From the Peaks to the Valleys: Cross-State Evidence on Income Volatility over the Business Cycle
利用美国各州经济状况差异，研究发现个人劳动收入波动在经济繁荣期反而更高，这对评估经济周期的福利成本有重要启示。
Countercyclical variation in individuals' idiosyncratic labor income risk could generate substantial welfare costs. Following past research, we infer income volatility—the variance of permanent income shocks, a standard proxy for income risk—from the rate at which cross-sectional variances of income rise over the life cycle for a given cohort. Our novelty lies in exploiting cross-state variation in state economic conditions or state sensitivity to national economic conditions. We find that income volatility is higher in good state times than bad; during good national times, we find volatility is higher in states that are more sensitive to national conditions. © 2013 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.