White House Report Cites UC Davis Economists on Migration, Electric Vehicles and International Trade
White House, Washington, D.C.
Credit: Günther Simmermacher, Pixabay

Research from UC Davis economists features prominently in a comprehensive White House report that included migration, electric vehicle adoption and international trade.

The Economic Report of the President, prepared by the Council of Economic Advisors, provides a foundation of leading research for the most pressing economic issues in the country. This year’s report to Congress covers employment, national demographic changes, housing, international trade, the clean energy transition and artificial intelligence.

“Our citations in this report reflect the concentration of policy relevant research and the intellectual diversity of our research in economics at UC Davis,” said Katheryn Russ, professor and chair of economics in the College of Letters and Science.

How migration affects the U.S. workforce and housing

The White House report describes how the aging U.S. population is slowing growth in the number of workers. Historically, one role for immigration has been to fill needed jobs. 

Giovanni Peri fills some of the gaps in understanding how this happens and its implications. Over the last 20 years, Peri, a professor of economics and founding director of the UC Davis Global Migration Center, has studied how immigrants contribute to several aspects of the U.S. economy as workers, entrepreneurs and scientists.

The White House report cites Peri’s papers with Chad Sparber at Colgate University and Gianmarco Ottaviano at Bocconi University that show immigration generates net benefits for the U.S. economy and only marginally reduces wages for some low-paid workers. The report also cites Peri’s 2020 paper with Gaetano Basso at Bank of Italy that found 43% of U.S. labor force growth from 2000-2017 was driven by immigrants.

“The report of the president emphasizes that as the population is aging and the labor force is shrinking, the contribution of immigrants is becoming even more crucial to the future of the U.S. economy,” said Peri.

Promoting electric vehicles for the renewable energy transition

The clean energy transition includes electric vehicles (EVs). However, the number of charging stations haven’t kept up with EV production.

Research from economists James Bushnell, David Rapson and Erich Muehlegger, provide a foundation for understanding what limitations are slowing EV adoption and how to overcome them. Rapson and Muehlegger wrote a National Bureau of Economics Research working paper that outlines the economics of EVs for the average household and how public policy can reduce their costs.

A 2021 paper by Bushnell, Rapson and their co-authors Fiona Burlig at the University of Chicago and Catherine Wolfram at MIT shows a complicated role for EVs in climate policy. Across 64,000 California EV owners who charge their vehicles at home, people drove their EVs substantially less than was earlier estimated. This suggests that EVs may be complements to gas-powered vehicles rather than substitutes.

“At first glance EVs are a great, lower-emissions option,” said Rapson, a professor of economics. “But gasoline cars have such a dominant market share in part because, at least for now, they offer superior transportation services to drivers. Our research aims to understand the tradeoffs and figure out the best approach to policy.”

University faculty making an impact on public policy

The new White House report also features economics chair Katheryn Russ’ research on how tariffs have impacted U.S. households based on their income. In that study, she found that these impacts take up a bigger chunk of income for people who earn the least. This means that when tariffs on imports increase the cost of goods, those costs fall more heavily on the poor than on the rich.

UC Davis economists have been frequently cited in the Council of Economic Advisors’ annual reports. The Council was established in 1946 in the wake of the Great Depression to provide the president with objective economic analysis and advice.

The economics faculty also impact public policy in other ways. Some provide testimony and public comment to state and federal agencies and elected officials. Some, including Russ, serve on committees for the National Academy of Sciences, Engineering, and Mathematics.

“Policy makers often need economists to provide technical expertise in policy processes,” said Russ.

From 2015 to 2016, Russ served in Washington D.C. as a senior economist for the Council of Economic Advisers to President Barack Obama. As senior economist for international trade and finance, Russ provided expert guidance on the economic impacts of various policies as well as on the quality of the data agencies would use to make decisions. For her work she received presidential recognition for outstanding service.

“We’re a state university, a land-grant institution, so we put out our research for use by the public to help inform public debate on the issues,” said Russ. “That’s the benefit of having such an intellectually diverse faculty in economics. We have people with different ways of thinking and all of us inject facts into the public discourse.”

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