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Works in Progress

Proactive and Reactive Infrastructure Investment

Maintaining infrastructure requires investment. Faced with uncertain quality degradation, managers can either invest proactively to prevent failure or reactively to address problems. Using a new dataset on drinking water systems, I construct and estimate a dynamic discrete choice model of infrastructure investment. Simulation results indicate that investment is currently too low to prevent system quality decline. Proactive-promoting policies facilitate the prevention of most health-based violations but leave some systems vulnerable to extreme quality decline. By contrast, reactive-promoting policies lead to milder but pervasive violations. A policy that increases proactive investment and reserves a safety net of reactive support enables all managers to sustain functional infrastructure.

Phoning Home: The Procurement of Telecommunications for Incarcerated Individuals in the United States (with Nathan Miller and Marleen Marra)

Incarcerated individuals in the U.S. purchase goods and services from monopoly vendors selected by their correctional authority. We study telecommunications services, which have come under bipartisan scrutiny due to the high prices inmates pay for phone calls. Prospective providers are evaluated on their technical capabilities, the prices they would charge, and the “commission” they would pay the correctional authority. Using data from public records requests, we estimate a first-score auction model with evaluation uncertainty and multi-dimensional bidder heterogeneity. Our results indicate that reducing the role of commissions in procurement lowers prices, whereas increasing competition among providers mainly raises commission payments. Moreover, recently promulgated federal regulation that bans commissions and caps prices likely preserves providers’ profitability.

Technology and Market Power: The United States Cement Industry, 1974-2019 (with Nathan Miller, Matthew Osborne, and Gloria Sheu)
Reject and Resubmit, American Economic Review, 2023.

We examine the evolution of market power in the cement industry over more than four decades using a structural model of procurement. The model matches aggregated outcomes in the data, and implies transportation costs, shipping distances, and demand elasticities that are consistent with external sources. Evaluating county-level outcomes throughout the contiguous United States, we find that market concentration and markups increase but that prices do not rise. We attribute these patterns to a technological innovation—the precalciner kiln—that lowered variable costs, increased plant-level capacities and economies of scale, and contributed to an industry shakeout in which many plants closed.

Low-Carbon Investment and Climate Policy (with Sarah Armitage, Nathan Miller, and Matthew Osborne)