoffs fail to find any formal employment within 36 months. These results show that heat shocks lead to persistent negative employment effect in the formal manufacturing labor market due to failure in job transitions over the medium run.

In Chapter Two, I turn the focus to manufacturing firms in Indonesia. In a heterogeneous firm model with capital-biased productivity, I incorporate temperature shocks through the direct labor productivity channel and illustrate how

less productive firms decide on production and re-optimize factor intensity as temperature increases. Empirically, I match gridded daily weather data with the Indonesian firm-level industrial surveys. I find that under heat shocks, the initially less productive firms are more likely to exit, highlighting the presence of survival bias intrinsic to firm-level intensive margin analysis. Second, on the aggregate, resources reallocate from less to more productive firms within industries. Among surviving firms, we observe factor substitution from unskilled to skilled workers, and firms switching from using domestic to foreign intermediate inputs.

Chapter Three investigates how global commodity price booms affect land use and forest management, and the factors that influence sustainable environmental practices of mining firms. We employ a spatial and temporal lens, by collecting proprietary data on more than 30,000 mines located around the world and matching the location of these mines to high-resolution satellite imagery. This allows a granular study of the relationship between commodity prices and loss of forest cover worldwide, as well as the spatial distribution of global mines in relation to changes in land-use patterns and local economic activities as measured by nighttime luminosity. We find a positive elasticity of forest cover loss. Mine owners from rich countries display larger disparity in the elasticity of forest cover loss when operating in low versus high income countries. Our estimates suggest that the early 2000s "commodity super-cycle" contributes to roughly 8%-20% of the observed total deforestation around mining sites and that mining-induced deforestation is not limited to the immediate surroundings of mining pits.